Exhibit 10.12
PURCHASE AND SALE
AGREEMENT
by and between
SELECT RESOURCES CORPORATION,
INC.
and
COLUMBIA RIVER
CARBONATES
Dated as of December 21,
2010
TABLE OF CONTENTS
ARTICLE 1 Definitions
Section 1.01 Defined
terms
Assignment of
Tidelands Lease ADL-106300
Bill of Sale,
Assignment, and Assumption Agreement
Equipment,
Fixtures, and Inventories
Occupational
Safety and Health Laws
Preliminary
Commitment for Title Insurance
Tidelands Lease
ADL-106300
Section 1.02 Construction
ARTICLE 2 Sale
and Purchase
Section 2.01 Sale
and Purchase of Assets
Section 2.02 Excluded
Assets
Section 2.03 Purchase
Price
Section 2.04 Payment
of Purchase Price
Section 2.06 Allocation
of Purchase Price
ARTICLE 3 Representations
and Warranties of Seller
Section 3.01 Organizational
Status; Power and Authority
Section 3.02 Duly
Executed
Section 3.03 No
Breach, Etc.
Section 3.05 Changes,
Etc.
Section 3.06 Title
to Assets
Section 3.07 Inclusiveness
of Assets
Section 3.08 Certain
Operational and Regulatory Matters
ARTICLE 4 Representations
and Warranties of Purchaser
Section 4.01 Organizational
Status; Power and Authority
Section 4.02 Duly
Executed
Section 4.03 Financial
Arrangements of Purchaser
Section 4.05 Due
Diligence
ARTICLE 5 Certain
Covenants of the Parties
Section 5.01 Obligations
of Seller Prior To Closing
Section 5.02 Obligations
of Parties Following Closing
ARTICLE 6 Conditions
Precedent
Section 6.01 Closing
Conditions
Section 6.02 Conditions
To Obligations of Purchaser
Section 6.03 Conditions
To Obligations of Seller
ARTICLE 7 Closing
ARTICLE 8 Termination
Prior To Completion of Closing
Section 8.02 Effect
of Termination
ARTICLE 9 Indemnification;
Disclaimer
Section 9.01 Indemnification
ARTICLE 10 Default
After Closing
ARTICLE 11 [INTENTIONALLY
LEFT BLANK]
ARTICLE 12 Miscellaneous
Section 12.01 Entire
Agreement
Section 12.02 Modification
Section 12.03 Extension
and Waiver
Section 12.04 Further
Actions
Section 12.07 No
Third Party Beneficiaries
Section 12.08 Counterparts
Section 12.09 Applicable
Law
Section
12.11 Facsimile
and Other Signatures
EXHIBITS,
SCHEDULES, and APPENDICES
Exhibit
A Real
Property
Exhibit
B Personal
Property
Schedule 1: Certain
Equipment, Fixtures, and Inventories
Exhibit
C Warranty
Deed
Exhibit
D Assignment
of Tidelands Lease ADL-106300
Exhibit
E Bill
of Sale, Assignment, and Assumption Agreement
Exhibit
F Certificates
of Title
Appendix 1: Letter
Agreement among Seller and Prior Owners
Appendix
2: Ketchikan
Title Agency, Inc.--Preliminary Commitment foir Title Insurance
Order No. 28195
Appendix
3: Copies
of all documents relating to DEC File 1545.38.001 (Contaminated
Sites Program Database Reckey 2004130124601)
PURCHASE AND SALE
AGREEMENT
THIS PURCHASE
AND SALE AGREEMENT (this “Agreement”), effective as of
December 21, 2010, by and between SELECT RESOURCES
CORPORATION, INC. (“Seller”), a Delaware corporation,
and COLUMBIA RIVER CARBONATES, a general partnership
(“Purchaser”).
