UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
6-K
REPORT
OF FOREIGN PRIVATE ISSUER
Pursuant
to Rule 13a-16 or 15d-16
Under
the Securities Exchange Act of 1934
For
the month of January 2025
Commission
File Number: 001-35829
Vermilion
Energy Inc.
(Exact
name of registrant as specified in its charter)
3500,
520 – 3rd Avenue S.W., Calgary, Alberta T2P 0R3
(Address
of principal executive offices)
Indicate
by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Exhibit
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.
VERMILION
ENERGY INC.
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| By: |
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/s/ Lars Glemser |
| Title: |
|
Lars Glemser, VP and Chief Financial Officer |
Date: January 2, 2025
Exhibit 99.1
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FORM 51-102F3 |
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MATERIAL CHANGE REPORT |
|
| 1. | Name and Address of Company |
Vermilion Energy Inc. (“Vermilion” or
the “Company”)
3500, 520 3rd Avenue SW
Calgary, Alberta T2P 0R3
| 2. | Date of Material Change |
December 22, 2024.
The news release reporting the material change was disseminated
on December 23, 2024, through the services of Newswire and filed on the Company’s SEDAR+ profile at www.sedarplus.ca.
| 4. | Summary of Material Change |
Vermilion has entered
into an arrangement agreement (the “Arrangement Agreement”) with Westbrick Energy Ltd.
(“Westbrick”) and its majority shareholder (the “Majority Shareholder”) pursuant to which the
Company agreed, subject to the terms and conditions of the Arrangement Agreement, to acquire all of the issued and outstanding
shares of the company (“Westbrick Amalco”) to be formed upon the amalgamation (the “Westbrick
Amalgamation”) of Westbrick and a wholly-owned subsidiary of the Majority Shareholder, for total consideration of $1.075
billion, subject to certain adjustments (the “Transaction”).
| 5.1 | Full Description of Material Change |
Effective December 22, 2024,
Vermilion entered into the Arrangement Agreement with Westbrick and the Majority Shareholder pursuant to which, among other things:
(i) Westbrick will complete the Spinco Conveyance (as defined below); (ii) the Majority Shareholder will complete a return of
capital; (iii) the Westbrick Amalgamation will occur; (iii) all shares of Westbrick Amalco (the “Westbrick Amalco
Shares”), including any shares issuable upon the exercise of outstanding options to purchase Westbrick Amalco Shares
(“Options”) prior to or in conjunction with Closing (as defined below), will be transferred to Vermilion; and
(iv) holders of unexercised Options and certain other share-based awards will receive an amount of cash equal to the value of their
entitlement, whether or not vested. As noted above, the total consideration to be paid by Vermilion for all such purposes at Closing
is $1.075 billion, subject to certain adjustments set forth in the Arrangement Agreement.
The Arrangement Agreement contains
customary representations, warranties, interim operational covenants of each party and customary closing conditions, including receipt
of applicable shareholder, court and other regulatory approvals, including approval under the Competition Act (Canada). The Transaction
will be accomplished by way of a statutory plan of arrangement under the Business Corporations Act (Alberta) and is expected to
close mid-Q1 2025 (the “Closing”).
Pursuant to the Transaction, Vermilion
will add approximately 50,000 boe/d of stable production and approximately 1.1 million
(770,000 net) acres of land from which Vermilion has identified over 700 drilling locations, increasing the Company’s
estimated inventory of premium drilling locations to over 15 years on a pro forma basis. Pro-forma production is expected to total
approximately 135,000 boe/d with greater than 80% of its production derived from its global gas franchise, consisting of
liquids-rich gas in Alberta and BC and gas-weighted production in Ireland, Germany, Netherlands and Croatia. See
“Transaction Metrics” in this material change report.
Consideration
Pursuant to the Transaction, holders
of Westbrick Amalco Shares, including any shares issued upon the exercise of outstanding Options prior to or in conjunction with Closing,
will receive cash consideration for their Westbrick Amalco Shares, provided that such holders may elect to receive all or a portion of
their consideration in common shares of Vermilion (the “Vermilion Shares”), up to a maximum of 1,700,000 Vermilion
Shares being issued in aggregate and subject to proration, at a deemed price per Vermilion Share of $12.831, being the volume weighted
average trading price of the Vermilion Shares on the Toronto Stock Exchange during the five business day period ending on December 20,
2024.
The Transaction will be funded through
Vermilion’s undrawn $1.35 billion revolving credit facility. In connection with the Transaction, Vermilion has also entered into
a new fully underwritten $250 million term loan maturing May 2028 through a debt commitment letter with TD Securities Inc. (“TD”),
acting as underwriter, and a new fully underwritten US$300 million bridge facility through a debt commitment letter with Royal Bank of
Canada and TD. Upon Closing, Vermilion is expected to have net debt(1) of $2.0 billion
with a pro forma year-end 2025 net debt to fund flows from operations (“FFO”) ratio(2)
of 1.5 times and liquidity of approximately $500 million. In addition to allocating a portion of free cash flow (“FCF”)
to debt reduction, Vermilion will also initiate a process to identify and execute non-core asset divestments in order to accelerate debt
reduction and further high-grade the portfolio, with the objective of reducing the net debt to FFO ratio to the targeted range of 1.0
times or less.
Spinco Conveyance
Under the Transaction, Westbrick
will convey its Cynthia Duvernay assets to TMax Energy Ltd. (“TMax”), a wholly- owned subsidiary of Westbrick on an
“as is, where is” basis, without representation and warranty, in consideration of, among other things, TMax assuming all of
the liabilities associated therewith (the “Spinco Conveyance”), subject to and in accordance with the terms of a conveyance
agreement to be dated on or before Closing (the “Conveyance Agreement”). All of the shares of TMax will be sold to
a third party prior to Closing or, if not sold, will be distributed to the existing shareholders of Westbrick at that time.
Voting Support Agreements
Certain shareholders of Westbrick
(the “Supporting Shareholders”), representing over 90% of the outstanding Westbrick common shares, have executed a
written resolution approving the Transaction. The Supporting Shareholders have also entered into lock-up and support agreements (the “Voting
Support Agreements”), agreeing to support the Transaction, except in certain circumstances.
Transaction
Metrics
| > |
Approximately 1.1 million (770,000 net) acres of land and four operated gas plants with total capacity of 102 mmcf/d in the southeast portion of the Deep Basin trend in Alberta. This footprint is contiguous and complementary to Vermilion’s legacy Deep Basin assets, providing operational and financial synergies, including capital efficiency improvements, infrastructure optimization, gas marketing opportunities, and other corporate synergies. The Transaction excludes undeveloped Duvernay rights on approximately 300,000 (290,000 net) acres of land pursuant to the Spinco Conveyance. |
| > |
Stable annual production of 50,000 boe/d (75% gas and 25% liquids) expected in 2025(3), based on Vermilion’s development plans. This production level represents 5% year-over-year growth and is forecast to generate more than $110 million of annual FCF(3,4) based on forward commodity prices(5). Revenue from the acquired assets will be derived approximately 50% from liquids and 50% from gas. |
| > |
2025E annual net operating
income of $275 million based on forward prices(5), translating into a net
operating income multiple of approximately 3.9x. The multiple compresses to 3.3x in 2026 as net operating income
is forecast to increase to $330 million based on forward pricing(5). |
| > |
Significant, high-quality drilling inventory adds over 700 locations in the Ellerslie, Notikewin, Rock Creek, Falher, Cardium, Wilrich and Niton formations, with half-cycle IRRs ranging from 40% to over 100% based on estimates provided by McDaniel & Associates Consultants Ltd (“McDaniel”)(6) and using three consultant average October 1, 2024 pricing assumptions(6). |
| > |
Proved developed producing (“PDP”) and proved plus probable (“2P”) reserves estimated at 92 million boe (75% gas) and 256 million boe (74% gas), respectively, based on McDaniel estimates(6). The Transaction price per boe of PDP reserves is $11.70, which translates to an implied recycle ratio of 1.3 times based on the operating netback noted above. Approximately 30% of the over 700 identified drilling locations have been included in the reserves estimates. |
| > |
Before-tax PDP reserve net present value at a 10% discount rate is estimated at $1.0 billion based on McDaniel estimates(6) and using three consultant average October 1, 2024 pricing assumptions(6). This value represents over 90% of the purchase price. |
Notes:
| (1) |
Net debt is a capital management measure most directly comparable to long-term debt and is comprised of long-term debt (excluding unrealized foreign exchange on swapped USD borrowings) plus adjusted working capital (defined as current assets less current liabilities, excluding current derivatives and current lease liabilities). |
| (2) |
Net debt to four quarter trailing fund flows from operations is a supplementary financial measure and is not a standardized financial measure under IFRS. It may not be comparable to similar measures disclosed by other issuers and is calculated using net debt (capital management measure) and FFO (total of segment measure). The measure is used to assess the ability to repay debt. |
| (3) |
Anticipated 2025 production and financial results from acquired assets, based on company estimates and full year average reference prices as at November 21, 2024 (see below). Results reflect full year production and cash flow estimates and may not align with Company guidance following the close of the Transaction, which will reflect post-close production and cash flow contributions. |
| (4) |
Free cash flow (FCF) and excess free cash flow (EFCF) are non-GAAP financial measures comparable to cash flows from operating activities. FCF is comprised of FFO less drilling and development and exploration and evaluation expenditures and EFCF is FCF less payments on lease obligations and asset retirement obligations settled. FCF and EFCF per basic share are non-GAAP supplementary financial measures and are not standardized financial measures under IFRS and may not be comparable to similar measures disclosed by other issuers. They are calculated using FCF or EFCF and weighted average basic shares outstanding. |
| (5) |
2025 forward strip pricing as at November 21, 2024: Brent US$72.31/bbl; WTI US$68.49/bbl; LSB = WTI less US$4.96/bbl; TTF $19.90/mmbtu; NBP $20.04/mmbtu; AECO $2.34/mcf; CAD/USD 1.40; CAD/EUR 1.48 and CAD/AUD 0.91. 2026 forward strip pricing as at November 21, 2024: Brent US$70.26/bbl; WTI US$66.25/bbl; LSB = WTI less US$6.18/bbl; TTF $15.83/mmbtu; NBP $15.92/mmbtu; AECO $3.16/mcf; CAD/USD 1.39; CAD/EUR 1.50 and CAD/AUD 0.90. |
| (6) |
Estimated gross proved,
developed and producing, total proved, and total proved plus probable reserves as evaluated by McDaniel in a report dated December
17, 2024, with an effective date of November 30, 2024 (the “McDaniel Reserves Report”). Net present value of
discounted cash flows as provided in the McDaniel Reserves Report. Three consultant average October 1, 2024 pricing assumptions used
in reserve estimates as follows: 2025 WTI US$72.00/bbl, AECO C$2.50/mmbtu, CAD/USD FX rate 0.747; 2026 WTI US$74.98/bbl, AECO
C$3.36/mmbtu, CAD/USD FX rate 0.753; 2027 WTI US$76.65/bbl, AECO C$3.62/mmbtu, CAD/USD FX rate 0.753. |
Additional Information
The foregoing descriptions of the
Arrangement Agreement, the Voting Support Agreements and the Conveyance Agreement are not complete and are qualified in their entirety
by reference to the full text of the Arrangement Agreement, which provides additional information. The Company has filed a copy of the
Arrangement Agreement on its SEDAR+ profile accessible at www.sedarplus.ca.
| 5.2 | Disclosure for Restructuring Transactions |
Not applicable.
| 6. | Reliance on subsection 7.1(2) of National Instrument 51-102 |
Not applicable.
No information has been omitted on the basis that it is confidential
information.
For inquiries regarding the material change and this report, please
contact:
Kyle Preston
Vice President, Investor Relations
(403) 269-4884 | 1-866-895-8101
January 2, 2025.
Forward Looking Information
Certain statements included or incorporated
by reference in this document may constitute forward-looking statements or information under applicable securities legislation. Such forward-looking
statements or information typically contain statements with words such as “anticipate”, “believe”, “expect”,
“plan”, “intend”, “estimate”, “propose”, or similar words suggesting future outcomes or
statements regarding an outlook. Forward looking statements or information in this document may include, but are not limited to: statements
regarding the terms of the Transaction and the expected timing and completion thereof; satisfaction or waiver of the closing conditions
in the Arrangement Agreement (including receipt of applicable shareholder, court and other regulatory approvals); the increase of drilling
inventory of over 15 years; the acquisition of 700 drilling locations; characteristics of the acquired assets, including expected pro
forma production and inventory in place; exploration and development plans and the timing thereof, including as a result of the Transaction
if it is completed; petroleum and natural gas sales, netbacks, and the expectation of generating strong free cash flow therefrom; the
effect of changes in crude oil and natural gas prices, and changes in exchange and inflation rates; Vermilion’s debt capacity, including
the availability of funds under financing arrangements that Vermilion has negotiated in connection with the Transaction and its ability
to meet draw down conditions applicable to such financing, and Vermilion’s ability to manage debt and leverage ratios and raise
additional debt; future production levels and the timing thereof; future production weighting, including weighting for product type or
geography; estimated volumes of reserves and resources, including with respect to those reserves and resources that may be acquired pursuant
to the Transaction; the flexibility of Vermilion’s capital program and operations; business strategies and objectives; operational
and financial performance, including the ability of Vermilion to realize synergies from the Transaction; significant declines in production
or sales volumes due to unforeseen circumstances; statements regarding the growth and size of Vermilion’s future project inventory,
including the number of future drilling locations expected to be available if the Transaction is completed; acquisition and disposition
plans and the economics and timing thereof; operating and other expenses, including the payment and amount of future dividends; and the
timing of regulatory proceedings and approvals.
Such forward-looking
statements or information are based on a number of assumptions, all or any of which may prove to be incorrect. In addition to any
other assumptions identified in this document, assumptions have been made regarding, among other things: the ability of Vermilion to
obtain equipment, services and supplies in a timely manner to carry out its activities in Canada and internationally; the ability of
Vermilion to market crude oil, natural gas liquids, and natural gas successfully to current and new customers; the timing and costs
of pipeline and storage facility construction and expansion and the ability to secure adequate product transportation; the timely
receipt of required regulatory approvals; the ability of Vermilion to obtain financing on acceptable terms; foreign currency
exchange rates and interest rates; future crude oil, natural gas liquids, and natural gas prices; management’s expectations
relating to the timing and results of exploration and development activities; the impact of Vermilion’s dividend policy on its
future cash flows; credit ratings; the ability of Vermilion to effectively maintain its hedging program; expected earnings/(loss)
and adjusted earnings/(loss); expected earnings/(loss) or adjusted earnings/(loss) per share; expected future cash flows and free
cash flow and expected future cash flow and free cash flow per share; estimated future dividends; financial strength and
flexibility; debt and equity market conditions; general economic and competitive conditions; ability of management to execute key
priorities; and the effectiveness of various actions resulting from the Vermilion’s strategic priorities.
Although Vermilion believes that
the expectations reflected in such forward-looking statements or information are reasonable, undue reliance should not be placed on forward
looking statements because Vermilion can give no assurance that such expectations will prove to be correct. Financial outlooks are provided
for the purpose of understanding Vermilion’s financial position and business objectives, and the information may not be appropriate
for other purposes. Forward looking statements or information are based on current expectations, estimates, and projections that involve
a number of risks and uncertainties which could cause actual results to differ materially from those anticipated by Vermilion and described
in the forward-looking statements or information. These risks and uncertainties include, but are not limited to: the timely receipt of
any required regulatory approvals and the satisfaction of all other conditions to the completion of the Transaction; the ability of Vermilion
to complete the Transaction; the ability of management to execute its business plan; the risks of the oil and gas industry, both domestically
and internationally, such as operational risks in exploring for, developing and producing crude oil, natural gas liquids, and natural
gas; risks and uncertainties involving geology of crude oil, natural gas liquids, and natural gas deposits; risks inherent in Vermilion’s
marketing operations, including credit risk; the uncertainty of reserves estimates and reserves life and estimates of resources and associated
expenditures; the uncertainty of estimates and projections relating to production and associated expenditures; potential delays or changes
in plans with respect to exploration or development projects; constraints at processing facilities and/or on transportation; Vermilion’s
ability to enter into or renew leases on acceptable terms; fluctuations in crude oil, natural gas liquids, and natural gas prices, foreign
currency exchange rates, interest rates and inflation; health, safety, and environmental risks and uncertainties related to environmental
legislation, hydraulic fracturing regulations and climate change; uncertainties as to the availability and cost of financing; the ability
of Vermilion to add production and reserves through exploration and development activities; the possibility that government policies or
laws may change or governmental approvals may be delayed or withheld; weather conditions, political events and terrorist attacks; uncertainty
in amounts and timing of royalty payments; risks associated with existing and potential future law suits and regulatory actions against
or involving Vermilion; and other risks and uncertainties described elsewhere in this document or in Vermilion’s other filings with
Canadian securities regulatory authorities.
The forward-looking statements
or information contained in this document are made as of the date hereof, and Vermilion undertakes no obligation to update publicly or
revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless required
by applicable securities laws.
Reserves and Drilling
Data
This document contains metrics commonly
used in the oil and gas industry. These oil and gas metrics do not have any standardized meaning or standard methods of calculation and,
therefore, may not be comparable to similar measures presented by other companies where similar terminology is used and should, therefore,
not be used to make comparisons. Natural gas volumes have been converted on the basis of six thousand cubic feet of natural gas to one
barrel of oil equivalent. Barrels of oil equivalent (boe) may be misleading, particularly if used in isolation. A boe conversion ratio
of six thousand cubic feet to one barrel of oil is based on an energy equivalency conversion method primarily applicable at the burner
tip and does not represent a value equivalency at the wellhead.
Estimates of Drilling Locations:
Unbooked drilling locations, including
those associated with the Transaction, are the internal estimates of Vermilion based on Vermilion’s prospective acreage, the acreage
that may be acquired pursuant to the Transaction, and an assumption as to the number of wells that can be drilled per section based on
industry practice and internal review. Unbooked locations do not have attributed reserves or resources (including contingent and prospective).
Unbooked locations have been identified by Vermilion’s management as an estimation of Vermilion’s multiyear drilling activities
based on evaluation of applicable geologic, seismic, engineering, production and reserves information, including expected activities if
the Transaction is completed. There is no certainty that Vermilion will drill all unbooked drilling locations, and if drilled, there is
no certainty that such locations will result in additional oil and natural gas reserves, resources or production. The drilling locations
on which Vermilion will actually drill wells, including the number and timing thereof is ultimately dependent upon completion of the Transaction,
the availability of funding, regulatory approvals, seasonal restrictions, oil and natural gas prices, costs, actual drilling results,
additional reservoir information that is obtained and other factors. While a certain number of the unbooked drilling locations have been
de-risked by Westbrick drilling existing wells in relative close proximity to such unbooked drilling locations, other unbooked drilling
locations are farther away from existing wells where management of Vermilion has less information about the characteristics of the reservoir
and, therefore, there is more uncertainty whether wells will be drilled in such locations and if drilled there is more uncertainty that
such wells will result in additional oil and gas reserves, resources or production.
Reserves Data:
There are numerous uncertainties
inherent in estimating quantities of crude oil, natural gas and NGL reserves, and the future cash flows attributed to such reserves. The
reserve and associated cash flow information incorporated in this release, including those relating to the reserves to be acquired pursuant
to the Transaction, are estimates only. Generally, estimates of economically recoverable crude oil, NGL and natural gas reserves (including
the breakdown of reserves by product type) and the future net cash flows from such estimated reserves are based upon a number of variable
factors and assumptions, such as historical production from the properties, production rates, ultimate reserve recovery, timing and amount
of capital expenditures, marketability of oil and natural gas, royalty rates, the assumed effects of regulation by governmental agencies
and future operating costs, all of which may vary materially from actual results. For those reasons, estimates of the economically recoverable
crude oil, NGL and natural gas reserves attributable to any particular group of properties, classification of such reserves based on risk
of recovery and estimates of future net revenues associated with reserves prepared by different engineers, or by the same engineers at
different times, may vary. Vermilion’s actual production, revenues, taxes and development and operating expenditures with respect
to its reserves will vary from estimates and such variations could be material.
Financial data contained within this document are reported
in Canadian dollars, unless otherwise stated.
Exhibit 99.2
ARRANGEMENT AGREEMENT
among
WESTBRICK ENERGY LTD.
and
[Name of party redacted]
and
VERMILION ENERGY INC.
Dated as of December 22, 2024
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TABLE OF CONTENTS |
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Page |
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ARTICLE 1 |
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DEFINITIONS AND INTERPRETATION |
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| 1.1 |
Definitions. |
2 |
| 1.2 |
Interpretation |
30 |
| 1.3 |
Schedules |
31 |
| 1.4 |
Interpretation if Closing Does Not Occur |
31 |
| 1.5 |
Knowledge |
31 |
| 1.6 |
Construction |
32 |
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ARTICLE 2 |
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ARRANGEMENT |
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| 2.1 |
Plan of Arrangement and Westbrick Board Recommendation |
32 |
| 2.2 |
Arrangement Resolution |
32 |
| 2.3 |
Interim and Final Order. |
33 |
| 2.4 |
Notice of Written Resolution |
34 |
| 2.5 |
Court Proceedings. |
35 |
| 2.6 |
Initial Arrangement Transactions |
36 |
| 2.7 |
Closing |
38 |
| 2.8 |
Determination of Aggregate Adjusted Consideration |
38 |
| 2.9 |
Payment of Consideration |
41 |
| 2.10 |
Purchaser’s Right to Withhold |
41 |
| 2.11 |
Applicable U.S. Securities Laws |
42 |
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ARTICLE 3 |
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REPRESENTATIONS
AND WARRANTIES OF [NAME OF PARTY REDACTED] |
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| 3.1 |
Organization and Corporate Power |
42 |
| 3.2 |
Subsidiaries |
42 |
| 3.3 |
Due Authorization and Enforceability of Obligations |
42 |
| 3.4 |
Solvency |
43 |
| 3.5 |
Legal Proceedings |
43 |
| 3.6 |
No Contravention |
43 |
| 3.7 |
Consents and Approvals |
44 |
| 3.8 |
Capitalization; Right to Sell |
44 |
| 3.9 |
[Name redacted] Holdco Indebtedness |
45 |
| 3.10 |
No Material Contracts |
45 |
| 3.11 |
Equity Monetization Plans |
45 |
| 3.12 |
Corporate Records |
45 |
| 3.13 |
Residence
of [name of party redacted] and [name redacted] Holdco |
45 |
| 3.14 |
No Conduct of Business |
45 |
| 3.15 |
Tax Matters |
46 |
| 3.16 |
Transaction Expenses |
48 |
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TABLE OF CONTENTS |
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(continued) |
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ARTICLE 4 |
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REPRESENTATIONS AND WARRANTIES OF WESTBRICK |
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| 4.1 |
Incorporation, Corporate Power and Registration |
48 |
| 4.2 |
Subsidiaries |
48 |
| 4.3 |
Capitalization |
48 |
| 4.4 |
Due Authorization and Enforceability of Obligations |
49 |
| 4.5 |
No Contravention |
49 |
| 4.6 |
Consents and Approvals |
50 |
| 4.7 |
Solvency |
50 |
| 4.8 |
Taxable Canadian Corporation - Westbrick |
50 |
| 4.9 |
Title |
50 |
| 4.10 |
Licences |
50 |
| 4.11 |
No Defaults under Leases and Agreements |
51 |
| 4.12 |
No Encumbrances |
51 |
| 4.13 |
No Preferential Purchase Rights |
52 |
| 4.14 |
No Reduction of Interests |
52 |
| 4.15 |
Production Penalties |
52 |
| 4.16 |
Operation of PNG Assets |
52 |
| 4.17 |
Area of Mutual Interest |
53 |
| 4.18 |
Off-Set Obligations |
53 |
| 4.19 |
Royalties, Rentals and Taxes Paid |
53 |
| 4.20 |
AFEs |
53 |
| 4.21 |
Capex Projects |
53 |
| 4.22 |
Reserves |
53 |
| 4.23 |
Hedging Transactions |
54 |
| 4.24 |
Financial Statements |
54 |
| 4.25 |
No Undisclosed Liabilities |
54 |
| 4.26 |
Absence of Changes |
55 |
| 4.27 |
Government Incentives |
55 |
| 4.28 |
Aboriginal Groups |
55 |
| 4.29 |
Material Contracts |
56 |
| 4.30 |
Equity Monetization Plans |
56 |
| 4.31 |
Duvernay Spinco Transaction |
56 |
| 4.32 |
Legal Proceedings |
57 |
| 4.33 |
Compliance with Applicable Laws |
57 |
| 4.34 |
Environmental Matters |
58 |
| 4.35 |
Employee Matters |
59 |
| 4.36 |
Employee Benefit Plans |
61 |
| 4.37 |
Non Arm’s Length Transactions |
62 |
| 4.38 |
Tax Matters |
63 |
| 4.39 |
Insurance |
65 |
| 4.40 |
Intellectual Property |
65 |
| 4.41 |
Books and Records, Corporate Records |
66 |
| 4.42 |
Anti-Corruption; Anti-Money Laundering |
66 |
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TABLE OF CONTENTS |
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(continued) |
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| 4.43 |
Directive 067 |
66 |
| 4.44 |
No Broker |
67 |
| 4.45 |
Net Debt |
67 |
| 4.46 |
Information Provided |
67 |
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ARTICLE 5 |
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REPRESENTATIONS AND WARRANTIES OF PURCHASER |
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| 5.1 |
Organization and Corporate Power |
67 |
| 5.2 |
Due Authorization and Enforceability of Obligations |
67 |
| 5.3 |
No Contravention |
68 |
| 5.4 |
Consents and Approvals |
68 |
| 5.5 |
Solvency |
68 |
| 5.6 |
AER Directive 067 |
68 |
| 5.7 |
Legal Proceedings |
69 |
| 5.8 |
Investment Canada Act |
69 |
| 5.9 |
Taxable Canadian Corporation - Purchaser |
69 |
| 5.10 |
Sufficiency of Funds |
69 |
| 5.11 |
Capitalization |
70 |
| 5.12 |
Issuance of Purchaser Shares |
70 |
| 5.13 |
Purchaser Financial Statements |
71 |
| 5.14 |
No Undisclosed Liabilities |
71 |
| 5.15 |
Absence of Changes |
71 |
| 5.16 |
Compliance with Applicable Laws |
71 |
| 5.17 |
Legal Proceedings |
72 |
| 5.18 |
Anti-Corruption; Anti-Money Laundering |
72 |
| 5.19 |
Reporting Issuer Status |
72 |
| 5.20 |
No Broker |
73 |
| 5.21 |
Principal |
73 |
| 5.22 |
Independent Investigation |
73 |
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ARTICLE 6 |
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COVENANTS |
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| 6.1 |
Access and Information, Integration |
73 |
| 6.2 |
Financing Cooperation |
76 |
| 6.3 |
Conduct of Business of Westbrick |
77 |
| 6.4 |
Conduct of Business of Purchaser |
82 |
| 6.5 |
Additional Covenants of Purchaser |
83 |
| 6.6 |
Regulatory Approvals and Consents |
85 |
| 6.7 |
Westbrick Employee Matters |
88 |
| 6.8 |
Additional Shareholders, Options and Awards |
88 |
| 6.9 |
Additional
[name of party redacted] Covenants |
88 |
| 6.10 |
Purchaser Financing |
89 |
| 6.11 |
Pre-Closing
Reorganization of [name of party redacted] |
91 |
| |
TABLE OF CONTENTS |
|
| |
(continued) |
|
| |
|
|
| |
|
Page |
| |
|
|
| |
ARTICLE 7 |
|
| |
CONDITIONS TO CLOSING AND CLOSING DELIVERIES |
|
| |
|
|
| 7.1 |
Mutual Conditions Precedent |
91 |
| 7.2 |
Conditions to the Obligations of Purchaser |
92 |
| 7.3 |
Conditions
to the Obligations of the Company and [name of party redacted]. |
93 |
| 7.4 |
Covenant to Satisfy Closing Conditions. |
94 |
| 7.5 |
Deliveries by Purchaser. |
94 |
| 7.6 |
Deliveries
by [name of party redacted]. |
94 |
| 7.7 |
Deliveries by Westbrick |
95 |
| |
|
|
| |
ARTICLE 8 |
|
| |
TERMINATION |
|
| |
|
|
| 8.1 |
Termination by Mutual Consent. |
95 |
| 8.2 |
Termination by Any Party. |
95 |
| 8.3 |
Termination by Purchaser. |
96 |
| 8.4 |
Termination
by [name of party redacted] or the Company |
96 |
| 8.5 |
Effect of Termination |
97 |
| |
|
|
| |
ARTICLE 9 |
|
| |
ADDITIONAL COVENANTS |
|
| |
|
|
| 9.1 |
Preservation of Records. |
97 |
| 9.2 |
Stub Period Returns and Other Tax Matters. |
98 |
| 9.3 |
Confidentiality and Public Announcements. |
100 |
| 9.4 |
D&O Insurance and Continuance of Directors’ and Officers’ Indemnification |
103 |
| 9.5 |
Environmental Matters. |
104 |
| 9.6 |
Privacy Matters. |
105 |
| 9.7 |
Insurance |
106 |
| |
|
|
| |
ARTICLE 10 |
|
| |
NO SHOP, NON-SOLICIT |
|
| |
|
|
| 10.1 |
No Shop |
106 |
| 10.2 |
Non-Solicitation |
108 |
| |
|
|
| |
ARTICLE 11 |
|
| |
MISCELLANEOUS |
|
| |
|
|
| 11.1 |
No Survival |
109 |
| 11.2 |
No Other Representation or Warranties |
110 |
| 11.3 |
Notices. |
111 |
| 11.4 |
Disclosure Schedules |
113 |
| 11.5 |
Amendment; Waiver |
114 |
| 11.6 |
Binding Effect; Assignment |
114 |
| 11.7 |
Third Party Beneficiaries |
114 |
| 11.8 |
Entire Agreement |
115 |
| 11.9 |
Fulfillment of Obligations |
115 |
| 11.10 |
Specific Performance and Remedies |
115 |
| |
TABLE OF CONTENTS |
|
| |
(continued) |
|
| |
|
|
| |
|
Page |
| |
|
|
| 11.11 |
Expenses. |
116 |
| 11.12 |
Governing Law; Submission to Jurisdiction; Selection of Forum. |
116 |
| 11.13 |
Resolution of Disputes |
117 |
| 11.14 |
Further Assurances. |
117 |
| 11.15 |
Excluded Privileged Communications |
117 |
| 11.16 |
Counterparts. |
118 |
| 11.17 |
Time of the Essence |
118 |
| 11.18 |
Severability. |
118 |
SCHEDULES
SCHEDULES
| Schedule “A” |
Plan of Arrangement |
| Schedule “B” |
Arrangement Resolution |
| Schedule “C” |
[Escrow Agreement redacted] |
THIS ARRANGEMENT AGREEMENT dated as
of December 22, 2024
AMONG:
WESTBRICK
ENERGY LTD., a corporation formed under the laws of Alberta (“Westbrick” or the “Company”)
-and-
[Name of party redacted], a company
formed under the laws of the Netherlands (“[Name of party redacted]”)
-and-
VERMILION ENERGY INC., a corporation
incorporated under the laws of Alberta (“Purchaser”)
WHEREAS [name
of party redacted] is the registered and beneficial owner of all of the issued and outstanding shares of [Name redacted] Holdco
(the “Holdco Shares”) and [Name redacted] Holdco is the registered and beneficial owner of certain Westbrick
Shares as further set out in the Disclosure Schedules (the “[Name redacted] Shares”);
AND WHEREAS the
remainder of the Westbrick Shares not comprised of the [name redacted] Shares (the “Additional Shares”) are
held by those Persons as further set out under the heading “Additional Shareholders” in the Disclosure Schedules (the “Additional
Shareholders”);
AND WHEREAS Purchaser,
Westbrick and [name redacted] Holdco and the other Westbrick Supporting Shareholders desire to complete an arrangement under section
193 of the ABCA in respect of Westbrick;
AND WHEREAS upon
Closing, and pursuant to the Arrangement: (i) [name redacted] Holdco intends to return capital to [name of party redacted]
with the [Name redacted] Holdco Note; (ii) [name redacted] Holdco and Westbrick intend to amalgamate (the “Amalgamation”);
(iii) upon the Amalgamation, [name of party redacted] and the Additional Shareholders shall receive shares in the amalgamated company
(“Westbrick Amalco”) in exchange for the Holdco Shares and the Additional Shares, respectively; and (iv) all shares
of Westbrick Amalco will be transferred to the Purchaser and the [name redacted] Holdco Note will be repaid;
AND WHEREAS concurrently
with the execution of this Agreement, the Westbrick Supporting Shareholders have entered into the Lock-Up Agreements and the Westbrick
Supporting Shareholders that hold Westbrick Shares have executed the Written Resolution and the Lock-Up Agreements;
AND WHEREAS the
Westbrick Supporting Shareholders hold, in the aggregate, not less than two-thirds of the issued and outstanding Westbrick Shares;
AND WHEREAS, prior
to completion of the Arrangement, Westbrick intends to complete the Duvernay Conveyance and either sell the Duvernay Spinco Shares or
complete the Duvernay Alternative Transaction;
NOW, THEREFORE,
in consideration of the foregoing, the mutual representations, warranties, covenants and agreements contained herein, and other good and
valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties covenant and agree as follows:
Article 1
DEFINITIONS AND INTERPRETATION
In this Agreement, including the recitals,
this Section 1.1, and the Schedules, the following capitalized terms shall have the following meanings:
“11-22 Gas Handling and Transportation
Agreement” means that Gas Handling and Transportation Agreement to be entered into on or prior Closing between Westbrick and
Duvernay Spinco, in form substantially as attached to the Disclosure Schedules.
“Abandonment and Reclamation Liabilities”
means all past, present and future obligations of Westbrick to:
| (a) | abandon wells and close, decommission, dismantle and remove structures, foundations, buildings, pipelines,
equipment and other facilities, including those located on the Lands or lands pooled or unitized therewith or used or previously used
in respect of Petroleum Substances: (i) produced or previously produced from the Lands or lands pooled or unitized therewith; or (ii)
stored or previously stored within, upon or under the Lands or lands pooled or unitized therewith; and |
| (b) | restore, remediate and reclaim the surface locations of wells and tangible assets and equipment including
the Wells and Tangibles and lands used to gain access thereto, including all such obligations relating to tangibles and equipment that
were abandoned or decommissioned prior to the Closing Date whether located on or off the Lands or lands pooled or unitized therewith or
that were located on other lands and used in respect of Petroleum Substances: (i) produced or previously produced from the Lands or lands
pooled or unitized therewith or other lands; or (ii) stored or previously stored within, upon or under the Lands or lands pooled or unitized
therewith or other lands. |
“ABCA”
means the Business Corporations Act (Alberta), as may be amended from time to time.
“Aboriginal Group”
means any “band” (within the meaning of the Indian Act (Canada)), First Nations, Métis, tribal council or other
indigenous groups or communities
“Acquisition Debt
Confirmations” means the certificate of the Purchaser dated as of the date of this Agreement certifying (i) that the Purchaser
has availability under the Purchaser Credit Agreement and the Purchaser Bridge Loan Facility to borrow amounts that are more than sufficient
in order to (A) pay all the Cash Consideration payable under the Plan of Arrangement, (B) fund the repayment and cancellation of the Credit
Facilities at the Closing Time, and (C) repay all Indebtedness of the Purchaser that matures prior to May 30, 2025 (collectively, the
“Required Funds”), subject to the terms and conditions of the Purchaser Credit Agreement and the Purchaser Bridge Loan
Facility, which include the funding conditions which are customary for (A) a revolving loan facility (in the case of the Purchaser Revolving
Loan Facility), (B) an acquisition term loan facility (in the case of the Purchaser Term Loan Facility) (except there are no “limited
conditionality” provisions in the funding conditions in the Purchaser Term Loan Facility since there are no such provisions in the
Purchaser Revolving Loan Facility) and (C) a “high yield” bridge loan facility (in the case of the Purchaser Bridge Loan Facility)
(ii) that the Purchaser has no reason to believe that it will be unable to satisfy, on a timely basis, any term or condition of any definitive
document related to the Debt Financing, and (iii) the amount available to be to drawn down under each of the Purchaser Credit Agreement
and the Purchaser Bridge Loan Facility as of the date of this Agreement.
“Acquisition Proposal”
means, (other than the transactions contemplated by this Agreement, the Duvernay Conveyance and Duvernay Share Purchase Agreement), any
proposal, expression of interest, inquiry or offer from, or public announcement of an intention by, any Person, or group of Persons “acting
jointly or in concert” within the meaning of National Instrument 62-104- Take-Over Bids and Issuer Bids, whether or not in
writing and whether or not delivered to a Party’s shareholders and whether or not subject to due diligence or other conditions,
or whether in one transaction or a series of transactions, that relates to, or may reasonably be expected to relate to:
| (a) | any direct or indirect sale, issuance or acquisition of shares or other securities (or securities convertible
or exercisable for shares or other securities) of Westbrick that, when taken together with the shares and other securities of Westbrick
held by the proposed acquiror and any Person acting jointly or in concert with such acquiror, represent 20% or more of any class of equity
or voting securities of Westbrick or rights or interests therein and thereto; |
| (b) | any direct or indirect acquisition or purchase of 20% or more of the assets or contributing 20% or more
of the consolidated revenue (or any joint venture, lease, long-term supply agreement or other arrangement having the same economic effect
as an acquisition or purchase) of Westbrick and its subsidiaries taken as a whole; |
| (c) | an amalgamation, arrangement, share exchange, merger, business combination, , consolidation, recapitalization,
liquidation, dissolution, winding-up, reorganization or other similar transaction involving Westbrick; or |
| (d) | any take-over bid, issuer bid, exchange offer or similar transaction involving a Party or its subsidiaries
that, if consummated, would result in a Person or group of Persons acting jointly or in concert with such Person acquiring beneficial
ownership of 20% or more of any class of equity or voting securities of such Party. |
“Additional Shareholders”
has the meaning given to that term in the recitals.
“Additional Shares”
has the meaning given to that term in the recitals and, as the context requires, the shares received in exchange for the Additional Shares
on the Amalgamation.
“Adjusted Inventory” means
such inventory of Westbrick listed in Schedule 1.1 of the Disclosure Schedules under the heading “Adjusted Inventory”.
“AFEs”
means authorities for expenditure, cash calls, operations notices, amounts budgeted pursuant to joint operating agreements, unit agreements,
mail ballots and similar notices and calls for funds.
“Affiliate”
has the meaning ascribed thereto in the Securities Act (Alberta). Notwithstanding the foregoing, in all cases except in Sections
7.1(e), 8.5 and 9.3, in respect of [name of party redacted] and Westbrick, the definition of “Affiliate” shall be deemed
to exclude any direct or indirect operating or portfolio company, investment vehicle, co-invest vehicle, investment fund (including any
limited or general partner thereof) or investee company of any fund managed or advised by [names redacted] or any Persons controlled
thereby, excluding [name of party redacted], [name redacted] Holdco and Westbrick and any of its subsidiaries as at the
date of this Agreement and from time to time. For purposes of this definition, [name redacted] Holdco and Westbrick shall be deemed
to be Affiliates of [name of party redacted] for the time period ending immediately prior to Closing, and Westbrick Amalco shall
be deemed to be an Affiliate of Purchaser for the time period from after Closing.
“Aggregate Adjusted
Consideration” has the meaning ascribed to it in Section 2.8(b);
“Aggregate Base
Consideration” has the meaning ascribed to it in Section 2.8(a);
“Agreement”
means this Arrangement Agreement, including the recitals, this Article 1, and all Schedules attached hereto, as the same may be amended
or supplemented from time to time in accordance with the terms hereof.
“Amalgamation”
has the meaning set forth in the Recitals hereto.
“Applicable Canadian
Securities Laws” means, collectively, and as the context may require, the applicable securities legislation of each of the Provinces
of Canada, and the rules, regulations, instruments, orders and policies published and/or promulgated thereunder, as such may be amended
from time to time prior to the Closing Date.
“Applicable U.S.
Securities Laws” means, collectively, the federal and state securities legislation of the United States and all rules, regulations
and orders promulgated thereunder, as amended from time to time prior to the Closing Date.
“Applicable Laws”
means, in relation to any Person, asset, transaction, event or circumstance, any and all applicable provisions of laws, statutes, common
law, rule of law, rules, regulations, ordinances, by-laws, treaties, published guidelines, standards, codes of practice and orders of,
and the terms of all judgments, orders, decisions, directives, ruling, awards and decrees issued by, any Governmental Authority by which
such Person is bound or having application to the asset, transaction, event or circumstance in question.
“Area of Mutual
Interest” means a designated geographical area in respect of which Westbrick is obligated by contract to offer to one or more
Third Parties the right to participate in an acquisition of petroleum and natural gas rights, oil and gas facilities or pipelines or other
material infrastructure related to the exploration and development of petroleum and natural gas rights.
“Arrangement”
means the arrangement in respect of Westbrick and involving its securityholders, Duvernay Spinco, [name of party redacted], Purchaser
and [name redacted]Holdco under the provisions of section 193 of the ABCA on the terms and conditions set out in the Plan of Arrangement,
as supplemented, or modified in accordance with the provisions of this Agreement and the Plan of Arrangement, or amended or made at the
direction of the Court in the Final Order (with the consent of Westbrick, [name of party redacted] and Purchaser, each acting reasonably).
“Arrangement Resolution”
means the special resolution of Westbrick Shareholders approving the Arrangement, in the form of the Written Resolution or such other
form as agreed to by the Parties.
“Articles of Arrangement”
means the articles of arrangement in respect of the Arrangement required under section 193(4.1) of the ABCA to be filed with the Registrar.
“Assets”
means, collectively, all properties and assets of Westbrick of every kind and description (whether real, personal, tangible or intangible)
wherever located and includes the PNG Assets, but does not include the Duvernay Assets.
“Award”
has the meaning set forth in the Omnibus Plan.
“Award Agreements”
means, collectively, the agreements entered into by each of the holders of Awards and Westbrick in connection with the grant of Awards,
and each such agreement is an “Award Agreement”.
“Benefit Plan”
means any pension, retirement, deferred compensation, profit-sharing, registered retirement savings plan, savings, disability, medical,
dental, health, life, death benefit, stock option, stock purchase, bonus, incentive, vacation entitlement and pay, change of control,
termination and severance pay or other employee benefit plan, trust, arrangement, Contract, agreement, policy or commitment, whether funded
or unfunded, insured or uninsured, written or oral, in each case (a) for the benefit of Westbrick Employees or former employees, or current
or former officers or directors of Westbrick, or other Persons who are receiving or have received remuneration for work or services provided
to Westbrick, or in all cases any of their eligible spouses, dependents, survivors or beneficiaries, and (b)(i) to which Westbrick is
a party or by which Westbrick is bound or (ii) with respect to which Westbrick has any Liability, but in all cases does not include Statutory
Plans.
“Books and Records”
means the books and records of Westbrick, [name redacted] Holdco, and Westbrick Amalco, including financial, corporate, operations
and sales books, records, books of account, sales and purchase records, lists of suppliers and customers, formulae, business reports,
plans and projections and all other documents, surveys, plans, files, records, assessments, correspondence, and other data and information,
financial or otherwise, including all data, information and databases stored on computer-related or other electronic media.
“Business”
means the exploration and development of oil and liquids-rich natural gas as presently conducted by Westbrick, including the operation
of the Assets and, except where expressly stated otherwise, includes the Duvernay Business.
“Business Day”
means any day (other than a Saturday, a Sunday or a statutory holiday) on which banks in Calgary, Alberta and New York, New York are generally
open for commercial banking business during normal banking hours.
“Capex Plan” means the capital
program and budget of Westbrick for the period from the date hereof until March 31, 2025 [redacted], a copy of which is included
in the Disclosure Schedule.
“Capital Expenditure” means
an expenditure that is required to be capitalized in accordance with IFRS in a manner consistent with the Financial Statements.
“Cash Consideration”
has the meaning set forth in the Plan of Arrangement.
“Cause” means a conviction
for a criminal act of fraud, theft, misappropriation, embezzlement or other indictable offence or any action taken by a Westbrick Employee
or Westbrick Contractor in bad faith that could be reasonably expected to damage or negatively impact the business, operations, reputation
or financial condition of the Purchaser or Westbrick in a material manner or otherwise amounts to just cause at common law.
[Definition redated]
[Definition redated]
“Claim”
means any claim, demand, lawsuit, action, proceeding, notice of non-compliance or violation, audit, order or direction, arbitration or
governmental proceeding or investigation.
“Closing”
means the filing of the Articles of Arrangement, payment of the Consideration, repayment of the [name redacted] Holdco Note and
delivery of all other items and consideration required to be delivered on or prior to the Closing Date hereunder to consummate the Transaction.
