Document:

Exhibit 10.7

 

DISPUTE RESOLUTION AGREEMENT

Entered into as of April 13, 2005

among

UNITED CHILE, INC.,

UNITED CHILE VENTURES INC.,

VTR GLOBALCOM S.A.,

LIBERTY COMUNICACIONES DE CHILE UNO LTDA.,

and

CRISTALERÍAS DE CHILE S.A.

 

 

TABLE OF CONTENTS

 

	
  ARTICLE I DEFINITIONS

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE II REPRESENTATIONS AND
  WARRANTIES

  	
   

  
	
  Section 2.1

  	
  Organization; Power and Authority.

  	
   

  
	
  Section 2.2

  	
  Validity

  	
   

  
	
  Section 2.3

  	
  Required Consents

  	
   

  
	
  Section 2.4

  	
  No Conflicts

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE III DISPUTE RESOLUTION

  	
   

  
	
  Section 3.1

  	
  Dispute Resolution.

  	
   

  
	
  Section 3.2

  	
  Multiple Disputes.

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE IV TERM AND TERMINATION

  	
   

  
	
  Section 4.1

  	
  Term

  	
   

  
	
  Section 4.2

  	
  Termination

  	
   

  
	
  Section 4.3

  	
  Survival

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE V MISCELLANEOUS

  	
   

  
	
  Section 5.1

  	
  Entire Agreement

  	
   

  
	
  Section 5.2

  	
  Governing Law

  	
   

  
	
  Section 5.3

  	
  Further Assurances; Compliance with Laws

  	
   

  
	
  Section 5.4

  	
  Limitation on Damages

  	
   

  
	
  Section 5.5

  	
  Headings

  	
   

  
	
  Section 5.6

  	
  Notices

  	
   

  
	
  Section 5.7

  	
  Severability

  	
   

  
	
  Section 5.8

  	
  Amendment; Waiver

  	
   

  
	
  Section 5.9

  	
  Assignment and Binding Effect

  	
   

  
	
  Section 5.10

  	
  No Benefit to Others

  	
   

  
	
  Section 5.11

  	
  Counterparts

  	
   

  
	
  Section 5.12

  	
  Interpretation.

  	
   

  
	
  Section 5.13

  	
  Rules of Construction

  	
   

  
	
   

  	
   

  	
   

  
	
  Exhibit A

  	
  Potential Party Arbitrators

  	
   

  
	
  Exhibit B

  	
  Potential Third Arbitrators

  	
   

  
				

 

i

 

DISPUTE RESOLUTION AGREEMENT

 

This Dispute
Resolution Agreement is entered into as of April 13, 2005, by and among

 

UNITED
CHILE, INC., a corporation duly incorporated and
validly existing under the Laws of the State of Colorado, U.S.A., with domicile
at 4643 South Ulster Street, Suite 1300, Denver, CO 80237, U.S.A. (“United
Chile”);

 

UNITED
CHILE VENTURES INC., a corporation duly incorporated
and validly existing under the Laws of the Cayman Islands, with domicile at
4643 South Ulster Street, Suite 1300, Denver, CO 80237, U.S.A. (“United
Chile Ventures”);

 

VTR
GLOBALCOM S.A., a sociedad anónima
duly organized and validly existing under the Laws of Chile, with domicile at
Reyes Lavalle 3340, 9th Floor, Las Condes, Santiago, Chile (“VTR”);

 

LIBERTY
COMUNICACIONES DE CHILE UNO LTDA., a sociedad de responsabilidad
limitada duly organized and validly existing under the laws of Chile
(“Uno”), with domicile at Isidora Goyenechea 3120, Third Floor, Las
Condes, Santiago, Chile;

 

CRISTALERÍAS
DE CHILE S.A., a sociedad anónima
duly organized and validly existing under the Laws of Chile, with domicile at
Hendaya 60, Suite 201, Las Condes, Santiago, Chile (“CCC”); and

 

CRISTALCHILE
INVERSIONES S.A., a sociedad
anónima duly organized and validly existing under the Laws of Chile,
with domicile at Hendaya 60, Suite 201, Las Condes, Santiago, Chile (“CCInversiones”).

 

United Chile,
United Chile Ventures, VTR, Uno, CCC, and CCInversiones are sometimes referred
to herein individually as a “Party” and collectively as the “Parties.”  Capitalized terms used and not otherwise
defined in this Agreement have the respective meanings ascribed thereto in Article I.

 

RECITALS

 

A.            Uno owns (a) shares
representing 50% of the outstanding share capital of Metrópolis-Intercom S.A.,
a Chilean sociedad
anónima (“Metrópolis”), (b) one share of Proser S.A., a
Chilean sociedad
anónima (“Proser”), and (c) the Metrópolis/Uno
Shareholder Debt.

 

B.            CCC owns (a) shares
representing 50% of the outstanding share capital of Metrópolis, (b) one
share of Proser, and (c) indirectly through a wholly owned Subsidiary, the
Metrópolis/CCC Shareholder Debt.

 

C.            Metrópolis owns the
remaining share capital of Proser.

 

D.            Simultaneously with
the execution and delivery of this Agreement by the Parties, (a) CCC, Uno,
and VTR are entering into a Purchase and Contribution Agreement, dated as of

 

1

 

the date
hereof (including the Exhibits, Disclosure Schedules (but not the Metrópolis
Disclosure Bundle), and other Schedules attached thereto, the “Purchase and
Contribution Agreement”), pursuant to which (i) Uno is selling to VTR,
and VTR is purchasing from Uno, all but one share of the issued and outstanding
share capital of Metrópolis that is owned by Uno, in consideration for, among
other things, a deferred purchase price obligation; (ii) Uno is
transferring to VTR Net S.A. the remaining share of Metrópolis and the single
share of Proser that are owned by Uno; (iii) Uno is selling to VTR the
Metrópolis/Uno Shareholder Debt pursuant to the Uno Debt DPPO; (iv) CCC is
contributing to VTR all of the issued and outstanding share capital of
Metrópolis that is owned by CCC in consideration for, among other things, newly
issued shares of VTR Stock representing 20% of the outstanding share capital of
VTR after such issuance; (v) CCC is transferring to Metrópolis the single
share of Proser that is owned by CCC; and (vi) CCC is causing
CCInversiones to sell to VTR the Metrópolis/CCC Shareholder Debt pursuant to
the CCC Debt DPPO; and (b) United Chile, United Chile Ventures, CCC, and
VTR are entering into a Shareholders Agreement, dated as of the date hereof
(including the Exhibits and Schedules attached thereto, the “Shareholders
Agreement”).

 

E.             The Parties desire to
enter into this Agreement to establish certain rights, responsibilities, and
obligations by and among themselves related to the resolution of Disputes
arising out of or related to any of the Chilean Transaction Documents (as
defined below).