WITNESSETH:
WHEREAS, Seller
owns the “Assets” (as defined below), subject to
(1) certain rights of SEALASKA CORPORATION
(“Sealaska”), an Alaska regional Native corporation,
and SEACAL, LLC (“Seacal”), an Alaska limited liability
company, (Sealaska and Seacal jointly and severally are referred to
herein as “Prior Owners”) that are the subject of the
“Letter Agreement” (as defined below) among Seller and
Prior Owners, and (2) the “Deed of Trust” (as
defined below) in favor of Sealaska securing the “Promissory
Note” (as defined below) on which $1,000,000 remains owing;
and
WHEREAS, Prior
Owners have agreed pursuant to the Letter Agreement to reconvey and
release all such rights and the Deed of Trust upon receipt of
payment in full of the $1,000,000 that remains due and owing under
the Promissory Note; and
WHEREAS, Seller
desires to sell, and Purchaser desires to purchase, the Assets
pursuant to, in accordance with, and in all respects subject to the
provisions of this Agreement,
NOW, THEREFORE,
in consideration of the premises and other good and valuable
consideration, the receipt and adequacy of which are hereby
acknowledged, the parties hereby agree as follows:
ARTICLE 1
Definitions
Section 1.01 Defined
terms . As used herein, the following terms have the
following meanings:
“
Affiliate ” means, (i) with respect to Seller,
any other Person that directly or indirectly, through one or more
intermediaries, controls, is controlled by, or is under common
control with Select Resources Corporation, Inc. or Tri-Valley
Corporation, Inc. (a Delaware corporation that is the parent
corporation of Select Resources Corporation, Inc.), and
(ii) with respect to Purchaser, any other Person that directly
or indirectly, through one or more intermediaries, controls, is
controlled by, or is under common control with Bleeck Management,
Inc. (an Oregon corporation) or Northwest Carbonates, Inc. (a
Delaware corporation). For the purpose of this definition,
“control,” when used with respect to any specified
Person, means the possession of the power to direct the management
or policies of the specified Person, directly or indirectly,
whether through the ownership of voting securities, partnership, or
limited liability company interests, by contract, or
otherwise.
“
Agreement ” means this Purchase and Sale Agreement, as
the same may be amended or modified in writing by the Parties from
time to time.
“
Assets ” means the Real Property and the Personal
Property.
“
Assignment of Tidelands Lease ADL-106300 ” means an
assignment in the form of Exhibit D , to be executed
and acknowledged by Seller and Purchaser, and delivered by Seller
to Purchaser, pursuant to Sections 7.01(a)(2) and
7.01(b)(2).
“
Assumed Liabilities ” means those liabilities assumed
pursuant to Section 2.05(a).
“ Bill
of Sale, Assignment, and Assumption Agreement ” means a
Bill of Sale, Assignment, and Assumption Agreement in the form of
Exhibit E , to be executed and acknowledged by Seller
and Purchaser, and delivered by Seller to Purchaser, pursuant to
Sections 7.01(a)(3) and 7.01(b)(3).
“
Business Day ” means any day except Saturday, Sunday,
and any other day on which banking institutions located in
Bakersfield, California, are required or authorized to
close.
“
Calder Mine Business ” means the business of owning
and operating the Assets.
“
Certificates of Title ” means the Certificates of
Title issued for those items of Personal Property for which a
certificate of title has been issued by the State of Alaska
Department of Motor Vehicles pursuant to
AS 28.10.201-28.10.401 (2004) (copies of all of which
certificates are attached hereto as Exhibit F ), the
applications for transfer of which are to be executed,
acknowledged, and delivered by Seller pursuant to
Sections 7.01(a)(4) and 7.01(b)(4).
“
Closing ” is defined in Section 7.01.
“
Closing Date ” is the date on which Closing is
completed.
“
Code ” means the Internal Revenue Code of 1986, as
amended.
“ Deed
of Trust ” means the deed of trust and security agreement
referred to in the Letter Agreement.
“
Diesel Spills ” means the Releases of diesel fuel
described in the documents attached hereto as
Appendix 3 .
