-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, I0mAAbey73Fcqv41nti2lhq6yKR08dF6Ze9DxM4oEPRO9bmr8OjPCH8Gxyl9r1fs TaKMvIJTdSWQ6GXAIPEYvg== 0000950129-03-002184.txt : 20030423 0000950129-03-002184.hdr.sgml : 20030423 20030423162950 ACCESSION NUMBER: 0000950129-03-002184 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 3 FILED AS OF DATE: 20030423 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: PLAINS RESOURCES INC CENTRAL INDEX KEY: 0000350426 STANDARD INDUSTRIAL CLASSIFICATION: WHOLESALE-PETROLEUM & PETROLEUM PRODUCTS (NO BULK STATIONS) [5172] IRS NUMBER: 132898764 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-33092 FILM NUMBER: 03660320 BUSINESS ADDRESS: STREET 1: 500 DALLAS STREET 2: STE 700 CITY: HOUSTON STATE: TX ZIP: 77002 BUSINESS PHONE: 7136541414 MAIL ADDRESS: STREET 1: 1600 SMITH STREET STREET 2: SUITE 1500 CITY: HOUSTON STATE: TX ZIP: 77002 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: ENCAP INVESTMENTS LLC CENTRAL INDEX KEY: 0001083297 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 1001 LOUISIANA AVENUE STREET 2: PO BOX 2511 CITY: HOUSTON STATE: TX ZIP: 77252 BUSINESS PHONE: 7136596100 MAIL ADDRESS: STREET 1: 1001 LOUINIANA ST STREET 2: PO BOX 2511 CITY: HOUSTON STATE: TX ZIP: 77252 SC 13D/A 1 h05075esc13dza.txt ENCAP INVESTMENTS LLC FOR PLAINS RESOURCES INC. SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Schedule 13D/A (Amendment No. 2) Under the Securities Exchange Act of 1934* PLAINS RESOURCES INC. (Name of Issuer) Common Stock, par value $0.10 per share (Title of Class of Securities) 726540503 (CUSIP Number) D. Martin Phillips EnCap Investments L.L.C. 1100 Louisiana, Suite 3150 Houston, Texas 77002 (713) 659-6100 (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) April 1, 2003 (Date of Event which Requires Filing of this Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition which is the subject of this Schedule 13D, and is filing this schedule because of ss.ss. 240.13d-1(e), 240.13d-1(f) or 204.13d-1(g), check the following box. [ ] NOTE: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See ss. 240.13d-7(b) for other parties to whom copies are to be sent. *The remainder of the cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page. The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act. Page 1 CUSIP NO. 726540503 SCHEDULE 13D/A (1) Names of Reporting Persons I.R.S. Identification Nos. of Above Persons (entities only) ENCAP INVESTMENTS L.L.C. (2) Check the Appropriate Box if a Member of a Group (See Instructions) (a) [ ] (b) [ ] (3) SEC Use Only (4) Source of Funds (See Instructions) OO (SEE ITEM 3) (5) Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e) o (6) Citizenship or Place of Organization EnCap Investments L.L.C. ("EnCap Investments") is a limited liability company organized under the laws of the State of Delaware. Number of (7) Sole Voting Power 0 Shares Bene- ficially (8) Shared Voting Power 1,173,662 (1) Owned by Each (9) Sole Dispositive Power 0 Reporting Person With (10) Shared Dispositive Power 1,173,662 (1) (11) Aggregate Amount Beneficially Owned by Each Reporting Person 1,173,662 (2) (12) Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) [ ] (13) Percent of Class Represented by Amount in Row (11) 4.9%(3) (14) Type of Reporting Person (See Instructions) OO - ------------------------------------------------------------------------------- (1) EnCap Investments L.L.C. may be deemed to have voting and dispositive power with respect to the shares of Common Stock owned by certain affiliates of EnCap Investments L.L.C. See Items 2, 5 and 6. (2) EnCap Investments L.L.C. disclaims any beneficial ownership of the shares owned by such affiliates. (3) Based on 24,167,935 shares of common stock issued and outstanding as of February 28, 2003, as disclosed in the Issuer's Annual Report on Form 10-K filed March 31, 2003. Page 2 ITEM 1. SECURITY AND ISSUER. No modification. ITEM 2. IDENTITY AND BACKGROUND. (a) - (c) No modification. Items 2(d) - (f) are amended in their entirety as follows: (d) - (f) See Schedule I ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION. The following is added to Item 3: On November 8, 2001, the Issuer issued 116 shares of its Common Stock, on January 2, 2002, the Issuer issued 163 shares of its Common Stock, on March 18, 2002, the Issuer issued 84 shares of its Common Stock, on April 1, 2002, the Issuer issued 161 shares of its Common Stock, on May 16, 2002, the Issuer issued 74 shares of its Common Stock, on June 20, 2002, the Issuer issued 75 shares of its Common Stock, on July 1, 2002, the Issuer issued 150 shares of its Common Stock, on September 10, 2002, the Issuer issued 80 shares of its Common Stock, on October 8, 2002, the Issuer issued 155 shares of its Common Stock, on November 6, 2002, the Issuer issued 91 shares of its Common Stock, on January 2, 2003, the Issuer issued 338 shares of its Common Stock, on March 3, 2003, the Issuer issued 344 shares of its Common Stock, and on April 1, 2003 the Issuer issued 375 shares of its Common Stock, to an entity which EnCap Investments is the sole general partner of, as compensation for services performed by D. Martin Phillips as a director of the Issuer. On April 1, 2003, EnCap Investments and the Issuer executed a Stock Purchase Agreement pursuant to which the Issuer agreed to repurchase 400,000 shares of its Common Stock from certain entities controlled by EnCap Investments at a price of $10.00 per share. The repurchase closed on April 2, 2003. ITEM 4. PURPOSE OF TRANSACTION. No modification. ITEM 5. INTEREST IN SECURITIES OF THE ISSUER. Item 5 is amended and restated in its entirety as follows: (a) EnCap Investments. EnCap Investments may be deemed to be the beneficial owner of 1,173,662 shares of Common Stock owned by certain affiliates of EnCap Investments, by virtue of being the general partner or controlling person of such affiliates. Based on the 24,167,935 shares of Common Stock outstanding as of February 28, 2003, EnCap Investments may be deemed the beneficial owner of approximately 4.9% of the outstanding shares of Common Stock. EnCap Investments disclaims beneficial ownership of the shares of Common Stock owned by its affiliates. Page 3 El Paso Merchant Energy and El Paso Corporation. Each of El Paso Merchant Energy and El Paso Corporation may be deemed to be the beneficial owner of the shares of Common Stock owned or deemed owned by EnCap Investments (by virtue of being controlling persons of EnCap Investments). El Paso Merchant Energy and El Paso Corporation disclaim beneficial ownership of the shares of Common Stock owned