“Closing Date”
has the meaning set forth in Section 2.7.
“Closing Date Statement”
has the meaning ascribed to it in Section 2.8(d).
“Closing Time”
has the meaning set forth in Section 2.7.
[Definition redacted]
“Commissioner”
means the Commissioner of Competition appointed under section 7(1) of the Competition Act and includes any Person designated by the Commissioner
to act on his or her behalf.
“Competition Act”
means the Competition Act (Canada).
“Competition Act
Approval” means the occurrence of either of the following:
| (a) | the issuance to Purchaser of an advance ruling certificate by the Commissioner under section 102(1) of
the Competition Act with respect to the completion of the Transaction; or |
| (b) | both of (i) the applicable waiting period, including any extension thereof, under section 123 of the Competition
Act shall have expired or been terminated or the obligation to provide a pre-merger notification in accordance with Part IX of the Competition
Act shall have been waived by the Commissioner pursuant to paragraph 113(c) of the Competition Act (a “Waiver”), and
(ii) the Commissioner shall have advised the Purchaser in writing that the Commissioner does not, at that time, intend to make an application
under section 92 of the Competition Act in respect of the completion of the Transaction (a “No-Action Letter”). |
“Conditions Satisfaction
Date” means the date on which the last of the conditions set forth in Section 7.1, 7.2 and 7.3 (other than those conditions
that by their nature are to be satisfied at or immediately prior to the Closing) have been satisfied or waived.
“Confidentiality
Agreement” means the Confidentiality Agreement dated as of September 26, 2024 between Purchaser and Westbrick.
“Consideration”
means, collectively, the Cash Consideration and Share Consideration payable pursuant to the Plan of Arrangement to Westbrick Shareholders.
“Continuing Contractor”
has the meaning set forth in Section 6.7(c).
“Continuing Employee”
has the meaning set forth in Section 6.7(c).
“Contract”
means, with respect to any Person, any contract, lease, deed, mortgage, license, undertaking, indenture, agreement, instrument or other
legally binding commitment or arrangement to which such Person is a party or under which it has rights or obligations, whether written
or oral, and includes authorizations for expenditure issued or approved by such Person under any of the foregoing.
“Court”
means the Court of King’s Bench of Alberta.
[Definition redacted]
“Credit Facilities”
means the credit facilities established by the Third Amended and Restated Credit Agreement dated May 31, 2024 among the Company and the
lender parties thereto.
“Credit Support”
means any guarantee, letter of credit, surety or performance bond or any other similar agreement or arrangement (including any security
or collateral furnished in connection therewith).
“Data Room”
means, collectively the two Firmex virtual data rooms established by or on behalf of Westbrick entitled “Buffalo Due Diligence”
and “Westbrick Energy” respectively, as they existed at 11:00 AM on December 21, 2024 (and Company will, as soon as reasonably
practicable after the date hereof, download the contents of the two virtual data rooms onto two USBs and deliver them to the Purchaser
or its Representatives).
“Debt Financing”
means the aggregate debt financing available to Purchaser under the Purchaser Credit Agreement and the Purchaser Bridge Loan Facility,
as described in the Acquisition Debt Confirmations, and where the context requires includes the definitive documents creating and governing
the Purchaser Credit Agreement and the Purchaser Bridge Loan Facility.
“Debt Financing
Sources” means the parties to the Purchaser Credit Agreement and the Purchaser Bridge Loan Facility (other than the Purchaser
and its Affiliates) and the Affiliates of such parties and, where the context permits, includes their respective former, current or future
general or limited partners, stockholders, managers, members, representatives, directors, officers, employees, agents, successors or assigns.
“December 31 Accounting
Principles” means those accounting methodologies and procedures (including classifications, judgments and estimation methodologies)
applied by Westbrick to arrive at the calculations set forth in Section 4.45 of the Disclosure Schedules consistent with the supporting
excel spreadsheet provided by Company to Purchaser concurrent with the execution of this Agreement and the earlier versions thereof that
were provided by Company to Purchaser.
“Depositary”
means Odyssey Trust Company, or such other Person that may be appointed by the Parties in connection with the Arrangement for the purpose
of receiving and paying the Consideration to the Westbrick Shareholders and receiving deposits of certificates formerly representing the
Purchased Shares.
“Depositary Agreement”
means the depositary agreement dated on or before the Closing Date between the Purchaser, the Company and the Depositary.
“Disclosure Date” has the
meaning ascribed to it in Section 7.2(b)(i).
“Disclosure Schedules”
has the meaning set forth in Article 3.
“Disputed Amount” has the
meaning set forth in Section 2.8(f).
“Dissent Rights”
means the right of a registered Westbrick Shareholder to dissent to the Arrangement Resolution and to be paid the fair value of the Westbrick
Shares in respect of which the holder dissents, all in accordance with section 191 of the ABCA, the Final Order and the Plan of Arrangement.
“Duvernay Alternative
Transaction” means the distribution of the Duvernay Spinco Shares to the Westbrick Shareholders and other matters ancillary
thereto as further set forth in Section 1.1 of the Disclosure Schedules under the heading “Duvernay Alternative Transaction”
and as provided for in the Plan of Arrangement.
“Duvernay Assets”
has the meaning set forth in the Duvernay Spinco Conveyance Agreement.
“Duvernay Assumed
Liabilities” has the meaning set forth in the Duvernay Spinco Conveyance Agreement.
“Duvernay Business” means
the ownership and operation by Westbrick of the Duvernay Assets, as currently conducted.
“Duvernay Conveyance”
means the transactions contemplated by the Duvernay Spinco Conveyance Agreement.
“Duvernay Deposit”
means the deposit paid to the Company pursuant to the Duvernay Share Purchase Agreement, if any.
“Duvernay Net Proceeds”
means the total amount of cash consideration under the Duvernay Share Purchase Agreement received by Westbrick, including for greater
certainty, the full amount of the Duvernay Deposit.
“Duvernay Share
Purchase Agreement” means a purchase and sale agreement which may be entered into by Westbrick and another Person for the acquisition
by such other Person prior to Closing of all of the Duvernay Spinco Shares.
“Duvernay Spinco”
means TMax Energy Ltd., a wholly-owned subsidiary of Westbrick.
“Duvernay Spinco
Conveyance Agreement” means the conveyance agreement to be dated on or before the Closing Date effecting the sale of the Duvernay
Assets to Duvernay Spinco in consideration for Duvernay Spinco Shares and the assumption by Duvernay Spinco of all of the Duvernay Assumed
Liabilities.
“Duvernay Spinco
Shares” means the common shares of Duvernay Spinco.
“Duvernay Spin-Out
Event” means: (a) the full amount of the Duvernay Net Proceeds have not been received by the Depositary by the second Business
Day prior to the date on which Closing is scheduled to occur, or there remain any closing conditions outstanding on the transactions under
the Duvernay Share Purchase Agreement as of such date (which are not capable of being satisfied on or prior to the Closing Date); or (b)
Westbrick and [name of party redacted] determine to pursue the Duvernay Alternative Transaction prior to the date on which Closing
is scheduled to occur.
“Duvernay Transaction
Expenses” means, without duplication (and without duplication to the Transaction Expenses), any out of pocket fees and expenses
incurred or payable by Westbrick, whether payable before or after Closing, in connection with (a) the Duvernay Conveyance and the Duvernay
Share Purchase Agreement (or the Duvernay Alternative Transaction), or relating to the negotiation, preparation, or execution of Duvernay
Conveyance Agreement and/or the Duvernay Share Purchase Agreement, or any documents or agreements contemplated by such agreements or the
performance or consummation of the transactions contemplated thereby, including the following to the extent incurred in connection with
such transactions (i) brokers’ or finders’ fees (including those of RBC and Scotiabank), and (ii) fees and expenses of professional
advisors, counsel (including Osler, Hoskin & Harcourt LLP), advisors, consultants, investment bankers, Tax advisors, accountants,
and auditors, (b) escrow agent fees and expenses; and (c) third party costs and expenses related to due diligence, including set up and
maintenance of the data room in respect of the Duvernay Assets, and diligence conducted by Westbrick, in respect of the purchaser, its
business, assets and operations; provided further, however, that the term “Duvernay Transaction Expenses” shall exclude (A)
all such fees and expenses that have already been paid on or before December 31, 2024; (B) any GST payable by Westbrick in connection
with any of the foregoing, and (C) any amounts included in the calculation of Net Debt or Transaction Expenses; and provided, however,
that Duvernay Transaction Expenses shall be increased by an amount equal to (i) [amount redacted] for each [amount redacted]
of proceeds under the Duvernay Share Purchase Agreement received by Westbrick prior to Closing (without adjustments for proceeds which
are above a [amount redacted] increment) or, (ii) to the extent a Duvernay Alternative Transaction is implemented pursuant to Section
2.6(b)(iv), [percentage redacted] of the Duvernay Spinco Shares Value (as defined in the Plan of Arrangement), rounded down to
the nearest [amount redacted], that are distributed to the Westbrick Shareholders.
“Employee Obligations”
means the obligations of Westbrick to pay any amounts to its Westbrick Employees for accrued and unpaid salary, wages, bonus, vacation
pay or benefits, and any amounts payable as a result of the termination of Westbrick Employees in accordance with this Agreement before
or immediately prior to Closing, including all change of control, termination and severance amounts under contract, statute and common
law.
“Encumbrance”
means any lien, pledge, charge, encumbrance, royalty, mortgage, hypothecation, title retention or other Security Interest or other adverse
claim, or any option, right of first refusal or other restriction on transfer.
“Entitlement Calculation”
means, in the case where (i) the Insurance Claim is settled prior to Closing, [percentage redacted] of the Insurance Recovery Amount;
or (ii) the Insurance Claim is settled following Closing, [percentage redacted] of the Insurance Recovery Amount.
“Entitlement Schedule” has
the meaning set forth in the Plan of Arrangement.
“Environment”
means the components of the earth, alone or in combination, and includes ambient air, land, surface and sub-surface strata, groundwater,
surface water, all layers of the atmosphere, all organic and inorganic matter and living organisms, including plants, animals and humans,
and the interacting natural systems that include such components, and any derivative thereof shall have a corresponding meaning.
“Environmental Law”
means all Applicable Laws concerning the protection of the Environment or the impact on the Environment of any use, storage, recycling,
treatment, generation, transportation, processing, handling, labeling, management, control, Release or threatened Release, emission, discharge
or disposal of any Hazardous Material, or pollution, contamination, reclamation or remediation of the Environment.
“Environmental Liabilities”
means all past, present and future Losses and Liabilities of Westbrick of whatsoever nature or kind, whether arising under contract, tort
(based on negligence or strict liability), Applicable Laws or otherwise, arising from or associated with: (a) Abandonment and Reclamation
Liabilities; (b) any past, present or future operations conducted on or related to the Assets resulting in any damage to, contamination
of or other adverse situations pertaining to the Environment, howsoever and by whomsoever caused, and regardless of whether such damage,
contamination or other adverse situations occur or arise in whole or in part prior to, on or subsequent to the Closing Time; (c) the presence,
collection, accumulation, use, holding, storage, assessment, recycling, treatment, generation, transportation, processing, stabilization,
handling, labeling, management, Release or threatened Release, emission, discharge or disposal of Hazardous Materials; (d) compliance
with or the consequences of any non-compliance with, or violation or breach of, any Environmental Law or otherwise, whether occurring
before, on or after the Closing Time; (e) sampling, monitoring or assessing the Environment or any potential impacts thereon from any
past, present or future activities or operations; or (f) the protection, reclamation, remediation or restoration of the Environment, in
each case, to the extent relating or arising by virtue of the Assets or the ownership or operation thereof, or any past, present or future
operations and activities conducted in connection therewith or on or in respect of the lands upon which any of the Assets or any structures,
foundations, buildings, facilities, pipelines, equipment and other physical assets used or previously used in connection with the Assets
are or were located and any other lands which are or were used to gain access thereto, but, for certainty, in each case, excluding all
such past, present and future obligations of Westbrick, Westbrick Amalco, Duvernay Spinco, or otherwise attributable to the Duvernay Assets.
“Field Contractors”
means those Westbrick Contractors set forth in Section 2.6(b) of the Disclosure Schedules.
“Final Order”
means the final order of the Court approving the Arrangement pursuant to section 193(4) of the ABCA approving the Arrangement, as such
order may be amended, modified, supplemented or varied by the Court (with the consent of each of the Purchaser, [name of party redacted]
and the Company, acting reasonably) at any time prior to the Closing Date or, if appealed, then unless such appeal is withdrawn or denied,
as affirmed or as amended (provided that such amendment is satisfactory to each of the Purchaser, [name of party redacted] and
the Company, acting reasonably) on appeal.
“Financial Statements”
means, collectively:
| (a) | the audited balance sheet of Westbrick as at December 31, 2021, December 31, 2022 and December 31, 2023
and the audited statements of income and cash flows for the 12-months ended on December 31, 2021, December 31, 2022 and December 31, 2023;
and |
| (b) | the unaudited balance sheet of Westbrick (the “Balance Sheet”) as at September 30,
2024 (the “Balance Sheet Date”) and the unaudited statements of income and cash flows for the three and nine months
ended on September 30, 2024. |
“Fraud” means with respect
to any Person, means an intentional and willful misrepresentation by such Person that constitutes common law fraud under the laws of the
Province of Alberta. For the avoidance of doubt, Fraud will not include any fraud claim based on constructive knowledge, negligent misrepresentation,
recklessness or a similar theory or any equitable fraud, promissory fraud, or unfair dealing fraud.
“Governmental Authority”
means, in relation to any Person, transaction or event, any: (a) federal, provincial, municipal, state or local governmental body (whether
administrative, legislative, executive or otherwise), both domestic and foreign, (b) agency, authority, commission, instrumentality, regulatory
body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or
functions of or pertaining to government, (c) court, arbitrator, commission or body exercising judicial, quasi-judicial, administrative
or similar functions, or (d) other body or entity created under the authority of or otherwise subject to the jurisdiction of any of the
foregoing, including any stock or other securities exchange (including the TSX and NYSE), in each case having, purporting to have, exercising,
or entitled to exercise, jurisdiction over such Person, transaction or event.
“GST” means
the goods and services tax and/or harmonized sales tax levied under the Excise Tax Act (Canada) and any analogous provision of
any comparable Applicable Law of any province or territory of Canada.
“Hazardous Materials”
means any waste, chemical, material or other substance that is listed, defined, designated or classified as hazardous, radioactive or
toxic or a pollutant or a contaminant under any Environmental Law, including petroleum and all derivatives thereof, asbestos or asbestos-containing
materials in any form or condition, and polychlorinated biphenyls.
“Hedging Transaction”
means: (a) any transaction which is a rate swap transaction, basis swap, forward rate transaction, commodity loan, commodity consignment,
commodity lease, commodity swap, commodity option, a commodity forward or futures Contract and whether settled by physical or financial
delivery, equity or equity index swap, equity or equity index option, bond option, interest rate option, foreign exchange transaction,
cap transaction, floor transaction, collar transaction, currency swap transaction, cross-currency rate swap transaction, currency option,
transaction to buy, sell, borrow or lend securities or any other similar transaction (including any option with respect to any of these
transactions); and (b) any derivative or combination of these transactions.
“Holdco Shares”
has the meaning set forth in the Recitals.
“Insurance Claim” means
the business interruption claim made by Westbrick as set forth in Section 4.39 the Disclosure Schedule.
“Insurance Payment” has
the meaning ascribed thereto in Section 9.7.
“Insurance Recovery Amount”
means [percentage redacted] of any amounts recovered by Westbrick in respect of the Insurance Claim.
“IFRS”
means International Financial Reporting Standards as issued by the International Accounting Standards Board, as at the relevant
time in question, as the context requires.
“Indebtedness” means, with
respect to any Person, without duplication, (a) indebtedness of such person for borrowed money, secured or unsecured, (b) every obligation
of such Person evidenced by bonds, debentures, notes, derived obligations or other similar instruments, (c) every obligation of such Person
to pay the deferred purchase price of property or services, except trade accounts payable and other current liabilities arising in the
ordinary course of business, (d) every obligation of such Person under purchase money, mortgages, conditional sales agreements, or other
similar instruments, relating to purchased property or assets, (e) every capitalized or non-consolidated lease obligation of such Person,
(f) every obligation of such Person under Hedging Transactions (valued at the termination value thereof), (g) every obligation of such
Person, contingent or otherwise, under acceptance credit, letters of credit or similar facilities, and (h) every obligation of the type
referred to above of any other Person, the payment of which such Person has guaranteed or which Person is otherwise responsible or liable.
“Independent Accountant”
has the meaning ascribed thereto in Section 2.8(f).
“Intellectual Property”
means any and all proprietary or industrial rights, whether registered or not, owned, licensed, used by a Person, provided under patent
laws, copyright laws, trade-mark laws, design patent or industrial design laws, semi-conductor chip, layout, architecture, topology or
mask work laws, trade secret laws or any other Applicable Laws that provides a right in intellectual property or the expression or use
of intellectual property and the goodwill associated therewith or symbolized thereby, and any applications, registrations or any other
evidence of a right in any of the foregoing.
“Interim Order”
means the interim order of the Court pursuant to section 193(4) of the ABCA containing declarations and directions with respect to the
Arrangement, as such order may be amended, modified, supplemented or varied by the Court (with the consent of each of the Purchaser, [name
of party redacted] and the Company, acting reasonably) or, if appealed, then unless such appeal is withdrawn or denied, as affirmed
or as amended (provided that such amendment is satisfactory to each of the Purchaser, [name of party redacted] and the Company,
acting reasonably) on appeal.
“IRC” means the U.S. Internal
Revenue Code of 1986, as amended.
“Key Executives” means those
individuals listed in Section 1.1 of the Disclosure Schedule under the heading “Key Executives.”
“Key Regulatory
Approval” means Competition Act Approval.
“[Name redacted]Holdco”
means [name redacted].
“[Name redacted]
Holdco Note” means a non-interest bearing promissory note, the form of which is attached in Section 1.1 of the Disclosure
Schedule under the heading “[name redacted] Holdco Note.”
“[Name redacted]
Shares” has the meaning set forth in the Recitals.
“[Name of party redacted]”
has the meaning set forth in the preamble.
“[name redacted]
Westbrick Amalco Shares” means the common shares issued to [name of party redacted] in exchange for the Holdco Shares
on the Amalgamation.
“Lands”
means all lands and formations set out in the Land Schedule and includes, unless the context otherwise requires, the surface of such Lands
and, subject to the exceptions noted in the Land Schedule, the Petroleum Substances within, upon or under those lands.
“Landlord Consents”
means, collectively:
| (a) | the consent of [names redacted], as landlord to the Company in respect of a lease of office space
between them dated April 20, 2021, as amended by the lease amending agreement dated January 17, 2022, the lease extension and amending
agreement dated March 25, 2024, the lease extension agreement dated May 13, 2024, and the lease amending agreement dated November 20,
2024; and |
| (b) | the consent of [name redacted], as landlord to the company in respect of a lease for office space
between them dated April 1, 2020. |
“Land Schedule”
means the mineral property report dated December 18, 2024 contained in the “Buffalo Due Diligence” Data Room folder “Buffalo
Due Diligence / 11. Land / 11.8”.
“Leases”
means, collectively, the leases, licenses, permits and other documents of title (excluding fee simple interests) that grant rights to
Petroleum Substances within, upon or under the Lands, including those that are set forth and described in the Land Schedule and includes,
if applicable, all renewals and extensions of such documents and all documents issued in substitution therefor but only to the extent
such documents of title relate to the Lands, except for any such leases, licenses, permits and other documents of title in respect of
Duvernay Assets.
“Letter of Transmittal
and Election Form” shall mean the letter of transmittal and election form, in form to be agreed to by the Parties, each acting
reasonably, to be included with the Notice of Written Resolution to be sent to [name of party redacted] and the Westbrick Shareholders
in connection with the approval of the Arrangement Resolution, or any similar document provided to [name of party redacted] and
the Westbrick Shareholders subsequent to approval of the Arrangement Resolution, pursuant to which Westbrick Shareholders may elect to
receive Cash Consideration and/or Share Consideration in respect of their Westbrick Shares, in each case in a form acceptable to Purchaser
acting reasonably.
“Liabilities”
of any Person means, as of any given time, any and all liabilities, commitments and obligations of any kind of such Person, whether fixed,
contingent or absolute, matured or unmatured, liquidated or unliquidated, accrued or not accrued, asserted or not asserted, known or unknown,
determined, determinable or otherwise, disputed or undisputed, contractual, legal or equitable, whenever or however arising (including
whether arising out of any contract, tort based on negligence or strict liability or Applicable Laws).
“Licences”
means any and all licences, rights, consents, permits, authorizations, approvals, privileges, variances, waivers, exemptions, orders,
certificates, rulings, agreements and other concessions from, of or with any Governmental Authority required to carry on the Business,
including those relating to the construction, installation, ownership and use of the PNG Assets and to explore, develop and produce Petroleum
Substances.
“Lock-Up Agreements”
means the support and lock-up agreements between Purchaser and each of the Westbrick Supporting Shareholders and [name of party redacted]
and delivered concurrent with the execution of this Agreement, pursuant to which, among other things, each of such Westbrick Supporting
Shareholders has agreed to execute and be bound by the Written Resolution and, if required, to vote the Westbrick Shares beneficially
owned or controlled, directly or indirectly, by such Westbrick Supporting Shareholder in favour of the Arrangement Resolution, and to
otherwise support the Arrangement.
“Losses”
means, with respect to any Person, any and all losses, costs, expenses, claims, judgments, debts, fines, penalties, settlement payments,
awards or damages of any kind actually suffered or incurred and paid by such Person, whether fixed, contingent or absolute, matured or
unmatured, liquidated or unliquidated, accrued or not accrued, asserted or not asserted, known or unknown, determined, determinable or
otherwise, disputed or undisputed, contractual, legal or equitable (including whether arising out of any contract, tort based on negligence
or strict liability or Applicable Laws) (together with all reasonably incurred cash disbursements, costs and expenses, costs of investigation,
defence and appeal and reasonable legal fees and expenses).
“Major Facilities”
means those pipelines, central delivery batteries, plants and other facilities, major equipment and tangible depreciable property set
out or referred to in “PNG Assets” under Section 1.1 of the Disclosure Schedule.
“Management Personnel”
means those Persons listed on Section 6.7 of the Disclosure Schedules under the heading “Management Personnel”.
“Material Adverse
Effect on Company” and “Material Adverse Effect on Purchaser” means, except as it relates to the Duvernay
Assets, with respect to the Company or the Purchaser, as applicable, any state of facts, event, change, effect or circumstance, development,
occurrence, or condition that has been, or would be reasonably likely to be, individually or in the aggregate, materially adverse to the
assets, business, operations, properties, liabilities (whether absolute, accrued, contingent or otherwise), capitalization, financial
condition or results of operations of the Company or the Purchaser, as applicable, taken as a whole or, in respect of the Company, on
the ability of the Company or [name of party redacted] to consummate the Transaction, or in respect of the Purchaser on the ability
of the Purchaser to consummate the Transaction; provided, however, that in no event shall any of the following, either alone or in combination,
be deemed to constitute or contribute to a Material Adverse Effect on Company or a Material Adverse Effect on the Purchaser, as applicable,
or otherwise be taken into account in determining whether a Material Adverse Effect on Company or a Material Adverse Effect on the Purchaser,
as applicable, has occurred or is existing:
| (a) | any change or prospective change in Applicable Laws or applicable accounting standards or the adoption,
implementation, interpretation or enforcement thereof; |
| (b) | any change in global, national or regional economic, political or business conditions or financial, credit,
debt or securities market conditions generally, including changes in interest rates, inflation rates, exchange rates, electricity prices,
fuel costs, costs of raw materials used; |
| (c) | any legal, regulatory or other change generally affecting the industries, industry sectors or geographic
sectors in which the Company or the Purchaser, as applicable, operate, including any change in the prices of oil, bitumen, natural gas,
natural gas liquids or other hydrocarbon products or the demand for related gathering, processing, transportation and storage services
or the production or curtailment of oil, bitumen, natural gas, natural gas liquids or other hydrocarbon products; |
| (d) | any seasonal reduction in revenues or earnings related to its assets substantially consistent with historical
results including as a result of any planned or unplanned turnaround; |
| (e) | the announcement or publicity of this Agreement and consummation of the Transaction, including the Arrangement
or the announcement thereof; |
| (f) | in respect of Material Adverse Effect on Company, the identity of the Purchaser and its Affiliates (including
the impact thereof on relationships, contractual or otherwise, with Westbrick’s customers, suppliers, distributors, partners, employees,
contractors or regulators), including any departures of Westbrick Employees; |
| (g) | in respect of a Material Adverse Effect on the Purchaser, the identity of Westbrick, the Westbrick Shareholders
and their respective Affiliates (including the impact thereof on relationships, contractual or otherwise, with the Purchaser’s customers,
suppliers, distributors, partners, employees, contractors or regulators); |
| (h) | acts of war, civil unrest (whether or not declared), hostilities, sabotage, cyber attack or hacking, acts
of terrorism, military actions or the escalation of any of the foregoing, any hurricane, flood, tornado, earthquake or other natural disaster,
or any other act of God, natural disaster, force majeure event, or any national or international calamity or crisis; |
| (i) | any epidemic, pandemic or disease outbreak (and any worsening thereof); |
| (j) | in respect of Material Adverse Effect on Company: (i) the taking of, or the failure to take, any action
by the Company, [name of party redacted] or any of their Affiliates and Representatives, which action is required to be taken,
or not taken, as the case may be, by this Agreement or was consented to or requested by Purchaser in writing prior to the action having
been taken or not taken, or (ii) the failure to take any action by the Company or any of its Affiliates and Representatives that requires
the consent of Purchaser under Section 6.3(b) if Purchaser has withheld its consent; |
| (k) | in respect of Material Adverse Effect on Purchaser: (i) the taking of, or the failure to take, any action
by the Purchaser or its Affiliates and Representatives, which action is required to be taken, or not taken, as the case may be, by this
Agreement or was consented to or requested by the Company or any of the Westbrick Shareholders in writing prior to the action having been
taken or not taken, or (ii) the failure to take any action by the Purchaser or any of its Affiliates and Representatives that requires
the consent of the Company under Section 6.4(a) if the Company has withheld its consent; |
| (l) | in respect of Material Adverse Effect on Company, any action (or the effects of any action) taken (or
omitted to be taken) by the Purchaser or its Affiliates; |
| (m) | any action taken by Purchaser in connection with obtaining any Key Regulatory Approval; |
| (n) | any matter disclosed in the Disclosure Schedules; and |
| (o) | any failure to achieve any published or internally prepared budgets, projections, predictions, estimates,
plans or forecasts of revenues, earnings or other financial performance measures or operating statistics (it being understood that, unless
otherwise excluded by paragraphs (a) - (o) of this definition, the causes underlying such failure may be considered to determine whether
the same constitutes a Material Adverse Effect on Company or a Material Adverse Effect on the Purchaser, as applicable), |
provided that, in
the case of each of clauses (a) - (c), (g) and (h) of this definition, any state of facts, event, change, effect or circumstance, development,
occurrence, or condition described in such clauses may be taken into account in determining whether a “Material Adverse Effect on
Company” or a “Material Adverse Effect on Purchaser” has a disproportionate effect on the Company or the Purchaser,
as applicable, relative to other entities of comparable size operating in the oil and gas industry in Canada generally.
“Material Contract”
means the following Contracts to which Westbrick, or Westbrick Amalco is bound, excluding in each case (x) any and all Contracts that
are being assigned or otherwise transferred to Duvernay Spinco pursuant to the Duvernay Spinco Conveyance Agreement, (y) the Duvernay
Spinco Conveyance Agreement; and (z) Title and Operating Documents except where expressly included below:
| (a) | for the purchase or sale of, lease or use of materials, vehicles, supplies, equipment or services (including
in respect of maintenance or operations services), or which otherwise obligates Westbrick, or Westbrick Amalco to make a Capital Expenditure
or acquire a capital asset, in each case, involving currently outstanding obligations of more than [amount redacted] per consecutive
12 month period or [amount redacted] in aggregate, in each case, excluding any such Contract that can be terminated by Westbrick
without any penalty on not more than 90 days’ notice; |
| (b) | Transportation, Sale and Handling Agreements or agreements pertaining to Take or Pay Obligations, provided
that the foregoing excludes any Contract that can be terminated by Westbrick without any penalty and with not more than 90 days’
notice; |
| (c) | relating to Hedging Transactions; |
| (d) | made with any Aboriginal Groups, including Title and Operating Documents with such Aboriginal Groups; |
| (e) | made with any Governmental Authority other than ordinary course Licences relating to the construction,
installation, ownership and use of the PNG Assets and to explore, develop and produce Petroleum Substances; |
| (f) | relating to the acquisition of any business, a material amount of shares or assets of any other Person
or any real property for consideration exceeding [amount redacted] individually and under which Westbrick or Westbrick Amalco has
any continuing liability or obligation, including Title and Operating Documents; |
| (g) | relating to the disposition of any part of the Business or any Assets (whether by merger, sale of Westbrick
Shares, Westbrick Amalco Shares, sale of Assets, or otherwise) where the amount paid to Westbrick, and/or Westbrick Amalco is in excess
of [amount redacted] individually and under which Westbrick or Westbrick Amalco has any continuing liability or obligation, including
Title and Operating Documents; |
| (h) | under which Westbrick, or Westbrick Amalco has incurred or assumed any Indebtedness, or instruments relating
to Indebtedness requiring, in either case, payments in excess of [amount redacted] individually; |
| (i) | entered into between Westbrick, or Westbrick Amalco, on the one hand, and a director or officer of Westbrick
or any other Person not dealing at arms’s length from Westbrick, or Westbrick Amalco (other than employment Contracts or indemnity
agreements); |
| (j) | for the lease or use of real property for consideration exceeding [amount redacted] in any calendar
year, other than in the ordinary course of business; |
| (k) | obligating the payment of royalties, license fees or similar payments in excess of [amount redacted]
in any calendar year; |
| (l) | excluding time limited non-disclosure and confidentiality agreements entered into in the ordinary course
of business and/or in connection with past acquisition opportunities, containing any (i) non-competition or non-solicitation covenant;
(ii) area of mutual interest; (iii) are of mutual exclusion; or (iv) any other provision or covenant which materially restricts Westbrick
or Westbrick Amalco or the conduct of its business (including the Business), except where such restrictions apply solely to the Duvernay
Business; |
| (m) | that are a partnership, joint venture or joint operating agreement or arrangement, or any cooperative
agreement involving a sharing of profits with any Person; |
| (n) | excluding licenses of Intellectual Property and for greater certainty excluding licenses of seismic or
other geophysical data, containing any rights, obligations, covenants or agreements which apply to or are triggered by a change of control
of Westbrick; |
| (o) | containing restrictions with respect to the payment of any dividend or other form of distribution in respect
of the Westbrick Shares or the Westbrick Amalco Shares; |
| (p) | other than licenses of seismic or other geophysical data, that licenses Intellectual Property from or
to any Person in respect of material operations for the Company, other than “shrink wrap”, “click wrap” or “off
the shelf” software licenses that are generally commercially available; |
| (q) | that is Credit Support granted (i) by Westbrick, or Westbrick Amalco in support of the obligations of
any Person; or (ii) by any Person in support of the obligations of Westbrick, or Westbrick Amalco; and |
| (r) | that requires, or could reasonably be expected to require, the posting of Credit Support (whether by Westbrick,
or Westbrick Amalco or any Person in support of Westbrick, or Westbrick Amalco), excluding Title and Operating Documents and any such
Contracts that are otherwise captured in the other subparagraphs of this definition. |
“Miscellaneous Interests”
means Westbrick’s entire right, title, estate and interest in and to all of the following:
| (a) | the Wells including the well bores of the Wells and down-hole casing for the Wells; and |
| (b) | all property, assets, interests and rights pertaining to the Petroleum and Natural Gas Rights and the
Tangibles (other than the Petroleum and Natural Gas Rights, the Wells and the Tangibles themselves), or either of them, but only to the
extent that such property, assets, interests and rights pertain to the Petroleum and Natural Gas Rights, the Wells and the Tangibles,
or either of them, including any and all of the following: |
| (A) | the Title and Operating Documents and all other Contracts relating to the Petroleum and Natural Gas Rights,
the Wells and the Tangibles, or either of them, including the Transportation, Sale and Handling Agreements; |
| (B) | all rights to enter upon, use or occupy, the surface of any lands which are or may be used to gain access
to or otherwise use the Petroleum and Natural Gas Rights, the Wells and the Tangibles, or any of them; |
| (C) | all subsisting rights to carry out operations relating to the Lands or Tangibles, and without limitation,
all easements and other Licences; |
| (D) | all records, files, correspondence, books, documents, reports and data (whether existing in physical or
electronic form) which relate to the Petroleum and Natural Gas Rights and the Tangibles, or either of them, including (i) lease, contract,
well, production and facilities files; and (ii) evaluations, forecasts or interpretations (whether geological, engineering, economic or
otherwise) |
| (E) | any facility or area specific emergency response plans pertaining to the Assets; |
| (F) | all proprietary interpretive geological, geophysical, technical or seismic data whatsoever and all records,
books, documents, licenses, reports and data and all sale, trading and reproduction associated with the seismic lines referred to in Section
1.1 of the Disclosure Schedules, including all 2D seismic lines and 3D seismic surveys and all associated field tapes, stack tapes, processed
record sections, operator’s reports, survey notes, shot point location maps and any other original seismic material associated with
them; |
| (G) | any deposits or other security related to Licences or any operations or royalties pertaining to the Petroleum
and Natural Gas Rights, the Lands, the Wells or the Tangibles; |
| (H) | all non-interpretative production and technical data; and |
| (I) | all extensions, renewals, replacements, substitutions or amendments of or to any of the agreements and
instruments described in this definition, |
but, for certainty, excluding
all such property, assets, interests and rights comprising the Duvernay Assets.
“misrepresentation” has
the meaning ascribed thereto in the Securities Act (Alberta).
“Net Debt” means the net
debt of the Company as of December 31, 2024 calculated in accordance with Section 1.1 of the Disclosure Schedule (under the heading “Net
Debt & December 31 Accounting Principles”) less the Duvernay Net Proceeds (if the sale under Duvernay Share Purchase Agreement
is completed), or less the amount, if any, equal to [percentage redacted] of the Duvernay Deposit if the Duvernay Share Purchase
Agreement is terminated in a circumstance in which the Duvernay Deposit is releasable to the Company.
“Notice of Written
Resolution” has the meaning set forth in Section 2.4.
“NYSE”
means the New York Stock Exchange.
“Omnibus Plan”
means the omnibus long-term equity incentive plan of Westbrick made effective as of September 4, 2024.
“Option Agreements”
means, collectively, the option agreements entered into by each of the Optionholders and Westbrick in connection with the grant of Options,
and each such agreement is an “Option Agreement”.
“Option Exercise Proceeds”
means the aggregate cash amounts received by Westbrick in connection with the exercise of Options by Optionholders.
“Option Plan”
means the share option plan of Westbrick made effective as of December 16, 2019, as amended on April 26, 2023.
“Option Exercise
and Surrender Agreements” has the meaning set forth in the Plan of Arrangement.
“Optionholder”
means a holder of Options.
“Options”
means the rights to purchase Westbrick common shares granted to the Optionholders in accordance with the Option Plan on the terms and
subject to the conditions set forth in the Option Plan and in each Optionholder’s Option Agreement.
“Organizational
Documents” means, with respect to any Person, (a) if a company or a corporation, the certificate and articles of incorporation,
notice of articles, articles of association, memorandum of association, articles of amalgamation, articles of arrangement and by-laws,
as applicable; (b) if a partnership, the partnership agreement and any certificate, declaration or other notice of partnership required
to be filed with any Governmental Authority in order to form the partnership or, in the case of a limited partnership, to maintain the
limited liability of any partners; (c) if a trust, the declaration of trust, trust indenture or other agreement of trust, as applicable;
(d) if another type of Person, any other charter or similar document adopted or filed with any Governmental Authority in connection with
the creation, formation or organization of the Person; (e) in the case of Westbrick, the Shareholder Agreement or any other unanimous
shareholder agreements, or in the case of such other Person if a company or a corporation, all unanimous shareholder agreements; and (f)
any amendment or supplement to any of the foregoing.
“Other Adjustment
Amounts” means the sum of: (a) [percentage redacted] of Employee Obligations relating to Management Personnel; (b) [percentage
redacted] of all payments made by Westbrick to its directors, officers and employees on the settlement and cancellation of such directors’,
officers’ and employees’ restricted share units and deferred share units, which were granted by Westbrick to such directors,
officers and employees pursuant the Omnibus Plan, as a result of this Agreement; and (c) an amount equal to [amount redacted] representing
an agreed adjustment for ascribed value of the Adjusted Inventory.
“Outside Date”
means March 31, 2025, provided that the Outside Date may be extended for two consecutive periods of no more than 30 days each (to
a maximum of 60 days ending no later than May 30, 2025) by either the Company and [name of party redacted], on the one hand, or
the Purchaser, on the other hand, upon written notice to the other Party (prior to the end of the applicable period), if, as of the Outside
Date, the Conditions Satisfaction Date has not yet occurred by such date or any extension thereof as provided in this definition.
“Parties”
means, collectively, Westbrick, Purchaser and [name of party redacted] and “Party” means any one of them.
“Permitted Encumbrances”
means, except to the extent relating to the Duvernay Assets or the Duvernay Business:
| (a) | builders’, mechanics’, materialmen’s, warehousemen’s, carriers’, workers’
or repairmen’s liens or other similar common law or statutory Encumbrances arising or incurred in the ordinary course of business
(i) securing payments not yet delinquent or (ii) that are being contested in good faith by or on behalf of Westbrick; |
| (b) | liens for Taxes, assessments and other governmental charges not yet due and payable or due but not delinquent,
the validity of which is being contested in good faith by or on behalf of Westbrick; |
| (c) | pledges and deposits made in the ordinary course of business with respect to, and in compliance in all
material respects with, workers’ compensation, unemployment insurance and other social security laws; |
| (d) | with respect to any interest in real property, (i) any conditions, rights, reservations, exceptions, easements,
or restrictions relating to real property that are (A) disclosed on any certificate of title or are otherwise of public record maintained
by any Governmental Authority, (ii) any conditions that may be shown by a current survey disclosed in the Data Room, (iii) Encumbrances
imposed by Applicable Laws and (iv) zoning, building, subdivision and other similar requirements and restrictions and all rights of any
Governmental Authority to levy Taxes on any of the Assets or the income or revenue attributable thereto in any manner and to limit, control,
or regulate real property, the Assets and their use; |
| (e) | undetermined or inchoate liens incurred or created in the ordinary course of business or liens created
as security in favor of any Person that is conducting the development or operation of any part of the PNG Assets to which relate, but
only for Westbrick’s proportionate share of the costs and expenses of such development or operation, and only to the extent not
yet due and payable or due but not delinquent or being contested in good faith by or on behalf of Westbrick; |
| (f) | easements, rights of way, servitudes, licenses and other similar rights in land, including rights of way
and servitudes for highways and other roads, railways, sewers, drains, gas, oil or other pipelines, gas and water mains, electric light,
power, telephone, telegraph and cable television conduits, poles, wires and cables; |
| (i) | the right reserved to or vested in any municipality or Governmental Authority by the terms of any lease,
license, franchise, grant or permit or by any Applicable Law, to terminate any such lease, license, franchise, grant or permit or to require
annual or other periodic payments as a condition of the continuance thereof; |
| (g) | liens granted or arising in the ordinary course of business to any public utility or Governmental Authority
with respect to the PNG Assets or operations pertaining thereto to the extent not due and payable or due but not delinquent or being contested
in good faith by or on behalf of Westbrick; |
| (h) | the terms and conditions of all Title and Operating Documents provided that, any overriding royalty, net
profits interest, or other adverse claim, Security Interest or similar Encumbrance, applicable to the Petroleum and Natural Gas Rights
and for which Westbrick has a payment obligation, will be a Permitted Encumbrance only if it satisfies another provision of this definition
of Permitted Encumbrance; |
| (i) | purchase money liens and liens securing rentals under capital leases with third parties entered into in
the ordinary course of business; |
| (j) | defects, imperfections or irregularities of title which would not materially and adversely interfere with
or impact the operations of the Business (excluding the Duvernay Business); |
| (k) | any Security Interest securing amounts owing under the Credit Facilities; |
| (l) | any trust obligations incurred or entered into in the ordinary course of business; |
| (m) | any Encumbrance that is fully released and, where applicable, discharged, on or prior to Closing; |
| (n) | all Encumbrances set out in the Land Schedule; and |
| (o) | any other Encumbrances listed in Section 1.1 of the Disclosure Schedules under the heading “Permitted
Encumbrances.” |
“Person”
means an individual, a corporation, a general or limited partnership, an association, a joint stock company, limited liability company
or other company, a Governmental Authority, a trust or other entity or organization, whether or not a legal entity.
“Personal Information”
means information about an identifiable individual, but does not include the name, title, business address or business, business email
address, or other similar business information, of an employee of an organization, where such information is used solely to contact the
individual in relation to that individual’s business responsibilities and for no other purpose.
“Petroleum and Natural
Gas Rights” means all of the right, title, estate and interest (whether absolute or contingent, legal or beneficial, present
or future, vested or not, and whether or not an “interest in land”) beneficially owned by Westbrick pursuant to the Title
and Operating Documents in or to any of the following, by whatever name the same are known:
| (a) | rights in or rights to explore for, drill for, extract, win, produce, take, recover, save, inject, store,
produce or market Petroleum Substances from the Lands or lands pooled or unitized therewith; |
| (b) | rights to a share of the production of Petroleum Substances from the Lands or lands pooled or unitized
therewith; |
| (c) | fee simple interests and other estates in Petroleum Substances; |
| (d) | working interests, carried working interests, royalty and overriding royalty interests, revenue interests,
net profit interests, and similar interests in Petroleum Substances or rights to a share of the proceeds of the sale of, or to receive
payment calculated by reference to, the quantity or value of the production of Petroleum Substances from the Lands or lands pooled or
unitized therewith; |
| (e) | the interests set forth in the land schedule (included in the Data Room) in and to and in respect of the
Leases and the Lands (including any fee simple interests, where specifically indicated); and |
| (f) | rights to acquire or earn any of the rights or interests described in items (a) to (e) of this definition, |
including all interests and rights in or in
respect of the Lands known as working interests, fee simple interests, leasehold interests, royalty interests, overriding royalty interests,
gross overriding royalty interests, production payments, profits interests, net profits interests, revenue interests, net revenue interests
or economic interests and including fractional or undivided interests in any of the foregoing, but, for certainty, excluding all such
property, assets, interests and rights comprising the Duvernay Assets.
“Petroleum Substances”
means any of petroleum, natural gas and related hydrocarbons excluding coal but including crude oil, coalbed methane, sulphur, hydrogen
sulphide, associated gas, solution gas, ethane, propane, butane and condensate and substances produced in association therewith or found
in any water, in each case whether liquid, solid or gaseous.
“Plan of Arrangement”
means the plan of arrangement, substantially in the form attached hereto as Schedule “A”, as the same may be amended or supplemented
from time to time in accordance with the terms hereof, thereof or at the direction of the Court in the Final Order, with the consent of
the Company, [name of party redacted] and Purchaser, acting reasonably.
“PNG Assets”
means the Petroleum and Natural Gas Rights, the Tangibles and the Miscellaneous Interests, but excludes the Duvernay Assets.
“Pre-Closing Period”
has the meaning set forth in Section 6.3(a).
[Definition redacted]
“Pre-Closing Tax Period”
means a taxation year or fiscal period that ends before the Closing Time and the portion of a Straddle Period that ends before the Closing
Time.
“Preferential Purchase
Rights” means any rights of first refusal, rights of first offer, preferential purchase rights or buy-out rights or options
created by, through or under the Company that are held by any Third Party to purchase or acquire any of the Assets which are triggered
as a consequence of the Parties entering into this Agreement or the consummation of the Transaction.
“Privileged Communications”
has the meaning set forth in Section 11.15(a).
“Purchased Shares”
means, collectively, the [name redacted] Westbrick Amalco Shares and the Additional Shares.
“Purchaser”
has the meaning set forth in the preamble.
“Purchaser Bridge
Loan Facility” means the committed US$300 million liquidity loan that Royal Bank of Canada and The Toronto-Dominion Bank have
agreed to provide to the Purchaser pursuant to a commitment letter dated on or before the date of this Agreement.
“Purchaser Credit Agreement”
means the fourth amended and restated credit agreement dated as of May 17, 2024 among the Purchaser, as Borrower, The Toronto-Dominion
Bank, as Administration Agent, and the Lenders from time to time party thereto, and unless the context otherwise requires includes the
additional Purchaser Term Loan Facility.