 

AGREEMENT

 

In
consideration of the mutual promises, covenants, and agreements set forth
herein and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Parties hereby agree as follows:

 

ARTICLE I

DEFINITIONS

 

For purposes
of this Agreement, the following terms will have the following meanings:

 

Agreement:  This Dispute Resolution Agreement (including
the Exhibits attached hereto).

 

Business Day:  Any day other than Saturday, Sunday, and a
day on which banks in Denver, Colorado, U.S.A. or Santiago, Chile are required
or permitted to close.

 

CAM Santiago:  As defined in Section 3.1(a).

 

CAM Santiago’s
List:  As
defined in Section 3.1(c).

 

CCC:  As defined in the preamble.

 

CCC Debt DPPO:  As defined in the Purchase and Contribution
Agreement.

 

CCInversiones:  As defined in the preamble.

 

Chile:  The Republic of Chile.

 

2

 

Chilean
Transaction Documents: 
This Agreement, the Purchase and Contribution Agreement, the
Shareholders Agreement, the CCC Subscription and Transfer Agreement (as defined
in the Purchase and Contribution Agreement), the Uno Transfer Agreement (as
defined in the Purchase and Contribution Agreement), the CCC Debt DPPO, and the
Uno Debt DPPO.

 

Contract:  Any note, bond, indenture, debenture,
security agreement, trust agreement, mortgage, lease, contract, license,
franchise, permit, guaranty, joint venture agreement, or other agreement,
instrument, commitment, or obligation, whether oral or written.

 

Dispute:  As defined in Section 3.1(a).

 

Entity:  Any sociedad anónima,
sociedad de responsabilidad limitada,
corporation, general or limited partnership, limited liability company, joint
venture, trust, association, unincorporated entity of any kind, or Governmental
Authority.

 

Governing
Documents:  The estatutos sociales, escritura de constitución
social, articles or certificate of incorporation or association,
general or limited partnership agreement, limited liability company or
operating agreement, bylaws, or other governing documents of any Entity.

 

Governmental
Authority:  Any
Chilean national, regional, or local, or any foreign, court, governmental
department, commission, authority, board, bureau, agency, official, or other
instrumentality.

 

Joinder Notice:  As defined in Section 3.2(a).

 

Joining Party:  As defined in Section 3.2(a).

 

Judgment:  Any judgment, writ, order, decree, injunction,
award, restraining order, or ruling of or by any court, judge, justice,
arbitrator, or magistrate, including any bankruptcy court or judge, and any
writ, order, decree, or ruling of or by any Governmental Authority.

 

Law:  Any Chilean national, regional, or local, or
any foreign, statute, code, ordinance, rule, regulation, Judgment, regulatory
agreement with a Governmental Authority, or general principle of common or
civil law or equity.

 

Licenses:  All franchises, concessions, licenses,
permits, authorizations, certificates, variances, exemptions, consents, leases,
rights of way, easements, instruments, orders, and approvals issued by or
pending with any Governmental Authority.

 

List of Party
Arbitrators:  As
defined in Section 3.1(c).

 

List of Third
Arbitrators:  As
defined in Section 3.1(c).

 

Metrópolis:  As defined in the recitals.

 

Metrópolis/CCC
Shareholder Debt: 
As defined in the Purchase and Contribution Agreement.

 

3

 

Metrópolis/Uno
Shareholder Debt: 
As defined in the Purchase and Contribution Agreement.

 

Party
or Parties:  As defined in the
preamble.

 

Pending
Arbitration:  As
defined in Section 3.2(a).

 

Person:  Any natural person or Entity.

 

Proser:  As defined in the recitals.

 

Purchase and Contribution
Agreement:  As
defined in the recitals.

 

Rules:  As defined in Section 3.1(a).

 

Shareholders
Agreement:  As
defined in the recitals.

 

Subsidiary:  With respect to any Person:

 

(a)           a
corporation a majority in voting power of whose share capital with voting
power, under ordinary circumstances, to elect directors is at the time,
directly or indirectly, owned by such Person, by a Subsidiary of such Person,
or by such Person and one or more Subsidiaries of such Person,

 

(b)           a
partnership or limited liability company in which such Person or a Subsidiary
of such Person is, at the date of determination, (i) in the case of a
partnership, a general partner of such partnership with the power affirmatively
to direct the policies and management of such partnership or (ii) in the
case of a limited liability company, the managing member or, in the absence of
a managing member, a member with the power affirmatively to direct the policies
and management of such limited liability company, or

 

(c)           any
Entity (other than a corporation, partnership, or limited liability company) in
which such Person, a Subsidiary of such Person, or such Person and one or more
Subsidiaries of such Person, directly or indirectly, at the date of
determination thereof, has (i) the power to elect or direct the election
of a majority of the members of the governing body of such Person or (ii) in
the absence of such a governing body, at least a majority ownership interest.

 

Third
Anniversary:  As
defined in Section 3.1(c).

 

UGC/LMI Merger
Agreement:  The
Agreement and Plan of Merger, dated as of January 17, 2005, by and among
New Cheetah, Inc., a Delaware corporation, Liberty Media International, Inc.,
a Delaware corporation, UnitedGlobalCom, Inc., a Delaware corporation,
Cheetah Acquisition Corp., a Delaware corporation, and Tiger Global Acquisition
Corp., a Delaware corporation.

 

United Chile:  As defined in the preamble.

 

4

 

United Chile
Ventures:  As
defined in the preamble.

 

United Parties:  United Chile, United Chile Ventures, VTR,
and, upon and after the consummation of the transactions contemplated by the
UGC/LMI Merger Agreement or if it otherwise becomes a Subsidiary of UGC, Uno.

 

Uno:  As defined in the preamble.

 

Uno Debt DPPO:  As defined in the Purchase and Contribution
Agreement.

 

VTR:  As defined in the preamble.

 

ARTICLE II

REPRESENTATIONS AND WARRANTIES

 

Each Party
hereby represents and warrants with respect to itself to the other Parties as
follows:

 

Section 2.1             Organization;
Power and Authority.

 

(a)           Organization.  It is duly organized, validly existing, and
in good standing under the Laws of its jurisdiction of organization.

 

(b)           Power and Authority.  It has all requisite power and authority to
enter into and perform its obligations under this Agreement; and its execution
and delivery of this Agreement and the performance of its obligations hereunder
have been duly authorized by all requisite action.

 

Section 2.2             Validity.  This Agreement has been duly executed and
delivered by it, and, assuming the due execution and delivery by each other
Party, this Agreement constitutes its legal, valid, and binding obligation,
enforceable against it in accordance with its terms, except as such
enforceability may be affected by applicable bankruptcy, reorganization,
insolvency, moratorium, or similar Laws affecting creditors’ rights generally.