or deemed owned by EnCap Investments. Executive Officers and Directors. Except as otherwise described herein, and to the knowledge of the reporting person, no person listed in Schedule I is the beneficial owner of any shares of Common Stock. (b) EnCap Investments. EnCap Investments shares the power to vote or direct the vote and to dispose or direct the disposition of an additional 1,173,662 shares of Common Stock held by affiliates of EnCap Investments. El Paso Merchant Energy and El Paso Corporation. Each of El Paso Merchant Energy and El Paso Corporation may be deemed to be the beneficial owner of the shares of Common Stock owned or deemed owned by EnCap Investments (by virtue of being controlling persons of EnCap Investments). El Paso Merchant Energy and El Paso Corporation disclaim beneficial ownership of the shares of Common Stock owned or deemed owned by EnCap Investments. Executive Officers and Directors. Except as otherwise described herein, and to the knowledge of the reporting person, no person listed in Schedule I has the power to vote or direct the vote or dispose or direct the disposition of any shares of Common Stock. (c) Except as otherwise described herein or in any Exhibit filed herewith, and to the knowledge of the reporting persons, none of the persons named in response to Paragraph (a) above has affected any transaction in the Common Stock during the past sixty (60) days. (d) Except as otherwise described herein, and to the knowledge of the reporting persons, no person has the right to receive or the power to direct the receipt of dividends from, or the proceeds from sale of, the Common Stock deemed to be beneficially owned by them. (e) As a result of the transactions reported herein, EnCap Investments ceased to be the owner of 5% of the Common Stock of the Issuer on April 16, 2003. ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO THE SECURITIES OF THE ISSUER. The following is added to Item 6: Letter Agreement EnCap Investments entered into a Letter Agreement (the "Letter Agreement") dated April 14, 2003 with Energy Capital Investment Company PLC, a company organized under the laws of England and Wales ("Energy PLC"). The purpose of the Letter Agreement was to amend the Investment Advisory Agreement dated February 4, 1994, as amended (the "Investment Advisory Agreement") by and between EnCap Investments and Energy PLC. Under the Investment Advisory Agreement, EnCap Investments served (subject to the terms thereof) as an advisor and manager with respect to the investment in, and re-investment of, the Issuer's securities. Pursuant to the Letter Agreement, on and after April 16, 2003, EnCap Investments and Energy PLC agreed that EnCap Investments will no longer have (i) any voting power with respect to the Securities (as defined in the Letter Page 4 Agreement and which includes the securities of the Issuer), including the power to vote or direct the voting of the Securities, (ii) any investment power with respect to the Securities, including the power to dispose or direct the disposition of the Securities, or (iii) any other powers, rights, duties or obligations with respect to the Securities, including any powers or rights that would in any way attribute beneficial ownership of the Securities to EnCap Investments, with it being agreed by EnCap Investments and Energy PLC that all such powers, rights, duties, and obligations of EnCap Investments with respect to the Securities are revoked and that all such powers, rights, duties, and obligations with respect to the Securities are retained by, and vested solely in, Energy PLC or its applicable affiliate. Further, on and after April 16, 2003, (i) the Securities will no longer be deemed Investments (as defined in the Letter Agreement) under, or otherwise subject to the Investment Advisory Agreement, and (ii) EnCap Investments will not provide Energy PLC or its affiliates with any information regarding the Securities. ITEM 7. MATERIAL TO BE FILED AS EXHIBITS. Exhibit 10.2 - Stock Purchase Agreement dated April 1, 2003 between Plains Resources Inc. and EnCap Investments L.L.C. Exhibit 10.3 - Letter Agreement dated April 14, 2003 between EnCap Investments L.L.C., a Texas limited liability company, and Energy Capital Investment Company PLC, a company organized under the laws of England and Wales. Page 5 SIGNATURES After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct. Date: April 23, 2003 ENCAP INVESTMENTS L.L.C. By: /s/ D. Martin Phillips --------------------------------- D. Martin Phillips, Managing Director Page 6 SCHEDULE I DIRECTORS, MANAGERS, EXECUTIVE OFFICERS, OR CONTROLLING PERSONS The name, business address, present principal occupation or employment and the name, principal business address of any corporation or other organization in which such employment is conducted, of each of (i) the managing directors of EnCap Investments, (ii) the directors and executive officers of El Paso Merchant Energy, and (iii) the directors and executive officers of El Paso Corporation are set forth below:
Name, Principal Business Address of Organization in Name and Capacity in Principal which Principal Occupation is Business Address Which Serves Occupation Conducted ---------------- ------------ ---------- --------- (i) EnCap Investments L.L.C. ------------------------ David B. Miller Managing Managing Director of EnCap Investments L.L.C. 3811 Turtle Creek Blvd. Director of EnCap Investments 3811 Turtle Creek Blvd. Dallas, Texas 75219 EnCap Dallas, Texas 75219 Investments D. Martin Phillips Managing Managing Director of EnCap Investments L.L.C. 1100 Louisiana, Suite 3150 Director of EnCap Investments 1100 Louisiana, Suite 3150 Houston, Texas 77002 EnCap Houston, Texas 77002 Investments Robert L. Zorich Managing Managing Director of EnCap Investments L.L.C. 1100 Louisiana, Suite 3150 Director of EnCap Investments 1100 Louisiana, Suite 3150 Houston, Texas 77002 EnCap Houston, Texas 77002 Investments Gary R. Petersen Managing Managing Director of EnCap Investments L.L.C. 1100 Louisiana, Suite 3150 Director of EnCap Investments 1100 Louisiana, Suite 3150 Houston, Texas 77002 EnCap Houston, Texas 77002 Investments
Name, Principal Business Address of Organization in Name and Capacity in Principal which Principal Occupation is Business Address Which Serves Occupation Conducted ---------------- ------------ ---------- --------- (ii) El Paso Merchant ---------------- Energy North America - -------------------- Company - ------- Robert W. Baker President and President, El Paso El Paso Merchant Energy 1001 Louisiana Street Director Merchant Energy North America Company Houston, Texas 77002 1001 Louisiana Street Houston, Texas 77002