“Purchaser Financial
Statements” means, collectively:
| (a) | the audited balance sheet of the Purchaser as at December 31, 2023 and the audited consolidated statements
of income and cash flows for the 12-months ended on December 31, 2023; and |
| (b) | the consolidated balance sheet (the “Purchaser Balance Sheet”) of the Purchaser as
at September 30, 2024 (the “Purchaser Balance Sheet Date”) and the unaudited consolidated statements of income and
cash flows for the three and nine months ended on September 30, 2024 |
“Purchaser Revolving
Loan Facility” means the committed $1.35 billion liquidity revolving loan facilities that the lenders have agreed to provide
to the Purchaser pursuant to the Purchaser Credit Agreement.
“Purchaser Term
Loan Facility” means the committed $250 million term loan that The Toronto-Dominion Bank has agreed to provide to the Purchaser
as an “Incremental Facility” under and as defined in the Purchaser Credit Agreement pursuant to a commitment letter dated
on or prior to the date of this Agreement.
“Purchaser Information”
means the information to be included in the Notice of Written Resolution describing Purchaser and the business, operations and affairs
of Purchaser together with any amendments thereto or supplements thereof in such detail as the Company reasonably requests or otherwise
as required by Applicable Laws.
“Purchaser Public
Record” means all information filed by or on behalf of Purchaser on and after December 31, 2022 with any securities commission
or similar regulatory authority, in compliance, or intended compliance, with any Applicable Canadian Securities Laws and Applicable U.S.
Securities Laws, which is available for public viewing on Purchaser’s profile on the System for Electronic Document Analysis and
Retrieval (Plus) at www.sedarplus.ca and on Purchaser’s profile on the Electronic Data
Gathering, Analysis and Retrieval System at www.sec.gov/edgar.shtml.
“Purchaser Shares”
means common shares in the capital of the Purchaser.
“RBC”
means RBC Dominion Securities Inc.
“Registrar”
means the Registrar of Corporations or a Deputy Registrar of Corporations appointed under Section 263 of the ABCA.
“Registration Rights
Agreement” means the Registration Rights Agreement among Westbrick, [name of party redacted] and certain other Shareholders
dated November 19, 2012.
“Release”
means the historic or current intermittent, gradual or spontaneous release, spill, emission, leaking, pumping, pouring, emptying, escaping,
dumping, injection, deposit, disposal, discharge, dispersal, leaching or migrating into the Environment, whether accidental or intentional.
[Definition redacted]
“Representatives”
means, with respect to any Person, any and all partners, directors, officers, employees, consultants, financial advisors, counsels, accountants
and other agents of such Person.
“Required Funds” has the
meaning ascribed thereto in the definition of “Acquisition Debt Confirmations.”
“Review Period” has the
meaning ascribed thereto in Section 2.8(e).
“Scotiabank”
means Scotia Capital Inc.
[Definition redacted]
“Securities Authorities”
means, collectively, the securities commissions or similar securities regulatory authorities in each of the provinces of Canada.
“Security Interest”
means any mortgage, charge, pledge, lien, hypothec, assignment by way of or in effect as security, conditional sale, title retention,
arrangement or other security interest.
“Share Consideration”
has the meaning ascribed thereto in the Plan of Arrangement.
“Share Maximum”
has the meaning set forth in the Plan of Arrangement.
“Shareholder Agreement”
means the Amended and Restated Unanimous Shareholder Agreement among Westbrick, [name of party redacted], [name redacted]
Holdco and the Additional Shareholders dated February 11, 2020, as amended on July 7, 2022.
“Statutory Plans”
means any statutory benefit plan which Westbrick is required to participate in, contribute to, or comply with, pursuant to statute, including
the Canada Pension Plan, Employment Insurance Program, and any other similar plans or programs administered pursuant to applicable health
tax, workplace safety insurance, workers’ compensation or unemployment insurance legislation.
“Straddle Period” means
a taxation year or fiscal period that begins before and ends after the Closing Time.
[Definition redacted]
“Tangibles”
means Westbrick’s entire right, title, estate and interest in and to: (a) any facilities, pipelines, and any and all other tangible
depreciable property, apparatus, plant, equipment, machinery, field inventory, facilities and assets which are located within, upon or
in the vicinity of the Lands and/or related to the Petroleum and Natural Gas Rights, and which are used or have previously been used or
intended to be used, to produce, process, gather, treat, measure, make marketable, store, transport, dispose, remove or inject Petroleum
Substances, including, the Major Facilities, any facilities that pertain to water injection or removal operations in respect of Petroleum
Substances, any tangible equipment relating to the Wells, and downhole equipment, tools, gas plants, oil batteries, buildings, production
equipment, pipelines, pipeline connections, meters, generators, motors, compressors, treaters, dehydrators, scrubbers, separators, pumps,
tanks, boilers and communication equipment (including any SCADA systems); (b) any vehicles; and (c) field office and administrative assets,
including buildings, office furniture, computer equipment, communication equipment and other office equipment located within, upon or
in the vicinity of the Lands, but, for certainty, in each case, excluding all such property, assets, interests and rights comprising the
Duvernay Assets.
“Take or Pay Obligations”
means obligations to sell or deliver Petroleum Substances or any of them without being entitled in due course to receive and retain full
payment for such Petroleum Substances.
“Tax”
or “Taxes” means (a) any taxes, duties, fees, premiums, assessments, imposts, levies and other similar charges of any
kind whatsoever imposed by any Governmental Authority, including those levied on, or measured by, or referred to as, income, gross receipts,
profits, capital, transfer, land transfer, sales, goods and services, harmonized sales, use, GST, value-added, excise, stamp, withholding,
business, franchising, property, development, occupancy, employer health, payroll, employment, health, social services, education and
social security taxes, all surtaxes, all customs duties and import and export taxes, countervail and anti-dumping, all license, franchise
and registration fees and all social security charges (including workers’ compensation and all unemployment insurance, employment
insurance, health insurance and Canada, Québec and other government pension plan premiums or contributions), (b) all interest,
penalties, fines, additions to tax or other additional amounts imposed by any Governmental Authority in respect thereof, and (c) any Liability
for the payment of any amounts described in clauses (a) or (b) as a result of being a transferee or a successor to any Person or as a
result any express or implied obligation to indemnify any other Person.
“Tax Act”
means the Income Tax Act, R.S.C. 1985, c.1 (5th Supp.) and all regulations promulgated thereunder, each as amended from time to
time.
[Definition redacted]
[Definition redacted]
“Tax Pools”
means undepreciated capital cost of any particular class of depreciable property, earned depletion base, cumulative Canadian exploration
expense, cumulative Canadian development expense, cumulative Canadian oil and gas property expense, foreign exploration and development
expense, capital losses, non-capital losses, cumulative eligible capital, share issue costs and investment tax credits, all as defined
in the Tax Act, and financing expenses referred to in paragraph 20(1)(e) of the Tax Act.
“Tax Returns”
means all reports, returns, declarations, elections, notices, filings, forms and statements, applications and other documents (whether
in tangible, electronic or other form) and including any amendments, schedules, attachments, supplements, appendices and exhibits thereto,
made, prepared, filed or required to be made, prepared or filed by Applicable Laws with respect to Taxes.
“Third Party”
means any Person other than Westbrick, [name of party redacted], [name redacted] Holdco, the Additional Shareholders and
the Purchaser.
“Title and Operating
Documents” all agreements relating to the acquisition, ownership, operation or exploitation of the Lands, the Petroleum and
Natural Gas Rights, Tangibles or the Wells, including, without limitation: (a) the Leases; (b) assignments, trust declarations, trust
agreements, operating agreements, royalty agreements, overriding royalty agreements, participation agreements, farm-in and farmout agreements,
sale and purchase agreements, pooling agreements, common stream agreements, easements, surface leases, pipeline crossing agreements, and
road use agreements; (c) Transportation, Sales and Handling Agreements; (d) agreements for construction, ownership and operation of the
gas plants, gas gathering systems, pipelines and other facilities; (e) the Licences; (f) agreements that create or relate to any surface
rights; and (g) trust declarations pursuant to which Westbrick holds interests in the Lands or any lands pooled or unitized therewith
in trust for other Persons.
“Transaction”
means collectively all transactions contemplated by this Agreement and the documents reference herein, including the Plan of Arrangement,
and the execution and delivery of other agreements and documents required under the Agreement to be executed and delivered at Closing
and thereafter.
“Transaction Documents”
means, collectively, this Agreement and all of the other agreements, certificates, instruments and other documents to be executed or delivered
by one or more of the Parties in connection with the Transaction.
“Transaction Expenses”
means, without duplication (and without duplication to the Duvernay Transaction Expenses), any out of pocket fees and expenses incurred
or payable by Westbrick, whether payable before or after Closing, in connection with (a) the Transaction, or relating to the negotiation,
preparation, or execution of this Agreement, the Plan of Arrangement, or any documents or agreements contemplated by this Agreement or
the performance or consummation of the Transaction, including the following to the extent incurred in connection with the Transaction
(i) brokers’ or finders’ fees (including those of RBC and Scotiabank), and (ii) fees and expenses of professional advisors,
counsel (including Osler, Hoskin & Harcourt LLP), advisors, consultants, investment bankers, Tax advisors, accountants, and auditors,
(b) amounts in respect of the Employee Obligations relating to Management Personnel, estimates of which are set forth in Section 6.7 of
the Disclosure Schedules; (c) printing, mailing and Depositary fees and expenses; (d) third party costs and expenses related to due diligence,
including set up and maintenance of the Data Room, and diligence conducted in respect of Purchaser, its business, assets and operations;
and (e) all damages, if any, payable to the purchaser pursuant to Section 7.5(a) of the Duvernay Share Purchase Agreement to a maximum
of [amount redacted]; provided, however, that the term “Transaction Expenses” shall exclude (A) all such fees and expenses
that have already been paid on or before December 31, 2024; (B) any GST payable by Westbrick in connection with any of the foregoing,
and (C) any amounts included in the calculation of Net Debt or Duvernay Transaction Expenses.
“Transition Employees”
means those individuals set forth in Section 6.7 of the Disclosure Schedule.
“Transition Period” means
the three month period beginning on the Closing Date.
“Transportation,
Sale and Handling Agreements” means agreements providing for the processing, compression, treatment, gathering, storage, transportation
or sale of Petroleum Substances produced from the Lands or lands pooled or unitized therewith or obligations for processing, compression,
treatment, gathering, storage, transportation or sale of Petroleum Substances on behalf of Persons other than Westbrick, but does not
include any of the foregoing to the extent solely related to the Duvernay Assets (and no other Assets).
“U.S. Securities
Act” means the United States Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
“Wells”
means wells located within, upon or under the Lands or any lands pooled or unitized therewith, including producing, commingled, monitoring
suspended, standing, plugged or unplugged, capped, shut-in, abandoned, source, disposal and injection wells, including the wellbores and
any and all casing, including, without limitation, the wells set out or referred to under the heading “Wells” under Section
1.1 of the Disclosure Schedule.
“Westbrick”
and “Company” has the meaning ascribed to them in the preamble and includes, as the context requires, Westbrick Amalco
(including all references to “Westbrick” which speak to a time period from and after the Amalgamation).
“Westbrick Amalco” has the
meaning set forth in the recitals.
“Westbrick Amalco
Shares” has the meaning set forth in the Plan of Arrangement.
“Westbrick Approval”
means approval by [name of party redacted] to consummate the Transaction, as required by the Shareholder Agreement and approval
of the Arrangement Resolution.
“Westbrick Board Recommendation”
has the meaning set forth in subsection 2.1(b).
“Westbrick Contractor”
has the meaning set forth in Section 4.35.
“Westbrick Employees”
means individuals employed by Westbrick on a full-time, part-time or temporary basis, including those employees on disability leave, parental
leave or other absence, and “Westbrick Employee” means any one of them.
“Westbrick Fairness
Opinion” means the opinion of Scotiabank, to the effect that, as of the date of such opinion and based upon and subject to the
assumptions, limitations and qualifications set forth therein, the Consideration to be received by the Westbrick Shareholders under the
Arrangement is fair, from a financial point of view, to the Westbrick Shareholders.
“Westbrick Indemnified
Parties” has the meaning set forth in Section 9.5.
“Westbrick Shareholders”
means: (a) prior to the Amalgamation, [name redacted] Holdco and following the Amalgamation, [name of party redacted]; and
(b) all Additional Shareholders.
“Westbrick Shares”
means all of the issued and outstanding common shares in the capital of Westbrick and Westbrick Amalco, as the context requires, including,
as the context requires, the [name redacted] Shares, Additional Shares and [name redacted] Westbrick Amalco Shares.
“Westbrick Supporting
Shareholders” means those Westbrick Shareholders that have entered into the Lock-Up Agreements with Purchaser as of the date
hereof, being [name redacted] Holdco, [name of party redacted] and the Key Executives.
[Definition redacted]
“Written Resolution”
means the written resolution substantially in the form set forth in Schedule “B” to this Agreement.
In this Agreement, unless specifically provided
otherwise or the context otherwise requires:
| (a) | the word “day” means calendar day, and the word “month” means calendar month; |
| (b) | the words “hereto”, “hereof”, “herein”, “hereby” and “hereunder”
and words of similar import, when used in this Agreement, shall refer to this Agreement as a whole and not to any particular provision
of this Agreement; |
| (c) | all references to “$” or dollars are to Canadian dollars; |
| (d) | references herein to a specific Article, Section or Schedule shall refer, respectively, to Articles, Sections
or Schedules of this Agreement unless otherwise indicated; |
| (e) | heading references herein and the table of contents hereof are for convenience purposes only, and shall
not be deemed to limit or affect the construction or interpretation of any of the provisions hereof; |
| (f) | wherever the word “include”, “includes” or “including” is used in
this Agreement, it shall be deemed to be followed by the words “without limitation”; |
| (g) | references to a specific time shall refer to the prevailing time in Calgary, Alberta; |
| (h) | the word “extent” in the phrase “to the extent” shall mean the degree to which
a subject or other thing extends and such phrase shall not mean simply “if”; |
| (i) | references to a Party mean the Party or its successors and permitted assigns; |
| (j) | any agreement, instrument or writing defined or referred to herein means such agreement, instrument or
writing, as from time to time amended, supplemented or modified prior to the date hereof; |
| (k) | any statute or regulation defined or referred to herein means such statute or regulation as from time
to time amended, supplemented or modified, including by succession of comparable successor statutes or regulations; and |
| (l) | when calculating the period of time within which, or following which, any act is to be done or step taken
pursuant to this Agreement, the date that is the reference day in calculating such period shall be excluded. If the last day of such period
is not a Business Day, the period in question shall end on the next Business Day. |
The following Schedules are attached to and
made part of this Agreement:
| Schedule “A” |
Plan of Arrangement |
| Schedule “B” |
Arrangement Resolution |
| Schedule “C” |
[Escrow Agreement redacted] |
Except as otherwise expressly provided herein,
if there is any conflict or inconsistency between a provision of the body of this Agreement and that of a Schedule, the provision of the
body of this Agreement shall prevail to the extent of said conflict or inconsistency.
| 1.4 | Interpretation if Closing Does Not Occur |
If Closing does not occur, each provision of
this Agreement which presumes that the Purchaser has acquired the Purchased Shares shall be construed as having been contingent on Closing
having occurred.
References to a Party’s knowledge or
awareness and similar references contained in this Agreement, mean, with respect to:
| (a) | Westbrick, the actual knowledge or awareness, as the case may be, of each of the following individuals,
without personal liability, in each case after due inquiry (provided that, “due inquiry” does not require such persons to
make enquiries of any person who is not a director, officer, employee of Westbrick or Westbrick Contractor): |
Ken McCagherty, President & Chief Executive
Officer; and
Moe Mangat, Chief Operating
Officer;
| (b) | [Knowledge parties redacted] |
| (c) | Purchaser, the actual knowledge or awareness, as the case may be, of each of the following individuals,
without personal liability, in each case after due inquiry (provided that, “due inquiry” does not require such persons to
make enquiries of any person who is not a director, officer, employee or consultant of Purchaser): |
Dion Hatcher, President
& Chief Executive Officer; and
Lars Glemser, Vice President
& Chief Financial Officer,
which in each case, does not include knowledge
and awareness of any other Person or constructive or imputed knowledge, nor any obligation to make inquiry of Third Parties or the files
and records of any Third Party or Governmental Authority in connection with representations and warranties that are made to its knowledge.
This Agreement has been negotiated by each
Party with the benefit of legal representation, and any rule of construction or interpretation to the effect that any ambiguities are
to be resolved against the drafting Party shall not apply to the construction or interpretation of this Agreement.
Article 2
Arrangement
| 2.1 | Plan of Arrangement and Westbrick Board Recommendation |
| (a) | Arrangement. Subject to the terms and conditions of this Agreement, the Parties agree to carry
out the Arrangement in accordance with the terms and conditions of this Agreement and of the Plan of Arrangement. |
| (b) | Westbrick Board Recommendation. Westbrick represents and warrants to Purchaser that the board of
directors of Westbrick has determined, after receiving legal and financial advice, to enter into this Agreement and has resolved to recommend
that the Westbrick Shareholders sign the Written Resolution (collectively, the “Westbrick Board Recommendation”). |
| 2.2 | Arrangement Resolution |
| (a) | Westbrick has, concurrent with the signing of this Agreement, delivered to Purchaser: |
| (i) | the Written Resolution executed by the Westbrick Supporting Shareholders. Westbrick represents that the
Westbrick Supporting Shareholders hold greater than two-thirds of the Westbrick Shares; |
| (ii) | a written resolution of [name of party redacted], as sole shareholder of [name redacted]
Holdco, approving the Arrangement and in a form and substance satisfactory to Westbrick, [name of party redacted] and Purchaser,
each acting reasonably; and |
| (iii) | the Lock-Up Agreements. |
| (b) | Westbrick covenants to use commercially reasonable efforts to obtain an executed Written Resolution from
the remaining Westbrick Shareholders prior to the application for the Final Order. |
| 2.3 | Interim and Final Order. |
| (a) | The Company shall, as soon as reasonably practicable after the date of this Agreement and in co-operation
with the Purchaser and in accordance with Section 2.5, prepare, file and diligently pursue an application for the Interim Order which
will provide, among other things, |
| (i) | for the class of Persons to whom notice is to be provided in respect of the Arrangement and the manner
in which such notice is to be provided; |
| (ii) | that any requirement for approval of the Arrangement by Westbrick Shareholders shall be met by holders
of at least (and not more than) two-thirds of the Westbrick Shares executing the Written Resolution; |
| (iii) | for the grant of Dissent Rights in the manner contemplated in the Plan of Arrangement; |
| (iv) | for the notice requirements with respect to the presentation of the application to the Court for the Final
Order; and |
| (v) | for such other matters as the Parties may reasonably require and agree in writing, each acting reasonably; |
| (b) | If the Interim Order is obtained and the Written Resolution is approved as provided in the Interim Order,
the Company shall, subject to the terms of this Agreement, in consultation and cooperation with the Purchaser and in accordance with Section
2.5, submit the Arrangement to the Court and diligently pursue an application for the Final Order pursuant to section 193 of the ABCA
as soon as reasonably practicable, which Final Order will: |
| (i) | include a declaration that the terms and conditions of the Arrangement, and the procedures relating thereto,
are fair and reasonable to Westbrick Shareholders and other affected parties, from a substantive and procedural point of view; and |
| (ii) | include an order approving the Arrangement pursuant to the provisions of Section 193 of the ABCA. |
| (c) | In the application for the Interim Order and Final Order, Westbrick shall inform the Court that the Parties
intend to rely on the exemption provided by Section 3(a)(10) of the U.S. Securities Act for the issuance of the Purchaser Shares
pursuant to the Arrangement and that, in connection therewith, the Court will be required to approve the substantive and procedural fairness
of the terms and conditions of the Arrangement to Westbrick Shareholder to whom Purchaser Shares will be issued. |
| (d) | Westbrick shall forthwith carry out the terms of the Interim Order and Final Order. |
| 2.4 | Notice of Written Resolution |
| (a) | As promptly as practical following the execution of this Agreement (and no later than ten days prior to
the hearing for the Final Order): |
| (i) | Westbrick shall prepare a notice of Written Resolution to be provided to each Westbrick Shareholder (the
“Notice of Written Resolution”) in consultation with [name of party redacted] and Purchaser and in compliance
in all material respects, with the Interim Order, and Westbrick shall ensure that the Notice of Written Resolution provides Westbrick
Shareholders with information in sufficient detail to permit them to form a reasoned judgment concerning the matters before them and shall,
without limitation: append a copy of the Westbrick Fairness Opinion and state the Westbrick Board Recommendation; and |
| (ii) | Westbrick shall send the Notice of Written Resolution and other relevant documentation (including a Letter
of Transmittal and Election Form, a copy of the Written Resolution as well as a copy of this Agreement and notice of the originating application
for the Final Order) to the Westbrick Shareholders and such other Persons as required by the Interim Order. |
| (b) | The Purchaser shall promptly furnish to the Company and [name of party redacted] all Purchaser
Information as may be reasonably required by the Company in the preparation of the Notice of Written Resolution. |
| (c) | Westbrick shall, subject to compliance with Applicable Laws, incorporate the Purchaser Information into
the Notice of Written Resolution substantially in the form provided by Purchaser and Westbrick shall provide Purchaser and its Representatives
with an opportunity to review and comment on the Notice of Written Resolution and any other relevant documentation and shall give due
consideration to all comments made by Purchaser and its Representatives. The Notice of Written Resolution shall be in form and content
satisfactory to Westbrick and Purchaser each acting reasonably, and shall comply with Applicable Laws. |
| (d) | Westbrick shall use its commercially reasonable efforts to ensure that all information disclosed in the
Notice of Written Resolution, other than the Purchaser Information, does not, at the time of the mailing of the Notice of Written Resolution,
contain any misrepresentation. Westbrick shall indemnify and save harmless the Purchaser and its Affiliates and their respective directors,
officers, employees, representatives and agents from and against any and all liabilities, claims, demands, losses, costs, damages and
expenses (excluding any loss of profits or consequential damages) to which any of such Persons may be subject or which any of such persons
may suffer or incur, whether under the provisions of any Applicable Law or otherwise, in any way caused by, or arising directly or indirectly,
from or in consequence of any misrepresentation or alleged misrepresentation in the information disclosed in the Notice of Written Resolution
other than Purchaser Information or any information included in the Notice of Written Resolution at the request of the Purchaser. |
| (e) | The Purchaser shall indemnify and save harmless the Company and its Affiliates and their respective directors,
officers, employees, representatives and agents from and against any and all liabilities, claims, demands, losses, costs, damages and
expenses (excluding any loss of profits or consequential damages) to which any of such Persons may be subject or which any of such Persons
may suffer or incur, whether under the provisions of any Applicable Law or otherwise, in any way caused by, or arising, directly or indirectly,
from or in consequence of: |
| (i) | any misrepresentation or alleged misrepresentation in the Purchaser Information; or |
| (ii) | any order made or any inquiry, investigation or proceeding by any Securities Authority or other competent
authority based upon any untrue statement or omission of a material fact or alleged untrue statement or omission of a material fact or
any misrepresentation or any alleged misrepresentation by the Purchaser in the Purchaser Information contained in the Notice of Written-
Resolution. |
| (f) | A Party shall promptly notify the other Parties if it becomes aware that the Notice of Written Resolution
contains a misrepresentation, or otherwise requires an amendment or supplement. The Parties shall co-operate in the preparation of any
such amendment or supplement as required or appropriate, and Westbrick shall promptly mail or otherwise disseminate any such amendment
or supplement to the Westbrick Shareholders and such other persons as required by the Interim Order and Applicable Laws, file the same
with the applicable Governmental Authorities as required. |
| (a) | Subject to the terms of this Agreement, the Purchaser and [name of party redacted] shall cooperate
with, assist and consent to the Company seeking the Interim Order and Final Order, including by the Purchaser and [name of party redacted]
providing to the Company on a timely basis any information expressly required by the Court to be supplied by such Party concerning itself
or its Affiliates in connection therewith. The Company shall diligently pursue, and cooperate with Purchaser in diligently pursuing, the
Interim Order and Final Order, and subject to any applicable privilege (including solicitor-client privilege), provide Purchaser, [name
of party redacted] and their respective legal counsels with all drafts, copies of the final versions of and reasonable opportunity
to review and comment on, all applications, filings, motions and other documents prepared by or on behalf of the Company in connection
with the Arrangement, and will give reasonable consideration to all such comments. The Company will also provide legal counsel to the
Purchaser and [name of party redacted] on a timely basis with copies of any notice of appearance or notice of intent to oppose
and any evidence served on the Company or its legal counsel in respect of the application for the Interim Order and Final Order or any
appeal therefrom. Subject to Applicable Law, the Company will not file any material with the Court in connection with the Arrangement
or serve any such material, and will not agree to modify or amend materials so filed or serve without the Purchaser’s prior written
consent, such consent not to be unreasonably withheld, conditioned or delayed. |
| (b) | Each of Company, [name of party redacted] and Purchaser shall use commercially reasonable efforts
to oppose any proposal from any Person that would result in the Interim order or Final Order containing any provision that is inconsistent
with this Agreement. |
| 2.6 | Initial Arrangement Transactions |
| (a) | [Name redacted] Holdco Return of Capital and Amalgamation. In connection with the implementation
of the Arrangement: |
| (i) | [Name redacted] Holdco shall return [amount redacted] of its capital to [name of party
redacted] in the form of the [name redacted] Holdco Note; |
| (ii) | pursuant to the Arrangement and the Duvernay Spinco Conveyance Agreement, the Duvernay Conveyance shall
be come effective and the Duvernay Assets will be transferred to Duvernay Spinco; |
| (iii) | [Name redacted] Holdco and Westbrick shall complete the Amalgamation under the Arrangement, with
[name of party redacted], the Additional Shareholders and any former Optionholders receiving shares in Westbrick Amalco (which,
in the case of [name of party redacted], the number of shares issuable to it upon the Amalgamation shall be reduced by the number
of Westbrick Amalco shares that correspond to the face value of the [name redacted] Holdco Note as set forth in the Plan of Arrangement); |
| (iv) | the Purchaser shall acquire the [name redacted] Westbrick Amalco Shares and the Additional Shares,
respectively in accordance with the Plan of Arrangement; and |
| (v) | the amount of the [name redacted] Holdco Note (which shall be assumed by Westbrick Amalco on the
Amalgamation) shall be repaid to [name of party redacted]. |
| (b) | Duvernay Spinco and Duvernay Share Purchase Agreement. |
| (i) | Provided the transactions contemplated by the Duvernay Share Purchase Agreement are completed, the proceeds
received by Westbrick in respect of that sale of Duvernay Spinco shall, at Closing, be applied to repay Westbrick’s obligations
owing under the Credit Facilities as required by the agreements governing such Credit Facilities. |
| (ii) | Westbrick covenants and agrees to cause Duvernay Spinco to take all steps, to do and perform all such
acts and things and to execute and deliver all such agreements, documents and other instruments as are necessary or desirable to effect
and complete the transactions contemplated in this Agreement in strict compliance with the Duvernay Spinco Conveyance Agreement and the
Plan of Arrangement, in accordance with the terms and conditions of such documents, and any and all covenants and agreements contained
herein, in the Plan of Arrangement and in the Duvernay Spinco Conveyance Agreement shall, to the extent that they are required to be performed
by Duvernay Spinco, be and be deemed to be covenants and agreements of Westbrick. |
| (iii) | The Duvernay Spinco Conveyance Agreement and the Duvernay Share Purchase Agreement shall be on terms and
conditions acceptable to the Purchaser, acting reasonably (provided that Purchaser acknowledges that any comments or provisions that are
unique, confidential, proprietary or competitively sensitive information of or pertaining to the potential purchaser under the Duvernay
Share Purchase Agreement may be redacted otherwise excluded from any form of Duvernay Spinco Conveyance Agreement and the Duvernay Share
Purchase Agreement provided to Purchaser), and Purchaser acknowledges that it has had an opportunity to review and comment on the draft
of the Duvernay Spinco Conveyance Agreement and the Duvernay Share Purchase Agreement prior to the date hereof and such forms of the Duvernay
Spinco Conveyance Agreement and the Duvernay Share Purchase Agreement (and any forms of agreements to be appended thereto), subject to
any amendments thereto which would not result in additional liabilities for Westbrick which would survive closing of the transaction thereunder,
any post-closing covenants of Westbrick (other than the adjustments set forth in the Duvernay Spinco Conveyance Agreement) or any additions
of Field Contractors (as defined there in and who are listed in Section 2.6(b) of the Disclosure Schedules), are acceptable to the Purchaser.
Except as Purchaser otherwise agrees, Westbrick shall, in negotiating the documents or agreements related to the transactions contemplated
by the Duvernay Share Purchase Agreement or the Duvernay Spinco Conveyance Agreement, ensure that such documents or agreements will not
result in (A) additional liabilities for Westbrick which would survive closing of the transaction thereunder; (B) any post-closing covenants
of Westbrick (other than the adjustments set forth in the Duvernay Spinco Conveyance Agreement); or (C) a change in the scope of the definitions
of “Duvernay Assets” or “Assumed Liabilities” (as such terms are defined in the Duvernay Spinco Conveyance Agreement).
Nothing in this Section 2.6(b)(iii) shall require Westbrick to breach any Applicable Laws or Contracts to which Westbrick is a Party. |
| (iv) | If a Duvernay Spin-Out Event occurs, then Westbrick shall promptly implement the Duvernay Alternative
Transaction, strictly in accordance with its terms, during the time period between the Condition Satisfaction Date and the Closing Date,
to ensure that the Closing is not delayed. |
Subject to Section 2.8(d) and 2.8(g), unless
the Parties otherwise agree in writing, the Closing shall take place at the Calgary offices of Osler, Hoskin & Harcourt LLP at 9:00
a.m. on the seventh Business Day after the Conditions Satisfaction Date has occurred, or such other date as agreed to by the Parties (the
“Closing Date”). Closing of the Transaction shall be deemed to have become effective as at 12:01 a.m. on the day that
Closing occurs (the “Closing Time”).
| 2.8 | Determination of Aggregate Adjusted Consideration |
| (a) | The aggregate base consideration for the purposes of the Arrangement shall be $1,075,000,000 (the “Aggregate
Base Consideration”). |
| (b) | The Aggregate Base Consideration will be adjusted as follows: |
| (i) | minus the Net Debt if the Net Debt is greater than $0; |
| (ii) | plus the absolute value of the Net Debt, if the Net Debt is less than $0; |
| (iii) | minus the Transaction Expenses; |
| (iv) | minus the Duvernay Transaction Expenses; |
| (v) | plus the Other Adjustment Amounts; and |
| (vi) | plus the Option Exercise Proceeds, |
(the Aggregate Base Consideration, as adjusted
by the amounts referred to in this Section 2.8(b), as the case may be, and without duplication, is referred to herein as the “Aggregate
Adjusted Consideration”). Any such adjustments shall be made on a basis consistent with the sample calculations set forth in
Section 2.8 of the Disclosure Schedule. For greater certainty, the Parties acknowledge and agree that if a Duvernay Spin-Out Event has
occurred, the Duvernay Spinco Share Value shall not be included, directly or indirectly, in the determination of Aggregate Adjusted Consideration
hereunder.
| (c) | The Parties acknowledge and agree that the good faith estimate of the Net Debt is set forth in Section
4.45 of the Disclosure Schedule. |
| (d) | No earlier than January 31, 2025 and at least five (5) Business Days prior to the Closing Date, Westbrick
shall deliver to Purchaser a statement setting forth: (i) a revised calculation of the Net Debt; (ii) a final estimate of the Transaction
Expenses; (iii) a final estimate of the Duvernay Transaction Expenses; (iv) a final estimate of the Other Adjustment Amounts; (v) the
value of the Option Exercise Proceeds; and (vi) the final determination of the Duvernay Net Proceeds, and the resulting Aggregate Adjusted
Consideration (the “Closing Date Statement”). The Closing Date Statement shall be prepared in a manner consistent with
the December 31 Accounting Principles and the sample calculation set forth in Section 2.8 of the Disclosure Schedule. Each amount included
in the Closing Date Statement shall be calculated in accordance with this Agreement and be accompanied by reasonable supporting detail
to evidence Westbrick’s good faith calculations, explanations and assumptions for the calculation of such amounts and its good faith
reasonable forecasts of the anticipated Transaction Expenses and Duvernay Transaction Expenses to be incurred to the Closing Date (with
supporting good faith estimates from any third party advisors). |
| (e) | Following receipt of the Closing Date Statement, Purchaser will have up to 3 Business Days to review the
Closing Date Statement (the “Review Period”). During the Review Period, Westbrick shall assist Purchaser in reviewing
and verifying the calculations and amounts set forth in the Closing Date Statement and make any revisions thereto reasonably required
as a result of such review, to the extent Westbrick does not otherwise dispute such revision in good faith (on the basis of the December
31 Accounting Principles and the sample calculation set forth in Section 2.8 of the Disclosure Schedule), and shall ensure that Purchaser
is given full access, upon every reasonable request, to the supporting documentation of Westbrick prepared in connection with the preparation
of the Closing Date Statement to verify the accuracy, calculation, presentation and other matters relating to the preparation of Closing
Date Statement. Notwithstanding any provision in this Agreement to the contrary, if the aggregate total of the Disputed Amounts (as defined
below), if any, is less than [amount redacted] or the Purchaser does not provide Westbrick with a notice during the Review Period
under Section 2.8(f) in respect of any Disputed Amount, the Parties shall proceed to Closing in accordance with the terms and conditions
herein on the basis of the Aggregate Adjusted Consideration set forth on the Closing Date Statement provided by Westbrick (subject to
any adjustments agreed to by Westbrick in accordance with the foregoing sentence). |
| (f) | If Purchaser disagrees with any calculations or determinations of the amounts set forth in the Closing
Date Statement by an amount, in the aggregate, greater than [amount redacted] (such amount, a “Disputed Amount”),
then Purchaser shall notify Westbrick during the Review Period by way of notice of objection and the Parties shall thereafter work expeditiously
and in good faith to resolve any Disputed Amount within two (2) Business Days following delivery of the notice of objection. Any Disputed
Amounts that are not resolved by the end of that two (2) Business Day period will be submitted by Purchaser and Westbrick for determination
to Pricewaterhouse Coopers in its Calgary, Alberta offices (the “Independent Accountant”). In making its determination,
the Independent Accountant will act as expert and not as arbitrator, must only consider the Disputed Amounts submitted to it, and must
make all reasonable efforts to determine the Disputed Amounts no later than ten (10) Business Days of the matter being submitted to the
Independent Accountant. Each of Purchaser’s and Westbrick’s submissions to the Independent Accountant shall be made in writing
and delivered to the Independent Accountant (with simultaneous copy to the other) within two (2) Business Days of the matter being submitted
to the Independent Accountant. With respect to each Disputed Amount, the Independent Accountant’s determination, if not in accordance
with the position of one of Purchaser or Westbrick, shall not be in excess of the highest nor less than the lowest of the amounts advocated
in any notice of objection or in the Closing Date Statement with respect to such Disputed Amount. The determination of the Independent
Accountant will be final and binding upon the Parties and will not be subject to appeal, absent manifest error. The Parties agree that,
unless Purchaser delivers a notice of objection representing Disputed Amounts, in the aggregate, of greater than [amount redacted],
the provisions of this Section 2.8(f) and Section 2.8(g) will be ignored for all intents and purposes. |
| (g) | If Purchaser delivers a notice of objection during the Review Period that it wishes to complete the dispute
resolution process set forth in Section 2.8(f), the Closing Date shall be delayed until two (2) Business Days following completion of
the dispute resolution process set forth in Section 2.8(f). Notwithstanding the foregoing, if the dispute resolution process set forth
in Section 2.8(f) has not been resolved by no later than ten (10) Business Days prior to the Outside Date, the Parties shall promptly
(but in any event not later than the last Business Day prior to the Outside Date) close the Transaction using the estimates provided on
the Closing Date Statement and: |
| (i) | the Purchaser shall pay any Disputed Amount to the Depositary to be held in escrow pending resolution
of such dispute; |
| (ii) | the Parties will use commercially reasonable efforts to resolve the dispute in an expeditious manner and
the Company and [name of party redacted] may appoint one or more representatives of the Westbrick Shareholders that will have authority
in accordance with the Plan of Arrangement or otherwise to resolve such dispute on behalf of the Westbrick Shareholders; |
| (iii) | the Parties agree that upon resolution of the dispute, the amounts payable by Purchaser will represent
an increase to the Aggregate Adjusted Consideration, which will be allocated in accordance with the Plan of Arrangement; and |
| (iv) | within two (2) Business Days of the resolution or the dispute and the determination of the amounts to
be paid hereunder, the Parties will execute and deliver a joint direction to the Depositary instructing the Depositary to release the
applicable amounts to the relevant Persons. |
| (h) | Concurrent with the delivery of the Closing Date Statement, Westbrick shall deliver its draft Entitlement
Schedule to the Purchaser for review and acceptance, acting reasonably. Westbrick shall assist Purchaser in reviewing and verifying the
Entitlement Schedule and make any revisions reasonably requested by Purchaser that are acceptable to Westbrick and [name of party redacted],
each acting reasonably. Westbrick and the Purchaser shall work expeditiously and in good faith to resolve any disagreements in respect
to the Entitlement Schedule. |
| 2.9 | Payment of Consideration |
| (a) | Purchaser shall, following receipt of the Final Order and one Business Day prior to the filing of the
Articles of Arrangement with the Registrar pending only filing of the Articles of Arrangement, provide, or cause to be provided to the
Depositary sufficient funds and Purchaser Shares (or an irrevocable direction to issue the Purchaser Shares in accordance with the Plan
of Arrangement upon filing of the Articles of Arrangement) to be held in escrow in accordance with the Depositary Agreement to satisfy
the payment of the [name redacted] Holdco Note by Westbrick and the aggregate Consideration payable to the Westbrick Shareholders
(other than, for greater certainty, Consideration for Westbrick Shareholders that have validly exercised Dissent Rights and in any case
not exceeding the Share Maximum) in accordance with the Plan of Arrangement. |
| (b) | Upon the completion of the Arrangement commencing at the Closing Time, all Purchased Shares will be transferred
to the Purchaser and for each Purchased Share held by a Westbrick Shareholder prior to the Closing Time, subject to and in accordance
with the other provisions of this Agreement and the Plan of Arrangement, such Westbrick Shareholder shall be entitled to receive a payment
in cash of its elected (or deemed elected) amount of the Cash Consideration, or if elected by such Westbrick Shareholder; (i) its elected
and allocated amount of the Share Consideration; or (ii) its elected and allocated amount comprising partially of the Cash Consideration
and the Share Consideration. For greater certainty, [name of party redacted] will be paid its portion of the Consideration in cash
only. |
| (c) | [Tax matters redacted] |
| 2.10 | Purchaser’s Right to Withhold |
| (a) | Subject to Section 2.10(b), the Purchaser shall be entitled to deduct and withhold from the consideration
otherwise payable to the Westbrick Shareholders pursuant to this Agreement such amounts as Purchaser determines, acting reasonably is
required to deduct and withhold under the Tax Act or any provision of any other Applicable Law with respect to the payment of such consideration.
To the extent that amounts are so deducted and withheld and paid over to the appropriate Governmental Authority, such deducted and withheld
amounts shall be treated for all purposes of this Agreement as having been paid to the Shareholder in respect of whom such deduction and
withholding was made. |
| (b) | [Tax matters redacted] |
| (c) | [Tax matters redacted] |
| (d) | [Tax matters redacted] |
| 2.11 | Applicable U.S. Securities Laws |
The Arrangement has been
and shall continue to be structured such that, assuming the Court considers the fairness of the terms and conditions of the Arrangement
and grants the Final Order, on the Closing Date the issuance of the Share Consideration issuable to the Westbrick Shareholders under the
Arrangement (i) will be made in compliance with Applicable Canadian Securities Laws and Applicable U.S. Securities Laws; and (ii) will
not require registration under the U.S. Securities Act, and the rules and regulations promulgated thereunder, in reliance on Section 3(a)(10)
of the U.S. Securities Act. Each Party agrees to act in good faith, consistent with the intent of the Parties and the intended treatment
of the Arrangement.
Article 3
REPRESENTATIONS AND WARRANTIES OF [name of party redacted]
Except as set forth the disclosure schedules
delivered by Westbrick to Purchaser on the date hereof concurrently with the execution of this Agreement (the “Disclosure Schedules”),
and subject to the other terms and conditions of this Agreement, [name of party redacted] represents and warrants to Purchaser
the matters set forth below.
| 3.1 | Organization and Corporate Power |
| (a) | [Name of party redacted] has been duly organized or created, is validly existing and is in good
standing under the laws of its jurisdiction of formation or creation and has all requisite power, capacity and authority to own the Holdco
Shares (and, upon the Amalgamation contemplated herein, the [name redacted] Westbrick Amalco Shares) and to enter into this Agreement
and each other agreement or instrument required to be executed and delivered by [name of party redacted] in connection with the
Transaction or otherwise contemplated herein, to perform its obligations hereunder and thereunder and to consummate the Transaction. |
| (b) | [Name redacted] Holdco is a corporation duly incorporated, validly existing and in good standing
under the laws of its jurisdiction of formation or creation and has all requisite power, capacity and authority to own the Westbrick Shares
and to enter into each agreement or instrument required to be executed and delivered by [name redacted] Holdco in connection with
the Transaction or otherwise contemplated herein, to perform its obligations thereunder and to consummate the Transaction. |
[Name redacted] Holdco does not own,
or have any interest in, any shares or have an ownership interest in any other Person other than Westbrick.
| 3.3 | Due Authorization and Enforceability of Obligations |
The execution and delivery of this Agreement
and each other agreement and instrument required to be executed and delivered by [name of party redacted] and/or [name redacted]
Holdco in connection with the Transaction or otherwise contemplated herein, the performance by [name of party redacted] and [name
redacted] Holdco of their respective obligations hereunder and thereunder and the consummation of the Transaction have been duly authorized
by all necessary action on the part of [name of party redacted] and [name redacted] Holdco. [name of party redacted]
has duly and validly executed and delivered this Agreement and [name of party redacted] and/or [name redacted] Holdco will
have duly and validly executed and delivered, or will duly and validly execute and deliver, each other agreement or instrument required
to be executed and delivered by it in connection with the Transaction or otherwise contemplated herein. This Agreement constitutes, and
each other agreement or instrument executed and delivered or to be executed and delivered by, or on behalf of, [name of party redacted]
at the Closing and in connection with the Transaction constitutes or will, at the time of execution, constitute, a legal, valid and binding
obligation of [name of party redacted], enforceable against [name of party redacted] in accordance with its terms, subject
to applicable bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws affecting the enforcement of creditors’
rights generally or, as to enforceability, by general equitable principles.
No actions have been taken or authorized by
[name of party redacted] to initiate proceedings for or in respect of the bankruptcy, insolvency, reorganization, receivership,
liquidation, dissolution or winding up of [name of party redacted] and no such proceedings have been taken or, as of the date hereof,
threatened by any other Person.
Except as would not individually or in the
aggregate if determined adversely to [name of party redacted], have a Material Adverse Effect on the Company, there are no material
Claims before a Governmental Authority which are pending, or to [name of party redacted]’s knowledge, threatened by any Person
against [name redacted] Holdco or affecting any of the Assets, or to [name of party redacted]’s knowledge, by or against
the Westbrick Shareholders relating to [name redacted] Holdco. Except as would not individually or in the aggregate have a Material
Adverse Effect on the Company, there is no outstanding order, writ, judgment, injunction, decree, stipulation, determination, award, decision,
sanction or ruling entered by or with any Governmental Authority in respect of [name redacted] Holdco, the Assets and/or the Purchased
Shares, and there are no unsatisfied judgments, settlements, penalties or awards for which [name redacted] Holdco is liable to
any Person.