 

Section 2.3             Required
Consents.  It has obtained all
authorizations, permits, approvals, waivers, or consents of, delivered all
notices to, and made all registrations, declarations, applications, or filings
with, any Persons required in connection with its execution and delivery of,
and its performance of its obligations under, this Agreement, except as would
not, individually or in the aggregate, materially adversely affect its ability
to perform its obligations hereunder.

 

Section 2.4             No
Conflicts.  Its execution and
delivery hereof, and its performance of its obligations hereunder, do not (a) violate
or conflict with any provision of its Governing Documents, (b) violate any
of the terms, conditions, or provisions of any Law or License to which it is
subject or by which it or any of its assets is bound, except that no
representation is made with respect to any Law of any foreign jurisdiction in
which it does not, directly or through a Subsidiary, own assets or engage in
business, or (c) violate, breach, or (with or without the giving of notice
or lapse of time or both) constitute a default (or give rise to any right of

 

5

 

termination, cancellation, acceleration, repurchase, prepayment,
repayment, or increased payments) under, or give rise to or accelerate any
material obligation (including any obligation to, or to offer to, repurchase,
prepay, repay, or make increased payments), or result in the loss or
modification of any material benefit under, or pursuant to, any Contract to
which it is a party or by which it or any of its assets is bound, except in
each case as would not, individually or in the aggregate, materially adversely
affect its ability to perform its obligations hereunder.

 

ARTICLE III

DISPUTE RESOLUTION

 

Section 3.1             Dispute
Resolution.

 

(a)           Any controversy, claim, or dispute between or among two or
more Parties (but not including any dispute with respect to which all of the
parties thereto are United Parties) that arises out of or relates to any
Chilean Transaction Document to which such Parties are party, including any
claim or controversy relating to the interpretation, breach, termination, or
invalidity of any provision thereof (a “Dispute”), and that is not
otherwise settled by agreement between such Parties, will be exclusively and
finally settled by binding arbitration under the Rules of Arbitration (the
“Rules”) of the Arbitration and Mediation Center of the Santiago Chamber
of Commerce (“CAM Santiago”) in effect on the date of this Agreement,
except to the extent the Rules conflict with the provisions of this Section 3.1,
in which event the provisions of this Section 3.1 will control.  The Parties specifically agree that any legal
action, including the filing of any precautionary actions (medidas
precautorias) or pre-judicial actions (medidas
prejudiciales) will be recognized and resolved by the arbitral
tribunal appointed in accordance with this Section 3.1, provided, however,
that, at any time before an arbitral tribunal is effectively in place, any
Party may file precautionary actions (medidas precautorias)
or pre-judicial actions (medidas prejudiciales)
before a court of competent jurisdiction to the extent necessary to preserve
the status quo pending the final outcome of an arbitration proceeding under
this Section 3.1.

 

(b)           The arbitration will be commenced when any Party to the
Dispute in question files with CAM Santiago a written Request for Arbitration (Solicitud de Arbitraje), as provided in the CAM Santiago
Arbitration Guide (Guía de Arbitraje) then in
effect, with a copy to all other Parties, including any Party who is not named
as a respondent in the arbitration; provided, however, that no
such Party will be required to commence an arbitration proceeding in lieu of
settlement of such Dispute by agreement. 
Notwithstanding any provision to the contrary in the Rules, the official
language of the arbitration will be English but (i) any Party may elect to
submit documents or other information to the arbitral tribunal in English or
Spanish, (ii) any witness whose native language is not English may elect
to give testimony in English or in Spanish, with simultaneous translation into
English if such testimony is given in Spanish, and (iii) the arbitral
tribunal must communicate awards, orders, and other written communications to
the parties to the arbitration in both English and Spanish.  If simultaneous translation is so made, the
translator will be appointed by the arbitral tribunal.  Each Party may also hire a translator at the
Party’s own expense, and may participate in the examination and
cross-examination of witnesses at any hearing. 
Each Party will bear its own costs and expenses in connection with such
arbitration, unless the arbitral tribunal determines otherwise.

 

6

 

(c)           The arbitration must be conducted before three arbitrators,
each of whom (regardless of how or by whom appointed, and whether selected from
the List of Party Arbitrators or CAM Santiago’s List) must be (1) a
lawyer, (2) fluent in English and Spanish, and (3) experienced in
arbitrating international commercial disputes. 
Within 30 days after the filing of the Request for Arbitration, the
arbitrators will be selected in accordance with the following sentences of this
Section 3.1(c).  Each Party that is
a party to the Dispute (for which purpose all United Parties will be counted as
a single Party) will select one arbitrator (i) from among the members on
the list attached hereto as Exhibit A (the “List of Party Arbitrators”)
if the arbitration is commenced on or before the third anniversary of date
hereof (the “Third Anniversary”), or (ii) from among the members on
CAM Santiago’s list of arbitrators (“CAM Santiago’s List”) if (A) the
arbitration is commenced on or before the Third Anniversary but none of the
arbitrators selected by such Party from the List of Party Arbitrators is
willing to act as such Party’s arbitrator in connection with such Dispute or (B) the
arbitration is commenced after the Third Anniversary.  If any such Party fails to appoint one
arbitrator during such 30-day period, then the other of such Parties may
deliver a written notice to CAM Santiago, requesting CAM Santiago to select
such arbitrator from among the members on the List of Party Arbitrators (if the
arbitration is commenced on or before the Third Anniversary) or from among the
members on CAM Santiago’s List (if the arbitration is commenced on or before the
Third Anniversary but none of the arbitrators selected by CAM Santiago from the
List of Party Arbitrators is willing to act as such arbitrator in connection
with such Dispute or the arbitration is commenced after the Third Anniversary),
in either case in accordance with this Section 3.1(c) and the
Rules.  The first two arbitrators
selected by the Parties in accordance with the preceding sentences of this Section 3.1(c) will
then select the third arbitrator (and will designate such third arbitrator the
chair of the arbitral tribunal) (y) from among the members on the list
attached hereto as Exhibit B (the “List of Third Arbitrators”) if
the arbitration is commenced on or before the Third Anniversary, or
(z) from among the members on CAM Santiago’s List if (A) the
arbitration is commenced on or before the Third Anniversary but none of the
arbitrators selected by the first two arbitrators from the List of Third
Arbitrators is willing to act as the third arbitrator in connection with such
Dispute or (B) the arbitration is commenced after the Third
Anniversary.  If the first two
arbitrators are unable to agree on the third arbitrator within 30 days after
the second arbitrator is selected in accordance with the preceding sentences of
this Section 3.1(c), then thereafter the first two arbitrators or any
Party that is a party to the Dispute may deliver a written notice to CAM
Santiago, requesting CAM Santiago to select the third arbitrator from among the
members on the List of Third Arbitrators (if the arbitration is commenced on or
before the Third Anniversary) or from among the members on CAM Santiago’s List
(if the arbitration is commenced on or before the Third Anniversary but none of
the arbitrators selected by CAM Santiago from the List of Third Arbitrators is willing
to act as such arbitrator in connection with such Dispute or the arbitration is
commenced after the Third Anniversary), and requesting CAM Santiago to
designate him or her as the chair of the arbitral tribunal, in each case in
accordance with this Section 3.1(c) and the Rules.  All arbitrators selected pursuant to this Section 3.1(c),
whether by any Party, or by the first two arbitrators selected by the Parties,
or by CAM Santiago, will be subject to challenge and rejection by the Parties
that are parties to the Dispute for bias or any other grounds for
disqualification or recusal recognized under Chilean Law or the Rules.  In addition to the preceding sentence, if the
third arbitrator is selected by CAM Santiago (but not by the first two
arbitrators selected by the Parties), each Party that is a party to the Dispute
will have the right, for any reason or for no reason, to challenge and reject