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Name, Principal Business Address of Organization in Name and Capacity in Principal which Principal Occupation is Business Address Which Serves Occupation Conducted ---------------- ------------ ---------- --------- John L. Harrison Senior Vice Senior Vice President, El Paso Merchant Energy 1001 Louisiana Street President, Chief Chief Financial Officer, North America Company Houston, Texas 77002 Financial Officer, and Treasurer El Paso 1001 Louisiana Street and Treasurer Merchant Energy Houston, Texas 77002 H. Brent Austin Director President and Chief El Paso Corporation 1001 Louisiana Street Operating Officer, El 1001 Louisiana Street Houston, Texas 77002 Paso Corporation Houston, Texas 77002
Name, Principal Business Address of Organization in Name and Capacity in Principal which Principal Occupation is Business Address Which Serves Occupation Conducted ---------------- ------------ ---------- --------- (iii) El Paso Corporation ------------------- Ronald L. Kuehn, Jr. Chairman of the Director, Chairman of El Paso Corporation 1001 Louisiana Street Board, the Board, 1001 Louisiana Street Houston, Texas 77002 Chief Executive and Chief Executive Houston, Texas 77002 Officer, and Officer of El Paso Director Corporation H. Brent Austin President and President and Chief El Paso Corporation 1001 Louisiana Street Chief Operating Operating Officer of 1001 Louisiana Street Houston, Texas 77002 Officer El Paso Corporation Houston, Texas 77002 Robert W. Baker Executive Vice Executive Vice President El Paso Corporation 1001 Louisiana Street President of El Paso Corporation 1001 Louisiana Street Houston, Texas 77002 Houston, Texas 77002 Greg G. Jenkins Executive Vice Executive Vice President El Paso Corporation 1001 Louisiana Street President of El Paso Corporation 1001 Louisiana Street Houston, Texas 77002 Houston, Texas 77002 D. Dwight Scott Executive Vice Executive Vice President El Paso Corporation 1001 Louisiana Street President and and Chief Financial 1001 Louisiana Street Houston, Texas 77002 Chief Financial Officer of El Paso Houston, Texas 77002 Officer Corporation David E. Zerhusen Executive Vice Executive Vice President El Paso Corporation 1001 Louisiana Street President of El Paso Corporation 1001 Louisiana Street Houston, Texas 77002 Houston, Texas 77002
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Name, Principal Business Address of Organization in Name and Capacity in Principal which Principal Occupation is Business Address Which Serves Occupation Conducted ---------------- ------------ ---------- --------- John W. Somerhalder II President, Pipeline President, Pipeline El Paso Corporation 1001 Louisiana Street Group Group of 1001 Louisiana Street Houston, Texas 77002 El Paso Corporation Houston, Texas 77002 Peggy A. Heeg Executive Vice Executive Vice President El Paso Corporation 1001 Louisiana Street President and 1001 Louisiana Street Houston, Texas 77002 and General Counsel of El Houston, Texas 77002 General Counsel Paso Corporation Jeffrey I. Beason Senior Vice Senior Vice President El Paso Corporation 1001 Louisiana Street President and and 1001 Louisiana Street Houston, Texas 77002 Controller Controller of El Paso Houston, Texas 77002 Corporation Byron Allumbaugh Director Retired Chairman 33 Ridgeline Drive 33 Ridgeline Drive Ralphs Grocery Newport Beach, CA 92660 Newport Beach, CA 92660 Company John M. Bissell Director Chairman of the Board of Bissell Inc. 2345 Walker Ave. N.W. Bissell Inc. 2345 Walker Avenue, N.W. Grand Rapids, MI 49501 Grand Rapids, MI 49501 Juan Carlos Braniff Director Vice Chairman Universidad 1200 Universidad 1200 Grupo Financiero Col. XOCO Col. XOCO Bancomer Mexico, D.F.C.P. 03399 Mexico, D.F.C.P. 03339 James F. Gibbons Director Professor at Stanford Stanford University Stafford University University Paul G. Allen Center Paul G. Allen Center for School of Engineering for Integrated Systems Integrated Systems Room 201 ( Mail Stop 4075) Room 201 (M.S. 4075) Stanford, CA 94305 Stanford, California 94305 Robert W. Goldman Director Business Consultant 13 Dupont Circle 13 Dupont Circle Sugar Land, Texas 77479 Sugar Land, Texas 77479 Anthony W. Hall, Jr. Director City Attorney City of Houston 900 Bagby, 4th Floor City of Houston, Texas 900 Bagby, 4th Floor Houston, Texas 77002 Houston, Texas 77002 William A. Wise Director Retired El Paso Corporation 1001 Louisiana Street 1001 Louisiana Street Houston, Texas 77002 Houston, Texas 77002
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Name, Principal Business Address of Organization in Name and Capacity in Principal which Principal Occupation is Business Address Which Serves Occupation Conducted ---------------- ------------ ---------- --------- J. Carleton MacNeil Jr. Director Securities Consultant 3421 Spanish Trail 3421 Spanish Trail Apt. 227D Apt. 227D Delray, Florida 33483 Delray, Florida 33483 Thomas R. McDade Director Senior Partner, McDade, McDade, Fogler, Maines, Two Houston Center Fogler, L.L.P. 909 Fannin, Suite 1200 Maines, L.L.P. Two Houston Center Houston, Texas 77010 909 Fannin, Suite 1200 Houston, Texas 77010 Malcolm Wallop Director Frontiers of Freedom Frontiers of Freedom Foundation Frontiers of Freedom Foundation 12011 Lee Jackson Memorial Foundation Hwy. 12011 Lee Jackson Fairfax, VA 22033 Memorial Hwy. Fairfax, Virginia 22033 Joe B. Wyatt Director Chancellor Emeritus Vanderbilt University 2525 West End Ave., Vanderbilt University 2525 West End Ave., Suite 1410 Suite 1410 Nashville, Tennessee 37203 Nashville, TN 37203 John Whitmire Director Chairman of the Board, Consol Energy, Inc. 10101 Southwest Freeway Consol Energy, Inc. 10101 Southwest Freeway, #380 #380 Houston, TX 77074 Houston, Texas 77074 J. Michael Talbert Director Chairman of the Board, Transocean, Inc. 4 Greenway Plaza Transocean, Inc. 4 Greenway Plaza Houston, Texas 77046 Houston, TX 77046 James L. Dunlap Director Business Consultant 1659 North Boulevard 1659 North Boulevard Houston, TX 77006 Houston, Texas 77006
