Document:

exv10w10

 

EXHIBIT 10.10

SPECIFIC TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT

FOR THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN SEPARATELY

FILED WITH THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN MARKED

AT THE APPROPRIATE PLACE WITH TWO ASTERISKS (**).

GAS PURCHASE CONTRACT

CANADIAN PLANT

HEMPHILL COUNTY, TEXAS

Between

WARREN PETROLEUM COMPANY

(a Division of Chevron U.S.A. Inc.)

as “Buyer”

And

WALLACE OIL & GAS, INC.

as “Seller”

 

 

GAS PURCHASE CONTRACT

INDEX

	 	 	 	 	 	 	 
	ARTICLE	 	 	 	PAGE
	I

	 	Definitions
	 	 	1	 
	 
	 	 	 	 	 	 
	II

	 	Representations and Commitment
	 	 	2	 
	 
	 	 	 	 	 	 
	III

	 	Reservations of Seller
	 	 	4	 
	 
	 	 	 	 	 	 
	IV

	 	Quantity
	 	 	4	 
	 
	 	 	 	 	 	 
	V

	 	Price
	 	 	4	 
	 
	 	 	 	 	 	 
	VI

	 	Delivery Point
	 	 	7	 
	 
	 	 	 	 	 	 
	VII

	 	Delivery Pressure
	 	 	8	 
	 
	 	 	 	 	 	 
	VIII

	 	Quality
	 	 	9	 
	 
	 	 	 	 	 	 
	IX

	 	Measurement and Tests
	 	 	10	 
	 
	 	 	 	 	 	 
	X

	 	Allocation Procedure
	 	 	12	 
	 
	 	 	 	 	 	 
	XI

	 	Payment
	 	 	13	 
	 
	 	 	 	 	 	 
	XII

	 	Warranty of Title
	 	 	14	 
	 
	 	 	 	 	 	 
	XIII

	 	Royalty
	 	 	15	 
	 
	 	 	 	 	 	 
	XIV

	 	Scope
	 	 	15	 
	 
	 	 	 	 	 	 
	XV

	 	Drip
	 	 	15	 
	 
	 	 	 	 	 	 
	XVI

	 	Rights-of-Way
	 	 	15	 
	 
	 	 	 	 	 	 
	XVII

	 	Force Majeure
	 	 	15	 
	 
	 	 	 	 	 	 
	XVIII

	 	Compliance with Laws, Rules and
Regulations
	 	 	16	 
	 
	 	 	 	 	 	 
	XIX

	 	Effective Date and Term
	 	 	16	 
	 
	 	 	 	 	 	 
	XX

	 	Assignment
	 	 	17	 
	 
	 	 	 	 	 	 
	XXI

	 	Notices
	 	 	17	 
	 
	 	 	 	 	 	 
	XXII

	 	Counterpart Execution
	 	 	17	 
	 
	 	 	 	 	 	 
	XXIII

	 	Unprofitable Gas
	 	 	17	 
	 
	 	 	 	 	 	 
	XXIV

	 	Cancellation of Prior Contract
	 	 	18	 
	 
	 	 	 	 	 	 
	 

	 	Exhibit “A”
	 	 	19	 
	 
	 	 	 	 	 	 
	 

	 	Exhibit “B”
	 	 	22	 
	 
	 	 	 	 	 	 
	 

	 	Exhibit “C”
	 	 	23	 

 

 

GAS PURCHASE CONTRACT

          THIS CONTRACT, made and entered into this 28th day of
March, 1994, by and between WARREN PETROLEUM COMPANY,
a Division of Chevron U.S.A. Inc., hereinafter referred to as “Buyer”, and WALLACE OIL & GAS, INC.
hereinafter referred to as “Seller”;

          WITNESSETH:

          WHEREAS, Seller owns or controls certain mineral leases or interests therein which are
more particularly described in Exhibit “A” and Exhibit “B” attached hereto and made a part
hereof from which Seller has or will have a supply of gas available for sale hereunder, and
Seller desires to sell such gas to Buyer; and,

          WHEREAS, Buyer represents that it has in operation a gas gathering system and processing
plant in the area in which Seller’s leases are located and desires to purchase the gas which
Seller has available for sale from time to time;

          NOW, THEREFORE, Buyer and Seller in consideration of the mutual agreements herein
contained the parties hereto hereby covenant and agree as follows:

ARTICLE I  — DEFINITIONS

Except in those certain instances where the context states another meaning, the following
terms, when used in this Contract, shall have the following meanings:

	 	1.1	 	Lease — Any written instrument which gives Seller the right to drill for,
produce and dispose of oil and gas in and under the properties described in Exhibit “A”
and Exhibit “B”.
	 
	 	1.2	 	Well — A well capable of production of oil, oil and gas or gas presently
classified by the Railroad Commission of Texas as a gas well, a 49-B gas well, or an oil
well; provided, however, if a well is completed and capable of producing from more than
one reservoir, each completion shall be considered as a separate well, unless the
Railroad Commission of Texas allows commingling, and to the extent as allowed, it will
be considered as one well.
	 
	 	1.3	 	Gas — The gaseous effluent, including all the constituents thereof from
Seller’s gas-liquid separator or separators to which the well or wells are connected on
each lease described in Exhibit “A” and Exhibit “B” attached hereto.
	 
	 	1.4	 	Day — The period of twenty-four (24) consecutive hours beginning at 8:00
a.m. CST on any calendar day and ending at 8:00 a.m. CST on the calendar day immediately
following.
	 
	 	1.5	 	Month — A period beginning at 8:00 a.m. CST on the first day of a calendar
month and ending at 8:00 a.m. CST on the first day of the calendar month immediately
following.
	 
	 	1.6	 	Year — A period of twelve (12) consecutive months from the date of initial
deliveries of gas hereunder.
	 
	 	1.7	 	MCF — One thousand cubic feet.
	 
	 	1.8	 	BTU — British Thermal Unit.
	 
	 	1.9	 	MMBTU — One million British Thermal Units.
	 
	 	1.10	 	Liquid Hydrocarbon Products — Individual hydrocarbon products are hereby
defined as follows: pentanes and heavier

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	 	 	 	hydrocarbons collectively treated as a single product sometimes referred to
as natural gasoline, iso-butane, normal butane, propane, ethane (including any
incidental methane recovered).
	 
	 	1.11	 	Gross Heating Value — The number of BTUs produced by the combustion of
gas at a constant pressure of 14.65 psi and 60°F and saturated with water vapor.
Expressed as BTUs per cubic foot.
	 
	 	1.12	 	Psig — Pounds per square inch gauge.
	 
	 	1.13	 	Residue Gas — (**)

ARTICLE II — REPRESENTATIONS AMD COMMITMENT

	 	2.1	 	Seller represents that it owns or controls certain leases or interests described in
Exhibit “A” and Exhibit “B”, the gas to be produced therefrom, and has the right to sell
the gas. Subject to the other provisions hereof, Buyer represents that it has in
operation a gathering system and gas processing plant capable of gathering, receiving and
processing the gas and that it will maintain and operate said system and plant for the
purpose of receiving and processing gas from Seller hereunder together with the gas
produced by others.
	 
	 	2.2	 	Seller hereby commits to the performance of this Contract for the term hereof, all
of the gas Seller owns or controls which may be produced from the leases described in
Exhibits “A” and “B” attached hereto, except such gas as is reserved by Seller under
Article III hereof. Such dedication shall include, but not be limited to, gas currently
being produced from the wells identified in Exhibits “A” and “B” as being located on such
leases, and any wells which may subsequently be drilled on such leases. Seller agrees
that prior to delivery to Buyer the gas shall not be processed other than in
conventional mechanical gas-oil separators operating at no less than ambient
temperatures.
	 
	 	2.3	 	New Gas Production: Lean Gas

	 	(a)	 	In the event Seller develops new gas supplies subsequent to
(**) on the leases described in Exhibits “A” or “B”, and the dry
MMBTU per MCF is less than (**), then Buyer shall have the right, but not the
obligation, to take Seller’s gas by matching any bona fide written third-party
offer (hereinafter referred to as “Offer”). However, Buyer shall not be
obligated to match such Offer. Seller shall provide to Buyer such written Offer
along with production data (hereinafter referred to as “Production
Data”). Production Data shall consists of information such as well tests
indicating deliverability, gas analysis, and any other pertinent information
Buyer requires in order to evaluate such Offer. In the event Buyer desires to
obtain another gas analysis after receipt of the Production Data, Buyer shall
have five (5) working days after receiving such Production Data to notify
Seller of such desire. If Buyer so notifies Seller, Seller shall coordinate
with Buyer to ensure such sample will be taken within five (5) working days.
After receipt of such written Offer and Production Data, Buyer shall have
twenty (20) working days to match such Offer. In the event that the results
from the two (2) gas analyses are significantly different, a third sample
will be taken immediately and such twenty (20) day period will be extended by
ten (10) working days. Buyer shall be deemed to have matched said Offer in the
event the economic

2

 

	 	 	 	benefit to Seller from Buyer’s offer equals or exceeds the economic benefit to
Seller from said Offer. Seller shall provide Buyer with sufficient documentation
necessary to support such determination. Should Buyer elect not to match such Offer,
then Buyer shall release from the provisions of this Contract the well(s)
attributable to such Offer.
	 
	 	(b)	 	Should Buyer elect to match such Offer, Buyer shall have (**)
days from the date Seller is notified by Buyer that Buyer intends to match such Offer
to connect the referenced new gas supplies (although Buyer shall endeavor to connect
Seller’s gas as soon as reasonably possible). Buyer shall receive an extension of
said (**) day period in the event Buyer has initiated construction prior
to the expiration of said (**) day period and has not been able to
complete installation of equipment to connect Seller’s well(s) due to extenuating
circumstances including, but not limited to, a gas connect requiring more than one
(1) mile of pipeline to connect Seller’s well(s). Notwithstanding the
foregoing, said (**) day period shall be suspended in the event of delays
due to force majeure as provided for in Article XVII.
	 
	 	(c)	 	In the event that Buyer elects to match such Offer, Buyer will prepare a
contract for execution by Seller for such new lean gas production.

	 	2.4	 	New Gas Production: Rich Gas

	 	(a)	 	In the event Seller develops gas supplies subsequent to (**),
and the dry MMBTU per MCF is greater than or equal to (**), then Buyer shall have
the right, but not the obligation, to process such new gas supplies under the
settlement terms set forth in Article V. Seller shall provide to Buyer Production
Data that Buyer requires in order to evaluate such new gas supplies, In the
event Buyer desires to obtain another gas analysis after receipt of the Production
Data, Buyer shall have five (5) working days after receiving such Production Data
to notify Seller of such desire, If Buyer so notifies Seller, Seller shall
coordinate with Buyer to ensure such sample will be taken within five (5) working
days. After receipt of Production Data, Buyer shall have twenty (20) working days
to notify Seller whether Buyer intends to process said new gas supplies. In the
event that the results from the two (2) gas analyses are significantly different, a
third sample will be taken immediately and such twenty (20) day period will be
extended by ten (10) working days. Should Buyer not elect to process such new gas
supplies, then Buyer shall release from the provisions of this Contract the well(s)
attributable to such new gas supplies.
	 
	 	(b)	 	Should Buyer elect to process said new gas supplies, Buyer shall have
(**) days from the date Seller is notified by Buyer that Buyer intends to
process said gas to connect such new gas supplies (although Buyer shall endeavor to
connect Seller’s gas as soon as reasonably possible). Buyer shall receive an
extension of said (**) day period in the event Buyer has initiated
construction prior to the expiration of said (**) day period and has not
been able to complete installation of equipment to connect Seller’s well(s) due to
extenuating circumstances including, but not limited to, a gas connect requiring more
than one (1) mile of pipeline to connect Seller’s well(s). Notwithstanding the
foregoing, said (**) day

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	 	 	 	period shall be suspended in the event of delays due to force majeure as
provided for in Article XVII.
	 
	 	(c)	 	Should Buyer elect to process said new gas supplies, such well(s)
shall be added to Exhibit “A”.

ARTICLE III — RESERVATIONS OF SELLER

	 	3.1	 	Seller reserves the following rights:

	 	(a)	 	To operate the leases free from any control by Buyer in such
manner as Seller, in Seller’s discretion, may deem advisable, including without
limitation the right to drill new wells, to repair and rework old wells, and to
abandon any well or surrender any lease when it no longer is deemed by Seller to
be capable of producing gas in paying quantities under normal methods of
operation; provided, however, that in the event Seller should terminate or
surrender any of the leases, written notice of same shall be given to Buyer
within thirty (30) days thereafter.
	 
