Exhibit 10.1
Execution
Copy
MERGER TERMINATION
AGREEMENT
This MERGER TERMINATION AGREEMENT
(“ Agreement ”) is entered into as of the 16th
day of December, 2008, by and among Chaparral Energy, Inc., a
Delaware corporation (“ Parent ”), Chaparral
Exploration, L.L.C., a Delaware limited liability company and a
wholly owned subsidiary of Parent (“ Sub ,” and
together with Parent, the “ Parent Parties ”),
and Edge Petroleum Corporation, a Delaware corporation (“
Edge ”).
I.
RECITALS
1.1 On July 14, 2008, Parent,
Sub and Edge executed that certain Agreement and Plan of Merger
(the “ Merger Agreement ”) pursuant to which
Edge would be merged with and into Sub pursuant to the terms and
conditions set forth in the Merger Agreement.
1.2 After due consideration, the
Parent Parties and Edge believe that the closing conditions set
forth in the Merger Agreement will not be met on or before the
Outside Date (as defined in the Merger Agreement), and desire to
terminate the Merger Agreement, effective upon execution of this
Agreement, by mutual written agreement pursuant to
Section 7.1(a) of the Merger Agreement.
1.3 Parent and Edge having
determined to enter into this Agreement, on December 16, 2008,
Parent, Edge, Magnetar Financial LLC (on behalf of itself and its
Affiliates (as defined therein), “ Magnetar ”),
Investment Partners II (B), LLC (“ Investment Partners
”), QRA SR, LLC (“ QRA ”), Triangle Peak
Partners Private Equity, LP (“ Triangle Peak ”),
and, together with Magnetar, Investment Partners and QRA, the
“ Series B Investors ”) and Post Oak Energy
Capital, LP (“ Post Oak ”) executed a
Termination and Settlement Agreement, pursuant to which, among
other things, (i) Parent and the Series B Investors terminated
the Stock Purchase Agreement dated July 14, 2008 by and
between Parent and Magnetar and related assignment and assumption
agreements with the Series B Investors, (ii) Parent and Post
Oak terminated that certain Letter of Intent dated June 16,
2008, (iii) the parties agreed to specified release and
indemnification provisions, (iv) Parent granted Magnetar
Financial LLP an option to invest in Parent’s common stock
and (v) Magnetar, on behalf of the Series B Investors and Post
Oak, agreed to make a $5.0 million payment to Chaparral in
respect of the termination, $1.5 million of which Parent has
directed Magnetar to pay to Edge on Parent’s behalf to
reimburse Edge for certain expenses.
NOW, THEREFORE, in consideration of
the premises and mutual promises and covenants herein contained,
and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
II.
TERMS OF
TERMINATION
2.1 Termination of the Merger
Agreement. Upon execution of this Agreement, the Merger
Agreement, including, without limitation, provisions of the Merger
Agreement that by their terms would otherwise have survived
termination of the Merger Agreement, is terminated and shall be of
no further force and effect.
2.2 Confidentiality.
Parent and Edge shall each file this Agreement as an exhibit to a
current report on Form 8-K to be filed by each of Parent and Edge
announcing the execution of this Agreement. The Parent Parties and
Edge hereby agree that the Confidentiality Agreements dated
March 17, 2008 and April 17, 2008 by and between Edge and
Parent shall survive according to their respective
terms.
2.3 Release by the Parent
Parties. Upon full compliance with and performance of the
terms stated herein, the Parent Parties, on their own behalf and,
to the fullest extent allowed by law, on behalf of those claiming
through them, hereby agree to and shall release and discharge Edge
and its subsidiaries and affiliates, and their respective
directors, officers, employees, shareholders, predecessors, heirs,
successors, assigns, agents and representatives (collectively, the
“ Edge Released Parties ”), from any and all
claims, liabilities, demands and causes of action known or unknown,
fixed or contingent, except for any obligations created by this
Agreement, that they now have against the Edge Released Parties or
that might subsequently accrue to them against any of the Edge
Released Parties by reason of any matter or thing arising out of or
in any way related with the Merger Agreement. Notwithstanding
anything to the contrary herein, the Parent Parties are not
releasing or discharging Edge from any obligation (i) created
by this Agreement, (ii) arising under the Confidentiality
Agreements dated March 17, 2008 and April 17, 2008 by and
between Edge and Parent or (iii) relating to the El Fortunado
prospect agreement between Chaparral Energy, L.L.C. and Edge
Petroleum Exploration Company dated August 19, 2008, as
amended on November 25, 2008.
2.4 Release by Edge.
Upon full compliance with and performance of the terms stated
herein, Edge, on its own behalf and, to the fullest extent allowed
by law, on behalf of those claiming through it, hereby agrees to
and shall release and discharge the Parent Parties and their
subsidiaries and affiliates, and their respective directors,
officers, employees, shareholders, predecessors, heirs, successors,
assigns, agents