(d) Neither EnCap Investments, El Paso Corporation, El Paso Merchant Energy, nor any of the individuals identified in this Schedule I has, to the knowledge of the reporting persons, during the last five years, been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors). (e) Neither EnCap Investments, El Paso Corporation, El Paso Merchant Energy, nor any of the individuals identified in this Schedule I has, to the knowledge of the reporting persons, during the last five years, been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws. I-4 (f) To the knowledge of the reporting persons, each of the individuals identified in this Schedule I is a citizen of the United States of America, with the exception of Juan Carlos Braniff, who is a citizen of Mexico. I-5 EX-10.2 3 h05075eexv10w2.txt STOCK PURCHASE AGREEMENT DATED 4/1/2003 EXHIBIT 10.2 STOCK PURCHASE AGREEMENT STOCK PURCHASE AGREEMENT (this "AGREEMENT"), dated as of April 1, 2003, by and between Plains Resources Inc., a Delaware corporation (the "COMPANY"), and EnCap Investments L.L.C., a Delaware limited liability company (the "ENCAP"). WHEREAS, the Company desires to repurchase 400,000 shares (the "SHARES") of its common stock, par value $.10 per share (the "COMMON STOCK") at a price of $10.00 per share from certain entities controlled by EnCap (collectively, the "ENCAP AFFILIATES") under the terms and conditions set forth herein, and to cancel and retire the Shares after such repurchase. NOW, THEREFORE, in consideration of the premises and the mutual promises herein made, and in consideration of the representations, warranties, agreements and covenants herein, the parties hereto hereby agree as follows: 1. Sale and Purchase. (a) On the Closing Date (as hereinafter defined), EnCap shall cause the EnCap Affiliates listed on Schedule I hereto to sell, assign and transfer to the Company the number of Shares set forth opposite such EnCap Affiliate's name on Schedule I hereto free and clear of all security interests, pledges, mortgages, liens, charges, encumbrances, adverse claims, restrictions, or other burdens or encumbrances of any kind ("Encumbrances"), other than those restrictions arising from applicable federal and state securities laws. (b) At the Closing (as hereinafter defined), the Company shall pay to EnCap, on behalf of the EnCap Affiliates, as the purchase price of the Shares, $10.00 per share in cash multiplied by the number of Shares sold, assigned and transferred by the EnCap Affiliates, by wire transfer of immediately available funds to EnCap's bank account set forth on Schedule I. (c) At the Closing, EnCap shall cause the EnCap Affiliates to deliver to the Company a certificate or certificates representing such EnCap Affiliate's Shares registered in such EnCap Affiliate's name, together with a duly executed stock power endorsed to the Company with signatures guaranteed by a national bank or trust company or a member firm of the New York Stock Exchange or such other assignments or instruments of conveyance and transfer, in form and substance satisfactory to the Company and its counsel, as shall be effective to vest in the Company all of such EnCap Affiliate's right, title and interest in and to the Shares. 2. Representations and Warranties of EnCap. EnCap represents and warrants to the Company that: (a) Each EnCap Affiliate is the sole record owner and is the beneficial owner of such EnCap Affiliate's Shares; other than EnCap, no person has a right to acquire or direct the disposition, or holds a proxy or other right to vote or direct the vote, of the Shares; and each EnCap Affiliate has good and valid title to the Shares, free and clear of any Encumbrances except restrictions arising from applicable federal and state securities laws. Other than this Agreement, there is no option, warrant, right, call, proxy, agreement, commitment or understanding of any nature whatsoever, fixed or contingent, that directly or indirectly (i) calls for the sale, pledge or other transfer or disposition of any of the Shares, any interest therein or any rights with respect thereto, or relates to the voting, disposition, exercise, conversion or control of the Shares, or (ii) obligates EnCap or any EnCap Affiliate to grant, offer or enter into any of the foregoing. (b) The sale by the EnCap Affiliates of the Shares and the delivery of the certificates representing the Shares to the Company against receipt of payment therefor pursuant hereto will transfer to the Company good and valid title to the Shares, free and clear of all Encumbrances except restrictions arising from applicable federal and state securities laws. (c) EnCap has all necessary power and authority to enter into this Agreement, to carry out its obligations hereunder, and to consummate the transactions contemplated hereby. The execution and delivery of this Agreement by EnCap, the performance by EnCap of its obligations hereunder, and the consummation by EnCap of the transactions contemplated hereby have been duly authorized by all requisite action on the part of EnCap and no other proceedings on the part of EnCap are necessary to authorize this Agreement or the consummation of the transactions contemplated hereby. This Agreement has been duly executed and delivered by EnCap and constitutes a legal, valid and binding obligation of EnCap enforceable against EnCap in accordance with its terms. (d) The execution, delivery and performance of this Agreement by EnCap does not and will not (a) violate or conflict with or result in a breach of any provision of the organizational documents of EnCap, (b) violate or conflict with any law or order, writ, judgment, injunction, decree, stipulation, determination, or award (a "GOVERNMENTAL ORDER") entered into by or with any federal, state, local, or any foreign government, governmental, regulatory, or administrative authority, agency or commission or any court (a "GOVERNMENTAL AUTHORITY") applicable to EnCap or any of its assets and properties, or (c) conflict with, result in any violation or breach of or constitute a default (or an event which, with the giving of notice or lapse of time, or both, would become a default) under, require any notice or consent under, or give to others any rights of termination, amendment, acceleration or cancellation of, or result in any loss of any benefit, the triggering of any payment by, or the increase in other obligation of, EnCap or the creation of any Encumbrance on any assets or properties of EnCap pursuant to any material contract, license, permit, franchise or other instrument or arrangement to which EnCap is a party or by which it, or any of such assets or properties is bound or affected, except for, in the case of clauses (b) and (c), such conflicts, violations, breaches, defaults or other occurrences which would not (i) impair, in any material respect, the ability of EnCap to perform its obligations under this Agreement or (ii) prevent or materially delay the consummation of any of the transactions contemplated hereby. The execution, delivery and performance of this Agreement by EnCap do not and will not require any consent, waiver, approval, authorization or other order of, action by, filing with or notification to, any Governmental Authority, except (a) the requirements of the Securities Exchange Act of 1934, as amended (the "EXCHANGE ACT"), and (b) any other consent, approval, authorization, filing or notice the failure of which to make or obtain would not (i) impair, in any material respect, the ability of EnCap to perform its 2 obligations under this Agreement, or (ii) prevent or materially delay the consummation of any of the transactions contemplated hereby. (e) EnCap has not entered into any agreement, arrangement or understanding with any person which will result in the obligation of the Company to pay any finder's fees, brokerage or agent's commissions or other like payments in connection with the negotiations leading to this Agreement of the consummation of the transactions contemplated hereby. 