	 	(b)	 	(**)
	 
	 	(c)	 	To use gas produced from the leases for developing and operating
the leases and for fulfilling obligations to the lessors in the leases for
domestic fuel maintenance.

ARTICLE IV — QUANTITY

	 	4.1	 	(**)
	 
	 	4.2	 	(**)

ARTICLE V — PRICE

Buyer shall pay to Seller for the gas delivered hereunder the sum of the values
computed in accordance with Paragraphs 5.1 and 5.2.

	 	5.1	 	(**)

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	 	5.2	 	(**)
	 
	 	5.3	 	The settlement under Paragraphs 5.1 and 5.2 shall be as follows:

(**)

 

			
	*	 	The applicable percentages will be determined monthly by dividing the Seller’s
Monthly Processed Volume by the number of days in such month.

	5.4	(a) 	 	Within twelve (12) months following February 1, 1994,
Seller shall spend, or cause to be spent, (**) towards the
cost of exploring for and developing potential oil and/or gas reserves on Exhibit
“A” and “B” leases. It is expressly understood that the aforementioned (**)
in exploration and development costs will include, but not be
limited to, leasehold acquisition costs and the legal and curative costs associated
therewith, seismic costs, drilling, completion, and equipment costs.
	 
	 	(b)	 	In addition to Buyer’s audit rights defined in Paragraph 11.2, Seller
shall, if Buyer requests, and within thirty (30) days of such request, provide
Buyer with a detailed summary accounting for the (**)
expenditure referenced in Paragraph 5.4 (a). Buyer may make such request at any
time between March 1, 1995, and August 31, 1995.

	 	5.5	 	In the event Seller does not fulfill its obligations under either Paragraph 5.4 (a) or 5.4
(b) above, the following settlements shall be deemed effective retroactive to January 1, 1994:

5

 

	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                Properties	 	 	 	 	 	% Liquids	 	% Residue
	(**)
	 	 	 	 	 	 	 	 	 	 	 	 

	 	5.6	 	In the event Seller should sell or assign one or more wells or leases covered by this
Contract, the volumes from such wells or leases shall not be included for purposes of
computing the settlement due Seller under this Article V. The settlement with the party
acquiring such well(s) or lease(s) shall be based on volumes attributable only to the acquired
production.
	 
	 	5.7	 	(**)
	 
	 	5.8	 	Gas Control

	 	(a)	 	Should Seller elect to take its share of the residue gas volume in-kind as
described in this Article, Seller shall provide all information deemed necessary to
Buyer for gas control at least five (5) working days prior to the first day of each
calendar month. Information shall include but not be limited to the
following:
	 
	 	 	 	          Transporter

          Purchaser

          Transportation Service Contract Number

          Name and Phone Number of Seller’s Gas Control Contact

	 	 	 	Seller further agrees to be responsible for nominations to the transporting
pipeline. Buyer agrees to be responsible for confirmation and delivery to the
transporting pipeline. Under no circumstances shall Buyer be required to confirm or
deliver more than the estimated available volume.
	 
	 	(b)	 	Buyer shall have the right to maintain an “over and short account” for
residue gas deliveries for Seller’s account. The statement sent monthly to Seller
shall identify any over or under deliveries for the current month and the cumulative
over or under deliveries to Seller’s receiving pipeline. Buyer shall endeavor to keep
the over and short volumes as much in balance as possible by making flow adjustments
monthly. However, if upon termination of this Gas Purchase Contract, an imbalance
exists, then Buyer shall have the option to pay Seller for a “short” balance over the
subsequent three (3) months. Seller shall have the option to pay Buyer for an “over”
balance at an average market price at the plant for the prior three (3) months or by
delivering the “over” balance over the subsequent three (3) months.
	 
	 	(c)	 	Should Seller fail to establish a market for the disposition of Seller’s
residue gas, Buyer shall have the right to market Seller’s allocated share of residue
gas and pay (**) of the net proceeds to Seller from the sale by
Buyer of Seller’s gas at the

6

 

	 	 	 	tailgate of the plant. Buyer shall retain (**) of the net
proceeds from the sale of the Seller’s gas as Buyer’s fee for marketing
Seller’s gas.
	 
	 	(d)	 	The right to take residue in-kind only applies to Seller
including without limitation their subsidiaries or affiliates, and the
interests they represent. Notwithstanding Article XIII, ROYALTY, Seller shall
act as representative for subsequent distribution of gag and NGL products, or
the value of such products, to any owners of royalties, working interest,
production payments and the like. If this Contract is assigned by Seller to
another party, written notices must be furnished to Buyer and effective the
first day of the following month the in-kind deliveries will cease.

ARTICLE VI — DELIVERY POINT

	6.1	(a)	 	Non-Red Deer Properties: With the exception of properties connected to
what is commonly known as the Red Deer Gathering System (currently owned by
Transwestern, hereinafter defined as “RDGS”), Buyer owns or will construct a metering
facility near the outlet of Seller’s separator on the lease(s) or at such other mutually
agreed upon location. This meter will be the point of delivery (“Delivery Point”) for
non-Red Deer properties for purposes of this Contract.

	 	(b)	 	Existing Red Deer Properties: The Delivery Point for
purposes of this Contract for any properties connected to RDGS (see Exhibit “C”
attached) shall be the interconnect between RDGS and Buyer’s gathering system
(Buyer’s existing meter 21-P, hereinafter defined as “Meter 21-P”). Seller will
be responsible for delivering the gas from such properties to the Delivery
Point and paying any associated delivery costs or fees.
	 
	 	 	 	If Seller is unable to maintain or renew its existing gathering agreement
with the owner of RDGS, Buyer will attempt to obtain a gathering agreement
with the owner of RDGS to receive the gas from Seller’s facilities and deliver
such gas to the Delivery Point. Prior to entering into such a gathering
agreement, Buyer shall submit a copy to Seller for its approval. If Seller
approves such gathering agreement, or fails to object to Buyer in writing
within 15 days after its receipt thereof (which failure shall be deemed to
constitute approval), Buyer shall proceed to execute the gathering agreement,
in which case Buyer shall have the right to deduct all costs associated with
such gathering agreement from the amounts otherwise due to Seller hereunder.
	 
	 	 	 	If Buyer cannot obtain a gathering agreement on RDGS to deliver Seller’s gas
to the Delivery Point and so notifies Seller in writing, or if Seller makes a
timely objection to a proposed gathering agreement as outlined above, then
Seller shall have 30 days from the date of such notice or objection (whichever
is applicable) in which to commit to Buyer in writing to construct and
operate, at Seller’s sole risk and expense, the necessary gathering facilities
to deliver Seller’s gas to the Delivery Point.
	 
	 	 	 	If Seller fails to make such commitment within the time permitted and Buyer
desires to extend its existing gathering system to connect directly to well(s)
listed in Exhibit “C”, Buyer may do so and Seller shall reimburse Buyer for the
full cost of constructing and operating such new gathering system. (**)

7

 

	 	 	 	Upon completion of
any such new connection, the Delivery Point for the affected gas shall be the
point of interconnection between Seller’s facilities and Buyer’s gathering
system.
	 
	 	 	 	(**)
	 
	 	(c)	 	Properties Connected Subsequent to (**): Buyer,
in its sole opinion, shall determine whether new gas supplies shall be tied in
to either the RDGS or to Buyer’s gathering system, and shall be responsible for
all costs associated therewith, with the exception of costs or fees charged by
the owner of the RDGS.

	 	(i)	 	In the event such new gas supplies referenced in
Paragraph 6.1 (c) above are connected to the RDGS, Paragraph 6.1(b) will
apply to such new gas supplies. Such Meter 21-P will be the Delivery
Point for purposes of this Contract and the new well(s) shall be added
to Exhibit “C”.
	 
	 	(ii)	 	In the event such new gas supplies referenced in
Paragraph 6.1 (c) above are connected directly to Buyer’s gathering
system, Buyer will construct a metering facility near the outlet of
Seller’s separator on the lease(s) or at such other mutually agreed upon
location. This meter will be the Delivery Point for purposes of non Red
Deer properties for purposes of this Contract.

	 	6.2	 	Except for properties connected to RDGS, title to the gas sold and delivered
hereunder shall pass to Buyer at the Delivery Point(s). Seller shall be in control and
possession of the gas delivered hereunder and responsible for any damage or injury caused
thereby until same shall have been delivered to Buyer, after which delivery Buyer shall
be deemed to be in exclusive control and possession thereof and responsible for any
injury or damage caused thereby.
	 
	 	6.3	 	For properties connected to RDGS, title to the gas shall pass from Seller to Buyer
at the point where Seller’s facilities connect to RDGS, but, as between the parties
hereto, custody and risk of loss to such gas shall remain with Seller until the gas is
delivered into Buyer’s facilities at the Delivery Point specified in Paragraph 6.1 (b)
above for such gas. Seller shall be deemed to be in control and possession of such gas,
and responsible for any damage or injury caused thereby, until same shall have been
delivered to Buyer at the Delivery Point, after which delivery Buyer shall be deemed to
be in exclusive control and possession thereof and responsible for any injury or damage
caused thereby.

ARTICLE VII — DELIVERY PRESSURE

	 	7.1	 	The gas purchased hereunder shall be delivered at a pressure sufficient to effect
delivery into Buyer’s gathering system against the pressure prevailing therein from time
to time. If any of Seller’s wells are unable to deliver gas at such delivery pressure,
neither Buyer nor Seller shall be obligated to install compression facilities at such
Delivery Point(s) in order to effect such deliveries.

8

 

	7.2	(a)	 	Buyer shall endeavor, through utilization of existing equipment, to
maintain an operating system pressure of approximately (**) psig
at the suction to Buyer’s Canadian plant inlet compressors; however, should
such pressure exceed (**) psig, Buyer shall not be required to
install new equipment to reduce the pressure at such plant inlet compressors,
Buyer shall have no liability to Seller for failing to maintain such pressure
and, notwithstanding the provisions of Article XVII, FORCE MAJEURE, Seller
shall remain obligated to continue delivering gas to Buyer except as provided
for in Paragraph 7.2 (b).
	 
	 	(b)	 	In the event the operating system pressure at the suction to
Buyer’s Canadian plant inlet compressors exceeds (**) psig for
(**) consecutive days, then to the extent Seller’s well(s) are incapable
of producing gas into Buyer’s system, such gag shall be deemed to be
(**)

ARTICLE VIII — QUALITY

	 	8.1	 	The gas delivered to Buyer hereunder shall be commercially free of dust, gum,
gum-forming constituents, and other solid and/or liquid matter and shall conform to the
following specifications:

	 	 	 	 	 
	 

	 	(a) Dust, rust, or other solids
	 	None
	 
	 	 	 	 
	 

	 	(b) Carbon Dioxide
	 	Not more than 2.0% by
Volume
	 
	 	 	 	 
	 

	 	(c) Oxygen
	 	None
	 
	 	 	 	 
	 

	 	(d) Hydrogen Sulfide
	 	Not more than 10 grains per
100 cubic feet
	 
	 	 	 	 
	 

	 	(e) Total Sulfur
	 	Not more than 20 grains per
100 cubic feet
	 
	 	 	 	 
	 

	 	(f) Heating Value
	 	Not less than 1,000 BTU/CF
	 
	 	 	 	 
	 

	 	(g) Temperature
	 	Not more than 120 degrees
F.
	 
	 	 	 	 
	 

	 	(h) Water
	 	No free water
	 
	 	 	 	 
	 

	 	(i) Nitrogen
	 	Not more than 2.0% by
Volume

	 	8.2	 	Buyer, at its option, may at any time and from time to time refuse to accept
delivery of any or all gas not meeting the quality specifications set out in this
Article VIII; thereafter Seller shall have the right to conform the gas to the above
specifications. If neither Buyer nor Seller elects to treat the gas to conform to the
above specifications, then Buyer shall upon ninety (90) days’ prior written notice from
Seller, release from the provisions of this Contract the producing formation of the well
and the acreage attributable thereto from which such gas is produced.
	 
	 	8.3	 	In the event that Seller’s gas contains substances which, in Buyer’s sole
opinion, could result in serious damage to Buyer’s employees, plant, or equipment, then
Buyer shall have

9

 

	 	 	 	the right to immediately cease receiving Seller’s gas as long as such condition
exists.