“
Employee Plans ” means all “employee benefit
plans” as defined by Section 3(3) of ERISA, all
specified fringe benefit plans as defined in Section 6039D of
the Code, and all other bonus, incentive-compensation,
deferred-compensation, profit-sharing, stock-option,
stock-appreciation-right, stock-bonus, stock-purchase,
employee-stock-ownership, savings, severance, change-in-control,
supplemental-unemployment, layoff, salary-continuation, retirement,
pension, health, life-insurance, disability, accident,
group-insurance, vacation, holiday, sick-leave,
fringe-benefit, or welfare plan, and any other employee
compensation or benefit plan, agreement, policy, practice,
commitment, contract, or understanding (whether qualified or
nonqualified, currently effective or terminated, written or
unwritten) and any trust, escrow, or other agreement related
thereto that (i) is maintained or contributed to by Seller or
any other corporation or trade or business controlled by,
controlling, or under common control with Seller (within the
meaning of Section 414 of the Code or Section 4001(a)(14)
or 4001(b) of ERISA) (“ERISA Affiliate”) or has been
maintained or contributed to in the last six (6) years by Seller or
any ERISA Affiliate, or with respect to which Seller or any ERISA
Affiliate has or may have any liability, and (ii) provides
benefits or describes policies or procedures applicable to any
current or former director, officer, employee, or service provider
of Seller or any ERISA Affiliate, or the dependents of any thereof,
regardless of how (or whether) liabilities for the provision of
benefits are accrued or assets are acquired or dedicated with
respect to the funding thereof.
“
Encumbrance ” means any deed of trust, mortgage,
pledge, restriction on transfer, assessment, security interest,
lien, adverse claim, levy, charge, or other legal or equitable
encumbrance of any kind.
“
Environmental Laws ” means any and all Legal
Requirements (including common law) pertaining to the protection of
human health (as it relates to exposure to Hazardous Materials),
the environment (including, without limitation, any generation,
use, storage, treatment, Release, or threatened Release of
Hazardous Materials into the indoor or outdoor environment),
wildlife or natural resources that is in effect in any and all
jurisdictions in which Seller is conducting or at any time has
conducted business or where the Assets are located, and any binding
judicial or administrative interpretation (including, but not
limited to, any judicial or administrative order, consent decree,
judgment or settlement) thereof, including, without limitation, the
Clean Air Act, as amended, the Federal Water Pollution Control Act,
as amended, the Rivers and Harbors Act of 1899, as amended, the Oil
Pollution Act of 1990, as amended, the Safe Drinking Water Act, as
amended, the Comprehensive Environmental Response, Compensation and
Liability Act, as amended, the Superfund Amendments and
Reauthorization Act of 1986, as amended, the Resource Conservation
and Recovery Act, as amended, the Hazardous and Solid Waste
Amendments Act of 1984, as amended, the Toxic Substances Control
Act, as amended, the Occupational Safety and Health Act, as
amended, the Hazardous Materials Transportation Act, as amended,
and AS 46.03.822 (2004), as amended.
“
Equipment, Fixtures, and Inventories ” means all
buildings, structures, plants, processing facilities, installed
equipment, office trailers, office equipment, trailer camps,
furnishings, kitchen facilities, pipelines, electric power
equipment and facilities, telecommunications equipment and
facilities, fuel tanks, waste facilities, docks, mining equipment,
crushers, conveyors, trucks, vans, hoppers, trailers, all-terrain
vehicles, and other items as are affixed to or situated upon the
Real Property or Tidelands Lease ADL-106300 at Closing (but
including wherever situated the items described on
Schedule 1 attached to
Exhibit B) , together with (1) all fuel, tools, and
parts held by Seller for or in connection with any of the
foregoing, (2) all warranties (if any) and software licenses
(if any) respecting any of the foregoing, and (3) all
extracted rock or rock products that have been severed from the
Real Property and that remain situated on the Real Property or
Tidelands Lease ADL-106300 or in storage at Craig Storage on Prince
of Wales Island at Closing.
“
ERISA ” means the Employee Retirement Income Security
Act of 1974.
“
Governmental Authority ” means any federal, state,
local, foreign or other government, any governmental, regulatory,
judicial or administrative agency, bureau, commission, body or
other authority exercising or entitled to exercise any
administrative, executive, judicial, legislative, police,
regulatory or taxing authority or power, or any court or
governmental tribunal, but does not include Purchaser, Seller, any
Affiliates thereof, or any of their respective
successors-in-interest.