 

7

 

one, but not more than one, third arbitrator so selected by CAM
Santiago with respect to such Dispute. 
The Parties hereby grant to CAM Santiago an irrevocable special limited
power of attorney to enable CAM Santiago, if necessary, to appoint, as
applicable, any Party’s arbitrator and any third arbitrator (and to designate
such third arbitrator as the chair of the arbitral tribunal), in each case in
accordance with the Rules and this Section 3.1(c).

 

(d)           The arbitration will be seated in the city of Santiago,
Chile, or such other place as is unanimously agreed in writing by the parties
to the arbitration.  Notwithstanding Article 34
or any other provision of the Rules to the contrary, the arbitrators on
the arbitral tribunal will act as árbitros mixtos,
and will therefore be free to determine the procedures it will use and follow
(as long as the parties to the arbitration are given adequate notice of such
procedures); but any Dispute to be resolved by the arbitral tribunal will be
resolved in accordance with Chilean Laws, with the exception of the procedural
provisions contained in the Rules and in this Agreement, which provisions
will be applied.

 

(e)           The Parties agree that they will use their best commercially
reasonable efforts to encourage the arbitral tribunal to enter a final award
resolving the Dispute within 180 days from the appointment of the arbitral
tribunal, unless it would be impracticable to do so due to the joinder of
additional claims pursuant to and in accordance with Section 3.2.  Notwithstanding any provision to the contrary
in this Section 3.1, the Parties to any arbitration proceeding under this Section 3.1
may agree at any time to discontinue and terminate such arbitration proceeding.

 

(f)            Any award of the arbitral
tribunal will be final and binding upon the parties to the arbitration
proceeding.  Any rights to appeal the
arbitral award, or to request any court or tribunal to review the arbitral
award for purposes other than enforcement pursuant to the following sentence,
are hereby waived to the maximum extent permitted by Law.  The award may be enforced against the parties
to the arbitration proceeding or their assets wherever they may be found and
judgment upon the award may be entered in any court of competent jurisdiction.

 

Section 3.2             Multiple
Disputes.

 

(a)           At any time up to and including the date that is 60 days
after the date all three arbitrators have been selected and the arbitral
tribunal is effectively in place, any Party (a “Joining Party”) may join
as a party to any pending arbitration commenced hereunder by another Party (a “Pending
Arbitration”) by submitting written notice (the “Joinder Notice”) to
the other Parties, the arbitral tribunal (if any), and CAM Santiago.  The Joinder Notice must include:  (i) a statement of the Joining Party’s
intention to join the Pending Arbitration; and (ii) a statement of any
claims (whether related to the Disputes in the Pending Arbitration or to other
Disputes) that the Joining Party wishes to assert in the Pending
Arbitration.  The arbitral tribunal in
the Pending Arbitration must resolve all claims stated in the Joinder Notice,
and must otherwise permit the Joining Party to participate in the Pending
Arbitration as if the Joining Party had been a party to the Pending Arbitration
since the date it was commenced.  Upon
receipt of a Joinder Notice, the arbitral tribunal must issue an order to
consolidate the claims stated in the Joinder Notice with the other claims in
the Pending Arbitration.  If the arbitral
tribunal refuses to permit consolidation of the claims stated in a timely-filed
Joinder Notice, such refusal will not preclude the Party seeking such
consolidation from bringing such claims in a separate arbitration proceeding
commenced under Section 3.1.

 

8

 

(b)           If there is a Pending Arbitration commenced under Section 3.1,
then until the entry of a final award in the Pending Arbitration, no Party may
commence another arbitration under Section 3.1 with respect to any Dispute
that is the subject of the Pending Arbitration, although any other Party may
join the Pending Arbitration as permitted in Section 3.2(a).  Subject to the first sentence of this Section 3.2(b),
if a Dispute arises while there is a Pending Arbitration but after the time for
filing a Joinder Notice has expired, a Party may commence a new arbitration
with regard to such Dispute.

 

ARTICLE IV
TERM AND
TERMINATION

 

Section 4.1             Term.  The term of this Agreement will commence upon
the date this Agreement is executed and delivered by all of the Parties.

 

Section 4.2             Termination.  This Agreement will terminate upon the mutual
agreement of the Parties.

 

Section 4.3             Survival.  The provisions of this Agreement will survive
the termination of any Chilean Transaction Document to the full extent
necessary for their enforcement and the protection of the Party in whose favor
they run, and each Party will remain liable for any breach of any Chilean
Transaction Document by such Party before such termination.  No termination of a Chilean Transaction
Document with respect to all Parties or any Party will affect any obligation or
liability of any Party arising before or as a result of circumstances in
existence before such termination.

 

ARTICLE V

MISCELLANEOUS

 

Section 5.1             Entire
Agreement.  This Agreement contains,
and is intended as, a complete statement of all of the terms of the agreements
between the Parties with respect to the matters provided for herein, and
supersedes and discharges any previous agreements and understandings between
the Parties with respect to those matters.

 

Section 5.2             Governing
Law.  This Agreement will be governed
by and construed in accordance with the Laws of Chile, without regard to
principles governing conflicts of law.

 

Section 5.3             Further
Assurances; Compliance with Laws. 
Each Party hereby agrees to furnish upon request to the other Parties
such further information, to execute and deliver to such other Parties such
other documents, and to do such other acts and things, all as such other
Parties may reasonably request for the purpose of carrying out the intent and
accomplishing the purposes of this Agreement. 
The Parties hereby agree that in the performance of their respective
obligations under this Agreement, they will comply with all applicable Laws.