3. Representations and Warranties of the Company. The Company represents and warrants to EnCap, for itself and for the benefit of the EnCap Affiliates, that: (a) The Company has all necessary power and authority to enter into this Agreement, to carry out its obligations hereunder, and to consummate the transactions contemplated hereby. The execution and delivery of this Agreement by the Company, the performance by the Company of its obligations hereunder, and the consummation by the Company of the transactions contemplated hereby have been duly authorized by all requisite action on the part of the Company and no other proceedings on the part of the Company are necessary to authorize this Agreement or the consummation of the transactions contemplated hereby. This Agreement has been duly executed and delivered by the Company and constitutes a legal, valid and binding obligation of the Company enforceable against it in accordance with its terms. (b) The execution, delivery and performance of this Agreement by the Company does not and will not (a) violate or conflict with or result in a breach of any provision of the organizational documents of the Company, (b) violate or conflict with any law or Governmental Order applicable to the Company or any of its assets and properties, or (c) conflict with, result in any violation or breach of or constitute a default (or an event which, with the giving of notice or lapse of time, or both, would become a default) under, require any notice or consent under, or give to others any rights of termination, amendment, acceleration or cancellation of, or result in any loss of any benefit, the triggering of any payment by, or the increase in other obligation of, the Company or the creation of any Encumbrance on any assets or properties of the Company pursuant to any material contract, license, permit, franchise or other instrument or arrangement to which the Company is a party or by which it, or any of its assets or properties is bound or affected, except for, in the case of clauses (b) and (c), such conflicts, violations, breaches, defaults or other occurrences which would not (i) impair, in any material respect, the ability of the Company to perform its obligations under this Agreement or (ii) prevent or materially delay the consummation of any of the transactions contemplated hereby. The execution, delivery and performance of this Agreement by the Company do not and will not require any consent, waiver, approval, authorization or other order of, action by, filing with or notification to, any Governmental Authority, except (a) the requirements of the Exchange Act, and (b) any other consent, approval, authorization, filing or notice the failure of which to make or obtain would not (i) impair, in any material respect, the ability of the Company to perform its obligations under this Agreement, or (ii) prevent or materially delay the consummation of any of the transactions contemplated hereby. 4. Covenants. EnCap hereby covenants and agrees that neither it nor any EnCap Affiliate will enter into any transaction, take any action, or by inaction permit any event to occur, 3 that would result in any of EnCap's representations or warranties herein contained not being true and correct as of (a) the time immediately after the occurrence of such transaction, action or event and (b) the Closing Date. The Company hereby covenants and agrees that it will not enter into any transaction, take any action, or by inaction permit any event to occur, that would result in any of the Company's representations or warranties herein contained not being true and correct as of (a) the time immediately after the occurrence of such transaction, action or event and (b) the Closing Date. 5. Adjustments Upon Changes in Capitalization. In the event of any reorganization, recapitalization, split, merger, stock split, stock dividend, combination or exchange of shares, issuance of other securities in exchange for Common Stock or any other change in the outstanding securities of the Company that results in a change in the number and the kind of shares of Common Stock or securities convertible into Common Stock, the terms "Shares" shall be deemed to refer to and include the Shares as well as all such dividends and distributions, and EnCap shall cause the EnCap Affiliates to deliver the Shares and all such dividends and distributions to the Company at the Closing and the amount to be paid per share by the Company shall be adjusted so that the total amount to be paid by the Company hereunder remains unchanged. 6. Closing; Conditions to Closing. The consummation of the transactions contemplated by this Agreement (the "CLOSING") shall take place at the offices of the Company, 500 Dallas Street, Suite 700, Houston, Texas 77002, on the business day after satisfaction or waiver of the conditions set forth in this Section 6. This Agreement shall terminate if the conditions set forth in this Section 6 have not been satisfied or waived by April 11, 2003. The date on which the Closing occurs is referred to in this Agreement as the "CLOSING DATE." The obligations of the Company to consummate the transactions contemplated by this Agreement are subject to the satisfaction of the following conditions, unless waived by the Company in writing: (a) each of the representations and warranties made by EnCap in this Agreement being true and correct as of the date hereof and the Closing; (b) EnCap has performed in all respects each and every covenant and agreement contained in this Agreement required to be performed by EnCap on or before the Closing; and (c) the Company and EnCap shall have obtained all approvals and consents necessary or required for the consummation of the transactions contemplated by this Agreement. 