“
Hazardous Material ” means any substance, material, or
waste that, in such quantity or concentration, is or will be
regulated under or pursuant to any Environmental Law as hazardous,
toxic, a pollutant, contaminant, solid waste, or words of similar
meaning, including but not limited to petroleum, petroleum
products, petroleum hydrocarbons, petroleum by-products, crude oil
and any components, fractions, or derivatives thereof, methyl
tertiary butyl ether, ammonia, asbestos or material containing or
presumed to contain asbestos, urea formaldehyde, polychlorinated
biphenyls, and other halogenated hydrocarbon compounds.
“
Information ” means all of the drill core, rock
samples, data, maps, files, and records (whether in written,
tabular, electronic, photographic, or other form and wherever
situated) relating to any or all of the following: the geology of
the Real Property or adjoining or nearby lands; the sampling,
drilling, mapping, or other analysis (whether of a geologic,
chemical, metallurgical, physical, engineering, environmental, or
other nature or type) of the Real Property or adjoining or nearby
lands, or of samples obtained therefrom; identification or
calculation of reserves or resources; engineering associated with
the Assets or the Calder Mine Business ; construction of
improvements on the Real Property or Tidelands Lease
ADL-106300 or otherwise for or in connection with the Calder
Mine Business ; acquisition and maintenance of title to the
Real Property; purchase, operation, maintenance, repair, and
replacement of the Equipment, Fixtures, and Inventories;
acquisition of, and compliance or noncompliance with, all Permits;
the mining, processing, transport, shipping, marketing, and sale of
minerals or mineral products derived from the Real Property; and
the conduct of reclamation or remediation activities in connection
with the Calder Mine Business; excluding, however,
(a) any and all emails sent or received by Seller respecting
the Assets or the Calder Mine Business and (b) any and all
confidential and proprietary reports of Seller respecting the
Assets or the Calder Mine Business .
“
Knowledge ”, when used in the phrases “to
Seller’s Knowledge,” “to the Knowledge of
Seller” or similar phrases with respect to Seller, means, and
shall be limited to, the actual knowledge of the executive officer
of Seller or the senior employee of Seller who is responsible for
the area of operation of Seller to which such Person’s
knowledge relates, and, when used in the phrases “to
Purchaser’s Knowledge,” “to the Knowledge of
Purchaser” or similar phrases with respect to Purchaser,
means, and shall be limited to, the actual knowledge of the
executive officer of Purchaser or the senior employee of Purchaser
who is responsible for the area of operation of Purchaser to which
such Person’s knowledge relates.
“
Legal Requirements ” means any and all applicable
(i) laws (common, constitutional, statutory, and
administrative, and including but not limited to Environmental
Laws), ordinances, regulations, judgments, orders, writs,
injunctions, and decrees of any Governmental Authority and
(ii) contracts with any Governmental Authority relating to
compliance with matters described in (i) above.
“
Letter Agreement ” means that certain letter agreement
dated December 1, 2010, among Seller and Prior Owners, a copy
of which is attached hereto as Appendix 1.
“
Occupational Safety and Health Laws ” means any and
all Legal Requirements (including common law) designed to provide
safe and healthful working conditions and to reduce occupational
safety and health hazards, including the Occupational Safety and
Health Act, the Mine Safety and Health Act, and any program,
whether governmental or private (such as those promulgated or
sponsored by industry associations and insurance companies),
designed to provide safe and healthful working
conditions.
“
Operative Documents ” means this Agreement; the
Warranty Deed; the Assignment of Tidelands Lease ADL-106300; the
Bill of Sale, Assignment, and Assumption Agreement; and the
applications for transfer of the Certificates of Title.
“
Party ” means Seller or Purchaser, as the context
requires, and “ Parties ” means, collectively,
Seller and Purchaser.
“
Permits ” means any and all easements, permits,
authorizations, determinations, approvals, licenses, exemptions,
variances, and orders that are currently in effect and held by
Seller in connection with the Assets or the Calder Mine
Business.
“
Permitted Encumbrances ” means, with reference to
Seller or the Assets:
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reservations,
exceptions, exclusions and limitations set forth in any federal
patent, state patent, or other governmental conveyance issued for
any of the Real Property;
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reservations,
exceptions, exclusions and limitations set forth in Tidelands Lease
ADL-106300;
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special
exceptions enumerated in the Preliminary Commitment for Title
Insurance;
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liens for
Taxes, assessments, and governmental charges not yet
delinquent;
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all Legal
Requirements and rights of any Governmental Authority, both
generally and under any of the Permits (including but not
necessarily limited to the right to consent to any transfer of any
of the Assets).