 

Section 5.4             Limitation
on Damages.  No Party will be liable
for any indirect, special, incidental, or consequential loss or damage, lost
profits, loss of use, or lost revenues suffered by the other Party arising from
or relating to a Party’s performance, non-performance, breach of or default
under a covenant, warranty, representation, term, or condition of this
Agreement or any Chilean Transaction Document. 
Each Party waives and relinquishes claims for such indirect,

 

9

 

special, incidental, or consequential losses or damages, lost profits,
loss of use, or lost revenues.  The
limitations on liability and damages set forth in this Section 5.4 apply
to all causes of action that may be asserted hereunder, whether sounding in
breach of contract, breach of warranty, tort, product liability, negligence, or
otherwise.

 

Section 5.5             Headings.  The article and section headings of
this Agreement are for reference purposes only and are to be given no effect in
the construction or interpretation of this Agreement.

 

Section 5.6             Notices.  All notices and other communications
hereunder will be in writing and will be delivered personally, telecopied (if
receipt of which is confirmed by the Person to whom sent), sent by
internationally recognized overnight delivery service or mailed by registered
or certified mail (if return receipt is requested) to the Parties at the
following addresses (or to such other Person or address for a Party as
specified by such Party by like notice) (notice will be deemed given and
received upon receipt, if delivered personally, by overnight delivery service
or by telecopy, or on the third Business Day following mailing, if mailed,
except that notice of a change of address will not be deemed given until
actually received):

 

(a)           If to United Chile, or United Chile Ventures, to it at:

 

 

	
   

  	
  c/o
  UnitedGlobalCom, Inc.

  
	
   

  	
  4643 South
  Ulster Street, #1300

  
	
   

  	
  Denver,
  Colorado 80237 U.S.A.

  
	
   

  	
  Attention:
  General Counsel

  
	
   

  	
  Telephone:
  303 770-4001

  
	
   

  	
  Telecopier:
  303 220-3117

  
	
   

  	
   

  
	
   

  	
  with a copy
  to:

  
	
   

  	
   

  
	
   

  	
  Holme Roberts &
  Owen LLP

  
	
   

  	
  1700 Lincoln
  Street

  
	
   

  	
  Suite 4100

  
	
   

  	
  Denver,
  Colorado 80203 U.S.A.

  
	
   

  	
  Attention:

  	
  W. Dean
  Salter

  
	
   

  	
   

  	
  Paul G.
  Thompson

  
	
   

  	
  Telephone:
  303 861-7000

  
	
   

  	
  Telecopier:
  303 861-0200

  

 

10

 

(b)           If to VTR, to it at:

 

	
   

  	
  Reyes Lavalle
  3340

  
	
   

  	
  9th Floor

  
	
   

  	
  Las Condes,
  Santiago

  
	
   

  	
  Chile

  
	
   

  	
  Attention:
  Vicepresidente de Asuntos Legales

  
	
   

  	
  Telephone:
  562 310-1419

  
	
   

  	
  Telecopier:
  562 310-1561

  
	
   

  	
   

  
	
   

  	
  with copies
  to:

  
	
   

  	
   

  
	
   

  	
  UnitedGlobalCom, Inc.

  
	
   

  	
  4643 South
  Ulster Street, #1300

  
	
   

  	
  Denver,
  Colorado 80237 U.S.A.

  
	
   

  	
  Attention:
  General Counsel

  
	
   

  	
  Telephone:
  303 770-4001

  
	
   

  	
  Telecopier:
  303 220-3117

  
	
   

  	
   

  
	
   

  	
  and to:

  
	
   

  	
   

  
	
   

  	
  Holme Roberts &
  Owen LLP

  
	
   

  	
  1700 Lincoln
  Street

  
	
   

  	
  Suite 4100

  
	
   

  	
  Denver,
  Colorado 80203 U.S.A.

  
	
   

  	
  Attention:

  	
  W. Dean
  Salter

  
	
   

  	
   

  	
  Paul G.
  Thompson

  
	
   

  	
  Telephone:
  303 861-7000

  
	
   

  	
  Telecopier:
  303 861-0200

  

 

(c)           If to Uno, to it at:

 

	
   

  	
  c/o Liberty
  Media International, Inc.

  
	
   

  	
  12300 Liberty
  Boulevard

  
	
   

  	
  Englewood,
  Colorado 80112 U.S.A.

  
	
   

  	
  Attention:
  Elizabeth M. Markowski

  
	
   

  	
  Telephone:
  720 875-6209

  
	
   

  	
  Telecopier:
  720 875-5858

  
	
   

  	
   

  
	
   

  	
  and, prior to
  the consummation of the transactions contemplated by the UGC/LMI Merger
  Agreement or if such agreement is terminated without such consummation
  occurring, with a copy to:

  
	
   

  	
   

  
	
   

  	
  Sherman &
  Howard L.L.C.

  
	
   

  	
  633
  Seventeenth Street

  
	
   

  	
  Suite 3000

  
	
   

  	
  Denver, Colorado
  80202

  
	
   

  	
  Attention:
  Amy L. Hirter

  

 

11

 

	
   

  	
  Telephone:
  303 299-8102

  
	
   

  	
  Telecopier:
  303 298-0940

  
	
   

  	
   

  
	
   

  	
  and,
  following the consummation of the transactions contemplated by the UGC/LMI
  Merger Agreement or if Uno otherwise becomes a Subsidiary of UGC, with a copy
  to:

  
	
   

  	
   

  
	
   

  	
  Holme Roberts &
  Owen LLP

  
	
   

  	
  1700 Lincoln
  Street

  
	
   

  	
  Suite 4100

  
	
   

  	
  Denver,
  Colorado 80203 U.S.A.

  
	
   

  	
  Attention:

  	
  W. Dean
  Salter

  
	
   

  	
   

  	
  Paul G.
  Thompson

  
	
   

  	
  Telephone:
  303 861-7000

  
	
   

  	
  Telecopier:
  303 861-0200

  

 

(d)           If to CCC or CCInversiones, to it at:

 

	
   

  	
  Hendaya 60

  
	
   

  	
  Piso 14, Las
  Condes

  
	
   

  	
  Santiago,
  Chile

  
	
   

  	
  Attention:
  Juan Antonio Alvarez

  
	
   

  	
  Telephone:
  562 330-7218

  
	
   

  	
  Telecopier:
  562 331-5153

  
	
   

  	
   

  
	
   

  	
  with a copy
  to:

  
	
   

  	
   

  
	
   

  	
  Attention:
  Baltazar Sánchez

  
	
   

  	
  Telephone:
  562 441-3702

  
	
   

  	
  Telecopier:
  562 441-3701

  

 

Section 5.7             Severability.  If at any time any covenant or provision
contained herein is deemed by a court or other body of competent jurisdiction
(including the arbitral tribunal under Section 3.1) to be invalid or unenforceable,
such covenant or provision will be considered divisible and such covenant or
provision will be deemed immediately amended and reformed to include only such
part of such covenant or provision as such court or other body has held to be
valid and enforceable; and the Parties agree that such covenant or provision,
as so amended and reformed, will be valid and binding as though the invalid or
unenforceable portion had not been included herein.