ARTICLE IX — MEASUREMENT AND TESTS

The measurement and tests for quality of gas delivered hereunder shall be governed by the
following:

	 	9.1	 	The volume shall be measured at the Delivery Point(s) by orifice meters installed,
maintained and operated by Buyer, and computations made in accordance with published
procedures adopted as American National Standard, “Orifice Metering of Natural Gas,”
published as ANSI/API 2530 as amended or revised from time to time. Buyer may, at its
option, install an electronic flow recorder to record the static and differential
pressures, flowing temperature and volume of such gas.
	 
	 	9.2	 	The unit of volume for purposes of measurement shall be one
(1) cubic foot of gas at a temperature base of 60° Fahrenheit and at a pressure base
of fourteen and sixty-five one-hundredths (14.65) pounds per square inch absolute.
	 
	 	9.3	 	The arithmetical average of the hourly temperatures recorded during each day, if
available, and the factor for specific gravity according to the latest tests, applicable
during each day shall be used to make proper computations of volumes hereunder. Only
those gas volumes measured at pressures of 100 psig or greater shall be corrected for
deviation from Boyle’s Law. Chart integration and volume computations shall be made as
accurately as possible and within the accuracy prescribed by the manufacturer of the
computing equipment used.
	 
	 	9.4	 	Temperature shall at Buyer’s option be determined by a
recording thermometer continuously used and installed so as to
record properly the temperature of the gas flowing through the
meter. If a recording thermometer is not being utilized at such meter, the
temperature shall be deemed to be 60° F.
	 
	 	9.5	 	The specific gravity of the gas purchased and sold hereunder shall be determined by
Buyer, at its election, either by the use of a gravitometer of the Ranarex type or by the
Gravity Balance Method in accordance with the official code of the Gas Processors
Association, or by chromatographic analysis, or any other method acceptable to Buyer and
Seller.
	 
	 	9.6	 	The average atmospheric (barometric) pressure shall be
assumed to be 13.2 psia
unless otherwise specified.
	 
	 	9.7	 	The total gross heating value of the individual wellhead gas streams and the GPM of
each individual product contained therein shall be determined by performing a
chromatographic analysis of the samples of the gas taken at each Delivery Point at such
times as may be mutually agreed by Buyer and Seller, but not less often than once each
six (6) months; provided, that if at any time, either party believes that the heating
value of the gas may have changed, such party may call for a special test to be conducted
at its expense after having given notice of the time of such test sufficiently in advance
to permit convenient arrangements for a representative of the other party to be present.
The MMBTUs removed due to product shrinkage will be calculated based on plant liquid
products measurement converted to MMBTUs utilizing the constants contained in G.P.A.
Publication No. 2145-93, as revised from time to time, and adjusted to 14.65 psia, plus
adjustment for plant fuel usage determined by measurement and BTU determination of
the gas so utilized. Physical constants for

10

 

	 	 	 	the hexanes and heavier hydrocarbons portion of hydrocarbon mixtures shall be
assumed to be the same as the physical constants for hexane. The heat content per gallon
of each liquid hydrocarbon shall be determined by multiplying the cubic feet per gallon
of such liquid by the heat content per cubic foot thereof. A continuous sampling device
shall be used to obtain a sample of the commingled stream of the plant products delivered
each month to a product pipeline. A chromatographic analysis of such sample will be used
to determine the gallons of each individual product so delivered. The specific gravity or
flowing density of the liquid will be determined by equipment installed by Buyer or the
operator of the products pipeline.
	 
	 	9.8	 	Tests for carbon dioxide, sulfur and hydrogen sulfide content of the gas delivered
hereunder shall be made by approved standard methods from time to time as requested by any
party hereto, but not less often than once each six (6) months.
	 
	 	9.9	 	All measuring equipment, housing, devices and materials shall be of standard manufacture
and shall, with all related equipment, appliances and buildings, be installed, maintained,
and furnished by Buyer at its expense in accordance with standards and specifications
generally accepted in the industry. Seller may install and operate check-measuring
equipment, which shall not interfere with the use of Buyer’s equipment. All testing
equipment shall be of standard manufacture and shall be maintained, operated and furnished by
Buyer at Buyer’s expense.
	 
	 	9.10	 	The accuracy of Buyer’s measuring equipment shall be verified by Buyer at reasonable
intervals, but not less often than once each six (6) months. The accuracy of Buyer’s testing
equipment shall be verified by Buyer at reasonable intervals according to the manufacturer’s
specifications. Tests for quality of the gas may be made at the time of testing equipment, or
at other times, but not less often than once each six (6) months. Notice of the time and
nature of each test shall be given by Buyer to Seller sufficiently in advance to permit
convenient arrangements for Seller’s representative to be present. Measuring and testing
equipment shall be tested by reasonable means and methods determined by Buyer. Tests and
adjustments shall be made in the presence of and observed by representatives of both Buyer
and Seller, if present. If after proper notice Seller fails to have a representative present,
Seller shall not have the right to dispute the accuracy of such tests. All tests shall be
made at Buyer’s expense, except that Seller shall bear the expense of tests made at its
request if the inaccuracy found is two percent (2%) or less.
	 
	 	9.11	 	If at any time any of the measuring or testing equipment is found to be out of service, or
registering inaccurately in any percentage, it shall be adjusted at once to read accurately,
within the limits prescribed by the manufacturer. If such equipment is out of service, or
inaccurate by an amount exceeding two percent (2%) at a reading corresponding to the average
rate of flow for the period since the last preceding test, the previous readings of such
equipment shall be disregarded for any period definitely known or agreed upon, or if not so
known or agreed upon, for a period of sixteen (16) days or one-half (1/2) of the elapsed time
since the last test, whichever is shorter. The volume of gas delivered during such period
shall be estimated by:

	 	(a)	 	Using the data recorded by any check-measuring equipment if installed
and accurately registering, or if not installed or registering accurately;

11

 

	 	(b)	 	By correcting the error if the percentage of error is ascertainable by
calibration, test or mathematical calculation, or if neither such method is
feasible;
	 
	 	(c)	 	By estimating the quantity, or quality, delivered, based upon
deliveries under similar conditions during a period when the equipment was
registering accurately. No corrections shall be made for recorded inaccuracies
of two percent (2%) or less.

	 	9.12	 	Buyer and Seller shall have the right to inspect equipment installed or furnished
by the other, and the charts and other measurement or testing data of the other, at all
times during business hours; but the reading, calibration and adjustment of such
equipment and changing of charts shall be done only by the party owning such equipment.
Each party shall preserve all original test data, charts and other similar records, in
such party’s possession for a period of at least two (2) years following the end of the
calendar year in which such data, charts, and records were created.

ARTICLE X — ALLOCATION PROCEDURE

	 	10.1	 	(**)
	 
	 	10.2	 	(**)

12

 

	 	10.3	 	In the event that gas from more than one well is delivered to Buyer through a
common meter, Buyer shall account only to said common meter and Seller shall account to
all individual wells delivering gas through said common meter and hold Buyer harmless
from any adverse claims arising therefrom. Seller also agrees to install and maintain
any metering facilities, prior to the Delivery Point, not installed by Buyer hereunder
as may be required by the Texas Railroad Commission or other jurisdictional governmental
body. Seller further agrees to provide to Buyer on or before the sixth working day of
each month, the percentages of gas delivered through said common meter which is
attributable to wells classified by the Texas Railroad Commission as proratable and
non-proratable. In the event Seller fails to provide such information by said date,
payment as provided for in Article XI will be delayed until the month following the
month the information is received by Buyer.

ARTICLE XI — PAYMENT

	 	11.1	 	After the delivery of gas has commenced hereunder, Buyer shall on or before the
last day of each month render to Seller a statement showing the quantity of gas delivered
during the preceding month and shall mail to Seller the amount due hereunder on or before
the last day of the month in which such statement was rendered. Such statement shall also
contain all information relative to the payment computations and the allocation in
accordance with Article X hereof.
	 
	 	11.2	 	Each party hereto shall have the right at any and all reasonable times to examine
the books and records of the other party, to the extent necessary to verify the accuracy
of any statement, charge, computation or demand made under or pursuant to this
Contract.
	 
	 	11.3	 	Notwithstanding the above, all statements rendered to Seller by Buyer during any
calendar year shall be conclusively presumed to be true and correct after twenty-four
(24) months following the end of any such calendar year, unless within the said
twenty-four (24) month period Seller takes written exception thereto and makes claim on
Buyer for adjustment. Failure on the part of Seller to make claim on Buyer for adjustment
within such period shall establish the correctness thereof and preclude the filing of
exceptions thereto or making of claims for adjustment thereof.
	 
	 	11.4	 	If the lease or leases described herein are owned by two or more parties to this
Contract, the Gas Purchase Statement will be sent to the party who is Operator and
payment of any sums due to Seller hereunder shall be made to the party designated as
Operator of such lease or leases. The Operator shall make proper distribution of the sums
to the other parties. In the event Seller notifies Buyer of its desire for Brigham Oil &
Gas to receive payment directly, Buyer shall make direct payment (as instructed by
Seller) to Brigham Oil & Gas.
	 
	 	11.5	 	The following shall apply only for Delivery Points delivering Seller’s gas into
Buyer’s low pressure gathering system and processed at Buyer’s plant:

	 	 	 	(**)

13

 

ARTICLE XII — WARRANTY OF TITLE

	 	12.1	 	Seller warrants title to all gas delivered by it and warrants that it has the right
to sell the same and that such gas upon

14

 

delivery to Buyer will be free from liens and adverse claims of every kind.
Seller shall indemnify and save Buyer harmless against all loss, damage and expense
of every character on account of adverse claims to the gas delivered hereunder. If
Seller’s title is questioned or involved in any action, Buyer may withhold payment
(without interest, to the extent permitted under V.T.C.A. Natural Resources Code
Section 91.402) of sums due hereunder up to the amount of the claim until title is
freed from such question or such action is finally determined, or until Seller has
furnished bond conditioned to save Buyer harmless, with a surety satisfactory to
Buyer.

ARTICLE XIII — ROYALTY

	 	13.1	 	Seller agrees to account and pay to the persons entitled thereto all royalties,
overriding royalties, bonus payments and production payment due with respect to the gas
sold or delivered hereunder and to hold Buyer harmless therefrom.

ARTICLE XIV — SCOPE

	 	14.1	 	This Contract shall be construed as a separate contract as to each lease and as
to each well on each lease identified in Exhibits “A” and “B” attached hereto.

ARTICLE XV — DRIP

	 	15.1	 	(**)

ARTICLE XVI — RIGHTS-OF-WAY

	 	16.1	 	To the full extent that Seller is able to convey such rights, Seller hereby
assigns and grants to Buyer an easement across the premises covered hereby to lay and
maintain lines and to install, maintain and operate any equipment necessary to its
operations hereunder and Buyer shall have the right of free entry for any purpose
connected therewith. All lines and equipment placed by Buyer on said premises shall
remain the property of Buyer and may be removed by Buyer before, or within a reasonable
time after, the expiration of this Contract.

ARTICLE XVII — FORCE MAJEURE

	 	17.1	 	In the event of either party hereto being rendered unable, wholly or in part, by
force majeure to carry out its obligations under this Contract, other than to make
payments due hereunder, the obligations of the party suffering force majeure, so as they
are affected by such force majeure, shall be suspended to the extent and for the period
of such force majeure condition. Such party suffering force majeure shall give notice
and full particulars of such force majeure in writing or by telegraph to the other party
as soon as possible after the occurrence of the cause. Such cause shall as far as
possible be remedied with all reasonable dispatch. The term “force majeure” as employed
herein shall mean acts of God, strikes, lockouts or other industrial disputes or
disturbances, acts of the public enemy, wars, blockades, insurrections, riots,
epidemics, landslides, lightning, earthquakes, fires, storms, floods, washouts, arrests
and restraints of governments and people, civil disturbances, explosions, breakage or
accidents to machinery or lines of pipe, the making of repairs or alterations to lines
of pipe or plants, inability to secure labor or materials, freezing of wells or lines of
pipe, partial or entire failure of wells or gas supply, necessity for compliance with
any court order, or

15

 

any law, statute, ordinance, regulation or order promulgated by a governmental
authority having jurisdiction, inclement weather that necessitates extraordinary
measures and expense to construct facilities and/or maintain operations and any
other causes, whether of the kind enumerated herein or otherwise, not within the
control of the party claiming suspension and which by the exercise of due diligence
such party is unable to prevent or overcome. Such term shall likewise include (a) in
those instances where either party hereto is required to obtain servitude,
right-of-way grants, permits or licenses to enable such party to fulfill its
obligations hereunder, the inability of such party to acquire, or delays on the part
of such party in acquiring, at reasonable cost and after the exercise of reasonable
diligence, such servitude, right-of-way grants, permits or licenses, and (b) in
those instances where either party hereto is required to furnish materials and
supplies for the purpose of constructing or maintaining facilities or is required to
secure permits or permissions from any governmental agency to enable such party to
fulfill its obligations hereunder, the inability of such party to acquire, or delays
on the part of such party in acquiring, at reasonable cost and after the exercise of
reasonable diligence, such materials, supplies, permits and permissions. It is
understood and agreed that the settlement of strikes or lockouts shall be entirely
within the discretion of the party having the difficulty, and that the above
requirements that any force majeure shall be remedied with all reasonable dispatch
shall not require the settlement of strikes or lockouts by acceding to the demands
of opposing party when such course is inadvisable in the discretion of the party
having difficulty. Either party may briefly interrupt its performance hereunder for
the purpose of making necessary or desirable inspections, alterations and repairs;
and the party requiring such relief shall give to the other party reasonable notice
of its intention to suspend its performance hereunder, except in cases of emergency
where such notice is impracticable or in cases where the operations of the other
party will not be affected. The party requiring such relief shall endeavor to
arrange such interruptions so as to inconvenience the other party as little as
possible. Service interruptions on the part of either party which are sanctioned by
this provision are expressly included within the definition of “force majeure” for
the purposes of this Contract.