7. Validity and Severability. If any provision of this Agreement shall be held to be illegal, invalid or unenforceable under any applicable law, then such contravention or invalidity shall not invalidate the entire Agreement. Such provision shall be deemed to be modified to the extent necessary to render it legal, valid and enforceable, and if no such modification shall render it legal, valid and enforceable, then this Agreement shall be construed as if not containing the provision held to be illegal, invalid or unenforceable and the rights and obligations of the parties hereto shall be construed and enforced accordingly. 8. Governing Law. This Agreement shall be governed by, and construed in accordance with, the laws of the State of Texas applicable to contracts executed in and to be performed in that state and without regard to any applicable conflicts of law. 4 9. Expenses. Whether or not the transactions contemplated by this Agreement are consummated, each of the parties hereto shall pay their respective fees and expenses incurred in connection herewith. 10. Entire Agreement. This Agreement represents the entire agreement of the parties with respect to the subject matter hereof and shall supersede any and all previous contracts, arrangements or understandings between the parties hereto, with respect to the subject matter hereof. 11. Amendment. This Agreement may not be amended or modified except by an instrument in writing signed by each of, or on behalf of each of, the parties. This Agreement may be amended or supplemented in writing by the parties hereto with respect to any of the terms contained in this Agreement. 12. Assignment; Binding Effect. Neither party shall assign any of its respective rights, interests or obligations hereunder without the prior written consent of the other party, which consent may be granted or withheld in such other party's sole discretion. Subject to the preceding sentence, this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns. Nothing in this Agreement, express or implied, is intended to confer on any person other than the parties hereto or their respective successors and assigns any rights, remedies, obligations or liabilities under or by reason of this Agreement. 13. Notices. All notices or communications hereunder shall be in writing (including facsimile or similar writing) addressed as follows: (a) To EnCap: EnCap Investments L.L.C. 1100 Louisiana, Suite 3150 Houston, Texas 77002 Attention: Mr. Jason DeLorenzo with a copy to: Thompson & Knight LLP 333 Clay St., Suite 3300 Houston, TX 77002 Telecopy: (713) 654-1871 Attention: Timothy T. Samson (b) To the Company: Plains Resources Inc. 500 Dallas Street, Suite 700 Houston, Texas 77002 Telecopy: (713) 654-1523 Attention: Franklin R. Bay 5 with a copy to: Akin, Gump, Strauss, Hauer & Feld, L.L.P. 300 West 6th Street, Suite 2100 Austin, Texas 78701 Telecopy: 512-703-1112 Attention: Michael F. Meskill Any such notice or communication shall be deemed given (i) when made, if made by hand delivery, and upon confirmation of receipt, if made by facsimile, (ii) one business day after being deposited with a next day courier, postage prepaid, or (iii) three business days after being sent certified or registered mail, return receipt requested, postage prepaid, in each case addressed as above (or to such other address as such party may designate in writing from time to time). 14. Counterparts. This Agreement may be executed and delivered (including by facsimile transmission) in one or more counterparts, and by the different parties hereto in separate counterparts, each of which when executed and delivered shall be deemed to be an original, but all of which taken together shall constitute one and the same agreement. 15. Survival of Representations, Warranties, Covenants and Agreements. The representations, warranties, covenants and agreements contained in this Agreement shall survive the Closing Date. 16. Transactions. This Agreement may be terminated and the transactions contemplated hereby may be abandoned at any time prior to the Closing (a) by the mutual written consent of the Company and EnCap or (b) by either party if there has been a breach by the other party of any representation, warranty, covenant or agreement of such other party in this Agreement which could prevent or materially delay the consummation of the transactions contemplated hereby. [SIGNATURE PAGE FOLLOWS] 6 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date first written above by their respective representatives thereunto duly authorized. PLAINS RESOURCES INC. By: -------------------------------- Name: Franklin R. Bay Title: Senior Vice President, Chief Legal Officer and Secretary ENCAP INVESTMENTS L.L.C By: -------------------------------- Name: D. Martin Phillips Title: Managing Director 7 SCHEDULE I ENCAP AFFILIATES
ENCAP AFFILIATE NUMBER OF SHARES PURCHASE PRICE --------------- ---------------- -------------- EnCap Energy Capital Fund III, L.P. 199,918 $ 1,999,180 EnCap Energy Capital Fund III-B, L.P. 151,169 $ 1,511,690 BOCP Energy Partners, L.P. 48,913 $ 489,130 TOTAL: 400,000 $ 4,000,000
EX-10.3 4 h05075eexv10w3.txt LETTER AGREEMENT DATED APRIL 14, 2003 EXHIBIT 10.3 ENCAP INVESTMENTS L.L.C. 1100 LOUISIANA STREET SUITE 3150 HOUSTON, TEXAS 77002 April 14, 2003 Energy Capital Investment Company PLC One Bow Churchyard London EC4M 9HH RE: Modifications to Investment Advisory Agreement Ladies and Gentlemen: Reference is herein made to that certain Investment Advisory Agreement dated February 4, 1994, by and between Energy Capital Investment Company PLC and EnCap Investments L.C. (now known as EnCap Investments L.L.C.), as heretofore amended (the "Agreement"). Capitalized terms used but not otherwise defined herein shall have the respective meanings assigned to them in the Agreement. Subject to the terms of the Agreement, the Company appointed EnCap to act as an advisor, manager and agent with respect to the negotiation, purchase and sale of Investments. Currently included in the Investments made by the Company (or its Affiliate, ECIC Corporation) pursuant to the Agreement are the U.S. securities described more particularly in Annex I hereto (the "Securities"). The Company and EnCap hereby agree that, notwithstanding anything in the Agreement to the contrary, EnCap, on and after the date the Company accepts and agrees to this letter agreement (the "Effective Date"), will no longer have (i) any voting power with respect to the Securities, including the power to vote or direct the voting of the