 

Section 5.8             Amendment;
Waiver.  No provision of this Agreement
may be amended or modified except by an instrument or instruments in writing
signed by the Parties and designated as an amendment or modification; provided,
however, that with respect to any particular Dispute, the Parties that
are party to such Dispute may amend or modify any provision of this Agreement
by an instrument or instruments in writing signed by such Parties and
designated as an amendment or modification, as the case may be, but such
amendment or modification, as the case may be, will apply only with respect to
such Parties with respect to such particular Dispute.  No waiver by any Party of any provision of
this Agreement will be valid unless in writing and

 

12

 

signed by the Party making such waiver and designated as a waiver; provided,
however, that with respect to any particular Dispute, the Parties that
are party to such Dispute may waive any provision of this Agreement by an
instrument or instruments in writing signed by such Parties and designated as a
waiver, but such waiver will apply only with respect to such Parties with
respect to such particular Dispute.  No
failure or delay by any Party in exercising any right, power, or remedy
hereunder will operate as a waiver thereof, nor will any single or partial
exercise thereof or the exercise of any other right, power, or remedy preclude
any further exercise thereof or the exercise of any other right, power, or
remedy.  No waiver of any provision
hereof will be construed as a waiver of any other provision.

 

Section 5.9             Assignment
and Binding Effect.  No Party may
assign any of its rights or delegate any of its duties under this Agreement,
except (a) in connection with an assignment of rights or delegation of
duties under, pursuant to, and in accordance with any applicable Chilean
Transaction Document, and (b) with the assumption by the applicable
assignee of the duties of the assignor under this Agreement to the extent of
such assignment of rights or delegation of duties under the applicable Chilean
Transaction Document.  All of the terms
and provisions of this Agreement will be binding on, and will inure to the
benefit of, the respective successors and permitted assigns of the Parties.

 

Section 5.10           No
Benefit to Others.  The
representations, warranties, covenants, and agreements contained in this
Agreement are for the sole benefit of the Parties and their respective
successors and permitted assigns, and they will not be construed as conferring
and are not intended to confer any rights, remedies, obligations, or
liabilities on any other Person, unless such Person is expressly stated to be
entitled to any such right, remedy, obligation, or liability.

 

Section 5.11           Counterparts.  This Agreement may be executed by the Parties
in separate counterparts, each of which when so executed and delivered will be
an original, but all such counterparts will together constitute one and the
same instrument.

 

Section 5.12           Interpretation.

 

(a)           As used herein, except as otherwise indicated herein or as
the context may otherwise require: (i) the words “include,” “includes,”
and “including” are deemed to be followed by “without limitation” whether or
not they are in fact followed by such words or words of like import; (ii) the
words “hereof,” “herein,” “hereunder,” and comparable terms refer to the
entirety of this Agreement, including the Exhibits hereto, and not to any
particular article, section, or other subdivision hereof or Exhibit hereto;
(iii) any pronoun will include the corresponding masculine, feminine, and
neuter forms; (iv) the singular includes the plural and vice versa; (v) references
to any agreement or other document are to such agreement or document as
amended, modified, supplemented, and restated now or hereafter from time to
time; (vi) references to any statute or regulation are to it as amended,
modified, supplemented, and restated now or hereafter from time to time, and to
any corresponding provisions of successor statutes or regulations; (vii) references
to “Article,” “Section,” or another subdivision or to an “Exhibit” are to an
article, section, or subdivision hereof or an “Exhibit” hereto; and (viii) except
as otherwise expressly provided in this Agreement, references to any Person or
Entity include such Person’s or Entity’s successors and permitted assigns.

 

13

 

(b)           Any reference herein to a “day” or number of “days” (without
the explicit qualification of “Business”) will be deemed to refer to a calendar
day or number of calendar days.  If any
action or notice is to be taken or given on or by a particular calendar day,
and such calendar day is not a Business Day, then such action or notice may be
taken or given on the next succeeding Business Day.

 

Section 5.13           Rules of
Construction.  The Parties agree that
they have been represented by counsel during the negotiation, preparation, and
execution of this Agreement and, therefore, waive the application of any Law or
rule of construction providing that ambiguities in an agreement or other
document will be construed against the Party drafting such agreement or
document.

 

[Remainder
of page intentionally left blank]

 

14

 

IN WITNESS
WHEREOF, the Parties have executed this Agreement as of the date first written
above.

 

 

	
   

  	
  UNITED CHILE, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ 
  MAURICIO RAMOS

  	
   

  
	
   

  	
   

  	
  Mauricio Ramos

  
	
   

  	
  Its:

  	
  Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  UNITED CHILE VENTURES INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ 
  JOHN P. BABB

  	
   

  
	
   

  	
   

  	
  John P. Babb

  
	
   

  	
  Its:

  	
  Vice President

  

 

 

	
   

  	
  VTR GLOBALCOM S.A.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ 
  RODRIGO CASTILLO MURILLO

  	
   

  
	
   

  	
   

  	
  Rodrigo Castillo Murillo

  
	
   

  	
  Its:

  	
  Vice President

  

 

 

	
   

  	
  LIBERTY COMUNICACIONES DE CHILE

  UNO LTDA.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ 
  MAX LETELIER BOMCHIL

  	
   

  
	
   

  	
   

  	
  Max Letelier Bomchil

  
	
   

  	
  Its:

  	
  Attorney-in-Fact

  

 

 

	
   

  	
  CRISTALERÍAS DE CHILE S.A.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ 
  BALTAZAR SÁNCHEZ GUZMÁN

  	
   

  
	
   

  	
   

  	
  Baltazar Sánchez Guzmán

  
	
   

  	
  Its:

  	
  Director

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ 
  CIRILO ELTON GONZÁLEZ

  	
   

  
	
   

  	
   

  	
  Cirilo Elton González

  
	
   

  	
  Its:

  	
  General Manager

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  CRISTALCHILE INVERSIONES S.A.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ 
  BALTAZAR SÁNCHEZ GUZMÁN

  	
   

  
	
   

  	
   

  	
  Baltazar Sánchez Guzmán

  
	
   

  	
  Its:

  	
  Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ 
  CIRILO ELTON GONZÁLEZ

  	
   

  
	
   

  	
   

  	
  Cirilo Elton González

  
	
   

  	
  Its:

  	
  Officer

  

 

 

EXHIBIT A

 

POTENTIAL
PARTY ARBITRATORS

 

