EXHIBIT 10.8
SHARE TRANSFER RESTRICTION AGREEMENT
This Share Transfer Restriction Agreement dated as of January 29, 2003
(the "Agreement") is by and among St. Mary Land & Exploration Company, a
Delaware corporation ("St. Mary"), and Flying J Oil & Gas Inc., a Utah
corporation ("FJOG") and Big West Oil & Gas Inc., a Utah corporation
("BWOG").
RECITALS
WHEREAS, St. Mary, FJOG and BWOG have entered into that certain
Purchase and Sale Agreement dated as of December 13, 2002 (the "PSA") by and
among FJOG and BWOG, NPC Inc., a Colorado corporation, and St. Mary, whereby
upon the closing of the PSA St. Mary shall issue to FJOG and BWOG a total of
3,380,818 shares (the "Shares") of St. Mary common stock, $0.01 par value per
share (the "St. Mary Stock");
WHEREAS, as a condition to the closing of the PSA, St. Mary desires
that each of FJOG and BWOG agree to certain transfer restrictions with respect
to the Shares of St. Mary Stock as set forth in this Agreement; and
WHEREAS, all capitalized terms used but not defined herein shall have
the respective meanings given to them in the PSA.
NOW, THEREFORE, in consideration of the premises and the mutual
agreements contained herein and in the PSA, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto hereby agree as follows:
AGREEMENT
Section 1. Restrictions on Transfer of Shares of St. Mary Stock. Until
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a period of two years has elapsed from the Closing of the PSA, FJOG and BWOG
shall not make any disposition by assignment, sale, distribution, pledge,
hypothecation, encumbrance or any other disposition (a "Transfer") of all or any
portion of the Shares of St. Mary Stock issued to FJOG and BWOG pursuant to the
PSA. Any Transfer in violation of the foregoing shall be void.
Section 2. Permitted Transfers. Notwithstanding the foregoing
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provisions of Section 1 above, the above transfer restrictions shall not apply
to the following transactions or under the following circumstances:
(a) After a period of one year has elapsed from the Closing of
the PSA, FJOG and BWOG may liquidate and distribute the Shares of St.
Mary Stock issued to them under the PSA to Flying J Inc., and such
shares shall, as held by Flying J Inc., continue to be bound by the
restrictions set forth in this Agreement until a period of two years
has elapsed from the Closing of the PSA.
(b) In the event of an Acquisition of St. Mary (as hereinafter
defined), the restrictions on the Transfer of Shares of St. Mary Stock
described in Section 1 above shall terminate and any shares of capital
stock of the acquirer (or an affiliate of the acquirer) received by
FJOG, BWOG or Flying J Inc. in the Acquisition of St. Mary shall not be
subject to such restrictions. For purposes of this Agreement, the term
"Acquisition of St. Mary" shall mean the occurrence of any of the
following events: (i) St. Mary shall not be the surviving entity in any
merger (other than a merger with a subsidiary of St. Mary), share
exchange, consolidation or other reorganization (or survives only as a
subsidiary of an entity other than an affiliate of St. Mary); or (ii)
St. Mary sells, leases or exchanges all or substantially all of its
assets to any other person or entity (other than a wholly owned
subsidiary of St. Mary). In the event of a tender offer for shares of
St. Mary Stock which is approved by the Board of Directors of St. Mary
pursuant to a plan intended to result in a subsequent Acquisition of
St. Mary, FJOG, BWOG or Flying J Inc. may participate in such tender
offer with respect to their Shares of St. Mary Stock and the maker of
such tender offer shall not be subject to the restrictions on Transfer
with respect to such Shares of St. Mary Stock.
(c) Transfers between FJOG and BWOG.
Section 3. Restrictive Legends and Stop Transfer Instructions. To
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ensure compliance with this Agreement, each certificate representing the Shares
of St. Mary Stock to be issued to FJOG and BWOG pursuant to the PSA shall bear,
in addition to any legend or legends required by applicable securities laws and
any other agreements pertaining to such Shares, a legend in substantially the
following form:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE
SUBJECT TO THE TERMS AND CONDITIONS OF A SHARE
TRANSFER RESTRICTION AGREEMENT DATED JANUARY 29,
2003 WHICH PLACES CERTAIN RESTRICTIONS ON THE TRANSFER
OF THE SHARES REPRESENTED HEREBY. A COPY OF SUCH SHARE
TRANSFER RESTRICTION AGREEMENT IS AVAILABLE AT THE
COMPANY'S PRINCIPAL EXECUTIVE OFFICES.
St. Mary shall also be permitted to deliver to any transfer agent or registrar
of Shares of St. Mary Stock appropriate stop transfer instructions covering
certificates representing the Shares of St. Mary Stock to be issued to FJOG and
BWOG pursuant to the PSA.
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Section 4. Removal of Legends and Stop Transfer Instructions. When the
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Transfer restrictions imposed by this Agreement terminate by reason of the
passage of time or otherwise, a holder of Shares of St. Mary Stock issued to
FJOG and BWOG pursuant to the PSA shall be entitled to receive from St. Mary,
without cost or expense, new certificates representing such shares that do not
bear the legend set forth in Section 3 above and shall be entitled to have the
stop transfer instructions referred to in Section 3 above cancelled by St. Mary.
Section 5. Miscellaneous.