In the event that during the term of this Contract Seller claims a suspension of its
obligation to deliver gas to Buyer for sixty (60) or more days for the reason of one
or more events of force majeure, then the term of this Contract shall be extended
for the number of days during which such force majeure condition is claimed.

ARTICLE
XVIII — COMPLIANCE WITH LAWS, RULES AND REGULATIONS

	 	18.1	 	This Contract and all provisions herein shall be subject to and performed in
accordance with all present and future, applicable and valid, orders, laws, rules or
regulations of any duly constituted federal, state or local governmental authority now
or hereafter having jurisdiction over the parties, their facilities, and the gas
delivered hereunder or this Contract.

ARTICLE XIX — EFFECTIVE DATE AND TERM

	 	19.1	 	This Contract will become effective January 1, 1994 and shall remain in full force
and effect for the life of Seller’s oil and gas leases or any extension or renewal
thereof further described on Exhibits “A” and “B”.

16

 

	 	19.2	 	Upon termination, this Contract will cease to have any force or effect,
except as to unsatisfied obligations or liabilities of either party attributable to
the period prior to 12:00 midnight on the date of termination, or arising thereafter
as a result of such termination.

ARTICLE XX — ASSIGNMENT

	 	20.1	 	The provisions of this Contract shall be binding upon and inure to the benefit of
the parties hereto, their heirs, successors and assigns. If Seller assigns or conveys
all or any part of the leases covered hereby, or any wells located thereon, Seller shall
provide in any instrument of assignment or conveyance that such assignment or conveyance
is subject to the terms and conditions of this Contract and that the party or parties to
whom such assignment or conveyance is made shall be bound by the
terms of this Contract.
No transfer of or succession to the interest of Seller hereunder, wholly or partially,
shall effect or bind Buyer until Buyer shall have been furnished with written notice and
the original instrument or a certified copy of an acceptable photocopy of the instrument
or instruments effecting such changes of ownership.

ARTICLE XXI — NOTICES

	 	21.1	 	Any notice, request, demand, or statement provided for in this Contract shall be
in writing and deemed given when deposited in the United States mail, postage prepaid,
directed to the Post Office address of the parties as follows or at such address as
either party may from time to time designate as the address for such purpose by
registered or certified letter addressed to the other party.

	 	 	 	 	 
	 

	 	BUYER:
	 	Warren Petroleum Company
	 

	 	 	 	(a Division of Chevron U.S.A. Inc.)
	 

	 	 	 	P. O. Box 1589
	 

	 	 	 	Tulsa, Oklahoma 74102
	 
	 	 	 	 
	 

	 	SELLER:
	 	Wallace Oil & Gas, Inc.
	 

	 	 	 	3030 Northwest Expressway
	 

	 	 	 	18th Floor
	 

	 	 	 	Oklahoma City, OK 73112

ARTICLE XXII — COUNTERPART EXECUTION

	 	22.1	 	This Contract may be executed in any number of counterparts, each of which, when
executed by any Buyer and any Seller, shall be deemed to be an original, binding
agreement between such Buyer and Seller, as of the effective date hereof, regardless of
any failure by one or more parties to execute such contract.

ARTICLE XXIII — UNPROFITABLE GAS

	 	23.1	 	In the event the gas from any well or combination of wells on the properties
described in Exhibit “A” and Exhibit “B” is or becomes, in the sole judgement of Buyer,
insufficient in volume or liquefiable hydrocarbon content, or for any other cause is or
becomes unprofitable for the extraction of liquefiable hydrocarbons
therefrom, Buyer
shall not be required to take such gas so long as such condition exists.

17

 

	 	 	 	If at any time the volume and/or liquefiable hydrocarbon content of the gas available
from any well or combination of wells located on the properties listed in Exhibits
“A” and “B”, or any other cause beyond Buyer’s control, shall render the operation of
Buyer’s plant or the gas gathering lines to such wells unprofitable, Buyer may by
thirty (30) days’ written notice to Seller cancel this Contract in regard to such
well or combination of wells which are unprofitable.

ARTICLE XXIV — CANCELLATION OF PRIOR CONTRACTS

	 	24.1	 	Effective January 1, 1994, this Contract shall supersede any prior gas contracts
and any amendments thereto effective between the parties hereto insofar as such
contracts cover the leases described in Exhibits “A” and “B” including, but not limited
to, Gas Purchase Contracts dated November 5, 1992, and June 4, 1992, between Wallace Oil
& Gas, Inc., and Warren Petroleum Company.
	 
	 		 	IN WITNESS WHEREOF, the parties hereto have executed this Contract as of the day and year
hereinabove written.

	 	 	 	 	 	 	 	 	 
	ATTEST:	 	 	 	WARREN PETROLEUM COMPANY	 	 
	 	 	 	 	(a Division of Chevron U.S.A. Inc.)	 	 
	 
	 	 	 	 	 	 	 	 
	/s/ T. R. THORNTON
 

          Secretary

	 	 	 	By
	 	/s/ D. D. Dunlap
 

D. D. Dunlap, Vice President
	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	                    “BUYER”	 	 
	 
	 	 	 	 	 	 	 	 
	ATTEST:	 	 	 	WALLACE OIL & GAS, INC.	 	 
	 
	 	 	 	 	 	 	 	 
	/s/ Dan F. Wallace
 

          Secretary

	 	 	 	By
	 	 
 

Title President
	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	                    “SELLER”	 	 

18

 

EXHIBIT “A”

(**)

19

 

EXHIBIT “B”

(**)

20

 

EXHIBIT “C”

(**)

21

 

GAS PURCHASE CONTRACT

AMENDATORY AGREEMENT

     Under date of March 28, 1994, a Gas Purchase Contract was entered into by and between
WARREN PETROLEUM COMPANY, a Division of Chevron U.S.A., Inc. as “Buyer” and WALLACE OIL &
GAS, INC. as “Seller”, covering the purchase of gas connected to Buyer’s Canadian Plant.

     NOW, THEREFORE, by mutual agreement of the parties hereto, said Contract is hereby
amended to add Seller’s interest in the lands described below:

(**)

and,

It is agreed by both parties that under the terms outlined in ARTICLE VI — DELIVERY
POINT Paragraph 6.1 (b) that Buyer shall install the
facilities necessary to gather the
following Red Deer Properties at a capital cost not to exceed (**):

	 	 	 	 	 	 	 	 	 
	 

	 	(**)
	 	 
	 	 
	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 

	 	 
	 	 	 	 	 	 

Seller shall reimburse Buyer for said capital cost, along with a 20% return on the
capital employed, at a rate of (**) delivered by Seller
from the Red Deer properties listed above. Said eight cent per MCF fee shall
terminate when Buyer has received full reimbursement as outlined herein. The volume
from any additional Red Deer properties that are gathered by Buyer while not
exceeding the $(**) limit will also stand the (**) fee and will be
applied to the reimbursement

and,

It is agreed by both parties that the recovery of capital costs, by Buyer from
Seller, of any facilites necessary to gather gas from the lands added in this
Amendment shall be subject to the same provisions, excluding the $(**) capital
limitation, as stated herein for the Red Deer Properties. Said capital costs for the
amended lands shall be limited to mainline facilities, (**) or larger pipe
sizes and shall include the following but not be limited to: purchase of pipe, labor
to install the pipe, Right Of Way acquisitions, pigging facilities, miscellaneous pipe
fittings.

The
effective date of this Amendment shall be
March 1, 1995.

Except as hereinabove amended, all other terms and provisions of the above referred to
Contract shall remain in full force and effect for the term thereof.

	 	 	 	 	 	 	 
	 	 	WARREN PETROLEUM COMPANY	 	 
	 	 	(A Division of Chevron U.S.A. Inc.)	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ [ILLEGIBLE]
 

Attorney-in-Fact
	 	 
	 
	 	 	 	 	 	 
	ACCEPTED AND AGREED TO THIS 31st
	 	 	 	 	 	 
	DAY OF March      , 1995
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	/s/ Dan F. Wallace
	 	 	 	 	 	 
	 

WALLACE OIL & GAS, INC.

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	By: /s/ Dan F. Wallace
	 	 	 	 	 	 
	 

Title: Vice President

	 	 	 	 	 	 

 

 

	 	 	 	 	 
	STATE OF Oklahoma

	 	}
	 	 
	 

	 	} ss.
	 	 
	COUNTY OF Oklahoma

	 	}
	 	 

     On this 31st day of March, A.D., 1995, before me, the undersigned, a Notary Public in and for
the county and state aforesaid, personally appeared Dan F. Wallace to me personally known to be
the identical person who signed the name of the maker thereof to the within and foregoing
instrument as its Vice President and acknowledged to me that he executed the same as his free and
voluntary act and deed, and as the free and voluntary act and deed of said corporation, for the
uses and purposes therein set forth.

     Given under my hand and seal the day and year last above written.

	 	 	 	 	 
	My commission expires 6-3-95

	 	/s/ Cheryl Fitzgerald	 	 
	 

	 	 

Notary Publicexv10w1

 

Exhibit 10.1

SHARE PURCHASE AGREEMENT

AMONG

GLOBAL EMPLOYMENT SOLUTIONS, INC.

GLOBAL EMPLOYMENT HOLDINGS, INC.

AND

SHAREHOLDERS OF GLOBAL EMPLOYMENT SOLUTIONS, INC.

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Page	 
	ARTICLE I	 	REPRESENTATIONS AND WARRANTIES OF HOLDINGS
	 	 	1	 
	 	 	 	 	 
	 	 	 	 
	 	1.1	 	 	Organization
	 	 	1	 
	 	 	 	 	 
	 	 	 	 
	 	1.2	 	 	Capital
	 	 	1	 
	 	 	 	 	 
	 	 	 	 
	 	1.3	 	 	Subsidiaries
	 	 	1	 
	 	 	 	 	 
	 	 	 	 
	 	1.4	 	 	Financial Statements
	 	 	1	 
	 	 	 	 	 
	 	 	 	 
	 	1.5	 	 	Absence of Changes
	 	 	2	 
	 	 	 	 	 
	 	 	 	 
	 	1.6	 	 	Absence of Undisclosed Liabilities
	 	 	2	 
	 	 	 	 	 
	 	 	 	 
	 	1.7	 	 	Tax Returns
	 	 	2	 
	 	 	 	 	 
	 	 	 	 
	 	1.8	 	 	Proprietary Rights
	 	 	2	 
	 	 	 	 	 
	 	 	 	 
	 	1.9	 	 	Compliance with Laws
	 	 	2	 
	 	 	 	 	 
	 	 	 	 
	 	1.10	 	 	Litigation
	 	 	2	 
	 	 	 	 	 
	 	 	 	 
	 	1.11	 	 	Authority
	 	 	2	 
	 	 	 	 	 
	 	 	 	 
	 	1.12	 	 	Ability to Carry Out Obligations
	 	 	2	 
	 	 	 	 	 
	 	 	 	 
	 	1.13	 	 	Assets
	 	 	3	 
	 	 	 	 	 
	 	 	 	 
	 	1.14	 	 	Material Contracts
	 	 	3	 
	 	 	 	 	 
	 	 	 	 
	ARTICLE II	 	REPRESENTATIONS AND WARRANTIES OF GLOBAL
	 	 	3	 
	 	 	 	 	 
	 	 	 	 
	 	2.1	 	 	Organization
	 	 	3	 
	 	 	 	 	 
	 	 	 	 
	 	2.2	 	 	Capital
	 	 	3	 
	 	 	 	 	 
	 	 	 	 
	 	2.3	 	 	Subsidiaries
	 	 	3	 
	 	 	 	 	 
	 	 	 	 
	 	2.4	 	 	Financial Statements
	 	 	3	 
	 	 	 	 	 
	 	 	 	 
	 	2.5	 	 	Absence of Changes
	 	 	4	 
	 	 	 	 	 
	 	 	 	 
	 	2.6	 	 	Absence of Undisclosed Liabilities
	 	 	4	 
	 	 	 	 	 
	 	 	 	 
	 	2.7	 	 	Tax Returns
	 	 	4	 
	 	 	 	 	 
	 	 	 	 
	 	2.8	 	 	Proprietary Rights
	 	 	4	 
	 	 	 	 	 
	 	 	 	 
	 	2.9	 	 	Compliance with Laws
	 	 	4	 
	 	 	 	 	 
	 	 	 	 
	 	2.10	 	 	Litigation
	 	 	4	 
	 	 	 	 	 
	 	 	 	 
	 	2.11	 	 	Authority
	 	 	4	 
	 	 	 	 	 
	 	 	 	 
	 	2.12	 	 	Ability to Carry Out Obligations
	 	 	4	 
	 	 	 	 	 
	 	 	 	 
	 	2.13	 	 	Assets
	 	 	4	 
	 	 	 	 	 
	 	 	 	 
	 	2.14	 	 	Material Contracts
	 	 	5	 

-i-

 

