{"id":43331,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/business-opportunities-agreement-union-oil-co-of-california.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"business-opportunities-agreement-union-oil-co-of-california","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/planning\/business-opportunities-agreement-union-oil-co-of-california.html","title":{"rendered":"Business Opportunities Agreement &#8211; Union Oil Co. of California and Titan Exploration Inc."},"content":{"rendered":"<pre> \n                       BUSINESS OPPORTUNITIES AGREEMENT\n\n     This BUSINESS OPPORTUNITIES AGREEMENT (this 'Agreement'), dated as of\nDecember 13, 1999, is entered into by Union Oil Company of California, a\nCalifornia corporation ('Union Oil'), Titan Resources Holdings, Inc., a newly\nformed Delaware corporation and wholly owned subsidiary of Union Oil (the\n'Company'), TRH, Inc., a newly formed Delaware corporation and a wholly owned\nsubsidiary of the Company ('Sub'), and Titan Exploration, Inc., a Delaware\ncorporation ('Titan').\n\n     This Agreement is being executed and delivered simultaneously with the\nexecution and delivery of the Agreement and Plan of Merger dated December 13,\n1999 (the 'Merger Agreement') among Union Oil, the Company, Sub and Titan.\nPursuant to the Merger Agreement, Sub will be merged with and into Titan, which\nwill be the Surviving Corporation. All capitalized terms used and not defined\nherein (as well as the terms 'affiliate' and 'person') have the meanings\nattributable to them in the Merger Agreement.  As a result of the Merger, Union\nOil will own a majority of the outstanding capital stock of the Company, and the\nCompany will own all of the outstanding capital stock of the Surviving\nCorporation.\n\n     Titan believes that it and its stockholders will benefit from the Merger\nand that the Merger is in its best interest and in the best interest of its\nstockholders.  Union Oil, however, is unwilling to enter into the Merger\nAgreement unless Titan and the Company enter into this Agreement because Union\nOil engages in the exploration for and the development, production and marketing\nof natural gas and crude oil in the United States.  The businesses in which\nUnion Oil engages are similar to those in which Titan and its subsidiaries\nengage and in which the Company and its subsidiaries, including the Surviving\nCorporation, will engage following the Merger.\n\n     As the owner of a controlling interest in the Company following the Merger,\nUnion Oil may owe certain duties to the Company.  Pursuant to a Stockholders\nAgreement entered into simultaneously with the execution and delivery of this\nAgreement, Union Oil will have the right to nominate certain persons\n('Designees') to serve on the board of directors of the Company following the\nMerger. Certain of the Designees may be directors of or employed by Union Oil or\ncompanies in which Union Oil has an interest, other than the Company and its\nsubsidiaries.  These Designees will have duties to the Company and duties to\nUnion Oil or such other companies.\n\n     The law relating to duties that Union Oil or its Designees may owe to the\nCompany is not clear.  The application of such law to particular circumstances\nis often difficult to predict, and if a court were to hold that Union Oil or one\nof its Designees breached any such duty Union Oil or such Designee could be held\nliable for damages in a legal action brought on behalf of the Company.\n\n                                       1\n\n \n     In order to induce Union Oil to enter into the Merger Agreement, Titan and\nthe Company are willing to enter into this Agreement in order to renounce,\neffective upon consummation of the Merger, any interest or expectancy either of\nthem or their subsidiaries may have in the classes or categories of business\nopportunities specified herein that are presented to or identified by Union Oil\nor any of its Designees, as more fully described herein.  As a result of this\nAgreement, Union Oil may continue to conduct its business and to pursue certain\nbusiness opportunities without an obligation to offer such opportunities to the\nCompany or any of its subsidiaries, and any Designee may continue to discharge\nhis or her responsibilities as a director or employee of Union Oil or any\ncompany in which Union Oil has an interest.\n\n     In consideration of the foregoing, the mutual covenants, rights, and\nobligations set forth in this Agreement, and the benefits to be derived\nherefrom, and other good and valuable consideration, the receipt and the\nsufficiency of which each of the parties hereto acknowledges and confesses, the\nparties hereto agree as follows:\n\n     1.   Scope of Business of the Company and its Subsidiaries Following the\n          -------------------------------------------------------------------\nMerger. The Company and Titan covenant and agree that, following consummation of\n------                                                                          \nthe Merger, except with the consent of Union Oil (which it may withhold in its\nsole discretion), the Company and its subsidiaries will not engage in any\nbusiness other than the E&amp;P Business and will not pursue any business\nopportunity that involves any direct or indirect ownership interest in any\nproperties located outside the areas onshore shown on the map attached hereto\n(collectively, the 'Designated Areas'). The Company and Titan hereby renounce,\neffective upon consummation of the Merger, any interest or expectancy in any\nbusiness opportunity that does not consist exclusively of the E&amp;P Business\nwithin the Designated Areas. 