1.     René
Abeliuk Manasevich

2.     Miguel
Luis Amunátegui Monckeberg

3.     Ignacio
Arteaga Echeverría

4.     Jorge
Barros Freire

5.     Fernando
Barros Tocornal

6.     Antonio
Bascuñan Valdés

7.     Blas
Bellolio Rodríguez

8.     Luis
Bezanilla Mena

9.     José
Alberto Bravo Lyon

10.   Fernando
Coloma Reyes

11.   Juan
Colombo Campbell

12.   Eugenio
Cornejo Füller

13.   Vasco
Costa Ramírez

14.   Francisco
Cumplido Cereceda

15.   Francisco
De la Barra Correa

16.   Jaime
Del Valle Alliende

17.   José
Tomás Errázuriz G.

18.   Gonzalo
Eyzaguirre Smart

19.   Juan
Feliú Segovia

20.   Olga
Feliú Segovia

21.   Luis
Simón Figueroa Del Río

22.   Patricio
Figueroa Velasco

23.   Juan
Eduardo Figueroa Valdés

24.   Arturo
Fontaine Aldunate

25.   Raúl
García Astaburuaga

26.   Arnaldo
Gorziglia Balbi

27.   Roberto
Guerrero del Río

28.   José
Tomás Guzmán Salcedo

29.   Manuel
Guzmán Vial

30.   Luis
Oscar Herrera Larraín

31.   Claudio
Illanes Ríos

32.   Juan
Infante Philippi

33.   Jaime
Irarrázabal Covarrubias

34.   Ramón
Jara Mujica

35.   Luz
María Jordán Astaburuaga

36.   Carlos
Eugenio Jorquiera Malschafsky

37.   Raúl
Lecaros Zegers

38.   Samuel
Lira Ovalle

39.   Jorge
López Santa María

40.   Eustaquio
Martínez Martínez

41.   Federico
Montes Lira

42.   Luis
Morand Valdivieso

43.   Eduardo
Novoa Aldunate

44.   Raúl
Novoa Galán

45.   Laura
Novoa Vásquez

46.   Carlos
Olivos Marchant

47.   Alberto
Orrego Gamboa

48.   Luis
Ortiz Quiroga

49.   Miguel
Otero Lathrop

50.   Juan
Luis Ossa Bulnes

51.   Ricardo
Peralta Valenzuela

52.   Orlando
Poblete Iturrate

53.   Patricio
Prieto Sánchez

54.   Álvaro
Rencoret Silva

55.   Carlos
Reymond Aldunate

56.   Walter
Riesco Salvo

57.   Manuel
A. Riveros Izquierdo

58.   Francisco
Ruíz-Tagle Decombe

59.   José
Luis Santa María Zañartu

60.   Hernán
Somerville Senn

61.   Eugenio
Silva Bezanilla

62.   Fernando
Silva Peake

63.   Beltrán
Urenda Salamanca

64.   Carlos
Urenda Zegers

65.   Sergio
Urrejola Monckeberg

66.   Raúl
Varela Morgan

67.   Sebastián
Vial Vial

68.   Carlos
Villarroel Barrientos

69.   Gabriel
Villarroel Barrientos

70.   Arturo
Yrarrázaval Covarrubias

71.   Alberto
Zaldívar Larraín

 

EA - 1

 

EXHIBIT B

 

POTENTIAL
THIRD ARBITRATORS

 

1.     Jorge
Barros Freire

2.     Fernando
Barros Tocornal

3.     Luis
Bezanilla Mena

4.     Juan
Colombo Campbell

5.     Vasco
Costa Ramírez

6.     José
Tomás Errázuriz G.

7.     Patricio
Figueroa Velasco

8.     Arnaldo
Gorziglia Balbi

9.     Claudio
Illanes Ríos

10.   Juan
Infante Philippi

11.   Carlos
Eugenio Jorquiera Malschafsky

12.   Samuel
Lira Ovalle

13.   Laura
Novoa Vásquez

14.   Carlos
Olivos Marchant

15.   Ricardo
Peralta Valenzuela

16.   Patricio
Prieto Sánchez

17.   Sergio
Urrejola Monckeberg

18.   Carlos
Villarroel Barrientos

19.   Gabriel
Villarroel Barrientos

20.   Arturo
Yrarrázaval Covarrubias

 

EB - 1Exhibit 10.03

 

MEMBERSHIP INTERESTS PURCHASE AGREEMENT

 

THIS MEMBERSHIP INTERESTS PURCHASE AGREEMENT
(this “Agreement”),
dated as of the 7th day of February, 2005, is made by and between Apollo
Resources International, Inc., a Utah corporation (“Buyer”), and SW Energy Investments, Inc., a Texas
corporation (“Seller”).

 

RECITALS:

 

A.            Seller currently owns
an aggregate one hundred percent (100%) membership interest in OGC Pipeline, LLC, an Oklahoma limited
liability company (the “Company”).

 

B.            Buyer wishes to pay
Seller the sum of FOUR MILLION DOLLARS ($4,000,000.00) in the form of the Buyer’s
Common Stock as consideration for the purchase of Seller’s entire membership
interests in the Company, its capital accounts, all rights represented by such
membership interests, and all goodwill associated therewith (the “Interests”).

 

C.            Seller wishes to sell
the Interests to Buyer upon the terms and subject to the conditions set forth
in this Agreement.

 

Agreement

 

NOW, THEREFORE, in consideration of the foregoing premises and the
representations, warranties, and covenants hereinafter set forth, and for other
good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties agree as follows:

 

1.             SALE
AND PURCHASE.  Subject to the terms and conditions herein set
forth, and in reliance upon the representations, warranties and covenants
contained herein, Buyer agrees to purchase the Interests from Seller, and
Seller agrees to sell the Interests to Buyer.

 

2.             PURCHASE
PRICE.   The purchase price for the Interests shall be the sum of
FOUR MILLION DOLLARS in the form of the Buyer’s Common stock valued at the
close of market Monday, February 7, 2005.

 

3.             REPRESENTATIONS
AND WARRANTIES OF SELLER. Seller hereby represents and warrants to Buyer
that:

 

a.               Seller is a
corporation duly incorporated, validly existing and in good standing under the
laws of the State of Texas, and has all requisite power and authority to enter
into, perform and carry out all of its duties and obligations in the transaction
contemplated by this Agreement.

 

b.              Seller is the sole
legal and beneficial owner of the Interests, free and clear of any and all
liens, claims, and encumbrances, with full power to transfer the same as
contemplated herein.

 

1

 

c.               Seller is not party
or bound by a contract, promissory note, agreements, commitment, or obligation,
creating or securing indebtedness, obligations, or liabilities, a breach or
default of which would be triggered by Seller’s execution, delivery or
performance of this Agreement.