 

TABLE OF CONTENTS

(continued)

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Page	 
	ARTICLE III	 	CONDITIONS PRECEDENT TO GLOBAL’S AND THE HOLDERS’ PERFORMANCE
	 	 	5	 
	 	 	 	 	 
	 	 	 	 
	 	3.1	 	 	Conditions
	 	 	5	 
	 	 	 	 	 
	 	 	 	 
	ARTICLE IV	 	CONDITIONS PRECEDENT TO HOLDINGS’ PERFORMANCE
	 	 	5	 
	 	 	 	 	 
	 	 	 	 
	 	4.1	 	 	Conditions
	 	 	5	 
	 	 	 	 	 
	 	 	 	 
	ARTICLE V	 	CLOSING
	 	 	7	 
	 	 	 	 	 
	 	 	 	 
	 	5.1	 	 	Closing
	 	 	7	 
	 	 	 	 	 
	 	 	 	 
	ARTICLE VI	 	COVENANTS SUBSEQUENT TO THE CLOSING DATE
	 	 	7	 
	 	 	 	 	 
	 	 	 	 
	 	6.1	 	 	Listing
	 	 	7	 
	 	 	 	 	 
	 	 	 	 
	 	6.2	 	 	Registration of Shares
	 	 	8	 
	 	 	 	 	 
	 	 	 	 
	ARTICLE VII	 	TERMINATION
	 	 	8	 
	 	 	 	 	 
	 	 	 	 
	 	7.1	 	 	Termination
	 	 	8	 
	 	 	 	 	 
	 	 	 	 
	 	7.2	 	 	Effect of Termination
	 	 	8	 
	 	 	 	 	 
	 	 	 	 
	ARTICLE VIII	 	MISCELLANEOUS
	 	 	9	 
	 	 	 	 	 
	 	 	 	 
	 	8.1	 	 	Captions and Headings
	 	 	9	 
	 	 	 	 	 
	 	 	 	 
	 	8.2	 	 	No Oral Change
	 	 	9	 
	 	 	 	 	 
	 	 	 	 
	 	8.3	 	 	Non-Waiver
	 	 	9	 
	 	 	 	 	 
	 	 	 	 
	 	8.4	 	 	Time of Essence
	 	 	9	 
	 	 	 	 	 
	 	 	 	 
	 	8.5	 	 	Entire Agreement
	 	 	9	 
	 	 	 	 	 
	 	 	 	 
	 	8.6	 	 	Choice of Law
	 	 	9	 
	 	 	 	 	 
	 	 	 	 
	 	8.7	 	 	Counterparts
	 	 	9	 
	 	 	 	 	 
	 	 	 	 
	 	8.8	 	 	Notices
	 	 	9	 
	 	 	 	 	 
	 	 	 	 
	 	8.9	 	 	Binding Effect
	 	 	10	 
	 	 	 	 	 
	 	 	 	 
	 	8.10	 	 	Mutual Cooperation
	 	 	10	 
	 	 	 	 	 
	 	 	 	 
	 	8.11	 	 	Expenses
	 	 	10	 
	 	 	 	 	 
	 	 	 	 
	 	8.12	 	 	Finders
	 	 	10	 
	 	 	 	 	 
	 	 	 	 
	 	8.13	 	 	Announcements
	 	 	10	 
	 	 	 	 	 
	 	 	 	 
	 	8.14	 	 	No Survival of Representations and Warranties
	 	 	11	 

-ii-

 

 

SHARE PURCHASE AGREEMENT

     SHARE
PURCHASE AGREEMENT dated as of March 31, 2006 among GLOBAL EMPLOYMENT SOLUTIONS, INC.,
a Colorado corporation (“Global”), GLOBAL EMPLOYMENT HOLDINGS, INC., a Delaware corporation
(“Holdings”), and the shareholders of Global signatory hereto (the “Holders”).

     WHEREAS, Holdings wishes to acquire the outstanding preferred stock of Global owned by the
Holders on the terms set forth herein; and

     WHEREAS, Global desires to assist Holdings in so acquiring all of the preferred stock of
Global owned by the Holders; and

     WHEREAS, the Holders agree to sell their shares on the terms set forth herein; and

     WHEREAS, the parties hereto intend that the transactions set forth herein be treated as an
exchange under §351 of the Internal Revenue Code of 1986, as amended.

     NOW, THEREFORE, in consideration of the mutual promises, covenants and representations
contained herein, the parties hereto agree as follows:

ARTICLE I

REPRESENTATIONS AND WARRANTIES OF HOLDINGS

     Holdings hereby represents and warrants to Global and the Holders that:

     1.1 Organization. Holdings is a corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware, and has all necessary corporate powers to own its
properties and to carry on its business as now owned and operated by it.

     1.2 Capital. The authorized capital stock of Holdings consists of (i) 75,000,000 authorized
shares of $0.0001 par value common stock (“Holdings Common Stock”), of which 180,927.835 shares are
issued and outstanding, (ii) 1,000,000 shares of Class A Common Stock, none of which are issued and
outstanding, (iii) 2,300,000 shares of Class B Common Stock, none of which are issued and
outstanding, and (iv) 10,000,000 shares of preferred stock, none of which are issued and
outstanding. All of the outstanding securities of Holdings have been duly and validly issued, and
are fully paid and nonassessable. There are no outstanding subscriptions, options, rights,
warrants, debentures, instruments, convertible securities or other agreements or commitments
obligating Holdings to issue or to transfer from treasury any additional shares of its capital
stock of any class.

     1.3 Subsidiaries. Holdings does not own any interest in any other enterprise.

     1.4 Financial Statements. The financial statements contained in Holdings’ Annual Report on
Form 10-K for the fiscal year ended December 31, 2005 (the “Holdings Financial

 

 

Statements”) have been prepared in accordance with generally accepted accounting principles
and practices in the United States consistently followed by Holdings throughout the periods
indicated, and fairly present the financial position of Holdings as of the dates of the balance
sheets included in the Holdings Financial Statements and the results of operations for the periods
indicated.

     1.5 Absence of Changes. Since December 31, 2005 there has not been any change in the
financial condition or operations of Holdings, other than changes in the ordinary course of
business, which changes have not in the aggregate been materially adverse.

     1.6 Absence of Undisclosed Liabilities. As of the date hereof, Holdings does not have any
material debt, liability or obligation of any nature, whether accrued, absolute, contingent or
otherwise, and whether due or to become due, that is not reflected in the Holdings Financial
Statements.

     1.7 Tax Returns. Holdings has filed all federal, state and local tax returns required by law
and has paid all taxes, assessments and penalties due and payable. There are no present disputes as
to taxes of any nature payable by Holdings.

     1.8 Proprietary Rights. Holdings does not have any patents, trademarks, service marks, trade
names or copyrights.

     1.9 Compliance with Laws. Holdings has complied in all material respects with, and is not in
violation of, applicable federal, state or local statutes, laws and regulations, including federal
and state securities laws. Holdings has filed on a timely basis all filings that would be required
under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the rules and
regulations thereunder, if Holdings had been required to make such filings under the Exchange Act.

     1.10 Litigation. Holdings is not a defendant in any suit, action, arbitration or legal,
administrative or other proceeding, or governmental investigation which is pending or, to the best
knowledge of Holdings, threatened against or affecting Holdings or its business, assets or
financial condition. Holdings is not in default with respect to any order, writ, injunction or
decree of any federal, state, local or foreign court, department, agency or instrumentality
applicable to it. Holdings is not engaged in any material litigation to recover monies due to it.

     1.11 Authority. The board of directors of Holdings has authorized the execution of this
Agreement and the consummation of the transactions contemplated herein, and Holdings has full power
and authority to execute, deliver and perform this Agreement, and this Agreement is a legal, valid
and binding obligation of Holdings and is enforceable in accordance with its terms and conditions.
No action by Holdings shareholders is necessary to authorize this Agreement or the transactions
contemplated herein.

     1.12 Ability to Carry Out Obligations. The execution and delivery of this Agreement by
Holdings and the performance by Holdings of its obligations hereunder in the time and manner
contemplated will not cause, constitute or conflict with or result in (i) any breach or

2

 

violation of any of the provisions of or constitute a default under any license, indenture,
mortgage, instrument, article of incorporation, bylaw, or other agreement or instrument to which
Holdings is a party, or by which it may be bound, nor will any consents or authorizations of any
party other than those hereto be required, (ii) an event that would permit any party to any
agreement or instrument to terminate it or to accelerate the maturity of any indebtedness or other
obligation of Holdings, or (iii) an event that would result in the creation or imposition of any
lien, charge or encumbrance on any asset of Holdings.

     1.13 Assets. Holdings has no material assets.

     1.14 Material Contracts. Holdings has no material contracts, as defined in Item 601 of
Regulation S-B under the Exchange Act (“Material Contracts”).

ARTICLE II

REPRESENTATIONS AND WARRANTIES OF GLOBAL

     Global represents and warrants to Holdings that:

     2.1 Organization. Global is a corporation duly organized, validly existing and in good
standing under the laws of Colorado, has all necessary corporate powers to carry on its business as
now owned and operated by it, and is duly qualified to do business and is in good standing in each
of the states where its business requires qualification.

     2.2 Capital. The authorized capital stock of Global consists of (i) 10,000,000 shares of
common stock, $.01 par value (“Common Stock”), 2,693,370 of which are issued and outstanding, (ii)
50,000,000 shares of preferred stock, $.01 par value, of which (a) 7,000,000 have been designated
as Series C Preferred Stock, 6,825,780 of which are outstanding, and (b) 30,000,000 of which have
been designated as Series D Preferred Stock, 21,841,930.34 of which are outstanding. The
outstanding Common Stock, Series C Preferred Stock and Series D Preferred Stock are referred to
collectively as the “Global Shares.” All of the outstanding Global Shares have been duly and
validly issued, and are fully paid and nonassessable. Except as set forth on Schedule 2.2,
there are no other outstanding subscriptions, options, rights, warrants, debentures, instruments,
convertible securities or other agreements or commitments obligating Global to issue or to transfer
from treasury any additional shares of its capital stock of any class.

     2.3 Subsidiaries. All of Global’s subsidiaries are set forth on Schedule 2.3.

     2.4 Financial Statements. Schedule 2.4 hereto consists of the audited financial
statements of Global for the year ended January 1, 2006 (the “Global Financial Statements”). The
Global Financial Statements have been prepared in accordance with generally accepted accounting
principles and practices consistently followed by Global throughout the period indicated, and
fairly present the financial position of Global as of January 1, 2006 and the results of operations
for the year ended January 1, 2006.

3

 

     2.5 Absence of Changes. Except as contemplated by this Agreement, since January 1, 2006,
there has not been any material change in the financial condition or operations of Global, except
for changes in the ordinary course of business.

     2.6 Absence of Undisclosed Liabilities. As of January 1, 2006, Global did not have any
material debt, liability or obligation of any nature, whether accrued, absolute, contingent or
otherwise, and whether due or to become due, that is not reflected in the Global Financial
Statements.