Securities, (ii) any investment power with respect to the Securities, including the power to dispose or direct the disposition of the Securities, or (iii) any other powers, rights, duties or obligations with respect to the Securities, including any powers or rights that would in any way attribute "beneficial ownership" of the Securities to EnCap, as defined in and for purposes of Rule 13d-3 promulgated pursuant to the Securities Exchange Act of 1934, as amended ("Rule 13d-3"), it being the express intention and agreement of the parties hereto that all such powers, rights, duties and obligations of EnCap with respect to the Securities will be revoked in all respects and that all such powers, rights, duties and obligations with respect to the Securities will be retained by, and vested solely in, the Company or ECIC Corporation, as applicable. As such, on and after the Effective Date, (i) the Securities will no longer be deemed Investments under, or otherwise subject to the Agreement, and (ii) without limiting the foregoing provisions of this paragraph, EnCap will not provide the Company or its Affiliates with any information regarding the Securities. In connection with the foregoing, the Company and EnCap further agree, notwithstanding anything in the Agreement to the contrary, as follows: 1. The Company acknowledges and affirms that (i) it has reviewed Annex II hereto prepared by EnCap's U.S. legal counsel, Thompson & Knight LLP, (ii) it has been furnished the documents listed in Annex III attached hereto, (iii) it has furnished and reviewed both this letter agreement (and the attached Annexes) and the documents listed in Annex III with its own legal counsel, and (iv) assuming the accuracy of the facts set forth in Annex I, the genuineness, authenticity, and completeness of the documents listed in Annex II, and that no other material agreements or documents affect the Securities, it understands and agrees with, based on such review and the advice of its own legal counsel, the conclusions set forth in Annex II. The Company also acknowledges and affirms that (a) the Company understands Annex II was prepared solely for the benefit of EnCap by EnCap's U.S. legal counsel and (b) the Company has relied solely upon its own legal counsel for purposes of its above agreement with the conclusions set forth in Annex II and not upon EnCap or EnCap's U.S. legal counsel. 2. EnCap agrees that as promptly as reasonably practicable and, in any event, within 10 days of the Effective Date, it will file amendments to the Schedule 13Ds previously filed by it with the U.S. Securities and Exchange Commission with respect to the Securities reflecting that EnCap no longer has "beneficial ownership" of the Securities, as defined in and for purposes of Rule 13d-3. The Company agrees that EnCap may specifically rely upon this letter agreement for purposes of filing the above-mentioned amendments and that EnCap may file a copy of this letter agreement with such amendments if necessary to comply with the provisions of Rule 13d-3. 3. EnCap agrees that within two business days of the Effective Date, it will file any Form 4s required to be filed by it with the U.S. Securities and Exchange Commission with respect to the Securities reflecting a change in EnCap's "beneficial ownership" of the Securities. 4. EnCap agrees to forward to the Company, within 10 days of the Effective Date all certificates that it has in its possession representing the Securities. 5. Subject to the terms of this paragraph 5, the Company shall indemnify, defend and hold harmless EnCap, its affiliates, and each managing director, director, officer, member, stockholder, owner, employee or agent of EnCap or any affiliate thereof and their respective heirs, legal representatives, successors and assigns (an "Indemnified Party"), from and against any and all claims, actions, causes of action, demands, assessments, losses, damages, liabilities, judgments, settlements, penalties, costs and expenses (including reasonable attorneys', consultants' or experts' fees and expenses) (collectively "Losses"), asserted against, relating to, imposed upon or incurred by any of them, directly or indirectly, based upon, arising out of or otherwise in respect of any breach of or non-compliance by the Company with applicable laws governing the ownership and resale of the Securities after the Effective Date, including applicable U.S. Federal and state securities laws, rules and regulations; provided, however, that the Company shall not be liable for any Losses that arise from or relate to fraud, negligence, willful default, bad faith or misconduct of an Indemnified Party. In the event that any claim or demand for which the Company would be liable under this paragraph 5 is asserted against or sought to be collected from an Indemnified Party by a third party, the Indemnified Party shall with reasonable promptness notify the Company of such claim or demand, but the failure so to notify the Company shall not relieve the Company except to the extent the Company demonstrates that the defense of such claim or demand is prejudiced thereby. The Company shall have 30 days from receipt of the above notice from the Indemnified Party (the "Notice Period") to notify the Indemnified Party whether or not the Company desires, at the Company's sole cost and expense, to defend the Indemnified Party against such claim or demand; provided, that the Indemnified Party is hereby authorized prior to and during the Notice Period to file any motion, answer or other pleading that it shall deem necessary or appropriate to protect its interests or those of the Company and not prejudicial to the Company. If the Company elects to assume the defense of any such claim or demand, the Indemnified Party shall have the right to employ separate counsel at its own expense and to participate in the defense thereof. If the Company elects not to assume the defense of such claim or demand (or fails to give notice to the Indemnified Party during the Notice Period), the Indemnified Party shall be entitled to assume the defense of such claim or demand with counsel of its own choice, at the expense of the Company. If the claim or demand is asserted against both the Company and the Indemnified Party and there is a conflict of interest which renders it inappropriate for the same counsel to represent both the Company and the Indemnified Party, the Company shall be responsible for paying separate counsel for the Indemnified Party; provided, however, that if there is more than one Indemnified Party, the Company shall not be responsible for paying for more than one separate firm of attorneys to represent the Indemnified Parties, regardless of the number of Indemnified Parties. If the Company elects to assume the defense of such claim or demand, (i) no compromise or settlement thereof may be effected by the Company without the Indemnified Party's written consent (which shall not be unreasonably withheld) unless the sole relief provided is monetary damages that are paid in full by the Company and (ii) the Company shall have no liability with respect to any compromise or settlement thereof effected without its written consent (which shall not be unreasonably withheld). 