The execution and delivery by [name of party
redacted] of this Agreement, the performance by [name of party redacted] of its obligations hereunder and the consummation
of the Transaction by [name of party redacted] do not and will not constitute or result in:
| (a) | a violation of or conflict with any of term or provision of [name of party redacted]’s or
[name redacted] Holdco’s Organizational Documents; |
| (b) | a default under, or give rise to any right of termination, cancellation or acceleration of any right under
any Contract to which [name of party redacted] or [name redacted] Holdco is a party; or |
| (c) | provided that the Key Regulatory Approval and the Final Order are obtained, a breach or violation of,
or a default under, any Applicable Laws to which [name of party redacted] is subject, |
except, in each case, as would not have
a Material Adverse Effect on the Company.
| 3.7 | Consents and Approvals |
Other than the Key Regulatory Approval and
the Final Order, no consent, approval, waiver, licenses, permit, certificates, order, grant, authorization, notice or filing is required
to be obtained by [name of party redacted] or [name redacted] Holdco from, or to be given by [name of party redacted]
or [name redacted] Holdco to, or to be made by [name of party redacted] or [name redacted] Holdco with, any Person
(including any Governmental Authority), in connection with the execution, delivery and performance by [name of party redacted]
of this Agreement and the consummation of the Transaction, except (a) as would not, individually or in the aggregate, have a Material
Adverse Effect on Westbrick, or (b) as may be required as a result of any facts or circumstances relating solely to Purchaser or any of
its Affiliates.
| 3.8 | Capitalization; Right to Sell |
| (a) | As at the date hereof, the authorized share capital of [name redacted] Holdco consists of: (i)
an unlimited number of common shares of which 36,643,737 are issued and outstanding and (ii) an unlimited number of preferred shares,
none of which are issued and outstanding. All of the Holdco Shares have been duly and validly issued and are outstanding as fully paid
and non-assessable shares. The Holdco Shares represent all of the issued and outstanding shares in the capital of [name redacted]
Holdco. |
| (b) | [Name redacted] Holdco is the sole registered and beneficial holder of the [name redacted]
Shares, free and clear of all Encumbrances (other than under [name redacted] Holdco’s Organizational Documents). Upon implementation
of the Arrangement, [name of party redacted] [name redacted] shall be the sole registered and beneficial holder of the [name
redacted] Westbrick Amalco Shares, free and clear of all Encumbrances (other than under Westbrick Amalco’s Organizational Documents).
[name of party redacted] has the sole and exclusive power to agree to the matters set forth herein with respect to the Holdco Shares
and, upon the implementation of the Arrangement, shall have the sole and exclusive right to dispose of the [name redacted] Westbrick
Amalco Shares as provided in this Agreement. |
| (c) | The Holdco Shares are not subject to the terms of any shareholder agreement (other than, to the extent
applicable, the Shareholder Agreement). |
| (d) | Other than pursuant to this Agreement, no Person has any agreement, right or option, present or future,
contingent or absolute, to: |
| (i) | require [name redacted] Holdco to issue any further or other shares or interests in its capital
or any other security convertible or exchangeable into shares, units or interest in its capital or to convert or exchange any securities
into or for shares or interests in its capital; |
| (ii) | require [name redacted] Holdco to purchase, redeem or otherwise acquire any of the Holdco Shares;
or |
| (iii) | acquire any of the Holdco Shares (or, at Closing, the [name redacted] Westbrick Amalco Shares). |
| 3.9 | [Name redacted] Holdco Indebtedness |
With the exception of the [name redacted]
Holdco Note which will be issued by [name redacted] Holdco to [name of party redacted] in connection with the Arrangement,
[name redacted] Holdco has no Indebtedness of any kind.
| 3.10 | No Material Contracts |
[Name redacted] Holdco is not a party
to any Contract that would constitute a Material Contract.
| 3.11 | Equity Monetization Plans |
There are no outstanding stock options, restricted
or deferred share units, performance share units, stock appreciation rights, phantom equity, profit sharing plan or any other similar
rights, agreements, arrangements or commitments payable to any director, officer or employee of [name redacted] Holdco which are
based upon the revenue, value, income or any other attribute of [name redacted] Holdco.
The minute books of [name redacted]
Holdco and other material corporate records have been made available to Purchaser for review. Such minute book and corporate records (i)
contain accurate and complete records of all meetings, and resolutions in writing of, the shareholders, the board of directors and any
committees of the board of directors of [name redacted] Holdco; and (ii) have been maintained in accordance with, in all material
respects, all Applicable Laws, and prudent business practice and are complete and accurate in all material respects.
| 3.13 | Residence of [name of party redacted] and [name redacted] Holdco |
[Name of party redacted] is a non-resident
of Canada for purposes of the Tax Act. [name redacted] Holdco is not a non-resident of Canada for the purposes of the Tax Act,
and is a “taxable Canadian corporation” for the purposes of the Tax Act.
| 3.14 | No Conduct of Business |
| (a) | [Name redacted] Holdco does not carry on, and has never carried on, any business operations, other
than holding shares in the capital of Westbrick, and [name redacted] Holdco’s sole purpose is to hold shares in the capital
of Westbrick. |
| (b) | [Name redacted] Holdco does not have, and has never had, any employees. |
| (c) | Other than the [name redacted] Shares, [name redacted] Holdco does not have and has never
had any tangible or intangible assets or Liabilities of any kind or nature, whether accrued or fixed, absolute or contingent, matured
or unmatured, or determined or determinable. |
| (d) | Other than the Shareholder Agreement and the Registration Rights Agreement, the [name redacted]
Shares are not subject to the terms of any agreement between or among any of the Westbrick Shareholders or Westbrick. |
| (a) | [Name redacted] Holdco, in all material respects, has duly and timely made or prepared all Tax
Returns required to be made or prepared by it, has duly and timely filed all Tax Returns required to be filed by it with the appropriate
Governmental Authority and has duly, completely and correctly reported all income and all other amounts and information required to be
reported thereon. |
| (b) | [Name redacted] Holdco, in all material respects, has duly and timely paid all Taxes, including
all instalments on account of Taxes for the current year, that are due and payable by it. |
| (c) | [Name redacted] Holdco has not requested or entered into any agreement or other arrangement, or
executed any waiver, providing for any material extension of time within which (i) to file any Tax Return covering any Taxes for which
[name redacted] Holdco is or may be liable; (ii) to file any elections, designations or similar filings relating to Taxes for which
[name redacted] Holdco is or may be liable; (iii) [name redacted] Holdco is required to pay or remit any Taxes or amounts
on account of Taxes; or (iv) any Governmental Authority may assess or collect Taxes for which [name redacted] Holdco is or may
be liable. |
| (d) | [name redacted] Holdco has not within the last three years made, prepared and/or filed any material
elections, designations or similar filings relating to Taxes or entered into any material agreement or other arrangement in respect of
Taxes or Tax Returns that is not disclosed in [name redacted] Holdco’s Tax Returns. |
| (e) | There are no material proceedings, investigations, audits or claims now pending or, to [name of party
redacted]’s knowledge, threatened against [name redacted] Holdco in respect of any Taxes and there are no material matters
under discussion, audit or appeal with any Governmental Authority relating to Taxes. |
| (f) | [Name redacted] Holdco, in all material respects, has duly and timely withheld all Taxes and other
amounts required by Applicable Laws to be withheld by it (including Taxes and other amounts required to be withheld by it in respect of
any amount paid or credited or deemed to be paid or credited by it to or for the account or benefit of any Person, including any officers
or directors and any non-resident Person), and has duly and timely remitted to the appropriate Governmental Authority such Taxes and other
amounts required by Applicable Laws to be remitted by it. |
| (g) | [Name redacted] Holdco has never been required to file any Tax Return with, and has never been
liable to pay any Taxes to, any Governmental Authority outside of Canada, and no claim has ever been made by a Governmental Authority
in a jurisdiction where [name redacted] Holdco does not file Tax Returns that [name redacted] Holdco is or may be subject
to taxation by that jurisdiction. |
| (h) | [Name redacted] Holdco has made adequate provision in its Books and Records for all Taxes which
are not yet due and payable but which relate to a Pre-Closing Tax Period, including without limitation, all instalments on account of
taxes. |
| (i) | There are no transactions or circumstances existing which could result in the application of sections
15, 17 or 78 to 80.04 of the Tax Act, or any analogous provision of any comparable Tax legislation of any jurisdiction, to [name redacted]
Holdco. |
| (j) | [Name redacted] Holdco will not be required to include any item of income in, or exclude any item
or deduction from, taxable income for any taxation year or portion thereof ending after the Closing as a result of any change in method
of accounting, closing agreement, installment sale, prepaid amounts or the use of an improper method of accounting, pertaining to a Pre-Closing
Tax Period. |
| (k) | [Name redacted] Holdco has not acquired property or services from or disposed of property or provided
services to, a Person with whom it does not deal at arm’s length (for purposes of the Tax Act) for an amount that is other than
the fair market value of such property or services in circumstances that could give rise to liability for [name redacted] Holdco
pursuant to section 160 of the Tax Act or any equivalent Applicable Law relating to Taxes. |
| (l) | For all transactions between [name redacted] Holdco and any non-resident Person with whom [name
redacted] Holdco was not dealing at arm’s length, for the purposes of the Tax Act, [name redacted] Holdco has made or
obtained records or documents that satisfy the requirements of paragraphs 247(4)(a) to (c) of the Tax Act. There are no transactions to
which section 247(2) or (3) of the Tax Act may reasonably be expected to apply. |
| (m) | [Name redacted] Holdco has never requested or received a ruling from a Governmental Authority in
respect of Taxes. |
| (n) | [Name redacted] Holdco is not party to or bound by any Tax sharing agreement, Tax indemnity obligation
in favour of any Person or similar agreement in favour of any Person with respect to Taxes (including any advance pricing agreement or
other similar agreement relating to Taxes with any Governmental Authority). |
| (o) | [Name redacted] Holdco does not have Tax Pools. |
| (p) | [Name redacted] Holdco has not been involved in any transaction or series of transactions that
require or required disclosure under any of sections 237.3, 237.4, or 237.5 of the Tax Act. |
[Name redacted] Holdco has not, and
is not, incurring any out of pocket fees and expenses in connection with the Transactions.
Article 4
REPRESENTATIONS AND WARRANTIES OF Westbrick
Except as set forth in the Disclosure Schedules,
and subject to the other terms and conditions of this Agreement, Westbrick represents and warrants to Purchaser the matters set forth
below.
| 4.1 | Incorporation, Corporate Power and Registration |
| (a) | Westbrick is a corporation duly incorporated and validly existing under the laws of the Province of Alberta
and has all necessary corporate power, authority and capacity to own, lease or operate its property and assets and carry on its business
as presently conducted. |
| (b) | Neither the nature of Westbrick’s business nor the location or character of the assets owned or
leased by Westbrick requires Westbrick to be registered, licensed or otherwise qualified as an extra-provincial or foreign corporation
in any jurisdiction other than in jurisdictions which it is duly registered, licensed or otherwise qualified for such purpose and other
than jurisdictions where the failure to be so registered, licensed or otherwise qualified would not reasonably be expected to have a Material
Adverse Effect on Company. |
Except for the Duvernay Spinco, Westbrick does
not own, or have any interest in, any shares or have an ownership interest in any other Person.
| (a) | As of the date hereof, the authorized share capital of Westbrick consists of: (i) an unlimited number
of Common Shares, of which 47,390,072 Common Shares are issued and outstanding; and (ii) an unlimited number of Preferred Shares, none
of which are issued and outstanding. All of the Westbrick Shares have been duly and validly issued and are outstanding as fully paid and
non-assessable shares. The Westbrick Shares represent all of the issued and outstanding shares in the capital of Westbrick. On the Closing
Date, following the filing of the Articles of Arrangement, the authorized share capital of Westbrick Amalco shall consist of an unlimited
number of common shares, of which no more than 52,304,022 common shares (less the difference between 36,643,737 and the number of Westbrick
Amalco Shares [name of party redacted] will receive upon amalgamation of Westbrick and [name redacted] Holdco in accordance
with the Plan of Arrangement) shall be issued and outstanding as at the date thereof, all of which shall be duly and validly issued and
outstanding as fully paid and non-assessable shares as of such date. |
| (b) | Other than the Shareholder Agreement and the Registration Rights Agreement, there are no agreements to
which Westbrick is a party restricting voting or dividend rights or transferability with respect to the Westbrick Shares (or at Closing,
the Westbrick Amalco Shares) or otherwise governing the affairs of Westbrick or the relationship, rights and duties of the shareholders
or directors of Westbrick. |
| (c) | Other than pursuant to this Agreement and the outstanding Options and Awards disclosed in the Disclosure
Schedules, no Person has any agreement, right or option, present or future, contingent or absolute, to: |
| (i) | require Westbrick to issue any further or other shares or interests in its capital or any other security
convertible or exchangeable into shares, units or interest in its capital or to convert or exchange any securities into or for shares
or interests in its capital; |
| (ii) | require Westbrick to purchase, redeem or otherwise acquire any of the Westbrick Shares; or |
| (iii) | acquire any of the Westbrick Shares. |
| 4.4 | Due Authorization and Enforceability of Obligations |
The execution and delivery of this Agreement,
the performance by Westbrick of its obligations hereunder and the consummation of the Transaction have been duly authorized by all necessary
corporate action on the part of Westbrick. Westbrick has duly and validly executed and delivered this Agreement and has duly and validly
executed and delivered, or will duly and validly execute and deliver, each other agreement or instrument to be executed and delivered
by Westbrick in connection with the Transaction or otherwise contemplated herein. This Agreement constitutes, and each other agreement
or instrument executed and delivered or to be executed and delivered by, or on behalf of, Westbrick at the Closing and in connection with
the Transaction constitutes or will, at the time of execution, constitute, a legal, valid and binding obligation of Westbrick, enforceable
against Westbrick in accordance with its terms, subject to applicable bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium
and similar laws affecting the enforcement of creditors’ rights generally or, as to enforceability, by general equitable principles.
Except as set forth in Section 4.5 of the Disclosure
Schedules, the execution and delivery by Westbrick of this Agreement, the performance by Westbrick of its obligations hereunder and the
consummation of the Transaction do not and will not constitute or result in:
| (a) | a violation of or conflict with any term or provision of Westbrick’s Organizational Documents; |
| (b) | a default under, or give rise to any right of termination, cancellation or acceleration of any right under
any Material Contract to which Westbrick is a party or by which Westbrick is bound; or |
| (c) | provided that the Key Regulatory Approval and Final Order are obtained, a breach or violation of, or a
default under, any Applicable Laws to which Westbrick is subject, |
except for such violations, conflicts, defaults
or breaches as would not, individually or in the aggregate, have a Material Adverse Effect on Company.
| 4.6 | Consents and Approvals |
Except as set forth in Section 4.6 of the Disclosure
Schedules, other than the Westbrick Approval, the approval of Westbrick’s lenders under the Credit Facilities and the Key Regulatory
Approval, no consent, approval, waiver, authorization, notice or filing is required to be obtained by Westbrick from, or to be given by
Westbrick to, or to be made by Westbrick with, any Person (including any Governmental Authority), in connection with the execution, delivery
and performance by Westbrick of this Agreement and the consummation of the Transaction, except (a) as would not, individually or in the
aggregate, have a Material Adverse Effect on Company, or (b) as may be required as a result of any facts or circumstances relating solely
to Purchaser or any of its Affiliates.
No actions have been taken or authorized by
Westbrick to initiate proceedings for or in respect of the bankruptcy, insolvency, reorganization, receivership, liquidation, dissolution
or winding up of Westbrick and no such proceedings have been taken or, as of the date hereof, threatened by any other Person.
| 4.8 | Taxable Canadian Corporation - Westbrick |
Westbrick is a “taxable Canadian corporation”
for the purposes of the Tax Act.
Although Westbrick does not warrant title to
the PNG Assets, as of the date hereof, except for Permitted Encumbrances, the PNG Assets are free and clear of all Encumbrances created
by, through or under Westbrick.
To its knowledge, except as set out or referred
to in Section 4.10 of the Disclosure Schedule and:
| (a) | Westbrick possesses all material Licences necessary for the ownership, operation and use of those material
PNG Assets that are currently operated by Westbrick and there is no material default under any of them, and no proceeding is pending or,
to the knowledge of Westbrick, threatened to revoke or amend any of them; |
| (b) | Other than in respect of Licences related to the Environment (which is addressed in Section 4.34), Westbrick
has not received any written notice alleging, any material violation under any Licence held by Westbrick and there are no investigations,
reviews or proceedings pending or, threatened by or before any Governmental Authority relating to any alleged violation of law or the
terms of any Licences arising out of operations of the PNG Assets, other than, in each case, claims, investigations or allegations that
have been resolved, withdrawn or abandoned; and |
| (c) | Westbrick has not taken any action to suspend, revoke, nor has it received any written notice of, or to
the knowledge of Westbrick has any Governmental Authority threatened any suspension, revocation or non-renewal of any Licence. |
| 4.11 | No Defaults under Leases and Agreements |
Except as disclosed in Section 4.11 of the
Disclosure Schedules,
| (a) | Westbrick has not received written notice of any default under any of the Leases and other Title and Operating
Documents or any other agreement or instrument pertaining to its Assets to which Westbrick is a party or by or to which Westbrick or any
of its Assets are bound or subject except to the extent that such defaults would not in the aggregate have a Material Adverse Effect on
Company. |
| (b) | To the knowledge of Westbrick: |
| (i) | Westbrick is in good standing under all, and is not in default under any; and |
| (ii) | there is no existing condition, circumstance or matter which constitutes or which, with the passage of
time or the giving of notice, would constitute a default under any, |
Leases and other Title
and Operating Documents or any other agreements and instruments pertaining to its Assets to which it is a party or by or to which it or
such Assets are bound or subject and, to the knowledge of Westbrick, all such Leases, Title and Operating Documents and other agreements
and instruments are in good standing and in full force and effect and none of the counterparties to such Leases, Title and Operating Documents
and other agreements and instruments is in default thereunder except to the extent that such defaults would not, individually or in the
aggregate, have a Material Adverse Effect on Company.
Except for Permitted Encumbrances, Westbrick
has not encumbered or alienated its interest in the PNG Assets or agreed to do so, nor has Westbrick done any act or thing whereby any
of the PNG Assets may be reduced, cancelled or determined.
| 4.13 | No Preferential Purchase Rights |
There are no Preferential Purchase Rights.
| 4.14 | No Reduction of Interests |
Other than the Permitted Encumbrances and except
as is reflected in the Westbrick Reserves Report, none of the Petroleum and Natural Gas Rights are subject to reduction by reference to
payout of or production penalty on any well or otherwise or to change to an interest of any other size or nature by virtue of or through
any right or interest granted by, through or under Westbrick except to the extent that such reduction or change to an interest would not
in the aggregate have a Material Adverse Effect on Company.
As of the date hereof, Westbrick has not received
written notice of any production penalty or similar production restriction of any nature imposed by any Governmental Authority, including
gas-oil ratio, off-target and overproduction penalties imposed by any Governmental Authority that may be applicable, and, to Westbrick’s
knowledge, none of the Wells in which it holds an interest is subject to any such penalty or restriction.
| 4.16 | Operation of PNG Assets |
Except to the extent that any such matters
would not individually or in the aggregate have a Material Adverse Effect on Westbrick:
| (a) | any and all operations of Westbrick, and to Westbrick’s knowledge, any and all operations by other
Persons, on or in respect of the PNG Assets, have been conducted in accordance with generally accepted oil and gas industry practices
in Western Canada and in material compliance with all Applicable Laws prevailing during the period or periods in which Westbrick has been
a working interest owner therein; |
| (b) | the Tangibles for which Westbrick is operator and, to Westbrick’s knowledge, the Tangibles for which
Westbrick is not operator, have been maintained and operated in all material respects in accordance with generally accepted oil and gas
industry practices in Western Canada and in material compliance with all Applicable Laws prevailing during the period or periods in which
Westbrick has been a working interest owner therein; |
| (c) | those Wells for which Westbrick is operator and, to Westbrick’s knowledge, those Wells for which
Westbrick is not operator, have been drilled, completed, maintained and operated and, if applicable, abandoned in all material respects
in accordance with generally accepted oil and gas industry practices in Western Canada and in material compliance with all Applicable
Laws prevailing during the period or periods in which Westbrick has been a working interest owner therein; and |
| (d) | no material tangible depreciable property that would otherwise form part of the Tangibles or Wells have
been removed from its location since the Balance Sheet Date, other than in the ordinary course of business; |
| 4.17 | Area of Mutual Interest |
There are no active Area of Mutual Interest
provisions in any of the Material Contracts or Title and Operating Documents.
As at the date hereof, Westbrick has not received
any written notice that the Leases in respect of its Petroleum and Natural Gas Rights are subject to any accrued drilling or off-set obligations
which have not been satisfied or permanently waived.
| 4.19 | Royalties, Rentals and Taxes Paid |
To Westbrick’s knowledge, (a) all royalties,
(b) all lease rentals; and (c) all ad valorem and property taxes and (d) all production, severance and similar Taxes, charges and assessments
payable on or before the date hereof and based on, or measured by, Westbrick’s ownership of the PNG Assets, the production of Petroleum
Substances from the PNG Assets or the receipt of proceeds therefrom under the Title and Operating Documents pertaining to the PNG Assets
have been properly paid in full and in a timely manner except to the extent that such non-payment would not individually or in the aggregate
have a Material Adverse Effect on Company.
Except in connection with the AFEs set out
or referred to in Section 4.20 of the Disclosure Schedules, and excluding operating expenses incurred in the normal conduct of operations
of the PNG Assets, there are no AFEs or other financial commitments pertaining to the PNG Assets under which individual expenditures in
excess of $150,000 are or may be required to be made Westbrick following the date hereof;
Except to the extent of any material changes
or deviations carried out, in whole or in part, at the request of Purchaser, there has not been any material changes to or deviation from
the capital projects set forth in the Capex Plans (including the budgets set forth therein).
A true and complete copy of the report prepared
by GLJ Ltd. (“GLJ”) for the period ended September 30, 2024 with respect to Westbrick’s reserves (the “Westbrick
Reserves Report”) has been provided to Purchaser. Westbrick co-operated with GLJ in the preparation of the Westbrick Reserves
Report, which has been accepted and approved by the Board of Directors of Westbrick. Westbrick has made available to GLJ prior to the
issuance of the Westbrick Reserves Report for the purpose of preparing such report, all information within Westbrick’s power or
possession requested by GLJ, which information did not to Westbrick’s knowledge, at the time such information was provided, contain
any misrepresentation and Westbrick does not have any knowledge of any change in the production, cost, reserves, resources or other relevant
information provided to GLJ since the date that such information was so provided that would result, individually or in the aggregate,
in a Material Adverse Effect on Company. Westbrick believes that the Westbrick Reserves Report reasonably presents the estimated quantity
and pre-tax net present values of the oil and natural gas reserves associated with the light & medium oil, natural gas and NGLs properties
evaluated in such reports as at September 30, 2024, based upon information available at the time such reserves information was prepared
and based upon the commodity price forecast assumptions made by GLJ, and Westbrick believes that at the date of such report, they reasonably
presented the aggregate estimated quantity and pre-tax net present values of such reserves or the estimated monthly production volumes
therefrom. GLJ, who prepared the Westbrick Reserves Report, is, to Westbrick’s knowledge, independent reserves evaluators in respect
of the Westbrick Reserves Report as interpreted and applied by the securities commission or similar securities regulatory authority in
each of the provinces and territories of Canada.
Except as set forth or referred to in Section
4.23 of the Disclosure Schedules, Westbrick has no Liabilities, direct or indirect, vested or contingent in respect of any Hedging Transaction.
All such Hedging Transactions were entered in the ordinary course of business consistent with past practice and as permitted under Westbrick’s
corporate policies.
| (a) | The Financial Statements have been prepared in accordance with IFRS applied on a basis consistent with
those of preceding fiscal periods. |
| (b) | The Financial Statements present fairly in all material respects the assets, liabilities and financial
position of Westbrick as at the end of the periods represented thereby, and the results of their operations and the changes in their financial
position for the periods then ended (provided that, in the case of the unaudited financial statements, subject to normal year-end adjustments,
the exclusion of notes and other presentation items thereto), all in accordance with IFRS consistently applied, except for any changes
in accounting policies disclosed in the Financial Statements. True, correct and complete copies of the Financial Statements are set forth
in Section 4.24 of the Disclosure Schedules. |
| (c) | Westbrick does not have any “off-balance sheet arrangements” (as such term is defined under
IFRS). |
| 4.25 | No Undisclosed Liabilities |
Westbrick has no material Liabilities (including
any Indebtedness), except for (a) those shown on the Balance Sheet, (b) those incurred since the Balance Sheet Date in the ordinary course
of business consistent with past practice (none of which is a Liability resulting from breach of contract, breach of warranty, tort, infringement
claim or lawsuit), and (c) those incurred in connection with the Agreement or the transactions contemplated by the Arrangement.
Since the Balance Sheet Date, (a) there has
been no Material Adverse Effect on Company in respect of the Business, and (b) Westbrick has conducted its Business (excluding the Duvernay
Business) in all material respects in the ordinary course of business consistent with past practice, and Westbrick has not, except as
expressly contemplated in this Agreement:
| (a) | declared, set aside, made or paid any dividend or other distribution on or with respect to the Westbrick
Shares; |
| (b) | other than grants of Awards disclosed in the Data Room, issued, granted, sold, pledged, transferred, disposed
of, or created any Encumbrance on, any shares or other securities of Westbrick, or securities convertible into or exchangeable for any
shares, or other securities of Westbrick, or any rights, warrants, options, calls or commitments to acquire any such shares or other securities
of Westbrick; |
| (c) | increased the rate of wages, salaries, compensation or bonuses of any Westbrick Employee, officer, director,
contractor or consultant, except as required under the terms of any Contract disclosed in the Data Room or Applicable Laws (it being understood
that 2024 bonuses have been accrued but not yet allocated and paid); |
| (d) | resigned or taken any action which would result in Westbrick’s resignation or replacement as operator
of any of the Assets or the Business; |
| (e) | increased the severance, change of control or termination payments that could become payable to any directors,
officers or Westbrick Employees; or |
| (f) | terminated, extended or materially amended or modified, or forfeited or waived any material right or benefit
under, any Material Contract. |
| 4.27 | Government Incentives |
All filings made by Westbrick under which it
has received or is entitled to government incentives have been made in compliance with all Applicable Laws and contain no misrepresentations
which could cause any material amount previously paid to Westbrick, or previously accrued on the accounts thereof to be recovered or disallowed.
Except as set forth in Section 4.28 of the
Disclosure Schedules:
| (a) | Westbrick has disclosed to Purchaser all material documentation and communication concerning engagement
with Aboriginal Groups concerning the Business; |
| (b) | Westbrick has not received any written demand or Claim from any Aboriginal Group; and |
| (c) | Westbrick is not party to any negotiations or discussions with any Aboriginal Group the primary objective
of which is the development and execution of a Contract between an Aboriginal Group and Westbrick related to the Business. |
With respect to those Material Contracts that
Westbrick is a Party to:
| (a) | True, complete and unredacted copies of all Material Contracts in existence as of the date hereof, including
all amendments thereto, have been uploaded into the Data Room. |
| (b) | The Material Contracts are in full force and effect and in good standing in all material respects. There
are no current or pending negotiations with respect to the renewal, repudiation or material amendment of any of the Material Contracts. |
| (c) | Neither Westbrick or, to the knowledge of Westbrick, any other party to a Material Contract, is in default
or breach, of a Material Contract and, to the knowledge of Westbrick, there does not exist any event, condition or omission that would
constitute such a default or breach with the lapse of time or notice or both, except to the extent such matters would not individually
or in the aggregate have a Material Adverse Effect on Company. |
| (d) | Westbrick has not received any written notice of termination or non-renewal under, or in respect of a
Material Contract. To the knowledge of Westbrick, no event, matter or circumstance is subsisting which constitutes or would reasonably
be expected to constitute a force majeure pursuant to a Material Contract. |
| 4.30 | Equity Monetization Plans |
Other than the Omnibus Plan (and Award Agreements
thereunder), Option Agreements and the Option Plan, there are no outstanding stock options, restricted or deferred share units, performance
share units, stock appreciation rights, phantom equity, profit sharing plan or any other similar rights, agreements, arrangements or commitments
payable to any director, officer or employee of Westbrick which are based upon the revenue, value, income or any other attribute of Westbrick.
| 4.31 | Duvernay Spinco Transaction |
| (a) | Schedule A to the Duvernay Spinco Conveyance Agreement Disclosure Schedules sets forth complete and accurate
lists of the Duvernay Assets that are being transferred to Duvernay Spinco under the Duvernay Conveyance. |
| (b) | There are no rights of first refusal, rights of first offer, preferential purchase rights or buy-out rights
or options created by, through or under Westbrick that are held by any Third Party to purchase or acquire any of the Duvernay Assets which
are triggered as a consequence of the Parties entering into this Agreement or the consummation of the Transaction or of Westbrick entering
into any or all of the Duvernay Spinco Conveyance Agreement and the Duvernay Share Purchase Agreement and consummation of the transactions
contemplated therein or in connection with the consummation of the Duvernay Alternative Transaction. |
| (c) | To the knowledge of Westbrick, the consummation of the transactions contemplated in the Duvernay Spinco
Conveyance Agreement and the Duvernay Share Purchase Agreement and the Duvernay Alternative Transaction will not result in the cancellation,
suspension or termination, or otherwise require modification (other than updates required pursuant to AER Directive 067), of any material
Licence maintained in respect of the conduct of the Business. |
| (d) | Westbrick is not aware of any facts or circumstances pertaining to Westbrick that could reasonably be
expected to result in Westbrick being determined to pose “an unreasonable risk” as contemplated under AER Directive 067 or
Company being determined, as a result of the Duvernay Conveyance or the Duvernay Alternative Transaction, to pose “an unreasonable
risk” as contemplated under AER Directive 067. |
| (e) | Except for the Field Contractors whose Contracts are transferred to Duvernay Spinco (or a Third Party
buyer of the Duvernay Spinco shares), no Westbrick Employees or Westbrick Contractors will be terminated or transferred to Duvernay Spinco
(or a Third Party buyer of the Duvernay Spinco shares) as part of the Duvernay Conveyance. |
Except as disclosed in Section 4.32 of the
Disclosure Schedules, there are no Claims before a Governmental Authority which are pending, or to Westbrick’s knowledge, threatened
by any Person against Westbrick or, to Westbrick’s knowledge, affecting any the Assets in any material respect or, to Westbrick’s
knowledge, by or against the Westbrick Shareholders relating to Westbrick. Except as would not individually or in the aggregate have a
Material Adverse Effect on the Company, there are no outstanding order, writ, judgment, injunction, decree, stipulation, determination,
award, decision, sanction or ruling entered by or with any Governmental Authority in respect of Westbrick, the Assets and/or the Purchased
Shares, and there are no unsatisfied judgments, settlements, penalties or awards for which Westbrick is liable to any Person.
| 4.33 | Compliance with Applicable Laws |
| (a) | The business of Westbrick is, and has been carried out, in compliance with and not in violation of any
Applicable Laws, and Westbrick is not in violation or non-compliance of any Applicable Laws, in each case which have or could reasonably
be expected to have, individually or in the aggregate, have a Material Adverse Effect on Company or would significantly impact the ability
of Westbrick to consummate the Transactions, and Westbrick has not received any notice of any alleged material violation of any such Applicable
Laws. |
| (b) | This Section 4.33 does not relate to matters involving the PNG Assets, Environmental Laws, Taxes, and
Intellectual Property, which for the purposes of compliance with Applicable Laws, shall be governed exclusively by Section 4.34, Section
4.38 and Section 4.40, respectively. |
| 4.34 | Environmental Matters |
Except as disclosed in Section 4.34 of the
Disclosure Schedules:
| (a) | Westbrick has not received any orders or directives from any Governmental Authority that are applicable
to Westbrick, the PNG Assets, the Duvernay Assets or any portion thereof related to Environmental Liabilities or environmental liabilities
pertaining to the Duvernay Assets that require any work, repairs, construction or Capital Expenditures with respect to the Assets or the
Duvernay Assets where such orders or directives have not been complied with in all material respects; |
| (b) | Westbrick has not received any written demands or notices from any Governmental Authority issued under
any Environmental Law with respect to the breach of any Environmental Law applicable to the Assets or the Duvernay Assets including in
respect of a Release, the use, storage, treatment, transportation, handling or disposition of environmental contaminants, or the protection
of the Environment, which demand or notice remains outstanding on the date hereof; |
| (c) | to Westbrick’s knowledge, there have not been any Releases of Hazardous Materials from the Assets
or the Duvernay Assets or for which Westbrick is responsible, that are reportable and require remedial action pursuant to any Applicable
Laws; |
| (d) | Westbrick has not, either expressly or by operation of Applicable Law, assumed responsibility for or agreed
to indemnify or hold harmless any Person for any liability or obligation arising under Environmental Law that is reasonably likely to
form the basis of any material Claim against Westbrick; |
| (e) | to Westbrick’s knowledge, neither the execution of this Agreement, nor the consummation of the Transaction,
shall require any material notification to any Governmental Authority or the undertaking of any investigations or remedial actions pursuant
to Environmental Law by Westbrick; and |
| (f) | Westbrick has made available all material environmental reports, investigations, studies, audits and other
environmental documents that are in Westbrick’s possession or control and that have been completed within the past three years that
relate to the operations of Westbrick, or any real or immovable property currently or formerly owned, operated or occupied by Westbrick; |
| (g) | to the knowledge of Westbrick, here are no writs, injunctions, decrees, orders or judgments outstanding
or any material actions, suits or proceedings pending before any Governmental Authority or, threatened, against Westbrick concerning compliance
by Westbrick with, Applicable Laws relating to the Environment or any environmental permits. |
| (a) | Section 4.35 to the Disclosure Schedules is a complete and accurate list of the Westbrick Employees, and
indicates for each individual their: (i) name; (ii) position title; (iii) location; (iv) date of hire and recognized service date (if
earlier); (v) exempt/non-exempt status for overtime; (vi) employment status (i.e., full-time, temporary or casual, and active or inactive
status); (vii) if temporary/fixed term, date of expiry of contract; (viii) annual vacation entitlement and current accrued but unused
vacation; (ix) accrued banked overtime; (x) other accrued but unused paid leave; (xi) current annual base salary or hourly wage rate (or
other compensation paid); (xii) target bonus/commission for the current year; (xiii) other forms of compensation provided; (xiv) base
compensation, bonus/commission and total compensation for the prior year; (xv) entitlement under Benefit Plans; (xvi) whether such employee
is currently on an approved/unapproved leave of absence (and for how long, if known), and their anticipated return date; (xvii) whether
the individual is party to a written employment agreement; and (xviii) whether any employees are on work permits. |
| (b) | Section 4.35 of the Disclosure Schedules is a complete and accurate list of the individuals who are acting
as independent contractors (including through a holding corporation) of Westbrick in respect of the Business (“Westbrick Contractors”)
and includes: (i) the name of the individual; (ii) the name of the individual’s employer/holding company (if applicable); (iii)
the time period such individual provided services to Westbrick or any of its subsidiaries; (iv) a description of the services provided;
(v) a description of the compensation terms for such services (e.g., set fees, hourly rates, etc.); (vi) whether such individual’s
work included overtime work; (vii) the total amount paid by Westbrick for such services in each of the last three calendar years; (viii)
state whether such individual at any time has been an employee of Westbrick; (ix) whether the individual is party to a written independent
contractor agreement; and (x) whether the individual supports the Duvernay Business, and a description of such support. |
| (c) | Other than as disclosed in Section 4.35 of the Disclosure Schedules, Westbrick is not a party to any oral
or written independent contractor agreement, consulting Contract, employment agreement (including employment offer), management Contract
or similar agreement or arrangement for the services or employment of one or more particular individuals to Westbrick in respect of the
Business. |
| (d) | There are no fines, notices of reassessment or penalty assessments or any other communications related
thereto which Westbrick has received from any Governmental Authority relating to any workers’ compensation regime which are unpaid
on the date hereof. All current assessments under workers’ compensation legislation in relation to Westbrick and the Business have
been paid and/or properly accrued by Westbrick. No audit of Westbrick is currently being performed under any employment Applicable Laws.
To Westbrick’s knowledge, there are no claims or potential claims which may materially adversely affect Westbrick’s accident
cost experience rating. |
| (e) | There are no outstanding prosecutions, fines, charges, penalties, assessments or orders issued under the
occupational health and safety Laws relating to Westbrick. To Westbrick’s knowledge, there have been no workplace accidents within
the last three (3) years that might be expected to lead to prosecution. Westbrick is operating in material compliance with all occupational
health and safety Applicable Laws and has no prior convictions under any occupational health and safety legislation. |
| (f) | There are no collective agreements or other Contracts or agreements with any labour union or employee
association currently in force. Westbrick has not entered into any collective agreements or made any commitments or conducted any negotiations
with any labour union or employee association with respect to any future collective agreements and, to the knowledge of Westbrick, there
is no current or threatened attempt to organize, certify or establish any labour union or employee association with respect to Westbrick
Employees. |
| (g) | There are no pending or, to the knowledge of Westbrick, threatened labour disputes, charges of unfair
labour practice, complaints or applications pursuant to any applicable federal or provincial labour relations code. |
| (h) | Westbrick is and has been in material compliance with all terms and conditions of employment, and all
Applicable Laws pertaining to employment including employment standards, labour standards, wages, hours of work, overtime, human rights,
occupational health and safety, immigration, privacy, workers’ compensation, income tax withholding, payroll taxes, the Statutory
Plans or any other employment-related matter arising under applicable Laws. There are no pending, actual, or, to the knowledge of Westbrick,
threatened complaints, actions or Claims pursuant to any applicable federal or provincial human rights legislation or employment standards
legislation, or other proceeding whatsoever, by or involving any present or former employee of Westbrick in respect of the Business. |
| (i) | Westbrick has not received written notice from any Governmental Authority disputing any classification
of an independent contractor or consultant of Westbrick and, to the knowledge of Westbrick, all such independent contractors and consultants
have been properly classified as the same in accordance with Applicable Laws. |
| (j) | Westbrick has paid in full to or accrued in accordance with IFRS on behalf of the Westbrick Employees
and former employees all wages, salaries, commissions, bonuses and other direct compensation for all services performed, all vacation,
profit-sharing and other benefits, all severance or termination pay owing, and all amounts required to be reimbursed. All accruals for
unpaid vacation pay and overtime, premiums for employment insurance, Benefit Plan premiums, Statutory Plan premiums, premiums and assessments
payable under applicable workers’ compensation legislation, and accrued compensation, fees, wages, bonuses, expenses, salaries,
allowances and commissions have been accurately reflected in its Books and Records. Westbrick has paid in full or accrued in accordance
with IFRS all amounts owing to Westbrick Contractors or former independent contractors for services performed. |
| (k) | Except as set forth in Section 4.35 of the Disclosure Schedules, to the knowledge of Westbrick, no offer
of employment or engagement has been made by Westbrick that has not yet been accepted, or which has been accepted but the employment or
engagement has not yet started. |
| (l) | Section 4.35 of the Disclosure Schedules contains a list of all written employment agreements and independent
contractor agreements, as well as any agreement or arrangement as to: (i) change of control; (ii) payment of any amount, bonus, fee, distribution,
remuneration or other compensation which is triggered by, or expected to be triggered by, the transactions contemplated hereby; (iii)
retention payment; and (iv) severance or termination payment required to terminate the Westbrick Employee’s employment or the independent
contractor’s service agreement. |
| (m) | Correct and complete copies of the form of all employment agreements and independent contractor agreements
set out in Section 4.35 of the Disclosure Schedules have been made available to Purchaser. |
| (n) | Except as set forth in Section 4.35 of the Disclosure Schedules, Westbrick is not party to or bound by
any agreement, whether written or oral, with any Westbrick Employee which is not terminable on the giving of reasonable notice under Applicable
Law. |
| 4.36 | Employee Benefit Plans |
| (a) | The list and description of Benefit Plans contained in Section 4.36 of the Disclosure Schedules is a complete
and accurate list and description of all Benefit Plans as of the date hereof together with all amendments that have been made to such
plans since their inception and all of the employee benefit booklets relating thereto. Current and complete copies of all written Benefit
Plans, including all amendments or, where oral, written summaries of the terms thereof, and all current booklets describing the Benefit
Plans which have been provided to all Persons entitled to benefits under the Benefit Plans, have been delivered or made available to Purchaser. |
| (b) | There are no participating employers that have any obligations or Liabilities with respect to any Benefit
Plan other than Westbrick, and Westbrick has no obligations or Liabilities under any Benefit Plan, including to provide benefits, to any
Person who is not an employee, director or officer or former employee, director or officer of Westbrick or any eligible dependent, survivor,
beneficiary or estate thereof. |
| (c) | None of the Benefit Plans provides post-employment or post-retirement health, life or other welfare benefits
to Westbrick Employees or former employees of Westbrick or any dependent, survivor, beneficiary or estate thereof, except for benefits
required to be provided after termination of employment without cause pursuant to Applicable Laws relating to employment standards. |
| (d) | None of the Benefit Plans is (a) a “registered pension plan” as defined in section 248(1)
of the Tax Act, (b) has a “defined benefit provision” as defined in section 147.1(1) of the Tax Act, (c) is a “multi-employer
plan” as defined in section 8500 of the Tax Act or in pension standards legislation in any Canadian jurisdiction, or (d) is a multi-employer
“employee life and health trust” as the term is used in the Tax Act. |
| (e) | All contributions to, and payments from, each Benefit Plan which have been or may have been required to
be made in accordance with the terms of any such Benefit Plan and Applicable Laws have been made or, for any such payments that are not
yet due, that have properly accrued, in each case in accordance with the provisions of each of the Benefit Plans, Applicable Law and generally
accepted accounting principles. Each Benefit Plan is, and has been, as applicable, established, registered, amended, funded and administered
in compliance with the terms of such Benefit Plan and all Applicable Laws. |
| (f) | Except as set forth in Section 6.8, neither the execution and delivery of this Agreement nor the completion
of the Transaction will constitute an event under any Benefit Plan or agreement with any Westbrick Employee, former employee, or current
or former director or officer, that will or may result in any severance or other payment or in the acceleration, vesting or increase in
benefits. |
| (g) | As of the date hereof, there is no Claim (other than routine claims for payments of benefits) pending
or threatened involving any Benefit Plan. |
| 4.37 | Non Arm’s Length Transactions |
Other than as disclosed in Section 4.37 of
the Disclosure Schedules:
| (a) | No director or officer, shareholder or Westbrick Employee, or former director or officer, shareholder
or Westbrick Employee (or any other Person not dealing at arm’s length (within the meaning of the Tax Act) with Westbrick) has engaged
in any transaction or arrangement with or is a party to a Contract with, or has any Indebtedness, liability or obligation to, Westbrick
and except for: (a) the Shareholder Agreement, the Registration Rights Agreement, the Option Agreements and the Award Agreements; (b)
employment, director and officer indemnification and other similar agreements entered into in the ordinary course of business; and (c)
upon implementation of the Arrangement, the [name redacted] Holdco Note; and |
| (b) | no such Person has any right, title or interest in (or the right to acquire any right, title or interest
in) any royalty interest, participation interest or any other interest whatsoever, in any assets or property of Westbrick. |
Except as disclosed in Section 4.38 of the
Disclosure Schedules:
| (a) | Westbrick, in all material respects, has duly and timely made or prepared all Tax Returns required to
be made or prepared by it, has duly and timely filed all Tax Returns required to be filed by it with the appropriate Governmental Authority
and has duly, completely and correctly reported all income and all other amounts and information required to be reported thereon. |
| (b) | Westbrick, in all material respects, has duly and timely paid all Taxes, including all instalments on
account of Taxes for the current year, that are due and payable by it. |
| (c) | Westbrick has not requested or entered into any agreement or other arrangement, or executed any waiver,
providing for any material extension of time within which (i) to file any Tax Return covering any Taxes for which Westbrick is or may
be liable; (ii) to file any elections, designations or similar filings relating to Taxes for which Westbrick is or may be liable; (iii)
Westbrick is required to pay or remit any Taxes or amounts on account of Taxes; or (iv) any Governmental Authority may assess or collect
Taxes for which Westbrick is or may be liable. |
| (d) | Westbrick has not within the last three years made, prepared and/or filed any material elections, designations
or similar filings relating to Taxes or entered into any material agreement or other arrangement in respect of Taxes or Tax Returns that
has effect for any period ending after the Closing Date and, in each case, that is not disclosed in Westbrick’s Tax Returns. |
| (e) | There are no material proceedings, investigations, audits or claims now pending or, to Westbrick’s
knowledge, threatened against Westbrick in respect of any Taxes and there are no material matters under discussion, audit or appeal with
any Governmental Authority relating to Taxes. |
| (f) | Westbrick, in all material respects, has duly and timely withheld all Taxes and other amounts required
by Applicable Laws to be withheld by it (including Taxes and other amounts required to be withheld by it in respect of any amount paid
or credited or deemed to be paid or credited by it to or for the account or benefit of any Person, including any Westbrick Employees,
officers or directors and any non-resident Person), and has duly and timely remitted to the appropriate Governmental Authority such Taxes
and other amounts required by Applicable Laws to be remitted by it. |
| (g) | Westbrick, in all material respects, has duly and timely collected all amounts on account of any sales
or transfer taxes, including goods and services, harmonized sales and provincial or territorial sales taxes, required by Applicable Laws
to be collected by it and has duly and timely remitted to the appropriate Governmental Authority any such amounts required by Applicable
Laws to be remitted by it. |
| (h) | Westbrick has never been required to file any Tax Return with, and has never been liable to pay any Taxes
to, any Governmental Authority outside of Canada, and no claim has ever been made in writing by a Governmental Authority in a jurisdiction
where Westbrick does not file Tax Returns that Westbrick is or may be subject to taxation by that jurisdiction. |
| (i) | Westbrick has made adequate provision in its Books and Records for all Taxes which are not yet due and
payable but which relate to a Pre-Closing Tax Period, including without limitation, all instalments on account of taxes. |
| (j) | Westbrick has not made an eligible dividend designation under subsection 89(14) of the Tax Act in respect
of any dividend paid or deemed by any provision of the Tax Act to have been paid on any class of shares of its capital stock. |
| (k) | All Tax refunds, Tax credits, deduction, investment tax credits (“ITCs”), subsidy or wage
subsidy (including the Canada Emergency Wage Subsidy, the Canada Emergency Rent Subsidy, and any other COVID-19 related assistance or
subsidies in respect of any Pre-Closing Tax Period), rebates and overpayments (including deemed overpayments) claimed by Westbrick in
any taxation year were claimed in accordance with the Tax Act and other Applicable Laws. |
| (l) | There are no transactions or circumstances existing which could result in the application of sections
15 , 17, 78 to 80.04 of the Tax Act, or any analogous provision of any comparable Tax legislation of any jurisdiction, to Westbrick. |
| (m) | Westbrick will not be required to include any item of income in, or exclude any item or deduction from,
taxable income for any taxation year or portion thereof ending after the Closing as a result of any change in method of accounting, closing
agreement, installment sale, prepaid amounts or the use of an improper method of accounting, pertaining to a Pre-Closing Tax Period. |
| (n) | Westbrick has not acquired property or services from or disposed of property or provided services to,
a Person with whom it does not deal at arm’s length (for purposes of the Tax Act) for an amount that is other than the fair market
value of such property or services in circumstances that could give rise to liability for Westbrick pursuant to section 160 of the Tax
Act or any equivalent Applicable Law relating to Taxes. |
| (o) | For all transactions between Westbrick, and any non-resident Person with whom Westbrick was not dealing
at arm’s length, for the purposes of the Tax Act Westbrick has made or obtained records or documents that satisfy the requirements
of paragraphs 247(4)(a) to (c) of the Tax Act. There are no transactions to which section 247(2) or (3) of the Tax Act may reasonably
be expected to apply. |
| (p) | Westbrick has never requested or received a ruling from a Governmental Authority in respect of Taxes. |
| (q) | Westbrick’s Tax Pools, as at the end of the taxation year ended December 31, 2023, are as set forth
in Section 4.38 of the Disclosure Schedules, and since January 1, 2024 to the date hereof Westbrick has not taken any action or entered
into any transaction, outside of the ordinary course, that would have the effect of materially reducing any amount set out therein. |
| (r) | Westbrick has not been involved in any transaction or series of transactions that require or required
disclosure under any of sections 237.3, 237.4, or 237.5 of the Tax Act. |
| (s) | Westbrick is duly registered under subdivision (d) of Division V of Part IX of the Excise Tax Act
(Canada) with respect to the goods and services tax and harmonized sales tax and its registration number is [redacted]. |
| (a) | Section 4.39 of the Disclosure Schedules sets forth a summary of coverage of the insurance policies maintained
by or on behalf of Westbrick in respect of the Business and any of the Assets (such policies, collectively, the “Policies”),
as well as a list of all active claims under such Policies, a description of the insurable event, and a status of the claim. The Policies
are in full force and effect. All premiums due and payable under the Policies have been paid in a timely manner and Westbrick has complied
in all material respects with the terms and conditions of all the Policies. Westbrick has not failed to give any notice or present any
material claim under any such Policies in due and timely fashion. |
| (b) | Except as disclosed in Section 4.39 of the Disclosure Schedules, there is no material insurance claim
pending under the Policies as to which coverage has been denied by the insurer other than customary indications as to reservation of rights
by insurers, and Westbrick has not received written notice of reduction, non-renewal or cancellation of any of the Policies. |
| 4.40 | Intellectual Property |
As at the date hereof:
| (a) | Westbrick owns or has the right to use pursuant to binding Contract or otherwise all material items of
Intellectual Property used in the operation of the Business as it is currently being operated (other than the Duvernay Assets); |
| (b) | no Third Party has asserted in writing against Westbrick a claim that Westbrick or the Business is infringing
on the Intellectual Property rights of such Third Party, and to the knowledge of Westbrick, except as would not have a Material Adverse
Effect on the Company, neither it nor the Business is infringing on the Intellectual Property rights of any such Third Party; |
| (c) | to the knowledge of Westbrick, no Third Party is infringing on the Intellectual Property owned by Westbrick; |
| (d) | except as would not have a Material Adverse Effect on the Company, |
| (i) | all computer hardware and their associated firmware and operating systems, application software, database
engines and processed data, technology infrastructure and other computer systems used in connection with the conduct of the Business (excluding
the Duvernay Business) (the “Technology”) are up to date and reasonably sufficient to conducting the Business (excluding
the Duvernay Business) as it is currently being operated; and |
| (ii) | Westbrick owns or has validly licensed (as it not in breach of such licenses in any material respect)
such Technology and has commercially reasonable virus protection and security measures in place in relation to such Technology. |
| 4.41 | Books and Records, Corporate Records |
| (a) | The minute books of Westbrick and other material corporate records have been made available to Purchaser
for review. Such minute book and corporate records (i) contain, in all material respects, accurate and complete records of all meetings,
and resolutions in writing of, the shareholders, the board of directors and any committees of the board of directors of Westbrick, (other
than those minutes of the meetings of the board of directors and any committees of the board of directors of Westbrick which are in draft
form or related to the transaction contemplated hereby or Westbrick’s Project Buffalo or Project Crow processes); and (ii) have
been maintained in accordance with, in all material respects, all Applicable Laws, and prudent business practice and are complete and
accurate in all material respects. |
| 4.42 | Anti-Corruption; Anti-Money Laundering |
Neither Westbrick nor, to the knowledge of
Westbrick, any director, officer, agent, employee or other Person authorized by it to act on its behalf has: (a) directly or indirectly
used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expense relating to political activity;
(b) made any direct or indirect unlawful payment to any foreign or domestic government official or employee from corporate funds, directly
or indirectly; (c) violated or is in violation of any applicable provision of the United States Foreign Corrupt Practices Act of 1977
or the Corruption of Foreign Public Official Act (Canada), the Proceeds of Crime (Money Laundering) and Terrorist Financing
Act (Canada), or any other similar anti-corruption or anti-money laundering law of any jurisdiction; or (d) made any bribe, rebate,
payoff, influence payment, kickback or other unlawful payment, in each case related to the Business or the Transaction.