     2.7 Tax Returns. Within the times and in the manner prescribed by law, Global has filed all
federal, state and local tax returns required by law and has paid all taxes, assessments, and
penalties due and payable.

     2.8 Proprietary Rights. Global owns and holds all necessary trademarks, service marks, trade
names, copyrights, patents and proprietary information and other rights necessary or material to
its business as now conducted or proposed to be conducted.

     2.9 Compliance with Laws. Global has complied in all material respects with, and is not in
violation of, applicable federal, state or local statutes, laws or regulations including federal
and state securities laws.

     2.10 Litigation. Global is not a defendant in any material suit, action, arbitration, or
legal, administrative or other proceeding, or governmental investigation which is pending or, to
the best knowledge of Global, threatened against or affecting Global or its business, assets or
financial condition. Global is not in default with respect to any order, writ, injunction or
decree of any federal, state, local or foreign court, department, agency or instrumentality
applicable to it. Global is not engaged in any material litigation to recover monies due to it.

     2.11 Authority. The board of directors of Global has authorized the execution of this
Agreement and the transactions contemplated herein, and Global has full power and authority to
execute, deliver and perform this Agreement, and this Agreement is the legal, valid and binding
obligation of Global, and is enforceable in accordance with its terms and conditions.

     2.12 Ability to Carry Out Obligations. The execution and delivery of this Agreement by Global
and the performance by Global of its obligations hereunder will not cause, constitute or conflict
with or result in (i) any breach or violation of any of the provisions of or constitute a default
under any license, indenture, mortgage, instrument, article of incorporation, bylaw or other
agreement or instrument to which Global is a party, or by which it may be bound, nor will any
consents or authorization of any party other than those hereto be required, (ii) an event that
would permit any party to any agreement or instrument to terminate it or to accelerate the maturity
of any indebtedness or other obligation of Global, or (iii) an event that would result in the
creation or imposition of any lien, charge or encumbrance on any asset of Global.

     2.13 Assets. Except as set forth on Schedule 2.13, Global has good and marketable
title to all of its property, free and clear of all liens, claims and encumbrances.

4

 

     2.14 Material Contracts. Schedule 2.14 sets forth all of Global’s Material Contracts.

ARTICLE III

CONDITIONS PRECEDENT TO GLOBAL’S AND THE HOLDERS’ PERFORMANCE

     3.1 Conditions. Global’s and the Holders’ obligations hereunder shall be subject to the
satisfaction at or before the closing of the transaction contemplated hereby (the “Closing”) of all
the conditions set forth in this Article III. Global may waive (for itself and on behalf of the
Holders) any or all of these conditions in whole or in part without prior notice; provided,
however, that no such waiver of a condition shall constitute a waiver by Global or the Holders of
any other condition or any of Global’s and the Holders’ other rights or remedies, at law or in
equity, if Holdings shall be in default of any of its representations, warranties or covenants
under this Agreement.

	 	(a)	 	Accuracy of Representations. Except as otherwise permitted by this Agreement,
all representations and warranties by Holdings in this Agreement or in any written
statement that shall be delivered to Global by Holdings under this Agreement shall be
true and accurate on and as of the Closing Date as though made at that time.
	 
	 	(b)	 	Performance. Holdings shall have performed, satisfied and complied with all
covenants, agreements and conditions required by this Agreement to be performed or
complied with by it on or before the Closing Date.
	 
	 	(c)	 	Absence of Litigation. No action, suit, or proceeding before any court or any
governmental body or authority, pertaining to the transaction contemplated by this
Agreement or to its consummation, shall have been instituted or threatened against
Global or Holdings on or before the Closing Date.
	 
	 	(d)	 	Officer’s Certificate. Holdings shall have delivered to Global a certificate
signed by the President of Holdings certifying that each of the conditions specified in
this Article has been fulfilled and that all of the representations set forth in
Article I are true and correct as of the Closing Date.

ARTICLE IV

CONDITIONS PRECEDENT TO HOLDINGS’ PERFORMANCE

     4.1 Conditions. Holdings’ obligations hereunder shall be subject to the satisfaction at or
before the Closing of all the conditions set forth in this Article IV. Holdings may waive any or
all of these conditions in whole or in part without prior notice; provided, however, that no such
waiver of a condition shall constitute a waiver by Holdings of any other condition or any of
Holdings’ other rights or remedies, at law or in equity, if Global or the Holders shall be in
default of any of its representations, warranties or covenants under this Agreement.

5

 

	 	(a)	 	Accuracy of Representations. Except as otherwise permitted by this Agreement,
all representations and warranties by Global in this Agreement or in any written
statement that shall be delivered to Holdings by Global under this Agreement shall be
true and accurate on and as of the Closing Date as though made at that time.
	 
	 	(b)	 	Performance. Global shall have performed, satisfied and complied with all
covenants, agreements and conditions required by this Agreement to be performed or
complied with by it on or before the Closing Date.
	 
	 	(c)	 	Absence of Litigation. No action, suit or proceeding before any court or any
governmental body or authority, pertaining to the transaction contemplated by this
Agreement or to its consummation, shall have been instituted or threatened against
Global or Holdings on or before the Closing Date.
	 
	 	(d)	 	Officer’s Certificate. Global shall have delivered to Holdings a certificate
dated the Closing Date and signed by the Chief Executive Officer of Global certifying
that each of the conditions specified in this Article has been fulfilled and that all
of the representations set forth in Article II are true and correct as of the Closing
Date.
	 
	 	(e)	 	Holders holding at least 90% of the Global Shares shall have entered into this
Agreement.
	 
	 	(f)	 	Board of Directors. The board of directors of Holdings shall consist solely of
Howard Brill, Charles Gwirtsman, Luci Staller Altman, Steven List and Jay Wells, and
all members of Holdings’ board directors prior to the Closing shall have resigned as
directors.
	 
	 	(g)	 	Declaration of Special Dividend. Holdings board of directors shall have
declared a dividend of $25.58528 per share of Class A Common Stock and $3.21374 per
share of Class B Common Stock, payable to each of the Holders immediately following the
Closing (the “Special Dividend”).
	 
	 	(h)	 	Private Placements. On the Closing Date, Holdings shall have completed a
private placement of (i) its preferred shares raising gross proceeds of at least
$12,750,000 and on terms acceptable to Global, (ii) its common shares raising gross
proceeds of at least $4,250,000 and (ii) its convertible notes raising gross proceeds
of $30,000,000 and on terms acceptable to Global (together, the “Private Placements”).
	 
	 	(i)	 	Wells Fargo Agent. On the Closing Date, Global’s senior credit facility with
Wells Fargo Business Credit shall have been amended to permit borrowings of up to
$20,000,000.

6

 

ARTICLE V

CLOSING

     5.1 Closing. The Closing shall be held at the offices of Brownstein Hyatt & Farber, P.C., as
soon as practicable following satisfaction or waiver of all the conditions set forth in Articles IV
and V, unless extended by agreement of Holdings and Global. At the Closing:

	 	(a)	 	Exchange of Global Shares for Holdings Shares. Holdings shall exchange
0.12737 shares of its Class A Common Stock for each share of Global Series C
Preferred Stock and 0.09479 shares of its Class B Common Stock for each share of Global
Series D Preferred Stock held by each Holder.
	 
	 	(b)	 	Global Dividend. The Special Dividend shall be paid to the Holders.
	 
	 	(c)	 	Restricted Stock Plan Participants. Each Holder that is a participant in
Global’s Restricted Stock Plan shall exchange his or her shares of Common Stock for the
amount of cash and Holdings Common Stock set forth opposite his or her name on
Schedule A hereto. Each such Holder acknowledges that the receipt of such cash
and Holdings Common Stock will satisfy all of Global’s obligations to such Holder under
Global’s Certificate of Incorporation, Global’s Series C Preferred Stock, Global’s
Series D Preferred Stock, the Restricted Stock Plan and the Master Investment Agreement
dated as of November 15, 2001, by and among Global, Global Investment I, LLC and the
other parties identified therein.
	 
	 	(d)	 	Retirement of Subordinated Debt. Holdings shall retire all of Global’s
subordinated debt listed on Schedule 5.1 by issuing the number of shares of
Holdings Common Stock and paying the dollar amount set forth opposite each item of
subordinated debt, and each holder of subordinated debt shall acknowledge in writing
that such item of subordinated debt is completely retired and satisfied in full.
	 
	 	(e)	 	Cancellation of Warrants and Options. Each Holder who holds warrants or
options to acquire Global Shares hereby acknowledges that in consideration of the
Holdings Common Stock and the Special Dividend received by such Holder, such warrants
or options are hereby forfeited to Global and cancelled, without any further action
required.

ARTICLE VI

COVENANTS SUBSEQUENT TO THE CLOSING DATE

     6.1 Listing. As soon as practicable following the Closing Date, Holdings shall use reasonable
commercial efforts to list the Holdings Common Stock on the National Association of Securities
Dealers, Inc.’s OTC Bulletin Board.

7

 

     6.2 Registration of Shares. Holdings shall file a registration statement with the Securities
and Exchange Commission on Form S-1 or other appropriate form to register the resale of the
Holdings Common Stock issued to the holders at the Closing, provided that Holdings shall not permit
such registration statement to become effective sooner than two years from the Closing Date.

ARTICLE VII

TERMINATION

     7.1 Termination. This Agreement may be terminated, and the transactions contemplated hereby
may be abandoned, at any time prior to the Closing, whether before or after approval by the
stockholders of Holdings:

     (a) by mutual written consent of Holdings and Global;

     (b) 
by either Holdings or Global, if the Closing shall not have been consummated on or before
April 30, 2006 (unless, in the case of any such termination pursuant to this Section 7.1(b), the
failure of such event to occur shall have been caused by the action or failure to act of the party
seeking to terminate this Agreement, which action or failure to act constitutes a breach of such
party’s obligations under this Agreement);

     (c) 
by either Holdings or Global, if any permanent injunction, order, decree or ruling by any
governmental entity of competent jurisdiction preventing the consummation of the Closing shall have
become final and nonappealable; provided, however, that the party seeking to terminate this
Agreement pursuant to this Section 7.1(c) shall have used its reasonable best efforts to remove
such injunction or overturn such action;

     (d) 
by Holdings, if there has been a material breach by Global of any of its representation or
warranties, or covenants or agreements set forth in this Agreement, which breach is not curable or,
if curable, is not cured within 45 days after written notice of such breach is given by Holdings to
Global;

     (e) 
by Global, if there has been a material breach by Holdings of any of its representations
or warranties, covenants or agreements set forth in this Agreement, which breach is not curable or,
if curable, is not cured within 45 days after written notice of such breach is given by the Company
to Parent; and

     (f) 
by Global or Holdings, if its respective board of directors shall determine, in good faith
and after consultation with outside counsel, that failure to terminate this Agreement may be
inconsistent such board’s fiduciary duties.

     7.2 
Effect of Termination. In the event of termination of this Agreement pursuant to this
Article VII, the transactions contemplated hereby shall be deemed abandoned and this Agreement
shall forthwith become void, except that the provisions of Section 8.11 shall survive

8

 

any termination of this Agreement; provided, however, that nothing in this Agreement shall
relieve any party from liability for any material breach of this Agreement.

ARTICLE VIII

MISCELLANEOUS

     8.1 Captions and Headings. The Article and Section headings throughout this Agreement are for
convenience and reference only and shall not define, limit or add to the meaning of any provision
of this Agreement.

     8.2 No Oral Change. This Agreement and any provision hereof may not be waived, changed,
modified or discharged orally, but only by an agreement in writing signed by the party against whom
enforcement of any such waiver, change, modification or discharge is sought.

     8.3 Non-Waiver. The failure of any party to insist in any one or more cases upon the
performance of any of the provisions, covenants or conditions of this Agreement or to exercise any
option herein contained shall not be construed as a waiver or relinquishment for the future of any
such provisions, covenants or conditions. No waiver by any party of one breach by another party
shall be construed as a waiver with respect to any other subsequent breach.

     8.4 Time of Essence. Time is of the essence of this Agreement and of each and every provision
hereof.

     8.5 Entire Agreement. This Agreement contains the entire Agreement and understanding between
the parties hereto and supersedes all prior agreements and understandings.

     8.6 Choice of Law. This Agreement and its application shall be governed by the laws of the
state of Colorado.

     8.7 Counterparts. This Agreement may be executed simultaneously in one or more counterparts,
each of which shall be deemed an original, but all of which together shall constitute one and the
same instrument.