'E&amp;P Business' means the oil and gas exploration,\nexploitation, development and production business and includes without\nlimitation (a) the ownership of oil and gas property interests (including\nworking interests, mineral fee interests and royalty and overriding royalty\ninterests), (b) the ownership and operation of real and personal property used\nor useful in connection with exploration for Hydrocarbons, development of\nHydrocarbon reserves upon discovery thereof and production of Hydrocarbons from\nwells located on oil and gas properties and (c) debt of or equity interests in\ncorporations, partnerships or other entities engaged in the exploration for\nHydrocarbons, the development of Hydrocarbon reserves and the production and\nsale of Hydrocarbons from wells located on oil and gas properties in which the\nentity conducting the E&amp;P Business owns an interest; but such term does not\ninclude the oilfield service business. 'Hydrocarbons' means oil, gas or other\nliquid or gaseous hydrocarbons or other minerals produced from oil and gas\nwells. 'Subsidiaries' means all entities controlled, directly or indirectly, by\nthe Company. Notwithstanding the foregoing, nothing in this Agreement shall\nprohibit the Company and its subsidiaries from purchasing securities of any\nclass registered under Section 12 of the Securities Exchange Act of 1934\n(regardless of the types or locations of businesses in which the issuer thereof\nengages) if following any such purchase the Company and its subsidiaries own, in\nthe aggregate, less than 5% of such class.\n\n     2.   Corporate Opportunities.  The Company and Titan recognize that Union\n          -----------------------                                             \nOil and its Designees (i) participate and will continue to participate in the\nE&amp;P Business, directly and through affiliates, (ii) may have interests in,\nparticipate with, and maintain seats on the \n\n                                       2\n\n \nboards of directors of or serve as officers or employees of other companies\nengaged in the E&amp;P Business and (iii) may develop business opportunities for\nUnion Oil and its affiliates and such other companies. The Company and Titan\nrecognize that Union Oil, its Designees and such affiliates and other companies\nmay be engaged in E&amp;P Business in competition with the Company and\/or its\nsubsidiaries. The Company and Titan (a) acknowledge and agree that neither Union\nOil, its affiliates nor its Designees nor any such company shall be restricted\nor proscribed by the relationship between Union Oil and the Company, or\notherwise, from engaging in the E&amp;P Business or any other business, regardless\nof whether such business activity is in direct or indirect competition with the\nbusiness or activities of the Company and its subsidiaries, on any basis other\nthan that which is inconsistent with the standards set forth in Section 3\nhereof, (b) acknowledge and agree that, as long as their activities are\nconducted in accordance with the standards set forth in Section 3 hereof,\nneither Union Oil nor any Designee or affiliate of Union Oil nor any such other\ncompany shall have any obligation to offer the Company or any of its\nsubsidiaries any business opportunity, (c) renounce any interest or expectancy\nin any business opportunity pursued by Union Oil, any affiliate of Union Oil,\nany Designee or any such company in accordance with the standards set forth in\nSection 3 hereof and (d) waive any claim that any business opportunity pursued\nby Union Oil, any affiliate of Union Oil, any Designee or any such company\nconstitutes a corporate opportunity of the Company or any of its subsidiaries\nthat should have been presented to the Company, unless such business opportunity\nwas pursued in violation of the standards set forth in Section 3 hereof.\n \n     3.   Standards for Separate Conduct of Business. Union Oil, any affiliate\n          -------------------------------------------                         \nof Union Oil, any Designee or any other company in which Union Oil has an\ninterest or of which a Designee is a director, officer or employee shall be\ndeemed to meet the standards set forth in this Section 3 if its businesses are\nconducted through the use of its own personnel and assets and not with the use\nof any personnel or assets of the Company. Without limiting the foregoing, such\nstandards will be met with respect to a business opportunity only if (a) it is\nidentified by or presented to personnel of Union Oil, such affiliate of Union\nOil, such Designee or such other company and developed and pursued solely\nthrough the use of their personnel and assets (and not based on confidential\ninformation disclosed by or on behalf of the Company in or during the course of\nsuch Designee's relationship with the Company), and (b) it did not come to the\nattention of such Designee solely in, and as a direct result of, his or her\ncapacity as a director of the Company; provided