Westbrick is not aware of any facts or circumstances
pertaining to Westbrick, including the transaction contemplated herein with respect to the Duvernay Assets and the Duvernay Spinco, that
could reasonably be expected to result in Westbrick being determined to pose “an unreasonable risk” as contemplated under
AER Directive 067.
Other than RBC and Scotiabank, Westbrick has
not retained, engaged or entered into any Contract (whether written or oral) with any Person who is or will be entitled to a broker’s
commission, finder’s fee, investment banker’s fee or similar payment in connection with the negotiation, execution or performance
of this Agreement.
Section 4.45 of the Disclosure Schedules sets
forth Westbrick’s bona fide good faith estimate of the Net Debt as of December 31, 2024 and bona fide good faith estimate of Transaction
Expenses, in each case such estimates being made as of the date hereof.
Company has not knowingly and intentionally
withheld from Purchaser any material information or material documents concerning Westbrick, [name redacted] Holdco, the Business
or the Assets or Liabilities associated therewith.
Article 5
REPRESENTATIONS AND WARRANTIES OF PURCHASER
Purchaser represents and warrants to each of
Westbrick and [name of party redacted] the matters set forth below.
| 5.1 | Organization and Corporate Power |
Purchaser has been duly organized or created,
is validly existing and is in good standing under the laws of its jurisdiction of formation or creation. Purchaser has all requisite corporate
or similar power and authority to execute and deliver this Agreement and each other agreement or instrument required to be executed and
delivered by the Purchaser in connection with the Transaction or otherwise contemplated herein, to perform its obligations hereunder and
thereunder and to consummate the Transaction.
| 5.2 | Due Authorization and Enforceability of Obligations |
The execution and delivery of this Agreement
and each other agreement and instrument required to be executed and delivered by Purchaser in connection with the Transaction or otherwise
contemplated herein, the performance by Purchaser of its obligations hereunder and thereunder and the consummation of the Transaction
have been duly authorized by all necessary action on the part of Purchaser. Purchaser has duly and validly executed and delivered this
Agreement and has duly and validly executed and delivered, or will duly and validly execute and deliver, each other agreement or instrument
required to be executed and delivered by Purchaser in connection with the Transaction or otherwise contemplated herein. This Agreement
constitutes, and each other agreement or instrument executed and delivered or to be executed and delivered by, or on behalf of, Purchaser
at the Closing and in connection with the Transaction constitutes or will, at the time of execution, constitute, a legal, valid and binding
obligation of Purchaser, enforceable against Purchaser in accordance with its terms, subject to applicable bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws affecting the enforcement of creditors’ rights generally or, as to enforceability,
by general equitable principles.
The execution and delivery by Purchaser of
this Agreement, the performance by Purchaser of its obligations hereunder and the consummation of the Transaction by Purchaser do not
and will not constitute or result in:
| (a) | a violation of or conflict with any of term or provision of Purchaser’s Organizational Documents; |
| (b) | a default under, or give rise to any right of termination, cancellation or acceleration of any right under
any Contract to which Purchaser is a party; or |
| (c) | provided that the Key Regulatory Approval is obtained, a breach or violation of, or a default under, any
Applicable Laws to which Purchaser is subject, |
except for such violations, conflicts, defaults
or breaches as would not, individually or in the aggregate, have a Material Adverse Effect on the Purchaser.
| 5.4 | Consents and Approvals |
Other than the Key Regulatory Approval, no
consent, approval, waiver, authorization, notice or filing is required to be obtained by Purchaser or any of its Affiliates from, or to
be given by Purchaser or any of its Affiliates to, or to be made by Purchaser or any of its Affiliates with, any Person (including any
Governmental Authority), in connection with the execution, delivery and performance by Purchaser of this Agreement and the consummation
of the Transaction, except (a) as would not prevent or materially delay or impair the ability of Purchaser to consummate the Transaction,
or (b) as may be required as a result of any facts or circumstances relating solely to Westbrick, [name of party redacted] or [name
redacted] Holdco.
No actions have been taken or authorized by
Purchaser to initiate proceedings for or in respect of the bankruptcy, insolvency, reorganization, receivership, liquidation, dissolution
or winding up of Purchaser and no such proceedings have been taken or, as of the date hereof, threatened by any other Person.
Purchaser is not aware of any facts or circumstances
pertaining to Purchaser that could reasonably be expected to result in Purchaser being determined to pose “an unreasonable risk”
as contemplated under AER Directive 067 or Westbrick being determined, as a result of the change of control or change in management of
the Company as result of the Transaction, to pose “an unreasonable risk” as contemplated under AER Directive 067.
Except as would not individually or in the
aggregate if determined adversely to Purchaser, have a Material Adverse Effect on Purchaser, there are no Claims before a Governmental
Authority which are pending, or to Purchaser’s knowledge, threatened by any Person against Purchaser or, to Purchaser’s knowledge,
affecting any of its assets. Except as would not individually or in the aggregate have a Material Adverse Effect on the Purchaser, there
are no outstanding order, writ, judgment, injunction, decree, stipulation, determination, award, decision, sanction or ruling entered
by or with any Governmental Authority in respect of the Purchaser, its assets and/or the Purchaser Shares, and there are no unsatisfied
judgments, settlements, penalties or awards for which the Purchaser is liable to any Person.
Purchaser is a “Canadian” within
the meaning of the Investment Canada Act.
| 5.9 | Taxable Canadian Corporation - Purchaser |
Purchaser is a “taxable Canadian corporation”
for the purposes of the Tax Act.
| (a) | Purchaser’s obligations hereunder are not subject to any conditions regarding its or any other Person’s
ability to obtain financing for the Transaction. Purchaser has sufficient cash, available lines of credit or other sources of immediately
available funds to enable Purchaser to pay in full to the Westbrick Shareholders the entire amount of the Cash Consideration and the entire
amount under the [name redacted] Holdco Note in immediately available funds in cash and otherwise perform its obligations under
this Agreement, and there are no conditions precedent or other contractual contingencies related to the payment or release of such funds
to the Westbrick Shareholders other than those which will automatically be satisfied by the waiver or satisfaction of the conditions in
Article 7. No part of the funds paid by Purchaser pursuant to this Agreement has been, or is, directly or indirectly, derived from,
or related to, any activity that is reasonably expected to contravene any applicable money-laundering laws. |
| (b) | Without limiting the generality of the foregoing, Purchaser has delivered to the Company and [name
of party redacted] a true and complete executed copy of the Acquisition Debt Confirmations, pursuant to which it has confirmed that
it has available to it under the Debt Financing amounts in excess of the Required Funds, subject to the terms and conditions therein.
The aggregate proceeds contemplated by the Acquisition Debt Confirmations, together with such other amounts as are currently available
to Purchaser from cash on hand, will be sufficient to pay, inter alia, the aggregate Cash Consideration. As of the date hereof,
subject to the receipt and execution of the customary credit and the security documents which Purchaser agrees to execute and deliver
and the related opinions thereon, Purchaser would be able to satisfy any term or condition of the Debt Financing such that it would be
able to fund the Cash Consideration on the date hereof. Purchaser has no knowledge that it will be unable to satisfy on a timely basis
any term or condition of the Debt Financing such that it would be unable to fund the Cash Consideration on Closing and, as of the date
hereof, has no knowledge of any fact, occurrence or condition that would cause any of the Debt Financing to be unavailable, terminate
or be ineffective or any of the terms or conditions of such financing not to be met. The Purchaser Credit Agreement is not subject to
any ordinary course redeterminations prior to the Closing Date. |
| (a) | As of the date hereof, the authorized share capital of Purchaser consists of an unlimited number of Purchaser
Shares, of which 154,538,276 Purchaser Shares are issued and outstanding. All of the Purchaser Shares have been duly and validly issued
and are outstanding as fully paid and non-assessable shares. The Purchaser Shares represent all of the issued and outstanding shares in
the capital of the Purchaser. |
| (b) | there are no agreements to which Purchaser is a party restricting voting or dividend rights or transferability
with respect to the Purchaser Shares or otherwise governing the affairs of Purchaser or the relationship, rights and duties of the shareholders
or directors of Purchaser. |
| (c) | Other than as disclosed in the Purchaser Public Record or in connection with any normal course issuer
bids for Purchaser Shares or open market repurchases of debt securities, no Person has any agreement, right or option, present or future,
contingent or absolute, to: |
| (i) | require Purchaser to issue any further or other shares or interests in its capital or any other security
convertible or exchangeable into shares, units or interest in its capital or to convert or exchange any securities into or for shares
or interests in its capital; |
| (ii) | require Purchaser to purchase, redeem or otherwise acquire any of the Purchaser Shares; or |
| (iii) | acquire any of the Purchaser Shares. |
| (d) | There are no rights of first refusal or similar rights restricting the transfer of Purchaser Shares contained
in shareholders, partnership, joint venture or similar agreements or pursuant to existing financing arrangements. |
| 5.12 | Issuance of Purchaser Shares |
Purchaser has reserved and allotted or will
reserve and allot prior to Closing a sufficient number of Purchaser Shares as are issuable pursuant to the Arrangement, and, subject to
the terms and conditions of the Arrangement, such Purchaser Shares, when issued, will be validly issued as fully paid and non-assessable
common shares in the capital of Purchaser, free and clear of all Encumbrances (other than Encumbrances created by the holders thereof),
freely tradeable under Applicable Canadian Securities Laws and shall not be subject to resale restrictions under Applicable Canadian Securities
Laws (other than as applicable to control persons or pursuant to section 2.6 of National Instrument 45-102 Resale of Securities) and will
be freely transferable securities under the U.S. Securities Act (other than to persons who are, have been within 90 days of the Closing
Time, or, at the effective time become, “affiliates” of Purchaser, as such term is defined in Rule 144 under the U.S. Securities
Act) and listed and posted for trading on the TSX and NYSE and are not and will not be subject to or issued in violation of, any pre-emptive
rights or back-in rights.
| 5.13 | Purchaser Financial Statements |
| (a) | The Purchaser Financial Statements have been prepared in accordance with IFRS applied on a basis consistent
with those of preceding fiscal periods. |
| (b) | The Purchaser Financial Statements present fairly in all material respects the assets, liabilities and
financial position of Purchaser as at the end of the periods represented thereby, and the results of their operations and the changes
in their financial position for the periods then ended (provided that, in the case of the unaudited financial statements, subject to normal
year-end adjustments and the exclusion of notes thereto), all in accordance with IFRS consistently applied. |
| 5.14 | No Undisclosed Liabilities |
Purchaser has no material Liabilities (including
Indebtedness), except for (a) those shown on the Purchaser Balance Sheet or in the Purchaser Public Record, (b) those incurred since the
Purchaser Balance Sheet Date in the ordinary course of business consistent with past practice (none of which is a Liability resulting
from breach of contract, breach of warranty, tort, infringement claim or lawsuit), and (c) those incurred in connection with the Agreement
or the transactions contemplated by the Arrangement.
During the period from the date of the most
recent balance sheet in the Purchaser Financial Statements to the date of this Agreement, (a) there has been no Material Adverse Effect
in respect of Purchaser, and (b) Purchaser has conducted its business in all material respects in the ordinary course of business consistent
with past practice.
| 5.16 | Compliance with Applicable Laws |
The business of Purchaser is, and has been
carried out, in compliance with and not in violation of any Applicable Laws, and Purchaser is not in violation or non-compliance of any
Applicable Laws, in each case which have or could reasonably be expected to have, individually or in the aggregate, have a Material Adverse
Effect on Purchaser or would significantly impact the ability of Purchaser to consummate the Transactions, and Purchaser has not received
any notice of any alleged material violation of any such Applicable Laws.
Except as would not individually or in the
aggregate if determined adversely to Purchaser, have a Material Adverse Effect on Purchaser, there are no Claims before a Governmental
Authority which are pending, or to Purchaser’s knowledge, threatened by any Person against Purchaser or, to Purchaser’s knowledge,
affecting any of its assets or, to Purchaser’s knowledge, by or against its shareholders relating to Purchaser. Except as would
not individually or in the aggregate have a Material Adverse Effect on Purchaser, there are no outstanding order, writ, judgment, injunction,
decree, stipulation, determination, award, decision, sanction or ruling entered by or with any Governmental Authority in respect of Purchaser,
its assets and/or the Purchaser Shares, and there are no unsatisfied judgments, settlements, penalties or awards for which Purchaser is
liable to any Person.
| 5.18 | Anti-Corruption; Anti-Money Laundering |
Neither Purchaser, any of its Affiliates nor,
to the knowledge of Purchaser, any director, officer, agent, employee or other Person authorized by it or any of its Affiliates to act
on their behalf has: (a) directly or indirectly used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful
expense relating to political activity; (b) made any direct or indirect unlawful payment to any foreign or domestic government official
or employee from corporate funds, directly or indirectly; (c) violated or is in violation of any applicable provision of the United States
Foreign Corrupt Practices Act of 1977, the Corruption of Foreign Public Officials Act (Canada), the Proceeds of
Crime (Money Laundering) and Terrorist Financing Act (Canada), or any other similar applicable anti-corruption or anti-money laundering
law of any jurisdiction; or (d) made any bribe, rebate, payoff, influence payment, kickback or other unlawful payment, in each case related
to this Agreement or the Transaction.
| 5.19 | Reporting Issuer Status |
Purchaser is a “reporting issuer”
in each of the Provinces of Canada and is in material compliance with all Applicable Canadian Securities Laws therein and the Purchaser
Shares are listed and posted for trading on the TSX. The Purchaser Shares are registered pursuant to Section 12(b) of the U.S. Exchange
Act, and Purchaser is in compliance in all material respects with its obligations thereunder. The Purchaser Shares are listed and posted
for trading on the NYSE. Purchaser is not in default of any material requirements of any Applicable Canadian Securities Laws, Applicable
U.S. Securities Laws or any rules or regulations of, or agreement with, the TSX or the NYSE. No delisting, suspension of trading in or
cease trading order with respect to Purchaser Shares is pending or, to the knowledge of Purchaser, threatened. The documents and information
comprising the Purchaser Public Record did not at the respective times they were filed with the relevant securities regulatory authorities,
did not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they were made, not misleading, unless such document or information
was subsequently corrected or superseded in the Purchaser Public Record prior to the date hereof. Since January 1, 2023, Purchaser has
timely filed with the relevant securities regulatory authorities all material forms, reports, schedules, statements and other documents
required to be filed by the Purchaser under Applicable Canadian Securities Laws. Purchaser has not filed any confidential material change
report that, at the date hereof, remains confidential.
Purchaser has not retained, engaged or entered
into any Contract (whether written or oral) with any Person who is or will be entitled to a broker’s commission, finder’s
fee, investment banker’s fee or similar payment from Westbrick or [name of party redacted] in connection with the negotiation,
execution or performance of this Agreement and the consummation of the Transaction.
| (a) | Purchaser is acquiring the Purchased Shares as principal for its own account and not on behalf or for
the benefit of any other Person and not with a view to, or for sale in connection with, any distribution thereof, nor with any present
intention of distributing or selling the same, and Purchaser has no present or contemplated agreement, undertaking arrangement, obligation,
Indebtedness or commitment providing for the disposition thereof. |
| (b) | Purchaser has such knowledge and experience in financial and business matters so as to be capable of evaluating
the merits and risks of its investment in the Purchased Shares, and Purchaser is capable of bearing the economic risks of such investment
and is able to bear the complete loss of its investment in the Purchased Shares. |
| 5.22 | Independent Investigation |
Purchaser acknowledges that
(a) it has been furnished, by or on behalf of each of Westbrick and [name of party redacted], the materials relating to the acquisition
of the Purchased Shares that it has requested; (b) each of Westbrick and [name of party redacted] has provided Purchaser an
adequate opportunity to acquire additional information about Westbrick and [name redacted] Holdco, respectively; and (c) Purchaser
has completed to its satisfaction an independent investigation of Westbrick and [name redacted] Holdco, and in making the decision
to enter into this Agreement and to consummate the Transaction, Purchaser has relied solely on (i) its own independent investigation of
Westbrick and [name redacted] Holdco, including the risks related thereto, and (ii) the express written representations, warranties
and covenants of each of Westbrick and [name of party redacted] in this Agreement. Without limiting the foregoing, Purchaser expressly
acknowledges the provisions set forth in Section 11.2.
Article 6
COVENANTS
| 6.1 | Access and Information, Integration |
| (a) | From the date hereof until the Closing Date (or earlier termination of this Agreement in accordance with
the terms hereof), subject to any Applicable Laws restricting disclosure and subject to any applicable privilege (including solicitor-client
privilege) contractual confidentiality obligations, upon reasonable prior notice, Westbrick shall: (i) afford Purchaser and its Representatives
reasonable access, during normal business hours, to the Books and Records, Title and Operating Documents, Contracts, Technology, offices
and properties of Westbrick (and such access to the Westbrick personnel) as Purchaser may reasonably request, in order to permit Purchaser
to be in a position to expeditiously and efficiently integrate the business and operations of Westbrick (other than the Duvernay Business)
with those of Purchaser immediately on, but nor prior to, Closing; and (ii) furnish to Purchaser such additional financial and operational
data and other information as Purchaser may from time to time reasonably request. In respect of any Contract withheld from Purchaser on
the basis of contractual confidentiality obligations, Westbrick shall promptly advise Purchaser that such Contract is being withheld and,
other than in respect of non-disclosure or confidentiality agreements, use commercially reasonable efforts to obtain consent from the
applicable counterparty to disclose the Contract to Purchaser (and Purchaser agrees to enter into such customary non-disclosure agreement
with the counterparty as may be required to obtain such consent). In no event shall the auditors and independent accountants of Westbrick
or any of its Affiliates be obligated to make any work papers available to any Person unless and until such Person has signed a customary
confidentiality and hold harmless agreement relating to such access to work papers in form and substance reasonably acceptable to such
auditors or independent accountants. Notwithstanding any other provision of this Section 6.1(a), the Company shall not be required to
furnish to Purchaser or any of its Representative with access to information if such access (x) would cause competitive harm to the Company
if the Transaction is not consummated (provided that Westbrick shall grant access to Purchaser’s external counsel to such information
on a privileged and confidential basis in connection with obtaining the Key Regulatory Approval), (y) would result in the waiver or forfeiture
of any solicitor-client privilege, work product doctrine or similar privilege or (z) would be in violation any Applicable Law or the provisions
of any Contract to which the Company is a party. |
| (b) | All requests for access or information made pursuant to Section 6.1(a) shall be directed to such Person
or Persons as may be designated by Westbrick, and Purchaser shall not directly or indirectly contact any Representative of Westbrick or
its Affiliates without the prior approval of such designated Person or Persons. Any such access or provision of information shall be supervised
by such Persons as may be designated by Westbrick and be conducted in such a manner so as not to unreasonably interfere with any of the
business or operations of Westbrick and shall not contravene any Applicable Laws. Purchaser further agrees to comply fully with all rules,
regulations and instructions issued to Purchaser by Westbrick in respect of Purchaser’s or its Representatives’ actions while
upon, entering or leaving any properties of Westbrick. |
| (c) | Purchaser agrees to be liable to and to indemnify, defend and hold harmless Westbrick, the Westbrick Shareholders
and their Affiliates and their respective partners, directors, officers and employees from and against any and all Losses and Liabilities,
including any and all claims and causes of action for personal injury, death or property damage, occurring as a result of Purchaser’s
or any of its Representatives’ inspection or physical access to the Books and Records, Title and Operating Contracts, offices and
properties of Westbrick. |
| (d) | From the date hereof until the Closing Date (or earlier termination of this Agreement in accordance with
the terms hereof): |
| (i) | Westbrick shall reasonably confer with Purchaser prior to taking action (other than in emergency situations)
with respect to any material operational matters involved in the Business (including, until such time as the Duvernay Spinco Shares are
sold, the Duvernay Business), which is not contemplated by the Capex Plan; and |
| (ii) | Upon written request of the Purchaser (which cannot be made more than once per week), Westbrick shall
provide the Purchaser with the amount of Indebtedness owing under the Credit Facilities. |
| (e) | Westbrick and [name of party redacted] shall promptly advise Purchaser in writing of: |
| (i) | any material breach by Westbrick or [name of party redacted] of any covenant, obligation or agreement
of Westbrick or [name of party redacted] contained in this Agreement; |
| (ii) | to the extent permitted by Applicable Laws, any material notice or other communication from any Governmental
Authority in connection with this Agreement (and contemporaneously provide a copy of any such written notice or communication to Purchaser); |
| (iii) | any material Governmental Authority or Third Party complaints, investigations or hearings (or communications
indicating that the same may be contemplated) in respect of Westbrick or the Arrangement; |
| (iv) | any notice or other communication from any Person alleging that the consent (or waiver, permit, exemption,
order, approval, agreement, amendment or confirmation) of such Person is required in connection with this Agreement or the Arrangement
(and contemporaneously provide a copy of any such written notice or communication to Purchaser); and |
| (v) | any material change (actual, anticipated, contemplated or, to the knowledge of Westbrick or [name of
party redacted] threatened, financial or otherwise) in its business, operations, affairs, assets, capitalization, financial condition,
Licences, rights, privileges or Liabilities, whether contractual or otherwise, or of any change in any fact or matter disclosed in writing
(including in the Disclosure Schedules) or in any representation or warranty provided by Westbrick or [name of party redacted]
in this Agreement which would reasonably be considered material to Purchaser in the context of this Agreement or which change is or may
be of such a nature to render any representation or warranty misleading or untrue in any material respect; except the delivery of such
notification shall not modify, amend or supersede any act or matter disclosed in writing (including the Disclosure Schedules) or included
in such information or any representation or warranty contained in the Agreement or in any certificate or other instrument delivered in
connection herewith and it will not affect any right of Purchaser hereunder. |
| (a) | Solely in connection with debt financing to be obtained under the Purchaser Credit Facilities, the Purchaser
Bridge Loan Facility and any other debt financing which Purchaser may pursue to refinance any or all Indebtedness of the Purchaser that
matures prior to March 31, 2025, Westbrick shall, and shall cause its Affiliates to, at the sole cost and expense of Purchaser, use its
and their commercially reasonable efforts to (a) make the Financial Statements and any other financial information, and the Westbrick
Reserves Report and any other reserve information, of the Company required in connection with the Purchaser’s preparation of pro
forma financial statements and reserve information available (or permit Purchaser to make available) to Purchaser and Purchaser’s
existing or potential lenders, underwriters and debt investors and their respective financial and legal advisors, including the Debt Financing
Sources, related to any such financing, (b) provide customary and reasonable assistance to Purchaser in connection with the due diligence
activities of Purchaser and Purchaser’s existing or potential lenders, underwriters and debt investors and their respective financial
and legal advisors, including the Debt Financing Sources, related to such financing, (c) provide customary and reasonable assistance with
respect to Purchaser’s preparation of pro forma financials, and (d) instruct Westbrick’s independent accountants and independent
petroleum engineers to provide customary and reasonable assistance to Purchaser in connection with the due diligence activities of Purchaser
and Purchaser’s existing or potential lenders, underwriters and debt investors and their respective financial and legal advisors,
including the Debt Financing Sources, related to such financing. Notwithstanding anything to the contrary in this Section 6.2, neither
Westbrick, nor its Affiliates or Representatives shall be required to take any action pursuant to this Section 6.2 if any such action
would reasonably be expected to (i) unreasonably disrupt or interfere with the Business; or (ii) require Westbrick or any of its Affiliates
to pay any fees or expenses or reimburse any expenses prior to the Closing that are not promptly reimbursed by Purchaser; or (iii) otherwise
require any such Persons to incur any Liabilities or give any indemnities, (iv) involve the entry by Westbrick or its Affiliates into
any agreement or other binding commitment with respect to any arrangement pursuant to such financing which is not conditional on Closing
occurring, (v) require Westbrick or any of its Affiliates or Representatives to prepare, compile or certify pro forma financial information
or projections, (vi) require Westbrick or any of its Affiliates or Representatives to prepare financial statements other than the Financial
Statements, or (vii) interfere with the normal operations of Westbrick. |
| (b) | Notwithstanding anything in this Agreement to the contrary, no failure by Westbrick to comply with the
terms set forth in this Section 6.2 shall be considered for purposes of determining whether the conditions to Closing set forth in Article 7
have been satisfied, it being agreed that the Purchaser’s obligation to consummate the Transaction is not conditional on securing
financing. |
| 6.3 | Conduct of Business of Westbrick |
| (a) | During the period from the date hereof to the Closing Date (or earlier termination of this Agreement in
accordance with the terms hereof) (the “Pre-Closing Period”), except as required by Applicable Laws, as otherwise expressly
permitted or required by this Agreement (including pursuant to the Plan of Arrangement, the Duvernay Spinco Conveyance Agreement, the
Duvernay Share Purchase Agreement, and including to complete the Transaction), as Purchaser otherwise consents in writing in advance (which
consent shall not be unreasonably withheld, delayed or conditioned), or as expressly disclosed in Section 6.3 the Disclosure Schedule,
Westbrick shall: |
| (i) | except as may be necessary in situations of emergency to preserve life, property or the environment, operate
the Assets operated by it (or cause the assets operated by its Affiliates) in the ordinary course of business and in accordance with good
industry practices and use its commercially reasonable efforts to preserve intact the Business (including, until such time as the Duvernay
Spinco Shares are sold, the Duvernay Business) and its relationships with its material customers, suppliers and creditors; |
| (ii) | maintain the Assets in a proper and prudent manner in accordance with good oil and gas industry practices
in Western Canada and in compliance in all material respects with all Applicable Laws; |
| (iii) | use commercially reasonable efforts to assist Purchaser in implementing any action to be taken with respect
to termination of the Credit Facilities effective as of the Closing Date as Purchaser may reasonably request, including the delivery to
Purchaser no less than five Business Days (or such lesser time as Purchaser and Westbrick agree) prior to the Closing Date of an executed
payout letter from its syndicate of banks (or the agent thereunder), setting forth the aggregate amount outstanding under the Credit Facilities
as at the date of the statement, which would be required to repay or cash collateralize in full all Liabilities and Indebtedness of Westbrick
under the Credit Facilities and which payout letter shall contain a release and discharge of all Encumbrances granted by Westbrick in
connection therewith and a termination of the Credit Facilities and all documents related thereto which releases, discharge and termination
shall be conditional upon receipt by its syndicate of banks, of the amounts referenced in such payout letter and such other customary
conditions acceptable to Westbrick, provided, however that no such actions shall require Westbrick to agree to or make effective any amendments,
incur any costs that are not paid for or reimbursed by Purchaser or make any payments in respect of the Credit Facilities if the Arrangement
is not consummated. |
| (b) | During the Pre-Closing Period, except as required by Applicable Laws, as otherwise expressly permitted
or required by this Agreement (including pursuant to the Plan of Arrangement, the Duvernay Spinco Conveyance Agreement, the Duvernay Share
Purchase Agreement, and including to complete the Transaction), Applicable Laws, or as Purchaser otherwise consents in writing in advance
(which consent shall not be unreasonably withheld, delayed or conditioned), or as expressly disclosed in Section 6.3 of the Disclosure
Schedule, Westbrick shall not and [name of party redacted] shall cause [name redacted] Holdco to not: |
| (i) | amend Westbrick’s or [name redacted] Holdco’s Organizational Documents; |
| (ii) | declare, set aside or pay any cash or non-cash dividend, return of capital or other distribution or payment
in cash, shares or property in respect of its securities owned by any Person excluding, for greater certainty, any distribution of the
Duvernay Spinco Shares to the Westbrick Shareholders in strict compliance with the Duvernay Alternative Transaction, if applicable; |
| (iii) | reduce the stated capital of any shares of Westbrick or [name redacted] Holdco; |
| (iv) | except for issuances of Westbrick Shares on exercise of any Options, issue, grant, sell or pledge or agree
to issue, grant sell or pledge any securities of Westbrick or [name redacted] Holdco or securities convertible into or exchangeable
or exercisable for, or otherwise evidencing a right to acquire, securities of Westbrick or [name redacted] Holdco, or grant any
rights, warrants, options, calls or commitments to acquire any such shares or other securities of Westbrick or [name redacted]
Holdco; |
| (v) | split, combine, subdivide, reclassify or redeem, or purchase or otherwise acquire, any of the Purchased
Shares, or make any other change with respect to the capital structure of Westbrick or [name redacted] Holdco; |
| (vi) | other than in connection with the Option Exercise and Surrender Agreements, amend the terms of any of
the securities of Westbrick or [name redacted] Holdco, including the Option Agreements and the Option Plans; |
| (vii) | adopt a plan of liquidation or resolutions providing for the liquidation, dissolution, merger, consolidation,
reorganization or arrangement or similar action of Westbrick or [name redacted] Holdco; |
| (viii) | sell, abandon, surrender, lease, license, transfer or dispose of the whole or any part of the Assets:
(A) at less than market value; and (B) having value individually in excess of [amount redacted] and in aggregate in excess of [amount
redacted], other than Petroleum Substances in the ordinary course; |
| (ix) | resign or take any action which would result in Westbrick’s resignation or replacement as operator
of any of the Assets or the Business (excluding the Duvernay Business); |
| (x) | create or allow any Encumbrance (other than Permitted Encumbrances) on the Assets; |
| (xi) | create any subsidiary except Duvernay Spinco; |
| (xii) | purchase any assets or business of, or shares in, or made any investment in, any Person (including by
purchase of all or substantially all of the assets of such business or Person), except in the ordinary course of business or for consideration
in excess of [amount redacted]; |
| (xiii) | incur Indebtedness or any other liability or obligation, or issue any debt securities or letters of credit
or assume, guarantee, endorse or otherwise become responsible for, the obligations of any other individual or Person, or make any loans
or advances, or commit to do any of the foregoing, other than: |
(A) to fund amounts otherwise
expressly permitted under this Section 6.3;
(B) Indebtedness incurred
in the ordinary course of business, including amounts to fund (i) the expenditures specified in (A) above, (ii) account payables incurred
in the ordinary course of business, (iii) payroll expenses incurred in the ordinary course of business, (iv) and capital and operating
expenditures incurred in the ordinary course of business, (v) general and administrative costs incurred in the ordinary course of business;
(C) Indebtedness incurred
for Transaction Expenses and Duvernay Transaction Expenses in connection with the Transactions and any other expenses expressly permitted
to be incurred under this Agreement;
(D) Indebtedness related
to mark to market amounts for existing Hedging Transactions;
(E) to fund payment of
amounts payable in respect of Westbrick Amalco Options, Westbrick RSUs and Westbrick DSUs under the Plan of Arrangement (as such terms
are defined in the Plan of Arrangement); or
(F) such other amounts
that would not exceeds [amount redacted].
| (xiv) | with the exception of the operating costs in the ordinary course of business or otherwise permitted by
this Agreements, expend or commit to expend any single amount more than [amount redacted] or more than [amount redacted] in
the aggregate with respect to any operating expenses; |
| (xv) | issue or provide any Credit Support, or amend any Credit Support currently in place; |
| (xvi) | enter into or terminate any hedges, swaps or other financial instruments or similar transactions; |
| (xvii) | commence any litigation or settle, pay or discharge or satisfy any claims, Liabilities if any single proposed
settlement exceeds [amount redacted] or if all proposed settlements after the date hereof total more than [amount redacted]in
the aggregate; |
| (xviii) | make any Capital Expenditure (or series of related Capital Expenditures) other than (1) in accordance
with the Capex Plan, (2) as required to comply with any Applicable Laws or in the event of an emergency to protect life, property or the
environment, (3) as required in order to comply with the terms of any Contract to which Westbrick is a party as of the date hereof which
has been provided to Purchaser for review; (4) maintenance capital incurred in the ordinary course of business, or (5) in the case of
capital expenditures not covered by clauses (1), (2), (3) or (4), that are not in excess of [amount redacted] individually or [amount
redacted] in the aggregate; |
| (xix) | make any material filings with any Governmental Authority without prior consultation with Purchaser except
in the ordinary course of business; |
| (xx) | write off any accounts receivable which is individually in excess of [amount redacted] other than
in the ordinary course of business consistent with past practice; |
| (xxi) | make any change in any method of accounting or accounting practice, except as required by IFRS or Applicable
Law, or as expressly disclosed in the notes to the Financial Statements; |
| (xxii) | make or change any material Tax election, file any amended material Tax Return, change any Tax accounting
period, adopt or change any material method of Tax accounting, settle any material Tax claim, audit or assessment or surrender any right
to claim a material Tax refund, offset or other reduction in Tax liability relating to Westbrick or [name redacted] Holdco, as
applicable, or take any action or enter into any transaction that would have the effect of materially increasing the Tax liability of
Westbrick (unless such action is taken or such transaction is entered into at the direction, or with the concurrence of Purchaser) enter
into any Tax allocation agreement, Tax sharing agreement or Tax indemnity agreement, or make any application or request for, or negotiate
or conclude any, voluntary Tax disclosure, Tax amnesty or Tax ruling with a Governmental Authority; |
| (xxiii) | enter into any contract that would have been a Material Contract had it been entered into prior to the
date hereof, amend any Material Contract, authorize or propose any release or relinquishment of any right under any Material Contract,
or terminate any Material Contract, in each case, other than in relation to a capital project expressly contemplated in the Capex Plan
(and in a manner strictly in accordance with such Capex Plan); |
| (xxiv) | establish, adopt, terminate or materially amend any Benefit Plan; |
| (xxv) | hire or retain the services of any executive officer or director, or terminate the services of any Westbrick
Employee, Westbrick Contractor, executive officer or director, other than for Cause; |
| (xxvi) | grant any increase in the rate of wages, salaries, benefits, bonuses or other remuneration of the Westbrick
Employees, officers or directors, other than as has been disclosed to Purchaser in writing (including in the Data Room) on or prior to
the date hereof, including for periodic hourly wage increases for field workers as may be required for crew retention purposes or wage
increases for field workers as a result of hourly market rate changes or conditions in order to remain competitive with wages paid by
Westbrick’s peers in the ordinary course (provided that the total aggregate amount of all such increases would be reasonable in
the circumstances and for certainty not result in a Material Adverse Effect on Company); |
| (xxvii) | amend, propose, negotiate or grant any change of control, severance, termination pay, pay in lieu of notice
of termination or retention policies or arrangements for any directors, officers, Westbrick Employees, or consultants and contractors; |
| (xxviii) | amend the engagement of its financial advisors and other than RBC and Scotiabank, retain any financial
advisor, broker, agent or finder, or pay or agree to pay, any financial advisor, broker, agent or finder; or |
| (xxix) | voluntarily, directly or indirectly, materially reduce the amount, or materially amend the characterization,
of any of its individual categories of Tax Pools or any other tax attributes; |
| (xxx) | in the case of Westbrick, enter into any new line of business other than the Business, and in the case
of [name redacted] Holdco, undertake any business (other than the ownership of the [name redacted] Shares and all matters
ancillary thereto); or |
| (xxxi) | authorize or enter into any binding agreement or commitment with respect to any of the foregoing. |
| (c) | Except as Purchaser otherwise consents in writing in advance (which consent shall not be unreasonably
withheld, delayed or conditioned), during the Pre-Closing Period, Westbrick shall use commercially reasonable efforts to continue to pursue
all capital projects set out in the Capex Plan in a manner consistent with the Capex Plan. Westbrick shall, as reasonably requested from
Purchaser from time to time (and not more than once weekly) provide status updates on (i) material developments in respect of capital
projects set out in the Capex Plan, and (ii) any material variance from the Capex Plan, |
| (d) | Westbrick shall use commercially reasonable efforts to obtain the Landlord Consents (provided that in
no event will receipt of either Landlord Consent be a condition to closing or give rise to a right for Purchaser to terminate this Agreement). |
| (e) | Except as Purchaser otherwise consents in writing in advance (which consent shall not be unreasonably
withheld, delayed or conditioned), Westbrick shall maintain the insurance policies in full force and effect during the Pre-Closing Period
and shall not terminate or reduce any insurance coverage prior to Closing. |
| (f) | For the avoidance of doubt, nothing contained in this Section 6.3 is intended to give Purchaser, directly
or indirectly, the right to control or direct the Business prior to Closing in any manner which would constitute a violation of Applicable
Laws and subject to Section 6.3, Westbrick shall exercise complete control and supervision over the Business. |
| 6.4 | Conduct of Business of Purchaser |
| (a) | During Pre-Closing Period, except as required by Applicable Laws, as otherwise expressly permitted or
required by this Agreement, as Westbrick and [name of party redacted] otherwise consents in writing in advance (which consent shall
not be unreasonably withheld, delayed or conditioned), the Purchaser shall: |
| (i) | Except as may be necessary in situations of emergency to preserve life, property or the environment, Purchaser
shall operate its assets operated by it (or cause the assets operated by its Affiliates) in the ordinary course of business and use its
commercially reasonable efforts to preserve intact the Purchaser’s business and its relationships with its material customers, suppliers
and creditors; |
| (ii) | Purchaser shall maintain its assets in a proper and prudent manner in accordance with good oil and gas
industry practices in predominate areas it operates in and in compliance in all material respects with all Applicable Laws; |
| (iii) | Purchaser shall not: |
| (A) | amend Purchaser’s Organizational Documents; |
| (B) | merge, amalgamate or consolidate itself with any other Person or adopt a plan of complete or partial liquidation,
dissolution, consolidation, restructuring, recapitalization or other reorganization; |
| (C) | transfer all or substantially all of its properties and other assets to any Person; |
| (D) | declare or pay any dividend, return of capital or other distribution or payment in cash, shares or property
in respect of its securities owned by any Person, except in the ordinary course of business; |
| (E) | issue, grant, sell or pledge or agree to issue, grant sell or pledge any securities of Purchaser or securities
convertible into or exchangeable or exercisable for, or otherwise evidencing a right to acquire, securities of Purchaser, other than grants
of incentive securities consistent with past practice of the Purchaser or in the ordinary course; or |
| (F) | amend the terms of any of the securities of Purchaser. |
| 6.5 | Additional Covenants of Purchaser |
| (a) | Purchaser shall use its commercially reasonable efforts to maintain the listing of the Purchaser Shares
on the TSX and the NYSE; |
| (b) | Purchaser shall: (i) apply to the TSX for conditional approval of the listing of the Purchaser Shares
issuable pursuant to the Arrangement on the TSX and shall apply to the NYSE for approval of the listing of such Purchaser Shares on the
NYSE; and (ii) use commercially reasonable efforts to obtain such conditional approval or approvals, subject only to customary conditions
for listing of such Purchaser Shares. |
| (c) | Purchaser will cause to be taken all necessary corporate action to allot and reserve for issuance the
Purchaser Shares to be issued pursuant to the Plan of Arrangement as fully-paid and non-assessable common shares in the capital of the
Purchaser. |
| (d) | The Purchaser will use its commercially reasonable efforts to maintain its status as a “reporting
issuer” (or similarly designated entity) not in default under the securities legislation in force in all provinces of Canada where
it is a reporting issuer at the date hereof. |
| (e) | Purchaser shall not split, combine, reclassify or change any of the Purchaser Shares unless the number
of Purchaser Shares to be issued under the Plan of Arrangement is adjusted appropriately to give effect. |
| (f) | Purchaser will make all necessary filings and applications under Applicable Laws, including Applicable
Canadian Securities Laws and Applicable U.S. Securities Laws, required to be made on the part of Purchaser in connection with the transactions
contemplated herein. |
| (g) | Except for proxies and non-substantive communications with the holders of its securities and communications
that the Purchaser is required to keep confidential pursuant to Applicable Law, the Purchaser shall furnish promptly to Westbrick and
[name of party redacted] counsel, a copy of each notice, report, schedule or other document delivered, filed or received by such
Party from holders of such Party’s securities or regulatory agencies in connection with: (i) the Arrangement; (ii) any filings under
Applicable Laws in connection with the transactions contemplated by this Agreement; and (iii) any dealings with stock exchanges or regulatory
agencies, in connection with the transactions contemplated by this Agreement. |
| (h) | Purchaser shall promptly advise Westbrick and [name of party redacted] in writing of: |
| (i) | any breach by Purchaser of any covenant, obligation or agreement of Purchaser contained in this Agreement; |
| (ii) | to the extent permitted by Applicable Laws, any material notice or other communication from any Governmental
Authority in connection with this Agreement (and contemporaneously provide a copy of any such written notice or communication to Westbrick
and [name of party redacted]); |
| (iii) | any material Governmental Authority or Third Party complaints, investigations or hearings (or communications
indicating that the same may be contemplated) in respect of Purchaser (including in relation to the Transaction); |
| (iv) | any notice or other communication from any Person alleging that the consent (or waiver, permit, exemption,
order, approval, agreement, amendment or confirmation) of such Person is required in connection with this Agreement or the Arrangement
(and contemporaneously provide a copy of any such written notice or communication to Westbrick and [name of party redacted]); |
| (v) | any circumstance or development that, to the knowledge of the Purchaser, would have a Material Adverse
Effect on the Purchaser or which might reasonably be expected to impede, interfere with or delay the Arrangement or prevent the completion
of the Arrangement; |
| (vi) | any material change (actual, anticipated, contemplated or, to the knowledge of Purchaser threatened, financial
or otherwise) in its business, operations, affairs, assets, capitalization, financial condition, Licences, rights, privileges or Liabilities,
whether contractual or otherwise, or of any change in any fact or matter disclosed in writing or in any representation or warranty provided
by the Purchaser in this Agreement which would reasonably be considered material to Westbrick or [name of party redacted] in the
context of this Agreement or which change is or may be of such a nature to render any representation or warranty misleading or untrue
in any material respect; except the delivery of such notification shall not modify, amend or supersede any act or matter disclosed in
writing or included in such information or any representation or warranty contained in the Agreement or in any certificate or other instrument
delivered in connection herewith and it will not affect any right of Westbrick or [name of party redacted] hereunder. |
| 6.6 | Regulatory Approvals and Consents |
| (a) | Subject to and in accordance with the other provisions of this Section 6.6, during the Pre-Closing Period,
each of Westbrick and Purchaser shall use reasonable best efforts to obtain (and shall cooperate fully with each other Party in obtaining)
as promptly as practicable all authorizations, consents, clearances, approvals and orders of Governmental Authorities necessary to consummate
the Transaction, including the Key Regulatory Approval (but excluding the Interim Order and Final Order, which is addressed in Section
2.3). |
| (b) | In furtherance and not in limitation of the foregoing, during the Pre-Closing Period: |
| (i) | As promptly as practicable after the date hereof, and in any event no later than five Business Days after
the date hereof Purchaser and Westbrick shall jointly submit a request that the Commissioner issue an advance ruling certificate pursuant
to section 102(1) of the Competition Act, or in lieu thereof issue a Waiver and a No-Action Letter; |
| (ii) | Upon the request of either the Purchaser or [name of party redacted] (which shall not be made until
at least fifteen (15) Business Days following the filing referenced in Section 6.6(b)(i)), each of Purchaser and Westbrick shall make
a notification filing with the Commissioner in accordance with Part IX of the Competition Act within ten Business Days of such request.