     8.8 Notices. All notices, requests, demands and other communications under this Agreement
shall be in writing and shall be deemed to have been duly given on the date of service if served
personally on the party to whom notice is to be given, or on the next business day when delivered
to a recognized overnight courier service:

To Global or the Holders:

Global Employment Solutions, Inc.

9090 Ridgeline Boulevard, Suite 205

Littleton, Colorado 80129

Attn: Howard Brill, Chief Executive Officer

9

 

Fax: (303) 216-9594

With copies to:

KRG Capital Partners, LLC

The Park Central Building

1515 Arapahoe Street

Tower One, Suite 1500

Denver, CO 80202

Attn: Charles Gwirtsman

Fax: (303) 390-5015

Brownstein Hyatt & Farber, P.C.

410 17th Street, 22nd Floor

Denver, CO 80202

Attn: Jeff Knetsch

Fax: (303) 224-0960

To Holdings:

With a copy to:

Morse Zelnick Rose & Lander, LLP

405 Park Avenue

New York, NY 10022

Attn: Kenneth Rose

Fax: (212) 838-9190

     8.9 Binding Effect. This Agreement shall inure to and be binding upon the heirs, executors,
personal representatives, successors and assigns of each of the parties to this Agreement.

     8.10 Mutual Cooperation. The parties hereto shall cooperate with each other to achieve the
purpose of this Agreement and shall execute such other and further documents and take such other
and further actions as may be necessary or convenient to effect the transaction described herein.

     8.11 Expenses. Each party shall bear its own costs and expenses in connection with this
Agreement and the transactions contemplated hereby.

     8.12 Finders. The parties hereto represent that no finder has brought about this Agreement,
and no finder’s fee has been paid or is payable by either party except for payments to be paid by
Global to Ewing Bemiss & Co. and Rodman & Renshaw, LLC.

     8.13 Announcements. The parties will consult and cooperate with each other as to the timing
and content of any public announcements regarding this Agreement.

10

 

     8.14 No Survival of Representations and Warranties. The representations and warranties of the
parties set forth in this Agreement shall not survive the Closing.

11

 

          In witness whereof, the parties have executed this Agreement on the date indicated above.

	 	 	 	 	 	 	 
	 	 	GLOBAL EMPLOYMENT SOLUTIONS, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By	 	 	 	 
	 

	 	 	 	 

Howard Brill

Chief Executive Officer
	 	 
	 
	 	 	 	 	 	 
	 	 	GLOBAL EMPLOYMENT HOLDINGS, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Arnold Kling	 	 
	 

	 	 	 	President	 	 

 

 

	 	 	 	 	 	 	 
	 	 	SHAREHOLDERS:	 	 
	 
	 	 	 	 	 	 
	 	 	Please Print Exact Name of Holder:	 	 
	 
	 
	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	Please Print Exact Name of

Authorized Signatory, if any:	 	 
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	Signature:	 	 
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	Second Signature if held jointly:	 	 
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 

 

 

DISCLOSURE SCHEDULE

Global Employment Solutions, Inc. (“GES”) delivers these Schedules in connection with the
Share Purchase Agreement, dated as of March 31, 2006, among GES, Global Employment Holdings, Inc.
and signatory shareholders of GES (the “SPA”). These Schedules are an integral part of the
SPA, are incorporated therein by reference and are not intended to be an independent document.
Disclosure of any item herein shall not constitute an admission that such item is required to be
disclosed, and the information contained herein is disclosed solely for the purposes of the SPA.
Nothing contained herein shall be deemed to be an admission by any party hereto to any third party
of any matter whatsoever, including, without limitation, any violation of law or breach of
agreement. The schedule numbers in these Schedules correspond to the section numbers in the SPA.
References to any document do not purport to be complete and are qualified in their entirety by the
document itself. Capitalized terms used but not defined herein shall have the same meanings given
them in the SPA.

 

 

Schedule A

Participants in Restricted Stock Plan

(see attached)

 

 

Schedule A to Share Purchase Agreement — Restricted Stock Plan Participants

GES

Restricted Stock Plan Distributions

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Distributed at Close of Reverse Merger
	 	 	Restricted Stock	 	Cash	 	 
	 	 	Allocated Shares	 	Consideration	 	# of Shares ($5.00)
	Investor Payouts
	 	 	 	 	 	 	 	 	 	 	 	 
	Howard Brill
	 	 	716,432.04	 	 	$	3,993,817.33	 	 	 	723,538.15	 
	Robert Pennington
	 	 	240,968.95	 	 	 	1,343,304.02	 	 	 	243,359.06	 
	Robert Larkin
	 	 	207,530.79	 	 	 	1,156,899.83	 	 	 	209,589.24	 
	Lee Elkinson
	 	 	51,768.67	 	 	 	288,589.28	 	 	 	52,282.15	 
	Kenneth Michaels
	 	 	149,838.40	 	 	 	835,288.20	 	 	 	151,324.61	 
	Terry Koch
	 	 	121,090.50	 	 	 	675,030.36	 	 	 	122,291.57	 
	Clinton Burgess
	 	 	82,108.83	 	 	 	457,723.38	 	 	 	82,923.25	 
	Gregory D’Ambrosio
	 	 	77,830.58	 	 	 	433,873.85	 	 	 	78,602.56	 
	Fred Viarrial
	 	 	68,081.52	 	 	 	379,526.80	 	 	 	68,756.80	 
	Daniel Hollenbach
	 	 	48,285.15	 	 	 	269,170.08	 	 	 	48,764.08	 
	Thomas Kennedy
	 	 	20,000.00	 	 	 	111,491.87	 	 	 	20,198.38	 
	Michael Lazrus
	 	 	18,354.05	 	 	 	102,316.35	 	 	 	18,536.10	 
	Derek Golenski
	 	 	11,810.54	 	 	 	65,838.99	 	 	 	11,927.69	 
	John Zaleski
	 	 	11,810.54	 	 	 	65,838.99	 	 	 	11,927.69	 
	Michael Sizemore
	 	 	11,250.00	 	 	 	62,714.18	 	 	 	11,361.59	 
	John Rudakas
	 	 	10,938.00	 	 	 	60,974.90	 	 	 	11,046.49	 
	Stephen Wallach
	 	 	10,000.00	 	 	 	55,745.94	 	 	 	10,099.19	 
	Craig Kasper
	 	 	6,613.91	 	 	 	36,869.83	 	 	 	6,679.51	 
	Sharvani Srinivas
	 	 	6,000.00	 	 	 	33,447.56	 	 	 	6,059.51	 
	Sarah Bullard
	 	 	5,886.00	 	 	 	32,812.06	 	 	 	5,944.38	 
	William Nagel
	 	 	5,463.00	 	 	 	30,454.01	 	 	 	5,517.19	 
	Bill Kilgour
	 	 	5,000.00	 	 	 	27,872.97	 	 	 	5,049.59	 
	Wendell Ellis
	 	 	4,750.00	 	 	 	26,479.32	 	 	 	4,797.11	 
	Barbara Stocks
	 	 	4,724.22	 	 	 	26,335.59	 	 	 	4,771.08	 
	Kimberly LePre
	 	 	4,724.22	 	 	 	26,335.59	 	 	 	4,771.08	 
	Zachary Schnell
	 	 	4,724.22	 	 	 	26,335.59	 	 	 	4,771.08	 
	Deborah Reynolds
	 	 	3,779.37	 	 	 	40,152.78	 	 	 	—	 
	Norma Nunez
	 	 	3,779.37	 	 	 	40,152.78	 	 	 	—	 
	W. Newmaster
	 	 	3,560.00	 	 	 	37,822.11	 	 	 	—	 
	Susan Primrose
	 	 	3,401.44	 	 	 	36,137.50	 	 	 	—	 
	Ralph Moseley
	 	 	3,115.00	 	 	 	33,094.35	 	 	 	—	 
	Srinivas Manepalli
	 	 	2,912.00	 	 	 	30,937.63	 	 	 	—	 
	Ashley Notthoff
	 	 	2,834.53	 	 	 	30,114.59	 	 	 	—	 
	Denyse Robinson
	 	 	2,834.53	 	 	 	30,114.59	 	 	 	—	 
	Susan Brewster
	 	 	2,834.53	 	 	 	30,114.59	 	 	 	—	 
	Monty Shapiro
	 	 	2,694.00	 	 	 	28,621.56	 	 	 	—	 
	Lisa Stanford
	 	 	2,362.11	 	 	 	25,095.49	 	 	 	—	 
	Arnold Tomasello
	 	 	2,301.00	 	 	 	24,446.26	 	 	 	—	 
	Michael DeVlieger
	 	 	1,987.00	 	 	 	21,110.27	 	 	 	—	 
	Douglas Graham
	 	 	2,362.11	 	 	 	25,095.49	 	 	 	—	 
	Elizabeth Matson
	 	 	1,889.69	 	 	 	20,076.39	 	 	 	—	 
	Jennifer Wolochow
	 	 	2,087.42	 	 	 	22,177.11	 	 	 	—	 
	Joel Caballero
	 	 	1,889.69	 	 	 	20,076.39	 	 	 	—	 
	Russell Abramson
	 	 	2,362.11	 	 	 	25,095.49	 	 	 	—	 
	Daniel Gallagher
	 	 	1,742.00	 	 	 	18,507.33	 	 	 	—	 
	Boyd Kelly
	 	 	1,655.00	 	 	 	17,583.04	 	 	 	—	 
	Kevin McCarthy
	 	 	1,655.00	 	 	 	17,583.04	 	 	 	—	 
	Ivette Alon-Kaptzan
	 	 	1,526.00	 	 	 	16,212.51	 	 	 	—	 
	Belia Duke
	 	 	750.00	 	 	 	7,968.14	 	 	 	—	 
	Catherine Byars
	 	 	1,417.27	 	 	 	15,057.29	 	 	 	—	 
	Diane Green
	 	 	1,417.27	 	 	 	15,057.29	 	 	 	—	 
	Rhonda Davis
	 	 	1,417.27	 	 	 	15,057.29	 	 	 	—	 
	Rhonda Wright
	 	 	1,417.27	 	 	 	15,057.29	 	 	 	—	 
	Susan Hudson
	 	 	1,417.27	 	 	 	15,057.29	 	 	 	—	 
	Marilyn Davie
	 	 	1,100.00	 	 	 	11,686.61	 	 	 	—	 
	Patrick Keenan
	 	 	1,079.00	 	 	 	11,463.50	 	 	 	—	 
	Edward Berry
	 	 	1,019.00	 	 	 	10,826.05	 	 	 	—	 
	Rosalie Saraco
	 	 	1,012.00	 	 	 	10,751.68	 	 	 	—	 
	David Lobato
	 	 	1,000.00	 	 	 	10,624.19	 	 	 	—	 
	Stephanie Buongiorno
	 	 	966.00	 	 	 	10,262.97	 	 	 	—	 
	April Loudermilk
	 	 	944.84	 	 	 	10,038.19	 	 	 	—	 
	Jeff Goffinet
	 	 	472.42	 	 	 	5,019.10	 	 	 	—	 
	Jodi Gomberg
	 	 	944.84	 	 	 	10,038.19	 	 	 	—	 
	Lauri Cook
	 	 	944.84	 	 	 	10,038.19	 	 	 	—	 
	Mary Dasher
	 	 	944.84	 	 	 	10,038.19	 	 	 	—	 
	Phil Preston
	 	 	283.45	 	 	 	3,011.46	 	 	 	—	 
	Pollette Jenkins
	 	 	944.84	 	 	 	10,038.19	 	 	 	—	 
	Julie Heath
	 	 	615.00	 	 	 	6,533.88	 	 	 	—	 
	Shashi Sethi
	 	 	600.00	 	 	 	6,374.51	 	 	 	—	 
	Charles LaBenski
	 	 	552.00	 	 	 	5,864.55	 	 	 	—	 
	George Lapworth
	 	 	548.00	 	 	 	5,822.05	 	 	 	—	 
	Mattie Anderson
	 	 	537.00	 	 	 	5,705.19	 	 	 	—	 
	Abigayle Dunn
	 	 	500.00	 	 	 	5,312.09	 	 	 	—	 
	Judith Bates
	 	 	500.00	 	 	 	5,312.09	 	 	 	—	 
	Nicholas Mervosh
	 	 	500.00	 	 	 	5,312.09	 	 	 	—	 
	Rajagopal Vedanthachari
	 	 	500.00	 	 	 	5,312.09	 	 	 	—	 
	Veska Tsenkova
	 	 	500.00	 	 	 	5,312.09	 	 	 	—	 
	Debbie Underkoffler
	 	 	944.84	 	 	 	10,038.19	 	 	 	—	 
	Gavin Meacham
	 	 	472.42	 	 	 	5,019.10	 	 	 	—	 
	Hans Van Ravensberg
	 	 	472.42	 	 	 	5,019.10	 	 	 	—	 
	Kevin Kelly
	 	 	472.42	 	 	 	5,019.10	 	 	 	—	 
	Ron Ellison
	 	 	472.42	 	 	 	5,019.10	 	 	 	—	 
	Tim Dasher
	 	 	944.84	 	 	 	10,038.19	 	 	 	—	 
	Terry Humphrey, Jr.
	 	 	448.00	 	 	 	4,759.64	 	 	 	—	 
	Jai Gulati
	 	 	405.00	 	 	 	4,302.80	 	 	 	—	 
	Ann Thornton
	 	 	283.45	 	 	 	3,011.46	 	 	 	—	 
	Dana Morgan
	 	 	283.45	 	 	 	3,011.46	 	 	 	—	 
	Debra Ponder
	 	 	283.45	 	 	 	3,011.46	 	 	 	—	 
	Joann Johnson
	 	 	283.45	 	 	 	3,011.46	 	 	 	—	 
	Karen Buttram
	 	 	283.45	 	 	 	3,011.46	 	 	 	—	 
	Linda Duckett
	 	 	472.42	 	 	 	5,019.10	 	 	 	—	 
	Phyllis Norman
	 	 	283.45	 	 	 	3,011.46	 	 	 	—	 
	Pilar Holder
	 	 	472.42	 	 	 	5,019.10	 	 	 	—	 
	Shaun Abernathy
	 	 	283.45	 	 	 	3,011.46	 	 	 	—	 
	Wanda McGarity
	 	 	283.45	 	 	 	3,011.46	 	 	 	—	 
	Peggy Sokol
	 	 	236.21	 	 	 	2,509.55	 	 	 	—	 
	Sandy Sanderson
	 	 	236.21	 	 	 	2,509.55	 	 	 	—	 
	Aarthi Krishnaswami
	 	 	209.00	 	 	 	2,220.46	 	 	 	—	 
	Kimberly Warner
	 	 	200.00	 	 	 	2,124.84	 	 	 	—	 
	Pranesh Hanumantha Rao
	 	 	168.00	 	 	 	1,784.86	 	 	 	—	 