that (i) if such opportunity is\nseparately identified by Union Oil or one of its affiliates or such other\ncompany or separately presented to Union Oil or one of its affiliates or such\nother company by a person other than such Designee, Union Oil, such affiliate or\nsuch company shall be free to pursue such opportunity even if it also came to\nthe Designee's attention solely as a result of and in his or her capacity as a\ndirector of the Company and (ii) if such opportunity is presented to or\nidentified by a Designee other than solely as a result of and in his or her\ncapacity as a director of the Company, Union Oil or such affiliate or such other\ncompany shall be free to pursue such opportunity even if it also came to the\nDesignee's attention as a result of and in his or her capacity as a director of\nthe Company.  Nothing in this Agreement will allow a Designee to usurp a\ncorporate opportunity solely for his or her personal benefit (as opposed to\npursuing, for the benefit of Union Oil, an affiliate or Union Oil or any such\nother company, an opportunity in accordance with the standards set forth in this\nSection 3).\n\n                                       3\n\n \n     4.   Termination of Section 1.  Section 1 of this Agreement will terminate\n          ------------------------                                             \nat such time as Union Oil no longer owns, directly or indirectly, capital stock\nof the Company representing at least 35% of the ordinary voting power for the\nelection of directors of the Company.\n\n     5.   Waiver. If the Company seeks a waiver of provisions of this Agreement,\n          ------  \nthe Company shall submit to Union Oil a written request, accompanied with\nmaterials that provide a basis for the request and assist Union Oil in\nconsidering the request.  Union Oil shall respond to the request within five\nbusiness days of its receipt of the request, unless it determines that it\nrequires additional information before responding, in which case it shall notify\nthe Company of its request for additional information.  Within five business\ndays of receipt of the Company's response to its request for additional\ninformation, Union Oil shall notify the Company of its decision as to the\nrequest for a waiver.  Union Oil may withhold such waiver in its sole discretion\nor grant a conditional or limited waiver, and Union Oil shall have no duty,\nfiduciary or otherwise, to grant any such waiver.\n\n     6.   Miscellaneous.\n          ------------- \n\n     This Agreement may be signed in any number of counterparts, each of which\nwhen so executed and delivered shall be deemed an original, and such\ncounterparts together shall constitute one instrument.  This Agreement shall be\ngoverned by and construed in accordance with the laws of the State of Delaware.\n\n                                       4\n\n \n     IN WITNESS WHEREOF, the undersigned have duly executed this Agreement as of\nthe date set forth above.\n\n                                   TITAN RESOURCES HOLDINGS, INC.\n\n\n                                        By:   \/s\/ Phillip Ballard\n                                           -------------------------------------\n                                           Phillip Ballard\n                                           Vice President\n\n\n                                   UNION OIL COMPANY OF CALIFORNIA\n\n\n                                        By: \/s\/ Timothy H. Ling\n                                           -------------------------------------\n                                           Timothy H. Ling\n                                           Executive Vice President, North\n                                           American Energy Operations and \n                                           Chief Financial Officer\n\n\n                                   TRH, INC.\n\n                                        By: \/s\/ Phillip Ballard\n                                           -------------------------------------\n                                           Phillip Ballard\n                                           Vice President\n\n\n                                   TITAN EXPLORATION, INC.\n\n\n                                        By: Jack D. Hightower\n                                           ------------------------------------\n                                            Jack D. Hightower\n                                            President and Chief Executive \n                                            Officer\n\n\n<\/pre>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[9064,9186],"corporate_contracts_industries":[9409],"corporate_contracts_types":[9622,9626],"class_list":["post-43331","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-titan-exploration-inc","corporate_contracts_companies-unocal-corp","corporate_contracts_industries-energy__exploration","corporate_contracts_types-planning","corporate_contracts_types-planning__merger"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/43331","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=43331"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=43331"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=43331"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=43331"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}