6. The Company agrees to promptly reimburse EnCap up to $7,000.00 for all reasonable third party out-of-pocket costs and expenses (including attorney's fees and printing expenses) incurred by EnCap in the preparation of this letter agreement and any amendments or modifications hereto, the filing of amendments to the Schedule 13Ds as referenced in Section 2 above, the filing of Form 4s as referenced in Section 3 above, the transfer of the Securities, and in otherwise performing its obligations hereunder. 7. EnCap shall not be entitled to any compensation with respect to the transactions contemplated by this letter agreement (except to the extent of the reimbursement provided in Section 6 above) and EnCap waives its right under the Agreement to receive three (3) months notice in respect of the termination hereby of its appointment as advisor in respect of the Securities. 8. EnCap agrees that from and after the Effective Date, the value of the Securities shall not be included in calculating NAV pursuant to Clause 5 of the Agreement. 9. EnCap covenants and agrees that if, after the Effective Date, any of the securities included in the Investments (other than the Securities) are exchanged for or become securities of an issuer that is required to file periodic and other reports pursuant to Section 13 of the Securities Exchange Act of 1934, as amended, this letter will be appropriately amended by EnCap and the Company to include such securities in the definition of "Securities" as used herein, and to supplement Annexes I, II, and III hereto. 10. EnCap agrees that it will not, directly or indirectly, enter into any lock-up or other similar agreement after the Effective Date restricting the rights or transferability of any of the Investments for a period of 180 days or more without the prior written consent of the Company, which consent shall not be unreasonably withheld by the Company. Further, EnCap agrees that if it enters into any lock-up or other similar agreement after the Effective Date restricting the rights or transferability of any of the Investments for a period of less than 180 days, it will promptly notify the Company of such agreement and will provide the Company with a copy of such agreement. All notices or other communications required or permitted to be given to a party hereto pursuant to this Agreement shall be in writing and shall be given either (i) in person, (ii) by mail, postage prepaid, (iii) by facsimile (with signed confirmed copy to follow by mail in the same manner as provided in clause (ii) above) or (iv) by expedited delivery service with proof of delivery, to the address listed below such party's signature block hereto (or at such other address as shall be specified by such party by like notice). Notices sent by hand delivery shall be deemed to have been given when received; notices mailed in accordance with the foregoing shall be deemed to have been given five business days following the date mailed; and notices sent by overnight courier service shall be deemed to have been given on the next business day following the date so sent. This letter agreement may be executed in multiple counterparts, all of which shall be considered one and the same agreement, and shall become effective when one or more counterparts have been signed by each of the parties hereto and delivered to the other party. In making proof of this letter agreement, it shall not be necessary to produce or account for more than one counterpart. A telecopied facsimile of an executed counterpart of this letter agreement shall be sufficient to evidence the binding agreement of a party to the terms hereof. This letter agreement shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, beneficiaries, legal representatives, successors and assigns; provided that the Company may not assign its indemnification obligations hereunder without the written consent of EnCap. If any provision of this letter agreement is held to be unenforceable, this letter agreement shall be considered divisible and such provision shall be deemed inoperative to the extent it is deemed unenforceable, and in all other respects this letter agreement shall remain in full force and effect; provided, however, that if any such provision may be made enforceable by limitation thereof, then such provision shall be deemed to be so limited and shall be enforceable to the maximum extent permitted by applicable law. The failure of any party hereto to insist upon strict performance of a covenant hereunder or of any obligation hereunder, irrespective of the length of time for which such failure continues, shall not be a waiver of such party's right to demand strict compliance in the future. No consent or waiver, express or implied, to or of any breach or default in the performance of any obligation hereunder shall constitute a consent or waiver to or of any other breach or default in the performance of the same or any other obligation hereunder. The word "includes" and its derivatives shall mean "includes, but is not limited to" and corresponding derivative expressions. THIS LETTER AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS WITHOUT REGARD TO THE PRINCIPLES OF CONFLICTS OF LAWS THEREOF. The Agreement, as amended or modified by this letter agreement, is hereby ratified and confirmed in all respects. -REMAINDER OF PAGE INTENTIONALLY LEFT BLANK; SIGNATURE PAGE FOLLOWS- Yours very truly, ENCAP INVESTMENTS L.L.C. By: ------------------------ Managing Director ADDRESS FOR NOTICE PURPOSES: EnCap Investments L.L.C. 1100 Louisiana Street Suite 3150 Houston, Texas 77002 Fax: 713-659-6100 Attention: Managing Director AGREED AND ACCEPTED AS OF THIS 16th DAY OF APRIL, 2003: ENERGY CAPITAL INVESTMENT COMPANY PLC By: ---------------------------- Name: -------------------------- Title: ------------------------- ADDRESS FOR NOTICE PURPOSES: One Bow Churchyard London EC4M 9HH Fax: ----------------------- Attention: ----------------- -----END PRIVACY-ENHANCED MESSAGE-----