Each of Westbrick, [name of party redacted], and Purchaser shall supply, as soon as practicable, any additional information and
documentary material that may be requested by the applicable Governmental Authority pursuant to the Competition Act or any other Applicable
Laws and make all subsequent filings and submissions required under the Competition Act or any other Applicable Laws. |
| (iii) | Neither Westbrick and [name of party redacted] on the one hand, nor Purchaser, on the other hand,
may, without the consent of the other Party, (i) cause any such filing or submission applicable to it to be withdrawn or refiled for any
reason, including to provide the applicable Governmental Authority with additional time to review the Transaction, or (ii) consent to
any voluntary extension of any statutory deadline or waiting period or to any voluntary delay of the consummation of the Transaction at
the behest of any Governmental Authority. |
| (iv) | Purchaser shall pay (i) all applicable filing fees and Taxes thereon under the Competition Act with respect
to the Transaction, and (ii) all reasonable attorneys’ fees, costs and other expenses of Westbrick and the [name of party redacted]
incurred in connection with the defence through litigation on the merits of any claim asserted in any court, tribunal, agency or other
proceeding by any Person, including any Governmental Authority, seeking to delay, restrain, prevent, enjoin or otherwise prohibit consummation
of the Transaction. |
| (c) | Without limiting the generality of the other provisions pursuant to this Section 6.6: |
| (i) | each of Westbrick and Purchaser shall use reasonable best efforts to take or cause to be taken the following
actions: (A) the prompt provision to any Governmental Authority of non-privileged information, documents or testimony requested by such
Governmental Authority that are necessary, proper or advisable to permit consummation of the Transaction, and (B) the prompt (and in any
event not later than reasonably necessary to enable the Closing to occur on or before the Outside Date) taking of reasonable best efforts
to avoid an investigation or the entry of, or to effect the dissolution of, any permanent, preliminary or temporary injunction or other
order, decree, decision, determination or judgment that would delay, restrain, prevent, enjoin or otherwise prohibit consummation of the
Transaction, including the defence through litigation on the merits of any claim asserted in any court, tribunal, agency or other proceeding
by any Person, including any Governmental Authority, seeking to delay, restrain, prevent, enjoin or otherwise prohibit consummation of
the Transaction; and |
| (ii) | in connection with Purchaser’s reasonable best efforts, Purchaser covenants and agrees to take such
actions that are required to obtain the Key Regulatory Approval as expeditiously as possible and in any event before the Outside Date,
including proposing, negotiating, agreeing to and effecting, by undertaking, consent agreement, hold separate agreement or otherwise (i)
the sale, divestiture, licensing, restructuring or disposition of any entities, assets or facilities of Westbrick or any entities, assets,
or facilities of Purchaser or its Affiliates; (ii) the termination or assignment of any existing contractual rights, relationships and
obligations of Westbrick or Purchaser or its Affiliates, or entry into or amendment of any licensing or contractual arrangements of Westbrick
or Purchaser or its Affiliates; and (iii) the taking of any action that, after consummation of the Transaction, would limit the freedom
of action of, or impose any other requirement on Westbrick or Purchaser or its Affiliates, with respect to the operation of one or more
of the businesses, or the assets, of Westbrick or Purchaser or its Affiliates, respectively; provided that any such action is conditioned
upon the completion of the Transaction. |
| (d) | During the Pre-Closing Period, subject to Applicable Laws including those relating to the sharing of information,
each of Westbrick, [name of party redacted] and Purchaser shall coordinate and cooperate fully with each other in exchanging such
information and providing such assistance as the other may reasonably request. Each of Westbrick, [name of party redacted] and
the Purchaser shall promptly notify each other of any communication any of them receives from any Governmental Authority (other than communications
for purely logistical purposes) and permit the other Parties to review in advance and consider in good faith any comments made by the
other Parties and their respective counsel on any proposed applications, notices, filings, submissions, undertakings, correspondence and
communications of any nature (including responses to requests for information and inquiries from any Governmental Authority) by Westbrick,
[name of party redacted] or Purchaser, as applicable, to any Governmental Authority and shall provide each other with copies of
all applications, notices, filings, submissions, undertakings, correspondence and communications of any nature (including responses to
requests for information and inquiries from any Governmental Authority) between Westbrick or Purchaser, as applicable, or any of their
respective Representatives, on the one hand, and any Governmental Authority or members of the staff of any Governmental Authority, on
the other hand, in each case to the extent relating to the matters that are the subject of this Agreement. None of Westbrick, [name
of party redacted] nor Purchaser shall agree to participate in any meeting or discussion (whether by telephone, videoconference or
otherwise) with any Governmental Authority relating to the matters that are the subject of this Agreement (including in respect of satisfying
or obtaining the Key Regulatory Approval) unless it consults with the other Parties in advance and, to the extent permitted by such Governmental
Authority, gives the other Parties the opportunity to attend and participate at such meeting or discussion. To the extent any Party is
not present at a meeting or is not a party to a discussion with any Governmental Authority, the other Party shall advise such absent Parties
of the substance of any proposals or any position to be taken by that Party in any such meeting or discussion and keep such absent Parties
fully informed of such meetings and discussions promptly after such meetings or discussions have occurred. Each of Westbrick, [name
of party redacted] and Purchaser shall keep the other informed of the status of discussions relating to obtaining any authorization,
consent, clearance, approval or order contemplated by Section 6.6(a). Notwithstanding the foregoing provisions of this Section 6.6(d),
competitively sensitive information of a Party and information relating to valuation of the Assets shall be provided only to external
counsel and external experts of the other Party and shall not be shared by such counsel or expert with its client. |
| (e) | Subject to Section 6.4, Purchaser agrees that, between the date hereof and Closing, it shall not, and
shall not permit any of its Affiliates to, directly or indirectly, acquire or agree to acquire any assets, business or any Person whether
by merger, consolidation, purchasing a substantial portion of the assets of or equity in or by any other manner or engage in any other
transaction or take any other action, if, the entering into of a definitive agreement relating to or the consummation of such acquisition,
merger, consolidation or purchase or other transaction or action could be reasonably expected to (i) impose any delay in the expiration
or termination of any applicable waiting period or impose any delay in the obtaining of, or increase the risk of not obtaining, any authorization,
consent, clearance, approval or order of a Governmental Authority necessary to consummate the Transaction, including the Key Regulatory
Approval and any approvals and expiration of waiting periods under applicable antitrust or noncompetition laws, (ii) increase the risk
of any Governmental Authority entering, or increase the risk of not being able to remove or successfully challenge, any permanent, preliminary
or temporary injunction or other order, decree, decision, determination or judgment that would delay, restrain, prevent, enjoin or otherwise
prohibit consummation of the Transaction or (iii) otherwise delay or impede the consummation of the Transaction. |
| (f) | Notwithstanding anything in this Section 6.6 (or elsewhere in this Agreement) to the contrary, neither
[name of party redacted] nor Westbrick shall be obligated to take any action, including any action contemplated by this Section
6.6, with respect to their Affiliates (other than [name redacted] Holdco). |
| 6.7 | Westbrick Employee Matters |
| (a) | [Employee Matters redacted] |
| (b) | [Employee Matters redacted] |
| (c) | [Employee Matters redacted] |
| (d) | [Employee Matters redacted] |
| (e) | [Employee Matters redacted] |
| (f) | [Employee Matters redacted] |
| (g) | [Employee Matters redacted] |
| 6.8 | Additional Shareholders, Options and Awards |
| (a) | Westbrick shall use commercially reasonable efforts to cause each of the Additional Shareholders to execute
and deliver a Letter of Transmittal and Election Form. |
| (b) | [Optionholder matters redacted] |
| (c) | [Optionholder matters redacted] |
| (d) | [Tax matters redacted] |
| 6.9 | Additional [name of party redacted] Covenants |
Subject to the terms and conditions of this
Agreement, [name of party redacted] covenants and agrees with the Purchaser that it shall:
| (a) | concurrently with the execution of this Agreement execute the Written Resolution and deliver to Purchaser
and Company; and |
| (b) | not: (i) sell, transfer, gift, assign, convey, pledge, hypothecate, encumber, grant a Security Interest
in or option, or enter into any derivative transactions in respect of, or otherwise dispose of any right or interest (including any economic
consequence of ownership) in, any of the Holdco Shares or Westbrick Shares it beneficially owns or enter into any agreement, arrangement
or understanding in connection therewith, other than pursuant to the Arrangement; or (ii) grant or agree to grant any proxy, power of
attorney or other right to vote any of the Holdco Shares or Westbrick Shares it beneficially owns, deposit any of its Holdco Shares or
Westbrick Shares it beneficially owns into a voting trust or pooling agreement, or enter into any agreement, arrangement or understanding
with respect to the voting of any of its Holdco Shares or Westbrick Shares it beneficially owns, other than as provided in this Agreement. |
| (a) | Purchaser shall obtain the amounts required to pay, inter alia, the Cash Consideration pursuant
to the credit facilities described in the Acquisition Debt Confirmations. |
| (b) | Purchaser shall: (i) satisfy, or cause to be satisfied, on a timely basis, all conditions, covenants,
terms, representations and warranties applicable to Purchaser in the Purchaser Credit Agreement and, if applicable, the Purchaser Bridge
Loan Facility; and (ii) enforce its rights under the Purchaser Credit Agreement, and, if applicable, the Purchaser Bridge Loan Facility,
including by seeking specific performance of the parties thereunder, if necessary to consummate the Transaction. |
| (c) | Purchaser will keep the Company and [name of party redacted] fully informed with respect to all
material activity concerning the status of the financings referred to in this Section 6.10 and will give the Company and [name of party
redacted] prompt notice of any material change with respect to any such financing. Without limiting the generality of the foregoing,
Purchaser shall give the Company and [name of party redacted] prompt notice: (i) of any breach or default (or any event or circumstance
that, with or without notice, lapse of time or both, would reasonably be expected to give rise to any breach or default) by any party
to any definitive document related to the Debt Financing of which Purchaser becomes aware, (ii) of the receipt of any written notice or
other communication from any Person with respect to any actual or potential breach, default, termination or repudiation by any party to
any of the definitive documents related to the Debt Financing or a request for amendments or waivers thereto that are or could be reasonably
expected to be adverse to the timely completion of the Debt Financing, (iii) if for any reason Purchaser believes in good faith that it
will not be able to obtain all or any portion of the Debt Financing on the terms, in the manner or from the sources contemplated by the
Acquisition Debt Confirmations or the definitive documents related to Debt Financing including if Purchaser has any reason to believe
that it will be unable to satisfy, on a timely basis, any term or condition of any definitive document related to the Debt Financing,
and (iv) if the Acquisition Debt Confirmations or the definitive documents related to the Debt Financing expire or are terminated for
any reason. Without limiting the generality of the foregoing, as soon as reasonably practicable, but in any event within two Business
Days after the date the Company and [name of party redacted] deliver to Purchaser a written request, Purchaser shall provide any
information reasonably requested by the Company and [name of party redacted] relating to any circumstance referred to in clause
(i), (ii), (iii) or (iv) of the immediately preceding sentence. |
| (d) | Purchaser will not amend, alter or terminate, or agree to amend, alter or terminate, the Purchaser Credit
Agreement, Acquisition Debt Confirmations or any definitive agreement or documentation referred to in this Section 6.10 in any manner
that could reasonably be expected to impair, delay or prevent the consummation of the Transaction, in each case without the prior written
consent of the Company and [name of party redacted], provided that Purchaser may replace and amend any of the credit facilities
described in the Acquisition Debt Confirmations so long as the aggregate amount of the Debt Financing is not decreased to an amount less
than the Required Funds and such replacement or amendment, as the case may be, would not expand in any material respect the conditions
to the Debt Financing as of the date hereof; and in any such event, Purchaser shall disclose to the Company and [name of party redacted]
its intention to obtain such alternative financing, shall keep the Company and [name of party redacted] fully informed of the terms
thereof; and provided further that, for clarity, nothing herein shall restrict the Purchaser from replacing the Purchaser Bridge Loan
Facility with fully funded “high yield” bonds in an aggregate amount of not less than US$300 million. |
| (e) | Purchaser acknowledges and agrees that its obtaining financing is not a condition to any of its obligations
hereunder, regardless of the reasons why financing is not obtained or whether such reasons are within or beyond the control of Purchaser.
For the avoidance of doubt, regardless of whether any such financing is obtained, Purchaser will continue to be obligated to consummate
the Transaction, subject to and on the terms contemplated by this Agreement including Section 11.9. |
| (f) | Notwithstanding anything to the contrary contained in this Agreement, but without limiting any of the
Company’s rights under this Section 6.10(f) or the rights of the parties to the Debt Financing under the terms thereof, the Company,
on behalf of itself and each of its Affiliates, hereby waives, any rights or claims against any Debt Financing Source in connection with
this Agreement, the Debt Financing and the transactions contemplated hereby or thereby, and the Company agrees not to support or commence,
or permit any of its Affiliates to support or commence, any action or proceeding against any Debt Financing Source in connection with
this Agreement, the Debt Financing, the Acquisition Debt Confirmations or in respect of any other document or theory of law or equity
in connection therewith, whether at law, in contract, in tort or otherwise. In particular, the Company agrees that no Debt Financing Source
shall be subject to any special, consequential, punitive or indirect damages or damages of a tortious nature. No Debt Financing Source
shall have any liability whatsoever to any of Westbrick, [name of party redacted], [name redacted] Holdco, Westbrick Supporting
Shareholders or any of their Affiliates in connection with the Debt Financing or any way related to this Agreement or any of the transactions
contemplated hereby, whether at law, in contract, in tort or otherwise, in each case, whether arising, in whole or in part, out of comparative,
contributory or sole negligence by any Debt Financing Source. Notwithstanding anything to the contrary in this Agreement, (i) no amendment
or modification to this Section 6.10(f) (or amendment or modification with respect to any related definitions as they affect this Section
6.10(f)) shall be effective without the prior written consent of each Debt Financing Source and (b) each Debt Financing Source shall be
an express third party beneficiary of, and shall have the right to enforce, this Section 6.10(f). This Section 6.10(f) is intended to
benefit and may be enforced by the Debt Financing Sources. |
| (g) | For the avoidance of doubt, nothing contained herein shall in any way limit or modify the rights and obligations
of the Purchaser or the Debt Financing Sources set forth under the definitive documents governing the Debt Financing, and nothing herein
shall limit or modify the ability of the Company to enforce its rights and remedies against the Purchaser hereunder including, without
limitation, seeking specific performance of the Purchaser’s obligations hereunder, including under Section 6.10. |
| 6.11 | Pre-Closing Reorganization of [name of party redacted] |
| (a) | [Pre-closing reorganization matters redacted] |
Article 7
CONDITIONS TO CLOSING and closing deliveries
| 7.1 | Mutual Conditions Precedent |
The respective obligations of the Parties to
complete the Transaction are subject to the satisfaction (or waiver by mutual consent of the Parties), at or prior to the Closing, of
each of the following conditions:
| (a) | Interim Order. The Interim Order shall have been obtained on terms consistent with this Agreement
and in form and substance satisfactory to each of the Company, the Purchaser and [name of party redacted], each acting reasonably,
and shall not have been set aside or modified in a manner unacceptable to the Company, the Purchaser or [name of party redacted],
each acting reasonably, on appeal or otherwise. |
| (b) | Final Order. The Final Order shall have been obtained on terms consistent with this Agreement and
in form and substance satisfactory to each of the Company, the Purchaser and [name of party redacted], each acting reasonably,
and shall not have been set aside or modified in a manner unacceptable to the Company, the Purchaser or [name of party redacted],
each acting reasonably, on appeal or otherwise. |
| (c) | Articles of Arrangement. The Articles of Arrangement together with the Final Order and all other
necessary related documents, in form and substance satisfactory to each of the Company, [name of party redacted] and the Purchaser,
each acting reasonably, shall have been sent for filing with the Registrar together with the Final Order in accordance with subsection
193(4.1) of the ABCA. |
| (d) | Key Regulatory Approval. The Key Regulatory Approval shall have been obtained. |
| (e) | No Prohibition. No Applicable Laws or preliminary or permanent injunction or other order, decree
or ruling issued by a Governmental Authority which restrains, enjoins, prohibits or otherwise makes illegal the consummation of the Transaction
shall be in effect; provided, however, that a Party may not rely on this condition if any such injunction or other order, decree or ruling
results from the actions of, or claims made by or on behalf of, that Party or any of its Affiliates. |
| 7.2 | Conditions to the Obligations of Purchaser |
The obligation of Purchaser to complete the
Transaction is subject to the satisfaction (or waiver by Purchaser), at or prior to the Closing, of each of the following conditions:
| (a) | Representations and Warranties. |
| (i) | The representations made by the Company and [name of party redacted] in Sections 3.1, 3.3, 3.8,
4.1, 4.3 and 4.4 respectively, shall be true and correct in all respects as of the date of this Agreement and as of the Closing Date;
except for (A) de minimis inaccuracies; and (B) changes which shall arise upon the implementation of the Arrangement; and |
| (ii) | all other representations and warranties made by [name of party redacted] in Article 3, and
made by Westbrick in Article 4 shall be true and correct as of the Closing Date as if made on such date (except to the extent that
any such representation and warranty expressly speaks as of an earlier date, in which case such representation and warranty shall be true
and correct as of such earlier date), except where the failure of such representations and warranties to be true and correct, individually
or in the aggregate, would not result in a Material Adverse Effect on Company (and for this purpose, any reference to “material”,
“Material Adverse Effect” or other concepts of materiality in such representations and warranties shall be ignored). |
| (b) | Compliance with Covenants. The covenants and agreements contained in this Agreement that are to
be performed on or prior to the Closing by Westbrick and [name of party redacted] shall have been duly performed by Westbrick and
[name of party redacted], respectively, in all material respects, provided however, that in respect of Section 6.1(e): |
| (i) | Westbrick shall be deemed to have cured any failure to “promptly” advise Purchaser of any
facts, circumstances or information required thereunder so long as it does so in writing not less than two (2) Business Days prior to
Closing (the “Disclosure Date”) and such failure to “promptly” advise Purchaser did not in and of itself
have a Material Adverse Effect on the Company; and |
| (ii) | Westbrick shall not be deemed to have failed to duly perform such covenants contained in Section 6.1(e)
to the extent its failure to advise Purchaser of a fact, circumstance or information required thereunder was a fact, circumstance or information
of which Purchaser, at the Disclosure Date, otherwise had knowledge. |
| (c) | Dissent Rights. Holders of no more than 5% of the Westbrick Shares shall have validly exercised,
and not withdrawn, Dissent Rights. |
| (d) | No Material Adverse Effect. Between the date hereof and the Closing Date, there shall not have
occurred any Material Adverse Effect on Company. |
The conditions set forth
in this Section 7.2 are for the exclusive benefit of Purchaser and may be asserted by Purchaser regardless of the circumstances or may
be waived in writing by Purchaser in its sole discretion, in whole or in part, at any time and from time to time without prejudice to
any other rights which Purchaser may have.
| 7.3 | Conditions to the Obligations of the Company and [name of party redacted]. |
The obligations of the Company and [name
of party redacted] to complete the Transaction is subject to the satisfaction (or waiver by the Company and [name of party redacted]),
at or prior to the Closing, of each of the following conditions:
| (a) | Representations and Warranties. |
| (i) | The representations made by Purchaser in Sections 5.1 and 5.2 shall be true and correct in all respects
as of the date of this Agreement and as of the Closing Date, as if made at and as of such time; and |
| (ii) | all other representations and warranties made by Purchaser in Article 5 shall be true and correct
as of the Closing Date as if made on such date (except to the extent that any such representation and warranty expressly speaks as of
an earlier date, in which case such representation and warranty shall be true and correct as of such earlier date), except where the failure
of such representations and warranties to be true and correct, individually or in the aggregate, would not result in a Material Adverse
Effect on Purchaser (and for this purpose, any reference to “material”, “Material Adverse Effect” or other concepts
of materiality in such representations and warranties shall be ignored). |
| (b) | Covenants. Purchaser shall have paid the Consideration pursuant to Article 2 and the Company
and [name of party redacted] shall have received confirmation of receipt of such Consideration by the Depositary (which, in respect
of the Share Consideration, may be in the form of an irrevocable treasury direction for up to the Share Maximum) and the other covenants
and agreements contained in this Agreement that are to be performed on or prior to the Closing by Purchaser shall have been duly performed
by Purchaser in all material respects. |
| (c) | Exchange Listings. (i) the TSX shall have conditionally approved the issuance and the listing and
posting for trading on the TSX of the Purchaser Shares to be issued pursuant to the Arrangement; and (ii) the NYSE shall have approved
the issuance of such Purchaser Shares, subject to official notice of issuance, in each case subject only to customary conditions reasonably
expected to be satisfied. |
The conditions set forth in this Section 7.3
are for the exclusive benefit of Westbrick and [name of party redacted] and may be asserted by Westbrick and [name of party
redacted] regardless of the circumstances or may be waived in writing by Westbrick and [name of party redacted] in their sole
discretion, in whole or in part, at any time and from time to time without prejudice to any other rights which Westbrick and [name
of party redacted] may have.
| 7.4 | Covenant to Satisfy Closing Conditions. |
Subject to Section 6.6 and the other terms
and conditions of this Agreement, each of the Parties shall use commercially reasonable efforts to satisfy or cause the satisfaction of
the conditions precedent to the completion of the Transaction as set forth in Sections 7.1, 7.2 and 7.3 (to the extent the same is within
its control) and to take or cause to be taken all other actions and to do or cause to be done all other things necessary to permit the
consummation of the Transaction in accordance with its obligations under this Agreement and to cooperate with each other in connection
therewith.
| 7.5 | Deliveries by Purchaser. |
At the Closing, Purchaser shall deliver, or
cause to be delivered to the Company and [name of party redacted], the following:
| (a) | the Key Regulatory Approval; and |
| (b) | a certificate, signed by a duly authorized officer of Purchaser and dated the Closing Date, to the effect
that the conditions set forth in Section 7.3(a) and Section 7.3(b) have been satisfied. |
| 7.6 | Deliveries by [name of party redacted]. |
At the Closing, [name of party redacted]
shall deliver, or cause to be delivered, to Purchaser the following:
| (a) | a Letter of Transmittal and Election Form with share certificates representing all of the [name redacted]
Westbrick Amalco Shares held by [name of party redacted]; |
| (b) | evidence of termination of the Registration Rights Agreement; and |
| (c) | a certificate, signed by an authorized signatory of [name of party redacted], dated the Closing
Date, to the effect that the conditions set forth in Section 7.2(a) and Section 7.2(b) (solely as they relate to [name of party redacted])
have been satisfied; provided, however, that [name of party redacted] shall be entitled to modify their certificate to reflect
any event, state of facts or circumstances relating to the representations and warranties of [name of party redacted] that are
necessary in order to make such certificate true and correct. |
| 7.7 | Deliveries by Westbrick |
At the Closing, Westbrick shall deliver, or
cause to be delivered, to Purchaser the following:
| (a) | any resignations and mutual releases executed by directors and officers of Westbrick received by Westbrick
prior to Closing; |
| (b) | the 11-22 Gas Handling and Transportation Agreement, duly executed by Duvernay Spinco and Westbrick; and |
| (c) | a certificate, signed by a duly authorized officer of Company and dated the Closing Date, to the effect
that the conditions set forth in Section 7.2(a) and Section 7.2(b) (solely as they relate to the Company) have been satisfied. |
Article 8
TERMINATION
| 8.1 | Termination by Mutual Consent. |
This Agreement may be terminated at any time
prior to the Closing by the mutual written agreement of Westbrick, [name of party redacted] and Purchaser.
| 8.2 | Termination by Any Party. |
This Agreement may be terminated by any of
the Company, [name of party redacted] or Purchaser at any time prior to the Closing:
| (a) | if the Closing Date shall not have occurred on or prior to the Outside Date or such later date as provided
for pursuant to Section 8.3 or 8.4, as applicable; provided, however, the right to terminate this Agreement under this Section 8.2(a)
shall not be available to a Party if the failure of that Party to fulfill any of its obligations under this Agreement has principally
caused or resulted in the failure of the Closing to occur prior to the Outside Date; and provided further that the right to terminate
this Agreement under this Section 8.2(a) shall not be available to any Party after the Conditions Satisfaction Date unless the Closing
shall not have occurred on the date scheduled therefor in accordance with Section 2.7; or |
| (b) | if a Governmental Authority shall have issued an order, decree or ruling or taken any other action permanently
restraining, enjoining or otherwise prohibiting the Transaction and such order, decree, ruling or other action shall have become final
and non-appealable; provided, however, that the right to terminate this Agreement under this Section 8.2(b) shall not be available to
a Party if the failure of that Party to fulfill any of its obligations under this Agreement has principally caused or resulted in such
order, decree, ruling or action, |
provided that, in each case, the Party seeking
to terminate the Agreement under this Section 8.2 shall give written notice of such termination to the other Parties, specifying in reasonable
detail the basis for such Party’s exercise of the termination right.
| 8.3 | Termination by Purchaser. |
This Agreement may be terminated by the Purchaser
prior to the Closing if there has been a breach of any representation, warranty, covenant or agreement made by the Company or [name
of party redacted] in this Agreement, or any such representation and warranty shall have become untrue after the date of this Agreement,
in either case such that any of the conditions set forth in Sections 7.1 and 7.2 would not be satisfied; provided, however, that the Purchaser
shall not be entitled to so terminate this Agreement unless the Purchaser has delivered a written notice to the Company and/or [name
of party redacted], as applicable, specifying in reasonable detail such breach or condition which the Purchaser is asserting as the
basis for exercise of its termination rights. If any such notice is delivered, unless such breach or condition is not capable of being
cured, the Purchaser may not terminate this Agreement until the earlier of (i) 30 days after such notice is delivered (which period shall
be extended for so long as the Company and/or [name of party redacted] is proceeding diligently to cure such breach or condition)
and (ii) one Business Day prior to the Outside Date; provided, however, if such notice is delivered within 30 days of the Outside Date,
unless such breach or condition is not capable of being cured, the Outside Date shall be automatically extended until the 30th
day after such notice is delivered, and if such breach is cured within the applicable time period, the Purchaser will not be entitled
to terminate this Agreement as a result of such breach. Notwithstanding the foregoing, the Purchaser shall not be entitled to terminate
this Agreement under this Section 8.3 if the failure to satisfy the particular condition precedent being relied upon as a basis for termination
occurred directly or indirectly as a result of, or was contributed to by, a breach by the Purchaser of any of its covenants, obligations,
representations or warranties under this Agreement.
| 8.4 | Termination by [name of party redacted] or the Company |
This Agreement may be terminated by [name
of party redacted] or the Company prior to the Closing if there has been a breach of any representation, warranty, covenant or agreement
made by the Purchaser in this Agreement, or any such representation and warranty shall have become untrue after the date of this Agreement,
in either case such that any of the conditions set forth in Sections 7.1 or 7.3 would not be satisfied; provided, however, that [name
of party redacted] and the Company shall not be entitled to so terminate this Agreement unless [name of party redacted] or
the Company has delivered a written notice to the Purchaser, specifying in reasonable detail such breach or condition which [name of
party redacted] or the Company are asserting as the basis for exercise of their termination rights. If any such notice is delivered,
unless such breach or condition is not capable of being cured or if the breach is in respect of a failure to pay the Consideration to
the Depositary by the Closing Time, [name of party redacted] and the Company may not terminate this Agreement until the earlier
of (i) 30 days after such notice is delivered (which period shall be extended for so long as the Purchaser is proceeding diligently to
cure such breach or condition); and (ii) one Business Day prior to the Outside Date; provided, however, if such notice is delivered within
30 days of the Outside Date, unless such breach or condition is not capable of being cured, the Outside Date shall be automatically extended
until the 30th day after such notice is delivered, and if such breach is cured within the applicable time period, [name
of party redacted] and the Company will not be entitled to terminate this Agreement as a result of such breach. Notwithstanding the
foregoing, [name of party redacted] and the Company shall not be entitled to terminate this Agreement under this Section 8.4 if
the failure to satisfy the particular condition precedent being relied upon as a basis for termination occurred directly or indirectly
as a result of, or was contributed to by, a breach by [name of party redacted] or the Company of any of its covenants, obligations,
representations or warranties under this Agreement.
In the event of the termination of this Agreement
in accordance with the terms hereof, this Agreement shall thereafter become void and have no effect, and the Parties shall not have any
liability to any other Party or their respective Affiliates, or their respective direct or indirect partners, equityholders, directors,
officers or employees, pursuant to this Agreement except for the obligations of the Parties contained in Section 6.1(c), this Section
8.5, Section 9.3, Article 11 and any related definitional or interpretive provisions set forth in Article 1, each of which shall
remain in full force and effect. Notwithstanding the foregoing, nothing in this Section 8.5 shall relieve any of the Parties from liability
for any willful breach of this Agreement that arose prior to such termination.
Article 9
ADDITIONAL COVENANTS
| 9.1 | Preservation of Records. |
The Purchaser shall take all reasonable steps
to preserve and keep the records of Westbrick and [name redacted] Holdco delivered to it in connection with the completion of the
transactions contemplated by this Agreement for a period of six years from the Closing Date, or for any longer period as may be required
by any Applicable Laws or Governmental Authority, and shall make such records available to [name of party redacted] and any Additional
Shareholders on a timely basis, during regular business hours as may be reasonably necessary and requested by them to the extent required
for the purposes of:
| (a) | preparing Tax Returns or responding to or disputing any Tax audit; |
| (b) | in the case of [name of party redacted], the determination of any matter relating to the rights
and obligations of [name of party redacted] under this Agreement; or |
| (c) | such other purposes for which access to such documents is agreed by the Parties to be reasonably necessary, |
provided, however, that access to such records
shall not interfere with the normal operations of Westbrick, Purchaser or their Affiliates, and the reasonable out-of-pocket expenses
of Westbrick, Purchaser and their Affiliates in connection therewith shall be paid by [name of party redacted] or such Additional
Shareholder requesting such records. Purchaser and Westbrick shall have the right, as a precondition to the release of such records, to
require [name of party redacted] or the Additional Shareholder requesting such records, to execute a confidentiality agreement,
in form acceptable to such parties, acting reasonably, in respect of the non-disclosure or use of such records for any purpose other than
the agreed permitted purpose stated herein.
| 9.2 | Stub Period Returns and Other Tax Matters. |
| (a) | The Purchaser shall cause Westbrick, [name redacted] Holdco and Westbrick Amalco to duly and timely
make or prepare all Tax Returns required to be made or prepared by Westbrick, [name redacted] Holdco and Westbrick Amalco, respectively,
and to duly and timely file all Tax Returns required to be filed by Westbrick, [name redacted] Holdco and Westbrick Amalco in respect
of any Pre-Closing Tax Period or Straddle Period (collectively, the “Stub Period Returns”) and for which such Stub
Period Returns have not been filed as of the Closing Date. |
| (b) | Westbrick, [name of party redacted] and the Purchaser shall co-operate fully with each other and
make available to each other in a timely fashion such data and other information as may reasonably be required for the preparation of
any Stub Period Return, and any pending or threatened audit, legal proceeding or assessment with respect thereto or to Taxes, of each
of Westbrick, [name redacted] Holdco and Westbrick Amalco in respect of any Pre-Closing Tax Period or Straddle Period and shall
preserve such data and other information until the expiration of any applicable limitation period under any Applicable Laws with respect
to Taxes. Such cooperation shall include the retention and (upon the relevant Party’s request) the provision of records and information
which are reasonably relevant to any such legal proceeding and making employees available on a mutually convenient basis to provide additional
information and explanation of any material provided hereunder. In furtherance of the foregoing, each of Westbrick and [name redacted]
Holdco (before the Closing) and [name of party redacted] (after the Closing) agree to cooperate with Purchaser and provide any
relevant information within its possession requested by Purchaser that is reasonably necessary for the Purchaser to determine the limitations,
if any, on any of Westbrick Amalco’s Tax Pool carry-forwards or balances. Notwithstanding the foregoing or any other provision herein
to the contrary, in no event shall Westbrick or [name of party redacted] be entitled to review or otherwise have access to any
income Tax Return, or information related thereto, of the Purchaser or its Affiliates. |
| (c) | If, at any time after the Closing Date, Purchaser or [name of party redacted] determines, or becomes
aware that an “advisor” (as is defined for purposes of section 237.3 or section 237.4 of the Tax Act) has determined, that
the transactions contemplated by this Agreement are or would be subject to the reporting requirements under section 237.3 or the notification
requirements under proposed section 237.4 of the Tax Act (in this Section 9.2(c), the “Disclosure Requirements”), Purchaser
or [name of party redacted], as the case may be, will promptly inform the other Party of its intent, or its advisor’s intent,
to comply with the Disclosure Requirements and the Parties will cooperate in good faith to determine the applicability of such requirements.
In the event that, following such cooperation, it is ultimately determined that any Party is required to file any applicable information
return, notification and/or disclosure in accordance with the Disclosure Requirements (in this Section 9.2(c), in each case, a “Mandatory
Disclosure”), each Party required to file a Mandatory Disclosure (in this Section 9.2(c)), a “Disclosing Party”)
shall submit to the other Party a draft of such Mandatory Disclosure at least 30 days before the date on which such Mandatory Disclosure
is required by Applicable Law to be filed, and such other Party shall have the right to make reasonable comments or changes on such draft
by communicating such comments or changes in writing to the Disclosing Party at least 15 days before the date on which such Mandatory
Disclosure is required by Applicable Law to be filed. The Disclosing Party shall consider in good faith any such comments or changes proposed
by the other Party and shall incorporate such comments or changes which the Disclosing Party determines are reasonable and in accordance
with law. |
| (d) | The parties hereto confirm that (i) no portion of any amount payable under this Agreement is paid in respect
of or allocated to the covenants granted under section 10.2, (ii) such covenants are integral to this Agreement, and (iii) such covenants
are granted to maintain and preserve the fair market value of the Westbrick Shares and meet the requirements specified in clause 56.4(7)(b)(ii)(B)
or subsection 56.4(6) of the Tax Act (and the equivalent provisions of any applicable provincial tax legislation), such that subsection
56.4(5) of the Tax Act (and the equivalent provisions of any applicable provincial tax legislation) applies to such covenants. |
| (e) | If, at any time after the date hereof, Westbrick Amalco is assessed for Taxes under subsection 185.1(1)
of the Tax Act (or equivalent provision under any Applicable Law) in respect of an “excessive eligible dividend designation”
within the meaning of subsection 89(1) of the Tax Act (or equivalent provision under any provincial Tax Law) in respect of any dividend
paid on or before the Closing Date by Westbrick or [name redacted] Holdco, the Purchaser shall cause Westbrick Amalco to make the
election under subsection 185.1(2) of the Tax Act (or equivalent provision under any Applicable Law) in prescribed manner and within the
time specified in subsection 185.1(2) (or equivalent provision under any Applicable Law), in respect of any such “excessive eligible
dividend designation” so as to treat such excess amount as a separate taxable dividend and [name of party redacted] and the
Additional Shareholders, as applicable, hereby concur with the making of the election under subsection 185.1(2) of the Tax Act (or equivalent
provision under any Applicable Law) to treat such excess amount as a taxable dividend and shall cooperate with Westbrick Amalco and take
all steps necessary in order to make such election. |
| (f) | If, at any time after the date hereof, Westbrick Amalco is assessed for Taxes under subsection 184(2)
of the Tax Act (or equivalent provision under any Applicable Law) in respect of a dividend paid on or before the Closing Date in respect
of which Westbrick or [name redacted] Holdco, as applicable, made a capital dividend election under subsection 83(2) of the Tax
Act (or equivalent provision under any Applicable Law), the Purchaser shall cause Westbrick Amalco to make the election under subsection
184(3) of the Tax Act (or equivalent provision under any Applicable Law) in the prescribed manner and within the time specified in subsection
184(3) (or equivalent provision under any Applicable Law) in respect of any such excessive capital dividend election so as to treat such
excess amount as a separate taxable dividend and [name of party redacted] and the Additional Shareholders, as applicable, hereby
concur with the making of an election under subsection 184(3) of the Tax Act (or equivalent provision under any Applicable Law) to treat
such excess amount as a taxable dividend and shall cooperate with Westbrick Amalco and take all steps necessary in order to make such
election. |
| 9.3 | Confidentiality and Public Announcements. |
| (a) | Prior to the Closing, the Purchaser shall keep confidential all information disclosed to it by Westbrick
or [name of party redacted] or their Representatives relating to [name of party redacted], and the Company shall keep confidential
all information disclosed to it by the Purchaser or its Representatives relating to the Purchaser and its business and assets (including
all information relating to the Debt Financing and the Debt Financing Sources), except information which: |
| (i) | at the time of disclosure to the Purchaser or the Company, as applicable, is generally available to and
known by the public (other than as a result of a disclosure by Purchaser or the Company, as applicable, or by any of their respective
Representatives); |
| (ii) | is or was received by Purchaser or Company, as applicable, on a non-confidential basis from a source other
than one of the other Parties who was not prohibited from transmitting the information to Purchaser or Company, as applicable, by a confidentiality
agreement with or other contractual, legal or fiduciary obligation to one of the other Parties; |
| (iii) | heretofore disclosed to Purchaser or Company, as applicable, by one of the Parties hereto on a non-confidential
basis; and |
| (iv) | was known by Purchaser or Company, as applicable, prior to disclosure hereunder and is not subject to
a confidentiality obligation. |
Each of Purchaser and
Company acknowledges and agrees that any information of [name of party redacted] or the Purchaser, respectively, made available
to Purchaser or the Company pursuant to Section 6.1 or otherwise by or on behalf of [name of party redacted] or the Purchaser,
respectively, or by any of their respective Representatives prior to the Closing shall be subject to the terms and conditions of this
Section 9.3.
| (b) | If this Agreement is terminated without completion of the transactions contemplated by this Agreement,
(i) the Purchaser shall promptly provide evidence of the destruction of all documents, work papers and other material (including all copies)
obtained from Westbrick or [name of party redacted] in respect of Westbrick or [name of party redacted], and not previously
made public and shall continue to maintain the confidence of all such information, and (ii) the Company and [name of party redacted]
shall promptly provide evidence of the destruction of all documents, work papers and other material (including all copies) obtained from
the Purchaser in respect of the Purchaser, the Debt Financing or the Debt Financing Sources, and not previously made public and shall
continue to maintain the confidence of all such information. Notwithstanding the foregoing, the Purchaser, the Company and [name of
party redacted] may each retain data or records in electronic form for the purposes of backup or recovery in accordance with its data
retention policies, so long as such data or records, to the extent not permanently deleted or overwritten in the ordinary course of business,
are not accessible in the ordinary course of business and are not accessed except as required for backup or recovery and Purchaser, the
Company and [name of party redacted] shall each continue to maintain such confidence and be prohibited from using of all such information.