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“
Person ” means an individual, corporation, limited
liability company, partnership, joint venture, bank, trust,
unincorporated organization and/or a government or any department
or agency thereof or other entity of any kind.
“
Personal Property ” means all of the following: the
Equipment, Fixtures, and Inventories; the Information; the Permits;
all rights to any and all proceeds of condemnation or inverse
condemnation of any of the Assets; all rights to any and all
insurance proceeds for any damage to or destruction or loss of any
of the Assets prior to Closing; and all claims of Seller against
third parties relating to any of the Assets (whether choate or
inchoate, known or unknown, contingent or
noncontingent).
“
Preliminary Commitment for Title Insurance ” means
that certain Preliminary Commitment for Title Insurance, Order
No. 28195, issued by Ketchikan Title Agency, Inc., a copy of
which is set out in Appendix 2 .
“
Prior Owners ” means Sealaska and Seacal, jointly and
severally.
“
Promissory Note ” means the promissory note referred
to in the Letter Agreement.
“
Purchase Price ” is defined in
Section 2.03.
“
Purchaser ” means Columbia River Carbonates, a general
partnership, registered and authorized to transact business in the
State of Washington, between Bleeck Management, Inc., an Oregon
corporation authorized to transact business in Alaska, and
Northwest Carbonates, Inc., a Delaware corporation authorized to
transact business in Alaska.
“ Real
Property ” means the real property described in
Exhibit A .
“
Release ” means any depositing, spilling, leaking,
pouring, emitting, discarding, abandoning, emptying, discharging,
migrating, injecting, escaping, leaching, seeping, dumping, or
disposing.
“
Retained Liabilities ” means those liabilities
retained pursuant to Section 2.05(b).
“
Seacal” means Seacal, LLC, a single-member
member-managed Alaska limited liability company.
“
Sealaska ” means Sealaska Corporation, an Alaska
regional Native corporation.
“
Seller ” means Select Resources Corporation, Inc., a
Delaware corporation authorized to transact business in
Alaska.
“
Taxes ” means unclaimed property and escheat
obligations, taxes, charges, fees, levies, penalties or other
assessments imposed by any Governmental Authority, including but
not limited to, income, excise, real or personal property, sales,
use, ad valorem , value added, environmental, transfer,
franchise, payroll, withholding, social security (or similar),
gross receipts, license, severance, fuel, production,
transportation, stamp, occupation, employment, payroll,
unemployment, disability or other taxes, including any interest,
penalties or additions attributable thereto, whether disputed or
not.
“Tidelands Lease ADL-106300”
means that certain
Tidelands Lease ADL-106300 effective June 1, 1999, and
recorded on July 8, 1999, at Book 64, Pages 20-33,
Petersburg Recording District, as amended, or its
equivalent.
“ WARN
Act ” means the Worker Adjustment and Retraining
Notification Act or any similar state or local legal
requirement.
“
Warranty Deed ” means a Statutory Warranty Deed in the
form of Exhibit C , to be executed, acknowledged, and
delivered by Seller pursuant to Section 7.01(a)(1).
Section 1.02
Construction . As used in this Agreement:
(a) the words “hereof,” “herein,” and
“hereunder” and derivative or similar words shall refer
to this entire Agreement and not to any particular provision of
this Agreement; (b) the terms “Article” or
“Section” refer to the specified Article or Section of
this Agreement; (c) the terms defined in the singular shall
have a comparable meaning when used in the plural, and vice versa;
(d) the terms “dollars” and “$” shall
mean United States dollars; and (e) unless otherwise
specified, all references in this Agreement to times of the day
shall be to the time in Ketchikan, Alaska (the place of
Closing). No provision of this Agreement will be interpreted in
favor of, or against, any Party by reason of the extent to which
any such Party or its counsel participated in the drafting thereof
or by reason of the extent to which any such provision is
inconsistent with any prior draft hereof or thereof.