 

4.             REPRESENTATIONS,
WARRANTIES AND COVENANTS OF BUYER. Buyer hereby represents, warrants and
covenants to Seller that:

 

a.               Buyer is a
corporation duly incorporated, validly existing in good standing under the laws
of the State of Utah, and has all requisite power and authority to enter into,
perform and carry out all of its duties and obligations in the transaction
contemplated by this Agreement.

 

b.              This Agreement is
(or will be when executed and delivered pursuant hereto) the legal, valid and
binding obligation of Buyer, enforceable in accordance with its terms.

 

c.               Neither the
execution and delivery of this Agreement by Buyer, nor Buyer’s compliance with
any of the terms and provisions of this Agreement, nor the consummation of the
transactions contemplated hereby, will conflict with or result in a violation
of, or constitute a material default under any other agreement, contract or
commitment to which it is a party; nor will the performance by Buyer of its
obligations hereunder violate any judgment, order, injunction, decree,
regulation or ruling of any court or governmental authority to which Buyer is
subject.

 

5.             ENTIRE
AGREEMENT; AMENDMENTS. Each of the parties represents that no promise or
agreement which is not expressed in this Agreement has been made to such party
in executing this Agreement, and none of the parties is relying upon any
statement or representation not contained in this Agreement. This Agreement
constitutes the entire understanding among the parties hereto relative to the
subject matter hereof, superseding any and all prior agreements, arrangements,
and understandings, written or oral, between the parties. This Agreement may be
amended only by a written instrument signed by the parties.

 

6.             BINDING
EFFECT. This Agreement and all of the provision hereof shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and permitted assigns. This Agreement may be transmitted between
Seller and Buyer by facsimile machine. The faxed signatures shall constitute
original signatures, and the faxed Agreement containing the signatures,
original or faxed, of all the parties is binding upon the parties.

 

7.             GOVERNING
LAW. This Agreement shall be governed by and construed in accordance with
the laws of the State of Texas, without reference to its conflict of laws
rules.

 

2

 

8.             SEVERABILITY.
If any provision of this Agreement is held to be invalid or unenforceable
by any court of competent jurisdiction, it is the intent of the parties that
all other provisions of this Agreement be construed to remain fully valid,
enforceable and binding on the parties.

 

9.             COVENANT
OF GOOD FAITH AND FAIR DEALING. With regard to their respective obligations
and commitments under this Agreement, each of Buyer and Seller covenants that
it shall act in good faith and deal fairly with the other party.

 

10.          REASONABLE
COOPERATION. Each party hereto agrees to execute and deliver such instruments
and take such other action as the other party may reasonably request in order
to carry out the intent of this Agreement.

 

 

IN WITNESS WHEREOF,
the parties hereto have caused their duly authorized representatives to execute
this Agreement as of the date first above written.

 

 

	
   

  	
  FOR THE
  SELLER:

  
	
   

  	
   

  
	
   

  	
  SW ENERGY INVESTMENTS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Peter S. Knollenberg

  	
   

  
	
   

  	
  Peter S. Knollenberg

  
	
   

  	
  Director

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  FOR THE
  BUYER:

  
	
   

  	
   

  
	
   

  	
  APOLLO RESOURCES
  INTERNATIONAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Dennis G. McLaughlin

  	
   

  
	
   

  	
  Dennis G. McLaughlin

  
	
   

  	
  Chief Executive Officer

  
				

 

3

 

Exhibit A

BILL OF SALE AND ASSIGNMENT

 

THIS BILL OF SALE AND ASSIGNMENT (this “Bill of Sale”), dated as of February      ,
2005 (the “Closing Date”),
is made and delivered by and between Apollo Resources International, Inc. (“Buyer”), and SW
Energy Investments, Inc. (“Seller”).  This Bill of Sale is being executed and
delivered pursuant to the terms of that certain Membership Interests Purchase
Agreement, dated as of the Closing Date (the “Purchase Agreement”), by and among Seller and
Buyer.  Capitalized terms used in this
Bill of Sale and not otherwise defined shall have the meanings assigned in the
Agreement.

 

Recitals

 

A.            Seller is the owner of
an undivided one hundred percent (100%) membership interest in OGC Pipeline, LLC, an Oklahoma limited liability company (“Company”).

 

B.            Seller desires to
assign to Buyer his entire one hundred percent (100%) membership interest in
Company, including all of its related rights and capital accounts and all
associated goodwill.

 

C.            Buyer desires to
accept such assignment and pay Seller the agreed upon Purchase Price therefor
established in the Purchase Agreement.

 

Agreement

 

IN CONSIDERATION OF the foregoing premises, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties agree as follows:

 

1.             Seller hereby
assigns, transfers, conveys, and sells to Buyer, Seller’s entire one hundred
percent (100%) membership interest in Company, together with Seller’s related
capital account, all rights represented by such membership interest, and all
goodwill associated therewith (collectively, the “Interest”).

 

2.             Seller hereby
represents, warrants and certifies to Buyer that on or before the date hereof,
Seller has delivered to Company all Company property in its possession or
control or to which it has had access during its association with the Company,
and that it has retained no copy thereof.

 

3.             Seller
hereby acknowledges receipt of the Buyer’s certificate for shares of the Buyer’s
Common stock which is agreed by the parties to be equal to FOUR MILLION DOLLARS
($4,000,000.00) Purchase Price due and payable as of the Closing Date.

 

4

 

4.             Each party shall
promptly execute and deliver to the other party all such further instruments,
assignments, assurances and other documents as such party may reasonably
request in connection with its performance under this Bill of Sale and the
transactions contemplated hereby and by the Purchase Agreement.

 

5.             Seller,
for itself and its personal representatives and assigns, covenants and agrees
to warrant and defend the transfer, assignment and conveyance of the Interest
and Buyer’s title thereto.

 

7.             This Bill of Sale
shall be governed by and construed in accordance with the laws of the Texas,
and shall inure to the benefit of and be binding upon the parties hereto, their
heirs, personal representatives, successors and assigns.

 

IN WITNESS WHEREOF, the undersigned have executed and delivered this
Bill of Sale effective as of the day and year first written above.

 

 

	
   

  	
  FOR THE
  SELLER:

  
	
   

  	
   

  
	
   

  	
  SW ENERGY INVESTMENTS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Peter S. Knollenberg

  	
   

  
	
   

  	
  Peter S. Knollenberg

  
	
   

  	
  Director

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  FOR THE
  BUYER:

  
	
   

  	
   

  
	
   

  	
  APOLLO RESOURCES
  INTERNATIONAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Dennis G. McLaughlin, III

  	
   

  
	
   

  	
  Dennis G. McLaughlin, III

  
	
   

  	
  Chief Executive Officer

  
				

 

5

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