If such data or records are restored or otherwise become accessible, they must be promptly permanently deleted. |
| (c) | The terms of the Confidentiality Agreement are incorporated into this Agreement by reference and shall
continue in full force and effect until the Closing, at which time such Confidentiality Agreement shall terminate. If, for any reason,
the Transaction is not consummated, the Confidentiality Agreement shall nonetheless continue in full force and effect in accordance with
its terms. Purchaser acknowledges and agrees that any information made available to Purchaser pursuant to Section 6.1 or otherwise by
or on behalf of the Company or any of its respective Representatives prior to the Closing shall be subject to the terms and conditions
of the Confidentiality Agreement. |
| (d) | For the period from the date hereof until two (2) years from the Closing, neither [name of party redacted]
nor any of its Affiliates who received Business Information shall disclose, divulge, reveal, report, publish, make use of, or transfer
to any Person, other than to Purchaser or Westbrick, any confidential or proprietary information comprised in or pertaining to (i) Westbrick,
the Assets or the Business; or (ii) the Purchaser, the Debt Financing or the Debt Financing Sources, (collectively, the “Business
Information”), excepting only disclosure or use of Business Information: |
| (i) | to any Governmental Authority or to the public, but in either case, only if and to the extent that such
disclosure is required under any Applicable Laws or any stock exchange rule or policy to which such Party or its Affiliates are subject; |
| (ii) | in a claim brought by any Party in the pursuit of its remedies under this Agreement or the defence of
a claim by any Party under this Agreement, |
| (iii) | in the preparation of any Tax Return or financial statements, or |
| (iv) | as may be consented to in writing by Purchaser. |
If [name of party
redacted] or any of its Affiliates is required by Applicable Law or required by law, regulation or legal, judicial or administrative
process (including, without limitation, an audit or examination by a regulatory authority or self-regulatory organization) to produce
or divulge any of the Business Information to any Person whatsoever, [name of party redacted] shall, to the extent legally permissible,
promptly notify Purchaser of such requirement so that Purchaser may seek a protective remedy or other appropriate remedy; provided, however,
that no such notice shall be required to the extent [name of party redacted] or its Affiliates are requested or required to disclose
Business Information to the applicable regulatory authorities or self-regulatory organizations having supervisory jurisdiction over [name
of party redacted] or such Affiliates during the course of any regulatory audit or examination. [name of party redacted] shall,
or shall cause its Affiliate to, cooperate with Purchaser on a reasonable basis in any attempt by Purchaser to obtain a protective order
or other appropriate remedy. Such protective order or other appropriate remedy shall be obtained at Purchaser’s sole cost and expense.
In any event, [name of party redacted] or its Affiliate which is so required to produce or divulge the Business Information will
only furnish that portion of the Business Information that it is legally required to disclose.
| (e) | Notwithstanding anything to the contrary, the restrictions set forth in Section 9.3(d) shall not apply
to, and neither [name of party redacted] nor its Affiliates will be liable for disclosure of, Business Information which: |
| (i) | is or becomes publicly known or available through means other than as a result of disclosure by [name
of party redacted], its Affiliates, or the Additional Shareholders; or |
| (ii) | was obtained by [name of party redacted], its Affiliates on a non-confidential basis from a source
other than Westbrick or its Affiliates, Representatives, or the Additional Shareholders, provided that the source of such information
was not bound by a confidentiality agreement with, or other contractual, legal or fiduciary obligation of confidentiality or secrecy to,
Westbrick, the Purchaser or any other party with respect to such information. |
| (f) | The Parties have agreed on the form of the press release to be issued by Purchaser promptly after the
execution of this Agreement insofar as such press release relates to this Agreement and the Transaction, provided however, that notwithstanding
the foregoing a full and complete copy of the press release shall be provided to the Company. |
| (g) | No Party shall (and each Party shall cause its respective Affiliates not to) otherwise disclose the contents
or existence of this Agreement or any information provided hereunder without the prior written consent of the other Party, which consent
shall not be unreasonably withheld, conditioned or delayed. Nothing contained in this Agreement shall prevent a Party (or its Affiliates)
from disclosing any information (i) to any Governmental Authority or to the public, but in either case, only if and to the extent that
such disclosure is required under any Applicable Laws (including continuous and timely disclosure requirements under Applicable Canadian
Securities Laws or Applicable U.S. Securities Laws) or any stock exchange rule or policy (including the TSX or the NYSE) to which such
Party or its Affiliates are subject, (ii) to any Governmental Authority or to a Third Party, but in either case, only if and to the extent
that such disclosure is required in order to obtain a Key Regulatory Approval, (iii) to Westbrick Shareholders in connection with the
Notice of Written Resolution, or (iv) such disclosure is otherwise contemplated herein, provided that, in each such instance, the Party
that proposes to make such a disclosure (whether directly or through one or more of its Affiliates) shall advise the other Party of such
proposed disclosure and such Party shall use its reasonable efforts to prevent the disclosure of any such information that is not required
to be disclosed for the listed purposes. In the event that a Party (or its Affiliates) is required to disclose information in accordance
with the procedures set out in this Section 9.3(g), the non-disclosing Party shall, to the extent practicable, be provided with reasonable
time to review such disclosure prior to dissemination, and the suggested revisions proposed by the non-disclosing Party and its professional
advisors will be considered and accepted or rejected in good faith by the disclosing Party and its professional advisors. Notwithstanding
the foregoing, the Parties and their applicable Affiliates may make any disclosures that are otherwise prohibited by this Section 9.3(g)
so long as such statements and announcements are consistent with the most recent press releases, public disclosures or public statements
made by the Parties in accordance with this Section 9.3(g). |
| 9.4 | D&O Insurance and Continuance of Directors’ and Officers’ Indemnification |
| (a) | The provisions of any document, including any insurance policy maintained by Westbrick, concerning the
elimination of liability and indemnification of directors and officers shall not be amended in any manner that would adversely affect
the rights thereunder of any person that is currently an officer or director of Westbrick. Without limiting the generality of the foregoing,
for a period of six years after the Closing Time, the Purchaser shall, or shall cause Westbrick or any successor of Westbrick to, maintain
Westbrick’s current directors’ and officers’ insurance policy or an equivalent policy subject, to terms and conditions
(when considered as a whole) no less advantageous to the directors and officers of Westbrick than those contained in the policy in effect
on the date hereof, for all present and former directors and officers of Westbrick, covering claims made prior to the Closing Time. Prior
to the Closing Time, Westbrick shall purchase run-off directors’ and officers’ liability insurance for the benefit of its
officers and directors having a coverage period of up to six years after the Closing Time. |
| (b) | From and after the Closing Date, the Purchaser and Westbrick Amalco (the “D&O Indemnitors”)
shall indemnify, hold harmless and defend each person who is a former officer or director of Westbrick (the “D&O Indemnitees”)
against all Losses arising out of or relating to acts or omissions (or alleged acts or omissions) of any of the D&O Indemnitees in
their capacities as such, which acts or omissions occurred prior to the Closing. The D&O Indemnitors shall promptly advance expenses
in connection with such indemnifications provided that, to the extent required by Applicable Laws, the Person to whom expenses are advanced
provides an undertaking to repay such advances if it is ultimately determined that such Person is not entitled to indemnification. |
| (c) | The Purchaser, on behalf of each of the D&O Indemnitors, represents and covenants from and after the
Closing Date that there has not been and will not be any assignment or other transfer of any right or interest in any Losses that such
D&O Indemnitor has or may have against the D&O Indemnitees, and agrees to indemnify and hold each D&O Indemnitees harmless
from any Losses, directly or indirectly incurred by any of the D&O Indemnitees as a result of any Person asserting any right or interest
pursuant to any such assignment or transfer of any such right or interest. |
| (d) | In the event that the Purchaser, Westbrick or any of its successors or assigns (i) consolidates with or
merges into any other Person or (ii) transfers or conveys all or substantially all of its properties and assets to any Person, then, and
in each such case, proper provision shall be made so that the successors and assigns of the Purchaser or Westbrick shall assume all of
the obligations thereof set forth in this Section 9.4. |
| (e) | [name of party redacted] confirms that it holds the benefit of the indemnity provisions in this
Section 9.4 in trust for the D&O Indemnitees. |
| 9.5 | Environmental Matters. |
Purchaser acknowledges that it is acquiring
Westbrick and the Business (excluding the Duvernay Business) on an “as is, where is” basis and that, except as set forth in
Section 4.34, it is not entitled to rely upon any representation or warranty of Westbrick or [name of party redacted] as to the
condition, environmental or otherwise, of the Assets. Purchaser hereby agrees that, from and after the Closing, it shall indemnify, defend
and hold harmless each of the Westbrick Shareholders, their Affiliates and their and Westbrick’s respective directors, officers,
direct or indirect equityholders, trustees and employees and their heirs, successors and permitted assigns, each in their capacity as
such (the “Westbrick Indemnified Parties”) from and against any and all Losses suffered or incurred by any of the Westbrick
Indemnified Parties to the extent arising out of or in connection with any Environmental Liabilities, whether occurring or accruing before,
on or after the Closing Date. Purchaser, on its own behalf and on behalf of its Affiliates, agrees that, from and after the Closing: (a)
Purchaser and its Affiliates shall be solely responsible for all Environmental Liabilities as between any of the Westbrick Indemnified
Parties, on the one hand, and Westbrick (and upon completion of the Amalgamation, Westbrick Amalco), Purchaser and its Affiliates, on
the other hand, (b) Purchaser agrees to cause any assignee of its interest in any of the Assets to also assume and become liable to the
Westbrick Indemnified Parties for all Losses suffered or incurred by any of the Westbrick Indemnified Parties arising out of or connected
with any Environmental Liabilities whether occurring or accruing before, on or after the closing date of a transaction between Purchaser
as seller and such assignee as buyer in respect of any of the Assets; (c) Westbrick (and upon completion of the Amalgamation, Westbrick
Amalco), Purchaser and its Affiliates hereby waive, and acknowledge and agree that none of them shall exercise, any right or remedy against
any of the Westbrick Indemnified Parties in respect of any Environmental Liabilities that Westbrick (and upon completion of the Amalgamation,
Westbrick Amalco), Purchaser or any of its Affiliates may otherwise have under any Applicable Laws, including any right to name any of
the Westbrick Indemnified Parties as a Third Party under any action commenced or enforcement proceeding by or against Purchaser or any
of its Affiliates, and (d) Westbrick (and upon completion of the Amalgamation, Westbrick Amalco), Purchaser and its Affiliates hereby
release the Westbrick Indemnified Parties from any and all claims whatsoever Purchaser or any of its Affiliates may have against any of
the Westbrick Indemnified Parties with respect to any and all Environmental Liabilities. In addition, the Westbrick Indemnified Parties
shall also retain those other rights and remedies available to them under Applicable Laws with respect to any claim any of them may have
against Westbrick, Purchaser and their respective Affiliates under this Section 9.5. [name of party redacted] confirms that it
holds the benefit of the provisions in this Section 9.5 in trust for the Westbrick Indemnified Parties.
| (a) | For the purposes of this Section 9.6, “Transferred Information” means Personal Information
disclosed or conveyed to one Party hereto or any of its Representatives or agents (each a “Receiving Party”) by or
on behalf of another Party hereto (a “Disclosing Party”) as a result of or in conjunction with the Transaction, and
includes all such personal information disclosed to the Receiving Party prior to the execution of this Agreement. |
| (b) | Each Disclosing Party shall ensure that any Transferred Information with respect to which it is responsible
for disclosing to a Receiving Party is necessary for the purposes of determining if the parties hereto shall proceed with the Transaction,
and if the determination is made to proceed with said transactions, to complete them. |
| (c) | Each Receiving Party covenants and agrees to: |
| (i) | prior to the completion of the Transaction: (A) use and disclose the Transferred Information solely for
the purpose of reviewing and completing such transactions, including for the purpose of determining whether to complete such transactions;
(B) protect the Transferred Information by security safeguards appropriate to the sensitivity of such Transferred Information; and (C)
if the Transaction does not proceed, return the Transferred Information to the Disclosing Party or destroy it, at the Receiving Party’s
election, within a reasonable time; and |
| (ii) | after the completion of the Transaction: (A) use and disclose the Transferred Information only for those
purposes for which the Transferred Information was initially collected, or permitted to be used, or disclosed, prior to the completion
of such transactions, unless (x) the Disclosing Party or Receiving Party have first notified such individual of such additional purpose,
and where required by Applicable Laws, obtained the consent of such individual to such additional purpose, or (y) such use or disclosure
is permitted or authorized by Applicable Laws, without notice to, or consent from, such individual; (B) protect the Transferred Information
by security safeguards appropriate to the sensitivity of such information; and (C) as required in accordance with Applicable Laws, give
effect to any withdrawal of consent made by an individual to whom the Transferred Information relates. |
| (d) | Where required by Applicable Laws, Westbrick will promptly notify the individuals to whom the Transferred
Information relates that the Transaction has taken place and that the Transferred Information has been disclosed to the other Parties. |
| (a) | [Insurance matters redacted] |
| (b) | [Insurance matters redacted] |
| (c) | [Insurance matters redacted] |
| (d) | [Insurance matters redacted] |
Article 10
NO SHOP, NON-SOLICIT
| (a) | Westbrick and [name of party redacted] shall immediately cease and cause to be terminated all existing
solicitations, discussions and negotiations (including, without limitation, through any of their respective Representatives), with any
parties (other than Purchaser) initiated or conducted before the date of this Agreement with respect to any proposal that constitutes,
or may reasonably be expected to constitute an Acquisition Proposal. Westbrick and [name of party redacted] each represent and
warrant that it has not waived, amended or failed to enforce any standstill provisions contained in a confidentiality agreement or otherwise
for any Person other than Purchaser. Westbrick and [name of party redacted] shall: |
| (i) | enforce against all Third Parties, other than Purchaser, the terms of any confidentiality, standstill
or similar agreement or restriction to which Westbrick or [name of party redacted], as applicable, is a party (and shall not provide
any consent that would relieve any such third party from any such restriction); provided that it is acknowledged by Purchaser that the
automatic termination or release of any such agreement or restriction solely as a result of entering into this Agreement shall not be
a violation of this Section 10.1; and |
| (ii) | immediately discontinue, and shall cause its Representatives to discontinue, access to any of Westbrick’s
or [name redacted] Holdco’s confidential information and not allow or establish access to any of its confidential information,
or any data room, virtual or otherwise and shall promptly request, to the extent that it is entitled to do so, and exercise all rights
it has to discontinue access to, and require the return or destruction of, all confidential information provided to any third parties
who have entered into a confidentiality agreement with Westbrick or [name of party redacted] or their respective Representatives
relating to an Acquisition Proposal and shall use commercially reasonable efforts to ensure that such requests are honoured. |
| (b) | Westbrick and [name of party redacted] shall not, directly or indirectly, do or authorize or permit
any of their respective Representatives to do, any of the following: |
| (i) | solicit, assist, initiate or knowingly facilitate or take any action to solicit or knowingly facilitate,
or initiate any Acquisition Proposal, or offer that constitutes or may constitute or would reasonably be expected to lead to an Acquisition
Proposal, including by way of furnishing information or access to properties, facilities or books and records; |
| (ii) | enter into or otherwise engage or participate in any discussions or negotiations regarding any inquiry,
proposal or offer that constitutes or may constitute or would reasonably be expected to lead to an Acquisition Proposal, or furnish or
provide access to any information with respect to its businesses, properties, operations, prospects, securities or conditions (financial
or otherwise) in connection with or in furtherance of an Acquisition Proposal or otherwise cooperate in any way with, or assist or participate
in, knowingly facilitate, any effort or attempt of any other Person to do or seek to do any of the foregoing; |
| (iii) | withdraw, amend, modify or qualify, or propose publicly to withdraw, amend, modify or qualify, in any
manner adverse to Purchaser, the Westbrick Board Recommendation; |
| (iv) | waive, modify or release any third party from, or enter into or participate in any discussions, negotiations
or agreements to waive, modify, release any third party from, or provide any consent to any third party under, any rights or other benefits
under confidential information agreements, including, without limitation, any “standstill provisions” thereunder; provided
that it is acknowledged by Purchaser that the automatic termination or release of any such agreement or restriction solely as a result
of entering into this Agreement shall not be a violation of this Section 10.1; |
| (v) | accept, recommend, approve, agree to, endorse, or propose publicly to accept, recommend, approve, agree
to, or endorse, an Acquisition Proposal; |
| (vi) | for a period in excess of three Business Days, take no position or a neutral position with respect to,
a publicly announced or publicly proposed Acquisition Proposal; or |
| (vii) | otherwise take any action that could reasonably be expected to lead to an Acquisition Proposal. |
| (c) | Westbrick and [name of party redacted] shall promptly (and in any event within 48 hours) notify
Purchaser of any Acquisition Proposal (or any amendment thereto) or any request for non-public information relating to Westbrick or [name
redacted] Holdco, the Business (excluding the Duvernay Business), or their assets in connection with an Acquisition Proposal, or any
amendments to the foregoing. Such notice shall include a copy of any written Acquisition Proposal (and any amendment thereto) which has
been received or, if no written Acquisition Proposal has been received, a description of the material terms and conditions of, and the
identity of the Person making, any inquiry, proposal, offer or request. Westbrick and [name of party redacted] shall keep Purchaser
promptly and fully informed of each change in the proposed consideration to be offered pursuant to such Acquisition Proposal and of each
material change in any of the terms of such Acquisition Proposal and shall provide to Purchaser copies of all correspondence with the
Person making such Acquisition Proposal, with respect to such Acquisition Proposal or proposal, inquiry, offer or request if in writing
or in electronic form, and if not in writing or in electronic form, a description of the terms of such correspondence. Purchaser agrees
with Westbrick that all information that may be provided to it by Westbrick with respect to any such acquisition shall be held confidential
in accordance with the terms of the Confidentiality Agreement and shall not be disclosed or used except in accordance with the provisions
of the Confidentiality Agreement or in order to enforce its rights under this Agreement in legal proceedings. |
| (a) | [Name of party redacted] covenants and agrees with Purchaser and Westbrick that, beginning on the
date hereof and for a period of one year from and after the Closing Date, [name of party redacted] shall not, and shall cause its
Affiliates to not, without prior written approval of the Purchaser, directly or indirectly, either individually or in partnership or jointly
or in conjunction with any Person hire or solicit any Westbrick Contractor or Westbrick Employee (other than any Management Personnel
or, following the Transition Period, the Transition Employees) that is a senior employee with whom [name of party redacted] first
had contact in connection with the matters contemplated hereunder or encourage any such employee to leave such employment or hire any
such employee who has left such employment (including any encouragement to transition his or her employment to support the Duvernay Business,
whether for Duvernay Spinco or otherwise). |
| (b) | Notwithstanding anything to the contrary in the foregoing, nothing in this Section 10.2 shall prevent
[name of party redacted] from soliciting or hiring any Westbrick Employee that: |
| (i) | responds to a general solicitation of employment through advertisement not targeted specifically at Westbrick
Employees, |
| (ii) | contacts [name of party redacted] on his or her own initiative (without any inducement or encouragement
from [name of party redacted]) for the purposes of obtaining employment with [name of party redacted]; or |
| (iii) | is referred to [name of party redacted] by search firms, recruiting firms, employment agencies
or other similar entities, provided that such entities have not been specifically instructed by [name of party redacted] to solicit
employees or consultants of the Westbrick Employees. |
| (c) | Each Party hereby agrees that, without in any way derogating from any other covenants provided by it,
all the restrictions in Section 10.2 (including the limitations of time, scope and geography) are reasonable and valid and all defences
to the strict enforcement thereof are hereby waived. Each Party agrees that the covenants set forth in Section 10.2 are drafted to and
are intended to comply with and be enforceable under Applicable Law. The Parties acknowledge and agree that if the scope of any of the
covenants in Section 10.2 is deemed to be too broad in any Court proceeding, the Court may reduce the scope as deemed reasonable under
the circumstances. Each Party acknowledges and agrees that this non-competition covenant is integral to this Agreement and is being granted
to maintain or preserve the fair market value of the Purchased Shares. |
| (d) | [Name of party redacted] acknowledges that any breach or threatened breach of this Section 10.2
may cause serious and irreparable damage and harm to Purchaser and that remedies under Applicable Law may be inadequate to protect against
breach or threatened breach of this Section 10.2. [Name of party redacted] accordingly agrees in advance to the granting of injunctive
relief in favour of Purchaser for any breach or threatened breach of this Section 10.2 and to the specific enforcement of its terms, without
proof of actual damages and without the requirement to post a bond or other security, in addition to any other remedy to which Purchaser
is entitled at law or in equity. |
Article 11
MISCELLANEOUS
Except in the case of Fraud, and assuming Closing
occurs, none of the representations, warranties, or pre-Closing covenants of Westbrick, [name of party redacted] or Purchaser in
this Agreement or certificate delivered at Closing pursuant to this Agreement (other than as set forth in the Letter of Transmittal and
Election Form) shall survive the Closing, and all rights, claims and causes of action (whether in contract or in tort or otherwise, or
whether at law or in equity) with respect thereto shall terminate at the Closing. Notwithstanding the foregoing, neither this Section
11.1 nor anything else in this Agreement to the contrary shall limit the survival of any covenant of the Parties which by its terms is
required to be performed or complied with in whole or in part after the Closing, which covenants shall survive the Closing in accordance
with their respective terms (including the terms of Sections 2.10(b), 2.10(c) or 2.10(d)). Purchaser, on behalf of itself and its Affiliates,
acknowledges and agrees that, except in the case of Fraud and assuming Closing occurs, neither [name of party redacted] nor Westbrick
shall have any responsibility for any Losses or Liabilities incurred by the Purchaser or any of its Affiliates, successors or assigns
for any inaccuracy or breach of any of [name of party redacted]’s or Westbrick’s representations, warranties, or pre-Closing
covenants contained in this Agreement. [name of party redacted] on behalf of itself and its Affiliates, acknowledges and agrees
that, except in the case of Fraud and assuming Closing occurs, Purchaser shall not have any responsibility for any Losses or Liabilities
incurred by [name of party redacted] or any of its Affiliates, successors or assigns for any inaccuracy or breach of any of Purchaser’s
representations, warranties, or pre-Closing covenants contained in this Agreement.
| 11.2 | No Other Representation or Warranties |
| (a) | Except for the representations and warranties contained in Section 2.1(b), Article 3 and Article 4,
the Duvernay Spinco Conveyance Agreement and in the Letter of Transmittal and Election Forms: |
| (i) | neither Westbrick (nor, upon the completion of the Amalgamation, Westbrick Amalco), [name of party
redacted], any of their Affiliates nor any of their respective Representatives has made or is making, and Purchaser has not relied
on, any other representation or warranty of any kind or nature whatsoever, oral or written, express or implied, in fact or by law, with
respect to Westbrick, Westbrick Amalco, [name of party redacted], [name redacted] Holdco, the Additional Shareholders, the
Purchased Shares, the Business, the Assets or otherwise in connection with this Agreement or the Transaction, including as to the accuracy
or completeness of any such information; |
| (ii) | no Person has been authorized by Westbrick (nor, upon the completion of the Amalgamation, Westbrick Amalco),
[name of party redacted], [name redacted] Holdco or the Additional Shareholders to make any representation or warranty relating
to Westbrick, Westbrick Amalco, [name of party redacted], [name redacted] Holdco, the Additional Shareholders, the Purchased
Shares, the Business, the Assets or otherwise in connection with this Agreement or the Transaction, including as to the accuracy or completeness
of any such information; |
| (iii) | each of Westbrick and [name of party redacted] disclaim, on behalf of themselves, their successors
and assigns and each of their respective Affiliates, all liability and responsibility for any other representation, warranty, opinion,
projection, forecast, advice, statement or information made, communicated or furnished (orally or in writing) to Purchaser or its Affiliates,
including any materials or information made available in the Data Room or in connection with presentations by Westbrick’s management;
and |
| (iv) | none of Westbrick (nor, upon the completion of the Amalgamation, Westbrick Amalco), [name of party
redacted], their respective Affiliates or any of their respective Representatives has made or is making, and Purchaser has not relied
on, any representations or warranties, direct or indirect, express or implied, in fact or by law, to Purchaser or any other Person regarding
the probable success or profitability of the business or operations of Westbrick or Westbrick Amalco (whether before or after the Closing),
including regarding the possibility or likelihood of any action, application, challenge, claim, proceeding or review, regulatory or otherwise,
including, in each case, in respect of the future occurrence of any environmental condition, Release or hazard, or any mechanical or technical
issue, problem, or failure, or of any interruption in service, or of any increase, decrease or plateau in the quantity, quality or recoverability
of Petroleum Substances, or revenue derived therefrom, or of the possibility, likelihood or potential outcome of any complaints, controversies
or disputes with respect to existing or future customers or suppliers. |
| (b) | Purchaser shall not be permitted to terminate this Agreement nor claim that the condition in Section 7.2(a)
has not been met based upon or arising out of any inaccuracy in or breach of any of the representations or warranties by the Company or
[name of party redacted] set out in this Agreement if Purchaser had knowledge of such inaccuracy or breach as of the date of this
Agreement. |
All notices, requests, consents, claims, demands,
waivers and other communications hereunder shall be in writing and shall be deemed to have been given (a) when delivered by hand (with
written confirmation of receipt), (b) when received by the addressee if sent by a nationally recognized overnight courier (return receipt
requested) or (c) on the date sent by email if sent during normal business hours of the recipient or on the next Business Day if sent
after normal business hours of the recipient. Such communications must be sent to Westbrick, [name of party redacted] and Purchaser,
respectively, at the following addresses or e-mail addresses (or at such other address or e-mail address for such Party as shall be specified
for such purpose in a notice given in accordance with this Section 11.3):
If to the Company
Westbrick Energy
Ltd.
520 3 Ave SW #2300
Calgary, AB T2P 0R3
Email: [email redacted]
Attention: Ken McCagherty
With a copy (which shall not constitute
notice) to:
Osler, Hoskin & Harcourt LLP
Suite 2700, 225 6 Ave SW
Calgary, AB T2P 1N2
Email: [email redacted]
Attn: Craig Spurn
If to [name of party redacted]:
[Name of party redacted]
[Address of party redacted]
Email: [email
redacted]
Attn: Management Board
With copies (which shall not constitute
notice) to:
Bennett Jones LLP
4500 Bankers Hall East
855 2nd Street SW
Calgary, Alberta
T2P 4K7
Email: [email redacted]
[email redacted]
Attn: John Mercury/Kristos Iatridis
and
Simpson Thacher & Bartlett LLP
600 Travis Street, Suite 5400
Houston, TX 77002
Email: [email
redacted] / [email redacted]
Attn: Breen Haire / Shamus Crosby
If to Purchaser:
Vermilion Energy Inc.
3500 - 520 3rd Avenue SW
Calgary, AB
T2P 0R3
Email: Tamar Epstein
Attn: [email redacted]
With a copy (which shall not constitute
notice) to:
Dentons Canada LLP
1500 - 850 2nd Street SW
Calgary, AB
T2P 0R8
Email: [email redacted]
Attn: George Antonopoulos
Any matter, information or item disclosed in
the Disclosure Schedules delivered under any specific representations, warranty or covenant or Disclosure Schedule number hereof, shall
be deemed to have been disclosed for all purposes of this Agreement or any other Transaction Document in response to every other representation,
warranty or covenant in this Agreement and the other Transaction Documents, as applicable, notwithstanding any cross-references (which
are included solely as a matter of convenience) or lack of a Disclosure Schedule reference in any representation, warranty or covenant,
provided that the foregoing deemed disclosure shall not apply where reference is made in the Disclosure Schedule to a specific folder
in the Data Room. To the extent a reference to a folder in the Data Room is intended to qualify or disclose matters specific to a representation,
warranty or covenant in this Agreement such reference shall be limited only to such representation, warranty or covenant where it is referenced
and shall not be deemed to have been a qualification or disclosure for any other representation, warranty or covenant unless specifically
referenced therein. Information reflected in the Disclosure Schedules is not necessarily limited to matters required by this Agreement
to be reflected in the Disclosure Schedules. Such additional information is set forth for informational purposes and does not necessarily
include other matters of a similar nature. Disclosure of such additional information will not be deemed to constitute an acknowledgment
that such information is required to be disclosed, and disclosure of such information will not be deemed to enlarge, enhance or broaden
any of the representations, warranties or covenants in this Agreement or any other Transaction Document or otherwise alter in any way
the terms of this Agreement or any other Transaction Document. The inclusion of any matter, information or item in the Disclosure Schedules
relating to any possible breach of any Contracts, Licences or Applicable Laws shall not be construed as an admission or indication that
such breach or violation exists or has actually occurred, and nothing in the Disclosure Schedules shall be deemed to constitute an admission
of any liability or obligation by Westbrick, [Name of party redacted] or Purchaser to any Third Party or shall confer or give to
any Third Party any remedy, claim, liability, reimbursement, cause of action or other right. Further, the inclusion of any matter, information
or item in the Disclosure Schedules shall not imply that any such matter, information or item is material or creates any standard of materiality
(including any Material Adverse Effect on Company or Material Adverse Effect on Purchaser, as applicable) for the purposes of this Agreement
or any other Transaction Document or a standard for what is or is not business in the ordinary course consistent with past practice. The
Disclosure hereto are hereby incorporated into this Agreement and hereby made a part hereof as if set out in full in this Agreement.
Any provision of this Agreement may be amended
or waived if, and only if, such amendment or waiver is in writing and signed, in the case of an amendment, by each Party, or in the case
of a waiver, by the Party against whom the waiver is to be effective. No failure or delay by any Party in exercising any right, power
or privilege hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further
exercise thereof or the exercise of any other right, power or privilege. The rights and remedies herein provided shall be cumulative and
not exclusive of any rights or remedies provided by Applicable Laws.
| 11.6 | Binding Effect; Assignment |
This Agreement and all of the provisions hereof
shall be binding upon and inure to the benefit of the Parties and their respective successors and permitted assigns. None of the Parties
may assign any of its rights or delegate any of its obligations under this Agreement (for the avoidance of doubt, no merger or sale of
securities of Purchaser or [name of party redacted] or any Person that directly or indirectly controls any of Purchaser or [name
of party redacted] shall constitute an assignment hereunder) without the prior written consent of the other Parties which may be withheld
in such Party’s sole and absolute discretion, and any attempted or purported assignment in violation of this Section 11.6 shall
be null and void.
| 11.7 | Third Party Beneficiaries |
Subject to the provisions of Sections 6.7,
6.10(f), 9.4, 9.5 and 11.10(c), this Agreement is solely for the benefit of (a) Westbrick and [name of party redacted] and their
successors and permitted assigns with respect to the obligations of Purchaser under this Agreement; and (b) Purchaser and its successors
and permitted assigns with respect to the obligations of Westbrick and [name of party redacted] under this Agreement, and this
Agreement shall not be deemed to confer upon or give to any other Third Party any remedy, claim, liability, reimbursement, cause of action
or other right. Except as set forth in the immediately preceding sentence, nothing in this Agreement, express or implied, is intended
to confer upon any Person other than the Parties and their respective successors and permitted assigns, any rights or remedies under or
by reason of this Agreement. Notwithstanding anything to the contrary contained in this Agreement, but excepting in all cases in the case
of Fraud, no Person other than [name of party redacted] shall have any obligation for any of [name of party redacted]’s
obligations hereunder and no recourse therefor shall be had against any former, current or future director, officer, agent, Affiliate,
manager, assignee, incorporator, controlling person or entity, fiduciary, representative or employee of [name of party redacted]
(or any of its successors or assignees) or of any Affiliate thereof or against any former, current or future director, officer, agent,
employee, Affiliate, manager, assignee, incorporator, controlling person, fiduciary, representative, general or limited partner, stockholder,
manager or member of any of the foregoing, but in each case not including [name of party redacted] (collectively, but excluding,
for the avoidance of doubt, [name of party redacted], “Non-Recourse Parties”), whether by or through attempted
piercing of the corporate veil, by or through a claim (whether in tort, contract or otherwise) by or on behalf of such party against [name
of party redacted], by the enforcement of any assessment or by any legal or equitable proceeding, or by virtue of any statute, regulation
or other applicable law, or otherwise; it being expressly agreed and acknowledged that no personal liability whatsoever shall attach to,
be imposed on, or otherwise be incurred by any Non-Recourse Party (except in the case of Fraud), as such, for any obligations of [name
of party redacted] under this Agreement or the transactions contemplated hereby or thereby, under any documents or instruments delivered
contemporaneously herewith, in respect of any oral representations made or alleged to be made in connection herewith or therewith, or
for any claim (whether in tort, contract or otherwise) based on, in respect of, or by reason of, such obligations or their creation.
This Agreement (including all Schedules and
Exhibits) contains the entire agreement between Westbrick, [name of party redacted] and Purchaser with respect to the subject matter
hereof and thereof and supersede all prior agreements and understandings, oral or written, with respect to such matters, except for the
Confidentiality Agreement.
| 11.9 | Fulfillment of Obligations |
Any obligation of any Party to any other Party
under this Agreement that is performed, satisfied or fulfilled completely by an Affiliate of such Party shall be deemed to have been performed,
satisfied or fulfilled by such Party. Each party to this Agreement shall, and shall cause its Affiliates to, perform all actions, agreements
and obligations set forth herein required to carry out the provisions of this Agreement and give effect to the transactions contemplated
hereby.
| 11.10 | Specific Performance and Remedies |
| (a) | The Parties hereto agree that irreparable damage would occur in the event that any of the covenants or
agreements set forth herein were not performed by them in accordance with the terms hereof or were otherwise breached and that money damages,
even if applicable, would not be an adequate remedy for such failure to perform or breach of this Agreement. Accordingly, Purchaser, on
the one hand, and the Company and [name of party redacted], on the other hand, hereby agree that the Parties shall be entitled
to specifically enforce the terms and provisions of this Agreement to prevent breaches or threatened breaches of, or to enforce compliance
with, the covenants and obligations of the other under this Agreement without proof of actual damages. Without limiting the generality
of the foregoing, the Parties hereby further agree that prior to the Closing, the Company and [name of party redacted] shall be
entitled to specific performance to enforce specifically the terms and provisions of, and to prevent or cure breaches of the covenants
required to be performed by Purchaser under this Agreement (including Sections 6.6 and 6.10 and Article 2) in addition to any other
remedy to which the Company or [name of party redacted] are entitled at law or in equity, including [name of party redacted]’s
and the Company’s right to terminate this Agreement pursuant to Article 8. Each of the Parties hereto further agrees that the
existence of any other remedy contemplated by this Agreement does not diminish the availability of specific performance of the obligations
hereunder or any other injunctive relief. |
| (b) | Each Party agrees that it will not oppose (and hereby waives any defense in any action for) the granting
of an injunction, specific performance and other equitable relief as provided herein on the basis that (i) the other Parties have an adequate
remedy at law or (ii) an award of specific performance or other equitable remedy is not an appropriate remedy for any reason at law, equity
or otherwise. Any Party seeking an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms
and provisions of this Agreement when available pursuant to the terms of this Agreement shall not be required to provide any bond or other
security in connection with any such order or injunction. |
| (c) | If the Company or [name of party redacted] bring an action for specific performance pursuant to
this Section 11.10, and a court rules that Purchaser breached this Agreement in connection with its failure to effect the Closing in accordance
with this Agreement, but such court declines to enforce specifically the obligations of Purchaser to effect the Closing in accordance
with this Agreement, then, in addition to the right of [name of party redacted] and the Company to terminate this Agreement pursuant
to Section 8.2, the Company, [name of party redacted] and any Additional Shareholders shall be entitled to pursue all applicable
remedies at law, including seeking punitive, incidental, consequential, expectation, special or indirect damages, including for loss of
economic benefit, loss of opportunity and time value of money. |
| (d) | If Purchaser brings an action for specific performance pursuant to this Section 11.10, and a court rules
that the Company or [name of party redacted] breached this Agreement in connection with its failure to effect the Closing in accordance
with this Agreement, but such court declines to enforce specifically the obligations of the Company or [name of party redacted]
to effect the Closing in accordance with this Agreement, then, in addition to the right of Purchaser to terminate this Agreement pursuant
to Section 8.2, Purchaser shall be entitled to pursue all applicable remedies at law, including seeking punitive, incidental, consequential,
expectation, special or indirect damages, including for loss of economic benefit, loss of opportunity and time value of money. |
Except as otherwise expressly provided in this
Agreement, whether or not the Transaction is consummated, all costs and expenses incurred in connection with this Agreement and the Transaction
shall be borne by the Party hereto incurring such costs and expenses.
| 11.12 | Governing Law; Submission to Jurisdiction; Selection of Forum. |
| (a) | This Agreement and the legal relations between the Parties shall be governed by and construed in accordance
with the laws of the Province of Alberta and the laws of Canada applicable therein. |
| (b) | The Parties hereby irrevocably and unconditionally submits, for itself and its property, to the exclusive
jurisdiction of the courts of Alberta and appropriate appellate courts therefrom for the resolution of any dispute, controversy or claim
arising out of or relating to this Agreement, and each Party hereby irrevocably agrees that all claims in respect of such dispute, controversy
or claim may be heard and determined in such courts. The Parties hereby irrevocably waive, to the fullest extent permitted by Applicable
Law, any objection that they may now or hereafter have to the laying of venue of any such dispute, controversy or claim brought in any
such court or any defence of inconvenient forum for the maintenance of such dispute, controversy or claim. Each Party agrees that a judgment
in any such dispute may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by Applicable Law. |
| 11.13 | Resolution of Disputes |
All disputes between the Parties arising in
relation to this Agreement (including disputes over the interpretation or enforceability of any provision of this Agreement) shall be
resolved through negotiation of the Parties, in good faith. If after thirty (30) days of attempting to resolve the dispute through negotiation
the Parties are unable to resolve the dispute, any Party may refer the matter to the Court of King’s Bench in the Province of Alberta,
Canada, for resolution.
Each of the Parties shall execute and deliver,
or shall cause to be executed and delivered, such documents and other instruments and shall take, or shall cause to be taken, such further
actions as may be reasonably required to carry out the provisions of this Agreement and give effect to the Transaction.
| 11.15 | Excluded Privileged Communications |
| (a) | Effective upon Closing, each of the Company and the Purchaser hereby irrevocably assign to [name of
party redacted], all rights and interest to solicitor-client communications (regardless of whether marked or labelled as such) by
or among the Company, [name of party redacted] and counsel to the Company and [name of party redacted] in respect of, in
connection with or related to, this Agreement or the Transaction, including all documentation, records and copies thereof (the “Privileged
Communications”). The Purchaser agrees to cause the Company to take commercially reasonable efforts in order for the Privileged
Communications to be assigned by the Company as aforesaid. For greater clarity and the avoidance of doubt, the Parties hereby confirm
and agree that Privileged Communications shall not include any such communications in respect of, in connection with, or related to the
conduct of the Business by the Company prior to or following the Closing Date that do not include communications in respect of, in connection
with or related to this Agreement or the Transaction. |
| (b) | The Parties hereby confirm and agree that, upon the Closing, all Privileged Communications will be subject
to, and protected by, a solicitor-client privilege of [name of party redacted] and [name of party redacted] alone, and that
[name of party redacted] will maintain the sole and exclusive rights over such privilege. Without limitation, upon Closing: (i)
all Privileged Communications, and all solicitor-client privilege therein, will remain the property of [name of party redacted]
and [name of party redacted] alone; and (ii) the Purchaser, the Company and any of their respective Affiliates will be deemed to
have irrevocably waived any and all rights to such Privileged Communications or any solicitor-client privilege therein. The Parties hereby
further agree that disclosure of any Privileged Communications to, or knowledge (whether actual or constructive) of any Privileged Communications
by, any shareholder, director, officer, employee or agent of the Company or the Purchaser following Closing will be presumed to be inadvertent
and will in no way be taken by any of the Parties as any waiver of solicitor-client privilege by [name of party redacted] or as
evidence in support of any joint retainer by [name of party redacted] and the Company with counsel. |
| (c) | Notwithstanding anything to the contrary herein, in the event that a dispute arises between the Purchaser,
the Company or their Affiliates, on the one hand, and a third party other than a Party, on the other hand, after the Closing, [name
of party redacted] may assert the solicitor-client privilege on behalf of the Company to prevent disclosure of Privileged Communications
to such third party. |
This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, and all of which shall constitute one and the same agreement. A signed copy of
this Agreement delivered by e-mail or other means of electronic transmission (including DocuSign) shall be deemed to have the same legal
effect as delivery of an original signed copy of this Agreement.
Time shall be of the essence in this Agreement.
The provisions of this Agreement shall be deemed
severable and the invalidity or unenforceability of any provision shall not affect the validity or enforceability of the other provisions
hereof. If any provision of this Agreement, or the application thereof to any Person or any circumstance, is invalid or unenforceable,
(a) a suitable and equitable provision shall be substituted therefor in order to carry out, so far as may be valid and enforceable, the
intent and purpose of such invalid or unenforceable provision and (b) the remainder of this Agreement and the application of such provision
to other Persons or circumstances shall not be affected by such invalidity or unenforceability, nor shall such invalidity or unenforceability
affect the validity or enforceability of such provision, or the application thereof, in any other jurisdiction.
[Remainder of Page Intentionally Left
Blank]
IN WITNESS WHEREOF, this Arrangement Agreement
has been duly executed by each Party set forth below as of the date first written above.