ARTICLE 2
Sale and
Purchase
Section 2.01 Sale and
Purchase of Assets . Subject to all of the terms and
conditions of this Agreement, at the Closing Seller shall sell,
transfer, and deliver to Purchaser, and Purchaser (or its designee)
shall purchase and accept delivery from Seller of,
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the Real
Property, free and clear of all Encumbrances other than Permitted
Encumbrances, and
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the Personal
Property, free and clear of all Encumbrances other than Permitted
Encumbrances.
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Section 2.02 Excluded
Assets . The following assets of Seller are not part of the
sale and purchase contemplated hereunder, are excluded from the
Assets, and shall remain the property of Seller after the
Closing:
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all cash, cash
equivalents, and accounts receivable associated with the Calder
Mine Business ;
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all minute
books and corporate seals;
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all personnel
records and other records that Seller is required by law to retain
in its possession;
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all claims for
refund of Taxes and other governmental charges paid by Seller prior
to closing of whatever nature;
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all rights in
connection with and assets of the Employee Plans; and
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all rights of
Seller under this Agreement or any other Operative
Document.
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Section 2.03 Purchase
Price . The aggregate purchase price for the Assets shall
be $2,500,000 (“Purchase Price”), payable to Seller as
described in Section 2.04.
Section 2.04 Payment of
Purchase Price . Upon execution of this Agreement,
Purchaser shall deliver into the trust account of Ketchikan Title
Agency, Inc. (the address of which is 57 Main Street,
Suite 209, Ketchikan, AK 99901) via wire transfer the sum of
$2,500,000. Said amount shall be disbursed by Ketchikan Title
Agency, Inc. as follows:
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$1,000,000
shall be paid to the order of Sealaska via wire transfer upon
receipt by Ketchikan Title Agency, Inc. from Sealaska and Seacal of
the following documents:
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an instrument
in the form of Exhibit A attached to the Letter Agreement;
and
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both
(A) the original Promissory Note and (B) a formal Request
for Reconveyance of the Deed of Trust.
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Upon payment of
$1,000,000 to Sealaska as aforesaid, Ketchikan Title Agency, Inc.
shall cancel the Promissory Note by marking the same “PAID IN
FULL” and shall deliver the cancelled Promissory Note and the
Request for Reconveyance to the trustee under the Deed of Trust, so
that said trustee may proceed to reconvey and release the Deed of
Trust.
(b) $1,500,000
shall be paid to the order of Seller immediately
following
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receipt from
Sealaska of the documents described in Section 2.04(a)(1) and
2.04(a)(2) above,
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completion of
the Closing as described in Section 7.01 below, except that
(A) approval of the assignment of the Tidelands Lease need not
have been received yet from the State of Alaska Department of
Natural Resources, (B) the Permits (if any) need not have been
transferred yet (see Section 5.02 below), and (C) new
certificates of title need not have been received yet in response
to the applications for the transfer of the Certificates of Title
delivered at Closing, and
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confirmation
that a policy of title insurance consistent in all respects with
the Preliminary Commitment for Title Insurance will be issued to
Purchaser (except that the rights of Prior Owners disclosed on the
Preliminary Commitment shall not appear as exceptions on the final
policy of title insurance).
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Ketchikan Title
Agency, Inc. shall record the executed Warranty Deed received from
Seller pursuant to Section 7.01(a)(1) but (i) shall have
no obligations respecting the documents received from Seller
pursuant to Sections 7.01(a)(2)-7.01(a)(4) except to deliver
the same to Purchaser and (ii) shall have no obligations
respecting the documents received from Purchaser pursuant to
Sections 7.01(b) except to deliver the same to
Seller.
Section 2.05
Liabilities .
(a)
Assumed Liabilities . Purchaser shall assume all
unsatisfied obligations to clean up and remediate the Diesel
Spills. Except for the liabilities and obligations to be assumed by
the Purchaser as set forth herein, the Purchaser will not assume
and will not be liable for any liabilities of the Seller, known or
unknown, contingent or absolute, accrued or other, and the Assets
will be free of all liabilities, obligations, liens, and
encumbrances. Without limiting the generality of the foregoing and
except as otherwise provided above, the Purchaser will not be
responsible for any of the Retained Liabilities.
(b) Retained
Liabilities . Seller shall retain each and every liability
of Seller, other than those liabilities expressly assumed by
Purchaser pursuant to Section 2.05(a),