 

 

GES

Restricted Stock Plan Distributions

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Distributed at Close of Reverse Merger
	 	 	Restricted Stock	 	Cash	 	 
	 	 	Allocated Shares	 	Consideration	 	# of Shares ($5.00)
	Investor Payouts
	 	 	 	 	 	 	 	 	 	 	 	 
	Preethi Krishnaswami
	 	 	151.00	 	 	 	1,604.26	 	 	 	—	 
	Nitin Raut
	 	 	109.00	 	 	 	1,158.04	 	 	 	—	 
	Albert Barbuzza
	 	 	100.00	 	 	 	1,062.42	 	 	 	—	 
	Amy Alderman
	 	 	100.00	 	 	 	1,062.42	 	 	 	—	 
	Catherine Angove
	 	 	100.00	 	 	 	1,062.42	 	 	 	—	 
	Daniel Reid
	 	 	100.00	 	 	 	1,062.42	 	 	 	—	 
	Darryl James
	 	 	100.00	 	 	 	1,062.42	 	 	 	—	 
	Jaganathan Venkatachalam
	 	 	100.00	 	 	 	1,062.42	 	 	 	—	 
	Jalime Vargas
	 	 	100.00	 	 	 	1,062.42	 	 	 	—	 
	Jenny Lazo
	 	 	100.00	 	 	 	1,062.42	 	 	 	—	 
	Jill McCarthy
	 	 	100.00	 	 	 	1,062.42	 	 	 	—	 
	Jo Anne McCann
	 	 	100.00	 	 	 	1,062.42	 	 	 	—	 
	Karol Wiser
	 	 	100.00	 	 	 	1,062.42	 	 	 	—	 
	Kathleen Martinez
	 	 	100.00	 	 	 	1,062.42	 	 	 	—	 
	Keri Kremer
	 	 	100.00	 	 	 	1,062.42	 	 	 	—	 
	Kevin Dodson
	 	 	100.00	 	 	 	1,062.42	 	 	 	—	 
	Lori Peterson
	 	 	100.00	 	 	 	1,062.42	 	 	 	—	 
	Lucille Sheppard
	 	 	100.00	 	 	 	1,062.42	 	 	 	—	 
	Mary Isla
	 	 	100.00	 	 	 	1,062.42	 	 	 	—	 
	Mindy McLeod
	 	 	100.00	 	 	 	1,062.42	 	 	 	—	 
	Nashira Soto
	 	 	100.00	 	 	 	1,062.42	 	 	 	—	 
	Norma Ramos
	 	 	100.00	 	 	 	1,062.42	 	 	 	—	 
	Paul Young
	 	 	100.00	 	 	 	1,062.42	 	 	 	—	 
	Robert Bacharach
	 	 	100.00	 	 	 	1,062.42	 	 	 	—	 
	Ruth Ricchezza
	 	 	100.00	 	 	 	1,062.42	 	 	 	—	 
	Sharon Semple
	 	 	100.00	 	 	 	1,062.42	 	 	 	—	 
	Simmonette Roxas
	 	 	100.00	 	 	 	1,062.42	 	 	 	—	 
	Susan Barr
	 	 	100.00	 	 	 	1,062.42	 	 	 	—	 
	Teresa Clark
	 	 	100.00	 	 	 	1,062.42	 	 	 	—	 
	Angela Butler
	 	 	73.00	 	 	 	775.57	 	 	 	—	 
	Gail Blanco
	 	 	73.00	 	 	 	775.57	 	 	 	—	 
	Eileen Wagner
	 	 	59.00	 	 	 	626.83	 	 	 	—	 
	Jamie Burton
	 	 	59.00	 	 	 	626.83	 	 	 	—	 
	Padmini Vijayan
	 	 	48.00	 	 	 	509.96	 	 	 	—	 
	Patricia Shanks
	 	 	48.00	 	 	 	509.96	 	 	 	—	 
	Sofia Trbovic
	 	 	45.00	 	 	 	478.09	 	 	 	—	 
	Anand Bhat
	 	 	42.00	 	 	 	446.22	 	 	 	—	 
	Kevin Licciardello
	 	 	42.00	 	 	 	446.22	 	 	 	—	 
	Catherine Taber
	 	 	36.00	 	 	 	382.47	 	 	 	—	 
	Tom Shaginaw
	 	 	472.42	 	 	 	5,019.10	 	 	 	—	 
	Lauren Korchinski
	 	 	283.45	 	 	 	3,011.46	 	 	 	—	 
	MaryKate Berry
	 	 	94.48	 	 	 	1,003.82	 	 	 	—	 
	Jennier Lester
	 	 	94.48	 	 	 	1,003.82	 	 	 	—	 
	Casey Chism
	 	 	283.45	 	 	 	3,011.46	 	 	 	—	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 
	 	 	2,000,000.00	 	 	$	11,623,929.27	 	 	 	1,924,889.11	 
	 	 	 	 	 	 	 

 

 

Schedule 2.2

Outstanding Securities

542,166 warrants are exercisable into 542,166 shares of common stock at $.01 per share, at any time
prior to the earlier of March 13, 2008 or six years after the Company’s senior subordinated notes
are paid in full. The warrants provide the holders the right to require the Company to redeem them
for fair value at any time after July 29, 2003. Pursuant to Section 5.1(d) of the SPA, the
warrants are forfeited to GES and cancelled, without any further action required, in consideration
of the warrant holders’ receiving PubCo common stock and the Special Dividend upon consummation of
the transaction contemplated by the SPA.

2,000,000 shares of GES common stock are issued under the Company’s Restricted Stock Plan; all of
these shares will be repurchased for the amount set forth on Schedule A.

 

 

Schedule 2.3

Subsidiaries

     The table below sets forth all subsidiaries of Global Employment Holdings, Inc. and the state
or other jurisdiction of incorporation or organization of each subsidiary.

	 	 	 	 	 
	 	 	State of
	Subsidiary	 	Incorporation
	Global Merger Corp(1)
	 	CO
	Global Employment Solutions, Inc.(2)
	 	CO
	Excell Personnel Services, Inc.(3)
	 	IL
	PD Quick Temps Inc.(4) (inactive)
	 	PA
	Friendly Advanced Software Technology, Inc.(3)
	 	NY
	Main Line Personnel Service, Inc.(3)
	 	PA
	Southeastern Personnel Management, Inc.(3)
	 	FL
	Southeastern Staffing, Inc.(3)
	 	FL
	Bay HR, Inc.(5)
	 	FL
	Placer Staffing, Inc.(5) (inactive)
	 	CA
	Southeastern Georgia HR, Inc.(5)
	 	GA
	Southeastern Staffing II, Inc.(5)
	 	FL
	Southeastern Staffing III, Inc.(5)
	 	FL
	Southeastern Staffing IV, Inc.(5)
	 	FL
	Southeastern Staffing V, Inc.(5)
	 	FL
	Southeastern Staffing VI, Inc.(5)
	 	FL
	Temporary Placement Service, Inc.(3)
	 	GA

 

			
	(1)	 	Wholly-owned subsidiary of Global Employment Holdings, Inc.
	 
	(2)	 	Majority-owned subsidiary of Global Merger Corp
	 
	(3)	 	Wholly-owned subsidiary of Global Employment Solutions, Inc.
	 
	(4)	 	Wholly-owned subsidiary of Excell Personnel Services, Inc.
	 
	(5)	 	Wholly-owned subsidiary of Southeastern Staffing, Inc.

 

 

Schedule 2.4

Audited Financial Statements FYE 2005

[Part of 8-K]

 

 

Schedule 2.13

Assets

Substantially all the assets of GES and its subsidiaries are secured by the Credit and Security
Agreement with Wells Fargo Bank, National Association, acting through its Wells Fargo Business
Credit operating division.

 

 

Schedule 2.14

Material Contracts

Subordinated Promissory Note Agreement, dated as of July 29, 1988

Warrant Purchase Agreement, dated as of March 13, 1998, as amended, among Global Personnel
Services, Inc., KRG Capital Partners, LLC, KRG Capital Investments IV, LLC, Seacoast Capital
Partners Limited Partnership and Pacific Mezzanine Fund, L.P.

Note Purchase Agreement, dated as of March 13, 1998, among Seacoast Capital Partners Limited
Partnership, Pacific Mezzanine Fund, L.P., Temporary Placement Service, Inc., Excell Personnel
Services Corporation and Global Personnel Services, Inc.

Master Investment Agreement, dates as of November 15, 2001, as amended, among GES, GES’
subsidiaries, Global Investment I, LLC, members of Global Investment I, LLC, and listed individuals
and institutions

2002 Restricted Stock Plan, accompanied by individual 2002 Restricted Stock Purchase Agreements
between GES and named purchasers

Credit and Security Agreement, dated as of Marcy 7, 2002, as amended, between GES and Wells Fargo
Bank, National Association, as successor in interest to Wells Fargo Business Credit, Inc.

Management Agreement with KRG Capital, LLC

Amended and Restated Employment Agreement, dated as of January 1, 2004, between GES and Howard
Brill

Non-Disclosure, Non-Competition, Arbitration & Employment Agreement, dated as of April 4, 2001,
between GES and Robert Larkin

Non-Disclosure, Non-Competition, Arbitration & Employment Agreement, dated as of March 14, 2003,
between GES and Robert S. Pennington

Non-Disclosure, Non-Competition, Arbitration & Employment Agreement, dated as of January 1, 2005,
between GES and Dan Hollenbach

 

 

Schedule 5.10 to SPA

Retirement of Subordinated Debt

	 	 	 	 	 	 	 	 	 
	Loan Details	 	Issued PubCo Stock (#)	 	 	Payment to Retire ($)	 
	Holders of subordinated
notes under the Note
Purchase Agreement,
dated March 13, 1998, as
amended, in the
approximate principal
amount $13,966,000
	 	 	74,702.744	 	 	$	13,592,486.28	 
	Holder of promissory
note dated November 15,
2001, in the approximate
principal amount
$1,500,000
	 	 	8,023.351	 	 	$	1,459,883.25	 
	Holders of subordinated
notes under the
Promissory Note
Agreement, dated July
29, 1988, in the
approximate principal
amount $483,909.42
	 	 	2,588.384	 	 	$	470,967.50

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