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(a) Notices. All notices, consents, instructions,
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authorizations, waivers and other communications required or permitted
by this Agreement shall be in writing and unless specified otherwise
herein shall be deemed duly given to a party when (i) delivered to the
appropriate address by hand or by nationally recognized overnight
courier service (costs prepaid); (ii) sent by facsimile or e-mail with
confirmation of transmission by the transmitting equipment; or (iii)
received or rejected by the addressee, if sent by certified mail,
return receipt requested, in each case to the addresses, facsimile
numbers or e-mail addresses and marked to the attention of the person
(by name or title) designated in the PSA (or to such other address,
facsimile number, e-mail address or person as a party may designate by
notice to the other parties).
(b) Entire Agreement. This Agreement sets forth the entire
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understanding of the parties with respect to the subject matter hereof.
(c) Binding Effect. This Agreement shall inure to the benefit
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of, and shall be binding upon, the parties hereto and their respective
successors and permitted assigns. Nothing in this Agreement, expressed
or implied, is intended to confer on any person other than the parties
hereto or their respective successors and permitted assigns any rights,
remedies, obligations or liabilities under or by reason of this
Agreement.
(d) Assignment. No party may assign its rights or delegate its
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obligations hereunder (whether voluntarily, involuntarily, or by
operation of law) without the prior written consent of the other
parties. Any such attempted assignment shall be null and void.
(e) Further Assurances. The parties agree that at any time and
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from time to time, upon the written request of a party, the parties
will execute and deliver such further documents and do such further
acts and things as reasonably requested to effect the purposes of this
Agreement.
(f) Amendments. This Agreement may be amended only by an
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agreement in writing executed by each of the parties hereto.
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(g) Waiver. The observance of any term of this Agreement may
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be waived only with the written consent of the party to be bound by
such waiver. No failure on the part of a party to exercise any right or
remedy shall operate as a waiver thereof.
(h) Governing Law. This Agreement shall be governed by and
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construed and interpreted in accordance with the laws of the State of
Colorado, without regard to any conflict of laws provisions thereof,
except that the Delaware General Corporation Law shall govern as to
matters of corporate law pertaining to St. Mary and the Utah Revised
Business Corporation Act shall govern as to matters of corporate law
pertaining to FJOG, BWOG and Flying J Inc..
(i) Jurisdiction and Venue. The parties hereto agree that any
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actions, suits or proceedings arising out of or relating to this
Agreement, the transactions contemplated hereby or any document
referred to herein shall be brought solely and exclusively in the
courts of the State of Colorado located in the City and County of
Denver, Colorado, and/or the courts of The United States of America
located in the City and County of Denver, Colorado, (and the parties
agree not to commence any action, suit or proceeding relating thereto
except in such courts), and further agree that service of any process,
summons, notice or document by U.S. registered mail to the respective
addresses referred to in Section 5(a) hereof shall be effective service
of process for any such action, suit or proceeding brought against any
party in any such court. The parties irrevocably and unconditionally
waive any objection to the laying of venue of any action, suit or
proceeding arising out of this Agreement or the transactions
contemplated hereby, in the courts of the State of Colorado or The
United States of America located in the City and County of Denver,
Colorado, and hereby further irrevocably and unconditionally waive and
agree not to plead or claim in any such court that any such action,
suit or proceeding brought in any such court has been brought in an
inconvenient forum.
(j) Severability. If any term, provision, covenant or
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restriction of this Agreement is held by a court of competent
jurisdiction to be invalid, void or unenforceable under applicable law,
the remainder of the terms, provisions, covenants and restrictions of
this Agreement shall remain in full force and effect and shall in no
way be affected, impaired or invalidated, and the term, provision,
covenant or restriction that is held to be invalid, void or
unenforceable shall be modified so that it accomplishes to the maximum
extent possible the original business purpose of such term, provision,
covenant or restriction in a valid and enforceable manner.
(k) Attorney Fees. If any action at law or in equity is
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necessary to enforce or interpret the terms of this Agreement, the
prevailing party shall be entitled to recover reasonable attorney fees,
costs and necessary disbursements in addition to any other relief to
which such party may be entitled.
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(l) Adjustments in Capitalization. The number of Shares of St.
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Mary Stock subject to this Agreement shall be subject to proportionate
and appropriate adjustment in the event of any change in the number of
outstanding shares of St. Mary Stock that occurs by reason of a stock
dividend or split, recapitalization, reclassification, or other similar
change in capitalization by St. Mary.
(m) Headings. The headings, subheadings and other captions of
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this Agreement are for convenience and reference only and shall not be
used in interpreting, construing or enforcing any of the provisions of
this Agreement.
(n) Counterparts and Facsimile Signatures. This Agreement may
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be executed in any number of counterparts, and signature pages may be
delivered by facsimile transmission.
[Signature page follows]
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IN WITNESS WHEREOF, this Share Transfer Restriction Agreement has been
duly executed on behalf of each of the parties hereto by their duly authorized
representatives as of the date first above written.
ST. MARY LAND & EXPLORATION COMPANY,
a Delaware corporation
By:/s/ MILAM RANDOLPH PHARO
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Milam Randolph Pharo, Vice President -
Land and Legal
FLYING J OIL & GAS INC.,
a Utah corporation
By:/s/ JOHN R. SCALES
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John R. Scales, President
BIG WEST OIL & GAS INC.,
a Utah corporation
By:/s/ JOHN R. SCALES
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John R. Scales, President
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