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WESTBRICK ENERGY LTD. |
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By: |
(signed) “Ken McCagherty” |
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Name: Ken McCagherty
Title: President and Chief
Executive Officer |
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[Name of party redacted] |
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By: |
(signed) “Paul Workman” |
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Name: Paul Workman
Title: Director A |
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By: |
(signed) “Marjolein Gorissen” |
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Name: Marjolein Gorissen
Title: Director B |
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VERMILION ENERGY INC. |
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By: |
(signed) “Dion Hatcher” |
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Name: Dion Hatcher
Title: President and Chief
Executive Officer |
SCHEDULE “A”
PLAN OF ARRANGEMENT
PLAN OF ARRANGEMENT
UNDER SECTION 193 OF THE
BUSINESS CORPORATIONS ACT (ALBERTA)
Article 1
INTERPRETATION
| 1.1 | In this Plan of Arrangement, the following terms have the following meanings: |
| (a) | “ABCA” means the Business Corporations Act (Alberta); |
| (b) | “Adjusted Fully-Diluted Shares” means the aggregate number of Westbrick Shares equal
to the sum of: |
| (i) | the number of issued and outstanding Westbrick Shares immediately prior to the Effective Time; and |
| (ii) | the number of Westbrick Shares issuable to the holders of In-the-Money Options immediately prior to the
Effective Time assuming exercise on a cashless basis; which shall be deemed in respect of each In-the-Money-Option to be equal to a fraction
of the number of Westbrick Shares stated to be issuable to the holder under such In-the-Money Option where the numerator is the In-the-Money
Amount applicable thereto and the denominator is the Consideration Per Share; |
| (iii) | the aggregate number of Westbrick RSUs and Westbrick DSUs outstanding immediately prior to the Effective
Time; |
provided, however, that in respect
of any In-the-Money Options which are exercised by the Optionholder paying the applicable exercise price in cash pursuant to an Option
Exercise and Surrender Agreement that has been duly completed, executed and returned to Westbrick prior to the Election Deadline, then
the full number of Westbrick Amalco Shares for which In-the-Money Options are exercised will be included in clause (ii) above;
| (c) | “Aggregate Adjusted Consideration” has the meaning set forth in the Arrangement Agreement; |
| (d) | “Aggregate Shares Elected” means the aggregate number of Purchaser Shares that would
be issuable to holders of Westbrick Amalco Shares based on elections to receive the Share Consideration and the Combined Consideration
made pursuant to subsection 3.1(m), before giving effect to the proration provision of subsection 3.1(n); |
| (e) | “Arrangement” means the arrangement under section 193 of the ABCA as set out in this
Plan of Arrangement, as the same may be amended in accordance with Article 7 of this Plan of Arrangement or at the direction of the
Court in the Interim Order or the Final Order with the consent of Westbrick, [name of party redacted] and the Purchaser, each acting
reasonably; |
| (f) | “Arrangement Agreement” means the arrangement agreement dated as of December 22, 2024
among Westbrick, [name of party redacted] and the Purchaser (including the schedules thereto), as such agreement may be amended,
modified or supplemented from time to time in accordance with its terms providing for, among other things, the Arrangement; |
| (g) | “Articles of Arrangement” means the articles of arrangement in respect of the Arrangement
required under subsection 193(4.1) of the ABCA to be filed with the Registrar after the Final Order has been made to give effect to the
Arrangement; |
| (h) | “Business Day” means any day other than a Saturday, a Sunday or a statutory holiday
on which banks in Calgary, Alberta and New York, New York are generally open for commercial banking business during normal banking hours; |
| (i) | “Cash Consideration” means consideration in the form of cash to be paid on the election
or deemed election of a Westbrick Amalco Shareholder pursuant to the Arrangement; |
| (j) | “Cash Electing Shareholder” means a Westbrick Amalco Shareholder who has elected or
deemed to have elected to only receive Cash Consideration pursuant to the Arrangement; |
| (k) | “Certificate” means the certificate or certificates or other confirmation of filing
to be issued by the Registrar pursuant to subsection 193(11) of the ABCA giving effect to the Arrangement; |
| (l) | “Combination Electing Shareholder” means a Westbrick Amalco Shareholder who has elected
Combined Consideration pursuant to the Arrangement; |
| (m) | “Combined Consideration” means the consideration in the form of Cash Consideration
and Share Consideration to be received on the election of a Westbrick Amalco Shareholder pursuant to the Arrangement; |
| (n) | “Consideration per Share” means the quotient of: (a) the Aggregate Adjusted Consideration
divided by (b) the Adjusted Fully-Diluted Shares; |
| (o) | “Court” means the Court of King’s Bench of Alberta; |
| (p) | “Depositary” means Odyssey Trust Company or such other trust company as may be designated
by Purchaser, [name of party redacted] and Westbrick; |
| (q) | “Dissent Rights” means the right of a registered Westbrick Shareholder to dissent to
the Arrangement Resolution and to be paid the fair value of the Westbrick Shares in respect of which the holder dissents, all in accordance
with section 191 of the ABCA, the Interim Order and Article 5; |
| (r) | “Dissenting Shareholders” means the registered Westbrick Shareholders that validly
exercise Dissent Rights in strict compliance section 191 of the ABCA, as modified by the Interim Order and Article 5, and have not
withdrawn, or been deemed to have withdrawn, such exercise of Dissent Rights immediately prior to the Effective Time and, and “Dissenting
Shareholder” means any one of them; |
| (s) | “Duvernay Alternative Transaction” has the meaning set forth in the Arrangement Agreement; |
| (t) | “Duvernay Assets” has the meaning ascribed to it in the Duvernay Spinco Conveyance
Agreement; |
| (u) | “Duvernay Assumed Liabilities” means the Assumed Liabilities as defined in the Duvernay
Spinco Conveyance Agreement; |
| (v) | “Duvernay Conveyance” means the transactions contemplated by the Duvernay Spinco Conveyance
Agreement; |
| (w) | “Duvernay Deposit” means the deposit paid to Westbrick pursuant to the Duvernay Share
Purchase Agreement, if any; |
| (x) | “Duvernay Net Proceeds” means the total amount of cash consideration under the Duvernay
Share Purchase Agreement received by Westbrick, including for greater certainty, the full amount of the Duvernay Deposit; |
| (y) | “Duvernay Share Purchase Agreement” has the meaning set forth in the Arrangement Agreement; |
| (z) | “Duvernay Spinco” means TMax Energy Ltd., a corporation existing under the ABCA; |
| (aa) | “Duvernay Spinco Conveyance Agreement” has the meaning set forth in the Arrangement
Agreement; |
| (bb) | “Duvernay Spinco Shares” means the common shares of Duvernay Spinco; |
| (cc) | “Duvernay Spinco Shares Value” means an amount determined by an independent valuator
acceptable to Westbrick, Purchaser and [name of party redacted], each acting reasonably, as the fair value of the Duvernay Spinco
Shares, or such other amount as agreed to by Westbrick, Purchaser and [name of party redacted]; |
| (dd) | “Duvernay Spin-Out Event” has the meaning set forth in the Arrangement Agreement; |
| (ee) | “Effective Date” means the date the Arrangement is effective under the ABCA; |
| (ff) | “Effective Time” means 12:01 a.m. on the Effective Date or such other time as Purchaser
and Westbrick may agree upon in writing; |
| (gg) | “Election Deadline” means 4:30 p.m. (Calgary time) on the date specified on the Notice
of Written Resolution (as defined in the Arrangement Agreement) which date shall not be later than the second Business Day prior to the
date the Final Order is issued; |
| (hh) | “Entitlement Schedule” means a spreadsheet prepared by the Company in consultation
with [name of party redacted] and acceptable to the Purchaser, acting reasonably, setting forth the Adjusted Fully-Diluted Shares
and the entitlement of each former Westbrick Amalco Shareholder, holder of Westbrick Amalco Options, holders of Westbrick RSUs and Westbrick
DSUs for any amounts payable to such persons under Section 3.5 or 3.6; |
| (ii) | “Final Order” means the final order of the Court approving the Arrangement pursuant
to section 193(4) of the ABCA, as such order may be amended, modified, supplemented or varied by the Court (with the consent of each of
the Purchaser, [name of party redacted] and the Company, acting reasonably) at any time prior to the Effective Date or, if appealed,
then unless such appeal is withdrawn or denied, as affirmed or as amended (provided that such amendment is satisfactory to each of the
Purchaser, [name of party redacted] and the Company, acting reasonably) on appeal; |
| (jj) | “Fully-Diluted Shares” means the number of Westbrick Shares equal to sum of: |
| (i) | the number of issued and outstanding Westbrick Shares immediately prior to the Effective Time; |
| (ii) | plus the number of issued and outstanding Westbrick Options exercisable immediately prior to the
Effective Time; |
| (iii) | plus the number of outstanding Westbrick RSUs and Westbrick DSUs immediately prior to the Effective
Time, as set forth on the Entitlement Schedule; |
| (kk) | “Governmental Authority” means any: |
| (i) | federal, provincial, municipal, state or local governmental body (whether administrative, legislative,
executive or otherwise), both domestic and foreign; |
| (ii) | agency, authority, commission, instrumentality, regulatory body, court, central bank or other entity exercising
executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government; |
| (iii) | court, arbitrator, commission or body exercising judicial, quasi-judicial, administrative or similar functions;
or |
| (iv) | other body or entity created under the authority of or otherwise subject to the jurisdiction of any of
the foregoing, including any stock or other securities exchange, in each case having, purporting to have, exercising, or entitled to exercise,
jurisdiction over such Person, transaction or event; |
| (ll) | “Holdco Shares” means all of the issued and outstanding shares in the capital of [name
redacted] Holdco; |
| (mm) | “In-the-Money Amount” means, with respect to an In-the-Money Option, the Consideration
per Share less the exercise price of such In-the-Money Option; |
| (nn) | “In-the-Money Option” means any Westbrick Option or Westbrick Amalco Option, as the
context requires that is not an Out-of-the-Money Option; |
| (oo) | “Interim Order” means the interim order of the Court pursuant to section 193(4) of
the ABCA containing declarations and directions with respect to the Arrangement, as such order may be amended, modified, supplemented
or varied by the Court (with the consent of each of the Purchaser, [name of party redacted] and the Company, acting reasonably)
at any time prior to the Effective Date or, if appealed, then unless such appeal is withdrawn or denied, as affirmed or as amended (provided
that such amendment is satisfactory to each of the Purchaser, [name of party redacted] and the Company, acting reasonably) on appeal; |
| (pp) | “Insurance Claim” means the business interruption claim made by Westbrick as set forth
on the Disclosure Schedules (as defined in the Arrangement Agreement); |
| (qq) | “Insurance Entitlement Calculation” means, in the case where (i) the Insurance Claim
is settled prior to the Effective Time, [percentage redacted] of the Insurance Recovery Amount; or (ii) the Insurance Claim is
settled following the Effective Time, [percentage redacted] of the Insurance Recovery Amount. |
| (rr) | “Insurance Recovery Amount” means [percentage redacted] of any amounts recovered
by Westbrick in respect of the Insurance Claim; |
| (ss) | “[Name redacted] Holdco” means [name redacted], an unlimited liability
corporation existing under the laws of the Province of Alberta; |
| (tt) | “[Name redacted] Holdco Note” has the meaning set forth in Section 3.1(f)(ii); |
| (uu) | “[Name redacted] Holdco Return of Capital Amount” has the meaning set forth
in Section 3.1(f)(ii); |
| (vv) | “[Name of party redacted]” means [name of party redacted], a private company
with limited liability existing under the laws of the Netherlands; |
| (ww) | “Letter of Transmittal and Election Form” has the meaning set forth in the Arrangement
Agreement; |
| (xx) | “Option Agreements” means, collectively, the option agreements entered into by each
of the Optionholders and Westbrick in connection with the grant of Westbrick Options, and each such agreement is an “Option Agreement”; |
| (yy) | “Option Payout Amount” means: |
| (i) | for each In-the-Money Option outstanding immediately prior to the Effective Time, the amount equal to
the product of (a) the In-the-Money Amount (as may be adjusted as set forth in Section 3.1(i)(xii)); and (b) the aggregate number of Westbrick
Amalco Shares subject to such Westbrick Amalco Option, which amount will be set forth in the Entitlement Schedule; and |
| (ii) | for each Out-of-the-Money Option outstanding immediately prior to the Effective Time, nil; |
| (zz) | “Option Exercise and Surrender Agreements” means option exercise and surrender agreements
in form to be agreed to by the Parties, each acting reasonably, executed and delivered by Optionholders whereby each Optionholder elects,
with respect to all of its Westbrick Amalco Options to: |
| (i) | exercise the Westbrick Amalco Options by paying the applicable cash exercise price in full; |
| (ii) | exercise each Westbrick Amalco Option on a cashless basis in exchange for a number of Westbrick Amalco
Shares equal to the In-the-Money Amount divided by the Consideration per Share, rounded down to the nearest whole Westbrick Amalco Share;
or |
| (iii) | surrender to Westbrick Amalco for cancellation
in consideration for a cash payment equal to the Option Payout Amount, in each case, less applicable statutory deductions and withholdings;
|
| (aaa) | “Optionholders” means holders of Westbrick Options or Westbrick Amalco Options, as
the context requires, and “Optionholder” means any one of them; |
| (bbb) | “Out-of-the-Money Option” means any Westbrick Option or Westbrick Amalco Option, as
the context requires, which has an exercise price equal to or greater than a dollar value per share determined by dividing (a) Aggregate
Adjusted Consideration (assuming solely for this purpose that the Option Exercise Proceeds equal an amount based on an exercise of all
Westbrick Options or Westbrick Amalco Options, as the context requires) by (b) the Fully-Diluted Shares; |
| (ccc) | “Parties” and “Party” have the meanings ascribed thereto in the
Arrangement Agreement; |
| (ddd) | “Person” means an individual, a corporation, a general or limited partnership, an association,
a joint stock company, limited liability company or other company, a Governmental Authority, a trust or other entity or organization,
whether or not a legal entity; |
| (eee) | “Plan of Arrangement”, “herein”, “hereof”, “hereto”,
“hereunder” and similar expressions mean and refer to this plan of arrangement under the ABCA, all on the terms and
conditions described herein, as it may be amended or supplemented from time to time in accordance with the terms hereof; |
| (fff) | “Purchaser” means Vermilion Energy Inc., a corporation existing under the ABCA; |
| (ggg) | “Purchaser Amalco” means the corporation resulting from the amalgamation of Purchaser
and Westbrick Amalco pursuant to subsection 3.1(p); |
| (hhh) | “Purchaser Shares” means common shares in the capital of the Purchaser; |
| (iii) | “Purchaser Share Price” means volume weighted trading price of the Purchaser Shares
on the Toronto Stock Exchange during the period of five business days ending on December 20, 2024, being $12.831; |
| (jjj) | “Registrar” means the Registrar of Corporations or a Deputy Registrar of Corporations
appointed under Section 263 of the ABCA; |
| (kkk) | “Share Consideration” means the consideration in the form of Purchaser Shares to be
received by a Westbrick Shareholder who has elected to receive consideration in such form (in whole or in part) pursuant to the Arrangement; |
| (lll) | “Share Consideration per Share” means a number of Purchaser Shares equal to the quotient
of the Consideration per Share divided by the Purchaser Share Price; |
| (mmm) | “Share Electing Shareholder” means a Westbrick Shareholder (other than [name redacted])
who has elected to only receive the Share Consideration pursuant to the Arrangement; |
| (nnn) | “Share Maximum” means the lesser of: (i) 1,700,000 Purchaser Shares; and (ii) such
number of Purchaser Shares equal to: (A) $25,000,000; divided by (B) the Purchaser Share Price; in each case subject to rounding to account
for fractional shares in accordance with Section 4.6; |
| (ooo) | “Share Proration Factor” means the result obtained by dividing the Share Maximum by
the Aggregate Shares Elected; |
| (ppp) | “Shareholder Agreement” means the Amended and Restated Unanimous Shareholder Agreement
among Westbrick, the Westbrick Shareholders and [name of party redacted] dated February 11, 2020, as amended; |
| (qqq) | “Tax Act” means the Income Tax Act (Canada), R.S.C. 1985, c. 1 (5th
Supp.); |
| (rrr) | “Westbrick” or the “Company” means Westbrick Energy Ltd., a corporation
existing pursuant to the ABCA; |
| (sss) | “Westbrick Amalco” means the corporation resulting from the amalgamation of Westbrick
and [name redacted] Holdco pursuant to subsection 3.1(i); |
| (ttt) | “Westbick Amalco Options” has the meaning set forth in Section 3.1(i)(xii); |
| (uuu) | “Westbrick Amalco Shares” means the common shares in the capital of Westbrick Amalco; |
| (vvv) | “Westbrick DSUs” means the Westbrick deferred share units granted pursuant to the Westbrick
Omnibus Plan; |
| (www) | “Westbrick Omnibus Plan” means the omnibus long-term equity incentive plan of Westbrick
made effective as of September 4, 2024; |
| (xxx) | “Westbrick Option Plan” means the share option plan of Westbrick made effective as
of December 16, 2019, as amended on April 26, 2023; |
| (yyy) | “Westbrick Options” means the rights to purchase Westbrick common shares granted to
the Optionholders in accordance with the Westbrick Option Plan on the terms and subject to the conditions set forth in the Westbrick Option
Plan and in each Optionholder’s Option Agreement; |
| (zzz) | “Westbrick RSUs” means the Westbrick restricted share units granted pursuant to the
Westbrick Omnibus Plan; |
| (aaaa) | “Westbrick Shareholders” means the holders of Westbrick Shares and Westbrick Amalco
Shares, as the context requires; |
| (bbbb) | “Westbrick Shares” means the common shares in the capital of Westbrick; and |
| (cccc) | “Written Resolution” means a written resolution substantially in the form set forth
in Schedule “B” to the Arrangement Agreement. |
| 1.2 | Capitalized terms which are not defined herein shall have the meaning ascribed thereto in the Arrangement
Agreement unless the context otherwise requires. |
| 1.3 | The division of this Plan of Arrangement into articles and sections and the insertion of headings are
for convenience of reference only and shall not affect the construction or interpretation of this Plan of Arrangement. |
| 1.4 | Unless reference is specifically made to some other document or instrument, all references herein to articles,
sections, subsections, paragraphs and subparagraphs are to articles, sections, subsections, paragraphs and subparagraphs of this Plan
of Arrangement. |
| 1.5 | Unless the context otherwise requires, words importing the singular number shall include the plural and
vice versa; words importing any gender shall include all genders. |
| 1.6 | In the event that the date on which any action is required to be taken hereunder by any of the Parties
is not a Business Day in the place where the action is required to be taken, such action shall be required to be taken on the next succeeding
day which is a Business Day in such place. |
| 1.7 | References in this Plan of Arrangement to any statute or sections thereof shall include such statute as
amended or substituted and any regulations promulgated thereunder from time to time in effect. |
| 1.8 | Unless otherwise specified, all references to “dollars” or “$” shall mean Canadian
dollars. |
Article 2
ARRANGEMENT AGREEMENT
| 2.1 | This Plan of Arrangement is made pursuant and subject to the provisions of the Arrangement Agreement.
If there is any inconsistency or conflict between the provisions of this Plan of Arrangement and the provisions of the Arrangement Agreement,
the provisions of this Plan of Arrangement shall govern. |
| 2.2 | The Arrangement, upon the filing of the Articles of Arrangement and the issuance of the Certificate, will
become effective at, and be binding on and after, the Effective Time on: (i) the Westbrick Shareholders (including Dissenting Shareholders);
(ii) [name redacted] Holdco; (iii) [name of party redacted]; (iv) Westbrick; (v) Purchaser; (vi) Westbrick Amalco; (vii)
Duvernay Spinco; (viii) the Optionholders and the holders of Westbrick RSUs and Westbrick DSUs and any other incentive or convertible
securities of Westbrick or Westbrick Amalco; and (ix) all other Persons, without any further act or formality required on the part of
any Person except as expressly provided herein. No portion of this Plan of Arrangement will take effect with respect to any Person until
the Effective Time. If a step or transaction set forth in Section 3.1 is specified to occur upon or subject to the occurrence of a specified
event or action, and such specified event or action does not occur, then such steps or transactions shall be, and shall be deemed to be,
omitted from this Plan and all remaining steps or transactions described in Section 3.1 shall otherwise occur in the manner and at the
times indicated. Subject to the foregoing sentence, each step or transaction set out in Section 3.1 shall be mutually conditional such
that no step or transaction set out in Section 3.1 may occur without all steps and transactions set out therein occurring. |
| 2.3 | The Certificate issued in respect of the Arrangement shall be conclusive evidence that the Arrangement
has become effective and that each of the provisions of Article 3 has become effective in the sequence and at the times set out therein.
None of the provisions of this Plan of Arrangement shall become effective unless all of the provisions of this Plan of Arrangement shall
have become effective in the sequence provided herein. |
Article 3
ARRANGEMENT
| 3.1 | Commencing at the Effective Time, each of the events set out below shall occur and shall be deemed to
occur in the following order at five (5) minute intervals (unless otherwise indicated) without any further act or formality except as
otherwise provided herein: |
Dissenting Shareholders
| (a) | the Westbrick Shares held by Dissenting Shareholders who have validly exercised and not withdrawn Dissent
Rights shall be deemed to have been transferred to Westbrick (free and clear of any and all Encumbrances) and shall be cancelled as of
the Effective Time, and such Dissenting Shareholders shall cease to have any rights as Westbrick Shareholders, other than the right to
be paid the fair value of their Westbrick Shares by Westbrick Amalco in accordance with Article 5; |
Duvernay Spinout
| (b) | the Duvernay Conveyance shall become effective pursuant to and in accordance with the terms and conditions
of the Duvernay Spinco Conveyance Agreement and Duvernay Spinco shall deliver to Westbrick that number of Duvernay Spinco Shares as are
required to be delivered to Westbrick pursuant to the Duvernay Spinco Conveyance Agreement in payment and satisfaction in full of the
purchase price for the Duvernay Assets; |
| (c) | if a Duvernay Spin-Out Event has not occurred prior to the Effective Time, the transactions under the
Duvernay Share Purchase Agreement shall become effective subject to the terms and conditions therein and Westbrick shall direct any proceeds
therefrom to be used to pay indebtedness owing on the Credit Facilities; |
| (d) | if and only if a Duvernay Spin-Out Event has occurred prior to the Effective Time, then the Duvernay Spinco
Shares shall be consolidated or split into such number of shares as is equal to the number of Westbrick Shares outstanding immediately
prior to this Section 3.1(d); |
| (e) | if and only if a Duvernay Spin-Out Event has occurred prior to the Effective Time, then: |
| (i) | the stated capital of Westbrick shall be reduced by an amount equal to the Duvernay Spinco Shares Value,
by deducting that amount from the stated capital account maintained by Westbrick for the Westbrick Shares; and |
| (ii) | an amount equal to the reduction of stated capital referred to in Section 3.1(e)(i) shall be distributed
as a return of capital by Westbrick to the Westbrick Shareholders, which distribution shall be paid by Westbrick by transferring to Westbrick
Shareholders one Duvernay Spinco Share for each one Westbrick Share held immediately prior to the effective time of this Section 3.1(e). |
[Name redacted]
Holdco Return of Capital
| (f) | [Name redacted] Holdco shall undertake a return of capital in respect of the Holdco Shares as follows: |
| (i) | the stated capital of [name redacted] Holdco shall be reduced by [amount redacted], by deducting
that amount from the stated capital account maintained by [name redacted] Holdco for the Holdco Shares; and |
| (ii) | an amount equal to the reduction of stated capital referred to in Section 3.1(f)(i) (the “[name
redacted] Holdco Return of Capital Amount”) shall be distributed as a return of capital by [name redacted] Holdco
to its sole shareholder, [name of party redacted], which distribution shall be paid by [name redacted] Holdco by the issuance
of a non-interest bearing promissory note (the “[name redacted] Holdco Note”) in the principal amount of the
[name redacted] Holdco Return of Capital Amount to [name of party redacted]; |
| (g) | if and only if a Duvernay Spin-Out Event has occurred prior to the Effective Time, [name redacted]
Holdco shall distribute all of the Duvernay SpinCo Shares which it received pursuant to Section 3.1(e) to [name of party redacted]
in partial satisfaction of the [name redacted] Holdco Note, and the principal amount owing by [name redacted] Holdco under
the [name redacted] Holdco Note shall be reduced by an amount equal to (A/B) x C, where A is the total number of Duvernay SpinCo
Shares which [name redacted] Holdco received pursuant to Section 3.1(e) and which it distributes to [name of party redacted]
pursuant to this Section 3.1(g), B is the total number of Duvernay Spinco Shares outstanding at the time of such distribution and C is
equal to Duvernay SpinCo Shares Value; |
Westbrick and
[name redacted] Holdco Amalgamation
| (h) | the Shareholder Agreement shall be terminated and shall cease to have any further force and effect; |
| (i) | [Name redacted] Holdco and Westbrick shall amalgamate under the provisions of the ABCA and shall
continue as one corporation under the ABCA (“Westbrick Amalco”) upon the following terms and conditions: |
| (i) | Name - The name of Westbrick Amalco shall be “Westbrick Energy Ltd.” or such other
name as the board of directors of Westbrick may approve (subject to the prior written consent of Purchaser); |
| (ii) | Registered Office - The registered office of Westbrick Amalco shall initially be the current registered
officer of Westbrick; |
| (iii) | Authorized Share Capital - Westbrick Amalco shall be authorized to issue: |
| (A) | an unlimited number of Westbrick Amalco Shares; and |
| (B) | an unlimited number of preferred shares, issuable in series (each, a “Westbrick Amalco Preferred
Share”). |
The rights, privileges,
restrictions and conditions attaching to the Westbrick Amalco Shares and the Westbrick Amalco Preferred Shares following the amalgamation
shall be the same as the rights, privileges, restrictions and conditions attaching to the Westbrick Shares and to the preferred shares
of Westbrick, respectively.
| (iv) | Restrictions on Transfer - Subject to any unanimous shareholder agreement with respect to Westbrick
Amalco then in force, the securities in the capital of Westbrick Amalco, other than non-convertible debt securities, shall not be transferred
without either the approval of the board of directors of Westbrick Amalco or the holder or holders of shares in the capital of Westbrick
Amalco to which are attached more than 50% of the votes attaching to all voting shares in the capital of Westbrick Amalco then outstanding,
to be evidenced, in either case, by a resolution of such directors or shareholders, with such approval being given prior to the time of
the transfer of such securities; |
| (v) | Other Provisions - The other provisions forming part of the articles of Westbrick Amalco shall
be those of Westbrick, mutatis mutandis; |
| (vi) | Directors and Officers - |
| (A) | Minimum and Maximum: The directors of Westbrick Amalco shall, unless otherwise changed in accordance
with the ABCA, consist of a minimum of one director and a maximum of ten directors; |
| (B) | Initial Directors: The initial directors of Westbrick Amalco shall be the directors of Westbrick
(or such other persons as Westbrick, [name of party redacted] and Purchaser agree in writing); |
| (vii) | Stated Capital - The aggregate stated capital of Westbrick Amalco will be an amount equal to the
aggregate of the paid-up capital for the purposes of the Tax Act of the Holdco Shares and the Westbrick Shares (other than the Westbrick
Shares held by [name redacted] Holdco), immediately before the amalgamation; |
| (viii) | By-laws - The by-laws of Westbrick Amalco shall be the by-laws of Westbrick, mutatis mutandis;
and |
| (ix) | Effect of Amalgamation - The provisions of subsections 186(b), (c), (d), (e) and (f) of the ABCA
shall apply to the amalgamation with the effect that: |
| (A) | the property of each of [name redacted] Holdco and Westbrick shall continue to be the property
of Westbrick Amalco; |
| (B) | Westbrick Amalco shall continue to be liable for all of the obligations of each of [name redacted]
Holdco and Westbrick; |
| (C) | any existing cause of action, claim or liability to prosecution of [name redacted] Holdco or Westbrick
shall be unaffected; |
| (D) | any civil, criminal or administrative action or proceedings pending by or against [name redacted]
Holdco or Westbrick may be continued to be prosecuted by or against Westbrick Amalco; and |
| (E) | a conviction against, or ruling, order or judgment in favour of or against, [name redacted] Holdco
or Westbrick may be enforced by or against Westbrick Amalco; |
| (x) | Articles - The Articles of Arrangement shall be deemed to be the articles of amalgamation of Westbrick
Amalco and any certificate issued in respect of such Articles of Arrangement by the Registrar giving effect to the Arrangement shall be
deemed to be the Certificate of Amalgamation of Westbrick Amalco; and |
| (xi) | Exchange and Cancellation of Shares - The shares in the capital of each of [name redacted]
Holdco and Westbrick shall be exchanged for issued and fully-paid shares in the capital of Westbrick Amalco, or shall be cancelled without
any repayment of the capital in respect thereof, as follows: |
| (A) | each issued and outstanding Holdco Share shall be exchanged for a fraction of a Westbrick Amalco Share
equal to: [[X x Y] - Z] / [X x Y]; where X is the number of Westbrick Shares held by [name redacted] Holdco as of the Effective
Time, Y is the Consideration per Share and Z is [name redacted] Holdco Return of Capital Amount; and the share certificates for
such Westbrick Amalco Shares will be deemed to be evidenced by the existing share certificates for such Holdco Shares; |
| (B) | each issued and outstanding Westbrick Share (other than Westbrick Shares held by [name redacted]
Holdco) shall be exchanged for one Westbrick Amalco Share, and the share certificates for such Westbrick Amalco Shares will be deemed
to be evidenced by the existing share certificates for such Westbrick Shares; and |
| (C) | each issued and outstanding Westbrick Share held by [name redacted] Holdco, being an aggregate
of 36,643,767 Westbrick Shares, shall be cancelled without any repayment of capital in respect thereof; |
| (xii) | Westbrick Options - Each outstanding Westbrick Option shall be exchanged for one option of Westbrick
Amalco (“Westbrick Amalco Option”) to acquire, on the same terms and conditions as were applicable to such Westbrick
Option including accelerated vesting in connection with the Arrangement and in accordance with the procedure set forth herein, one Westbrick
Amalco Share at an exercise price per Westbrick Amalco Share equal to the exercise price per Westbrick Share of the Westbrick Option immediately
prior to the amalgamation, provided that it is intended that the provisions of subsection 7(1.4) of the Tax Act apply to the exchange
of the Westbrick Options for Westbrick Amalco Options under this Section 3.1(i)(xii) and accordingly, notwithstanding the foregoing, if
required for purposes of ensuring the provisions of subsection 7(1.4) of the Tax Act will apply to the exchange, the exercise price of
a Westbrick Amalco Option will be deemed to be increased such that the value of the Westbrick Amalco Share immediately after the exchange
less the exercise price of the Westbrick Amalco Option does not exceed the value of the Westbrick Share immediately before the exchange
less the exercise price of the Westbrick Option for which it was exchanged; |
Westbrick Options
| (j) | in respect of the Westbrick Amalco Options: |
| (i) | each Option Exercise and Surrender Agreement that has been duly completed, executed and returned to Westbrick
prior to the Election Deadline is deemed to become effective such that the issuances of Westbrick Amalco Shares and cash payments thereunder
are made to the applicable Optionholder (less any applicable withholding amounts), in each case in accordance with the applicable Option
Exercise and Surrender Agreement; |
| (ii) | in respect of any Westbrick Amalco Options for which an Option Exercise and Surrender Agreement has not
been duly completed, executed and returned to Westbrick prior to the Election Deadline, notwithstanding the terms of such Westbrick Amalco
Options, the Westbrick Option Plan and any Option Agreements in relation thereto or any employment agreement (or similar agreement) or
any resolution of the Westbrick board of directors (or any committee thereof) such Westbrick Amalco Option shall be surrendered and transferred
to Westbrick Amalco (free and clear of any encumbrances) for cancellation in exchange for a cash payment from Westbrick Amalco equal to
the Optionholder’s Option Payout Amount (less any applicable withholding amounts); |
| (iii) | the names of the holders of such Optionholder shall be removed from the register of holders of Westbrick
Amalco Options maintained by or on behalf of Westbrick Amalco; and |
| (iv) | the Westbrick Option Plan and each Option Agreement in relation thereto shall terminate and be of no further
force and effect, and neither Westbrick Amalco, Purchaser, nor any of their respective successors or assigns shall have any further liability
or obligation with respect thereto; |
Westbrick RSUs
| (k) | each Westbrick RSU outstanding immediately prior to the Effective Time (whether vested or unvested), shall,
notwithstanding the terms of such Westbrick RSUs, the Westbrick Omnibus Plan and any award agreements in relation thereto or any employment
agreement (or similar agreement) or any resolution of the Westbrick board of directors (or any committee thereof): |
| (i) | be settled in exchange for a cash payment from Westbrick Amalco equal to the Consideration per Share per
each Westbrick RSU (less any applicable withholding amounts); |
| (ii) | the names of the holders of such Westbrick RSUs shall be removed from the register of holders of Westbrick
RSUs maintained by or on behalf of Westbrick; and |
| (iii) | the Westbrick RSUs shall be immediately cancelled and each award agreement in relation thereto shall terminate
and be of no further force and effect, and neither Westbrick, Purchaser, nor any of their respective successors or assigns shall have
any further liability or obligation with respect thereto; |
Westbrick DSUs
| (l) | each Westbrick DSU outstanding immediately prior to the Effective Time (whether vested or unvested), shall,
notwithstanding the terms of such Westbrick DSUs, the Westbrick Omnibus Plan and any award agreements in relation thereto or any employment
agreement (or similar agreement) or any resolution of the Westbrick board of directors (or any committee thereof): |
| (i) | be settled in exchange for a cash payment from Westbrick Amalco equal to the Consideration per Share per
each Westbrick DSU (less any applicable withholding amounts); |
| (ii) | the names of the holders of such Westbrick DSUs shall be removed from the register of holders of Westbrick
DSUs maintained by or on behalf of Westbrick; and |
| (iii) | the Westbrick DSUs shall be immediately cancelled and the Westbrick Omnibus Plan and each award agreement
in relation thereto shall terminate and be of no further force and effect, and neither Westbrick, Purchaser, nor any of their respective
successors or assigns shall have any further liability or obligation with respect thereto; |
Acquisition
of Westbrick Amalco Shares by Purchaser
| (m) | each issued and outstanding Westbrick Amalco Share (other than those transferred to Westbrick pursuant
to Section 3.1(a)) shall be, and shall be deemed to be, transferred to, and acquired by, Purchaser (free and clear of any Encumbrances)
in exchange for the payment by Purchaser to such Westbrick Amalco Shareholder as follows: |
| (i) | each Westbrick Amalco Shareholder that is a Cash Electing Shareholder will receive an amount of Cash Consideration
equal to the number of Westbrick Amalco Shares transferred to the Purchaser hereunder multiplied by the Consideration per Share; |
| (ii) | subject to subsection 3.1(n) and Section 3.3, each Westbrick Shareholder that is a Share Electing Shareholder
will receive that number of Purchaser Shares, rounded to the nearest whole Purchaser Share, equal to the Share Consideration per Share
for each Westbrick Amalco Share transferred to the Purchaser hereunder; |
| (iii) | subject to subsection 3.1(n) and Sections 3.3 and 3.7, each Westbrick Shareholder that is a Combination
Electing Shareholder will receive: |
| (A) | an amount of Cash Consideration equal to the product of the number of Westbrick Amalco Shares transferred
to the Purchaser hereunder in respect of which the Combination Electing Shareholder validly elected the Cash Consideration in accordance
with this Plan of Arrangement multiplied by the Consideration per Share; and |
| (B) | the Share Consideration per Share for each Westbrick Amalco Share transferred to the Purchaser hereunder
in respect of which the Combination Electing Shareholder validly elected the Share Consideration per Share in accordance with this Plan
of Arrangement; |
| (n) | Purchaser shall not be required to issue an aggregate amount of Purchaser Shares in excess of the Share
Maximum in exchange for Westbrick Amalco Shares and, if the Aggregate Shares Elected exceeds the Share Maximum, each Share Electing Shareholder
and Combination Electing Shareholder shall be entitled to receive, in lieu of the number of Purchaser Shares referred to in Section 3.1(m)(ii)
or 3.1(m)(iii), as applicable: |
| (i) | Share Consideration per Share in consideration for the number of Westbrick Amalco Shares as is equal to
the product obtained by multiplying (A) the Share Proration Factor, by (B) the number of Westbrick Amalco Shares transferred to the Purchaser
by the Westbrick Amalco Shareholder hereunder in respect of which such Westbrick Amalco Shareholder would have, absent the application
of this section 3.1(j), received Purchaser Shares; and |
| (ii) | an amount of Cash Consideration equal to the Consideration per Share multiplied by such number of Westbrick
Amalco Shares that is determined by subtracting the number of Westbrick Amalco Shares transferred for Share Consideration as determined
under section 3.1(j)(i) from the total number of Westbrick Amalco Shares transferred to the Purchaser by such Westbrick Amalco Shareholder
hereunder; |
Repayment of
[name redacted] Holdco Note
| (o) | as repayment by Westbrick Amalco of the [name redacted] Holdco Note, as assumed by Westbrick Amalco
on the amalgamation, the Depositary shall release funds in the amount equal to the then remaining outstanding balance under the [name
redacted] Holdco Note to [name of party redacted]; |
Westbrick Amalco and Purchaser
Amalgamation
| (p) | Westbrick Amalco and Purchaser shall amalgamate under the provisions of the ABCA and shall continue as
one corporation under the ABCA (“Purchaser Amalco”) upon the following terms and conditions: |
| (i) | Name - The name of Purchaser Amalco shall be “Vermilion Energy Inc.” or such other
name as the board of directors of Purchaser may approve; |
| (ii) | Registered Office - The registered office of Purchaser Amalco shall be 3500-520 3rd Avenue SW,
Calgary, Alberta T2P 0R3; |
| (iii) | Authorized Share Capital - Purchaser Amalco shall be authorized to issue an unlimited number of
common shares; |
| (iv) | Other Provisions - The other provisions forming part of the articles of Purchaser Amalco shall
be those of Purchaser, mutatis mutandis; |
| (v) | Directors and Officers - |
| (A) | the current directors of Purchaser shall be the directors of Purchaser Amalco to hold office until the
next annual general meeting of the shareholders of Purchaser Amalco or until their successors are duly appointed; |
| (B) | the current officers of Purchaser shall be the officers of Purchaser Amalco to hold office until their
successors are duly appointed: |
| (vi) | Stated Capital - The aggregate stated capital of Purchaser Amalco will be an amount equal to the
aggregate of the paid-up capital for the purposes of the Tax Act of the Purchaser Shares immediately before the amalgamation; |
| (vii) | By-laws - The by-laws of Purchaser Amalco shall be the by-laws of Purchaser, mutatis mutandis; |
| (viii) | No Securities Issued |
| (A) | no securities shall be issued by Purchaser Amalco in connection with the amalgamation; |
| (B) | each issued and outstanding Westbrick Amalco Share shall be cancelled; |
| (ix) | Effect of Amalgamation - The provisions of subsections 186(b), (c), (d), (e) and (f) of the ABCA
shall apply to the amalgamation with the effect that: |
| (A) | the property of each of Westbrick Amalco and Purchaser shall continue to be the property of Purchaser
Amalco; |
| (B) | Purchaser Amalco shall continue to be liable for all of the obligations of each of Westbrick Amalco and
Purchaser; |
| (C) | any existing cause of action, claim or liability to prosecution of Westbrick Amalco and Purchaser shall
be unaffected; |
| (D) | any civil, criminal or administrative action or proceedings pending by or against Westbrick Amalco and
Purchaser may be continued to be prosecuted by or against Purchaser Amalco; and |
| (E) | a conviction against, or ruling, order or judgment in favour of or against, Westbrick Amalco and Purchaser
may be enforced by or against Purchaser Amalco; |
| (x) | Articles - The Articles of Amalgamation of Purchaser Amalco shall be the same as the articles of
Purchaser; and |
| (xi) | Cancellation of Shares - No securities shall be issued by Purchaser Amalco in connection with the
amalgamation and each issued and outstanding Westbrick Amalco Share shall be cancelled. Any certificates representing the Purchaser Shares
shall be deemed to evidence common shares in the capital of Purchaser Amalco. |
| 3.2 | The Parties shall make the appropriate entries into their securities registers to reflect the matters
referred to under Section 3.1. For greater certainty, the aggregate pre-tax cash consideration payable to [name of party redacted]
pursuant this Plan of Arrangement shall neither be more nor less than the aggregate amount of pre-tax cash consideration that [name
redacted] Holdco would have been entitled to receive if Sections 3.1(f), 3.1(i) and 3.1(o) were omitted from this Plan of Arrangement,
but all remaining applicable steps in the Plan of Arrangement were completed. |
| 3.3 | With respect to the elections made by a holder of Westbrick Amalco Shares pursuant to subsection 3.1(m): |
| (i) | each of such holders of Westbrick Amalco Shares shall make such election by depositing with the Depositary,
prior to the Election Deadline, a duly completed Letter of Transmittal and Election Form indicating such holder’s election (which
for those electing to receive Combined Consideration, shall also indicate the percentage of their Westbrick Amalco Shares requested to
be exchanged for Share Consideration), together with certificates representing such holder’s Westbrick Shares; and |
| (ii) | any Westbrick Amalco Shareholder who does not deposit a duly completed Letter of Transmittal and Election
Form with the Depositary prior to the Election Deadline, or otherwise fails to comply with the requirements the Letter of Transmittal
and Election Form to make an election to exchange Westbrick Amalco Shares as contemplated by subsection 3.3(i), shall be deemed to have
elected Cash Consideration. |
| 3.4 | A Westbrick Amalco Shareholder who received consideration consisting, in whole or in part, of Share Consideration
shall be entitled to make a tax election, pursuant to subsection 85(1) or 85(2) of the Tax Act, as applicable (and the analogous provisions
of provincial income tax law). Purchaser shall make available on Purchaser’s website (or otherwise made available to Westbrick Amalco
Shareholders) tax election forms required under the Tax Act within 60 days of the Effective Date. Any Westbrick Amalco Shareholder who
wants to make such election and otherwise qualifies to make such election may do so by providing to Purchaser two signed copies of the
necessary election forms within 120 days following the Effective Date, duly completed with the details of the number of Westbrick Shares
transferred and the applicable agreed amount or amounts for the purposes of such election. Thereafter, subject to the election forms complying
with the provisions of the Tax Act (or applicable provincial or territorial income tax law), the forms will be signed by Purchaser and
returned to such Westbrick Amalco Shareholder by ordinary mail within 30 days after the receipt thereof by Purchaser for filing with the
Canada Revenue Agency (or the applicable provincial or territorial taxing authority). Purchaser will not be responsible for the proper
completion of any election form and, except for the obligation of Purchaser to so sign and return duly completed election forms which
are received by Purchaser within 120 days of the Effective Date. Purchaser will not be responsible for any taxes, interest or penalties
resulting from the failure by a Westbrick Amalco Shareholder to properly complete or file the election forms in the form and manner and
within the time prescribed by the Tax Act (or any applicable provincial or territorial legislation). In its sole discretion, Purchaser
may choose to sign and return an election form received by it more than 120 days following the Effective Date, but Purchaser will have
no obligation to do so. |
| 3.5 | Post-Closing Adjustment Amount |
In the event the Parties
to the Arrangement Agreement proceed to Closing notwithstanding that the dispute resolution process set forth in Section 2.8(f) of the
Arrangement Agreement has not been finalized, as set forth in Section 2.8(g) of the Arrangement Agreement, then [name of party redacted]
and Westbrick may appoint one or more shareholder representatives who will have authority to resolve such dispute on behalf of the former
Westbrick Amalco Shareholders (the “Shareholder Representatives”). The Aggregate Adjusted Consideration hereunder shall
be deemed as of the Effective Time to be reduced by the amount payable by Purchaser which is being disputed in accordance with Section
2.8(f) of the Arrangement Agreement. Following the resolution of such dispute, the Aggregate Adjusted Consideration shall be deemed to
be increased by the amount of the disputed amount which is required to be paid by the Purchaser under the Arrangement Agreement, and the
Depositary shall release such disputed amounts as directed by the Shareholder Representatives in accordance with the Entitlement Schedule.
| 3.6 | Insurance Claim Recovery Amount |
| (a) | [Insurance matters redacted] |
| (b) | [Insurance matters redacted] |
| 3.7 | Notwithstanding anything else in this Plan of Arrangement: |
| (a) | if a Westbrick Amalco Shareholder makes a valid election described in section 3.4 hereof, then such Westbrick
Amalco Shareholder shall be deemed to have exchanged all of such Westbrick Amalco Shareholder’s Westbrick Amalco Shares for a combination
of the Cash Consideration, Share Consideration and any amounts in respect of the Insurance Recovery Amount (if any) received by such Westbrick
Amalco Shareholder; and |
| (b) | if a Westbrick Amalco Shareholder does not make a valid election described in section 3.4 hereof, then
such Westbrick Shareholder shall be deemed to have exchanged that number of Westbrick Amalco Shares (including any fraction thereof) equal
to the aggregate Cash Consideration and the portion of the Insurance Recovery Amount (if any) received by such Westbrick Shareholder,
if any, divided by Consideration per Share, and to have exchanged such Westbrick Shareholder’s remaining number of Westbrick Shares
solely for the Share Consideration received. |
Article 4
OUTSTANDING CERTIFICATES AND FRACTIONAL SECURITIES
| 4.1 | From and after the Effective Time, certificates formerly representing Westbrick Shares and Westbrick Amalco
Shares shall represent only the right to receive the consideration to which the holders are entitled under the Arrangement or as to those
certificates formerly representing Westbrick Shares held by Dissenting Shareholders (if any) (other than those Dissenting Shareholders
deemed to have participated in the Arrangement pursuant to Article 5), to receive the fair value of the Westbrick Amalco Shares represented
by such certificates. |
| 4.2 | Prior to the Effective Time, Purchaser shall: (i) provide to the Depositary a certified cheque, bank draft
or wire transfer of funds in an amount at least equal to the sum of the principal amount of the [name redacted] Holdco Note and
the aggregate amount of cash that the Westbrick Shareholders are entitled to receive for their Westbrick Amalco Shares in accordance with
the terms of the Arrangement Agreement and this Plan of Arrangement; and (ii) issue and deliver to the Depositary an irrevocable treasury
order authorizing the Depositary, as the registrar and transfer agent for the Purchaser Shares, to issue in a book based register the
aggregate number of Purchaser Shares payable to the former holders of Westbrick Amalco Shares pursuant to the provisions of the Arrangement
Agreement and this Plan of Arrangement. Following the Effective Time, the Depositary shall be considered to hold such funds and Purchaser
Shares for the sole benefit of [name of party redacted] and the Westbrick Amalco Shareholders. |
| 4.3 | The Depositary shall (as soon as is practicable but in any event not later than the date that is three
Business Days following the later of the Effective Date and the date of deposit by a former Westbrick Shareholder of a duly completed
and executed Letter of Transmittal and Election Form, together with the share certificates representing the holder’s Westbrick Amalco
Shares and such other documents and instruments as the Depositary may reasonably require) cause to be prepared individual cheques (or
other form of immediately available funds) and/or certificates representing the Purchaser Shares (or arrange for the direct non-certificated
deposit of the Purchaser Shares), as applicable. Such cheques and/or Purchaser Shares, as applicable, shall be forwarded by first class
mail, postage pre-paid, to the Person and at the address specified in the relevant Letter of Transmittal and Election Form or, if no address
has been specified therein, at the address specified for the particular holder in the register of holders of Westbrick Shares. Cheques
and/or Purchaser Shares, as applicable, mailed pursuant hereto will be deemed to have been delivered at the time of delivery thereof to
the post office. |
| 4.4 | If any certificate which immediately prior to the Effective Time represented an interest in outstanding
Westbrick Shares that were exchanged pursuant to Section 3.1 has been lost, stolen or destroyed, upon the making of an affidavit of that
fact by the Person claiming such certificate to have been lost, stolen or destroyed, the Depositary will issue and deliver in exchange
for such lost stolen or destroyed certificate the consideration to which the holder is entitled pursuant to the Arrangement (and any dividends
or distributions with respect thereto). The Person who is entitled to receive such consideration shall, as a condition precedent to the
receipt thereof, give a bond to Westbrick and the Depositary, which bond is in form and substance satisfactory to Purchaser or shall otherwise
indemnify Westbrick, the Purchaser and the Depositary against any claim that may be made against any of them with respect to the certificate
alleged to have been lost, stolen or destroyed. |
| 4.5 | Any certificate formerly representing Westbrick Shares that is not deposited with all other documents
as required by this Plan of Arrangement and the Letter of Transmittal and Election Form on or before the last Business Day prior to the
third anniversary of the Effective Date shall cease to represent a right or claim of any kind or nature, including the right of the holder
of such Westbrick Shares to receive the consideration that the holder is entitled pursuant to this Arrangement. In such case, the cash
that the holder is entitled to pursuant to this Arrangement (including any dividends or other distributions in respect of Purchaser Shares)
shall be returned by the Depositary to Purchaser and the Purchaser Shares shall be returned to Purchaser for cancellation. |
| 4.6 | No certificates representing fractional Purchaser Shares shall be issued. Where the aggregate number of
Purchaser Shares to be issued to a former Westbrick Shareholder pursuant to this Plan of Arrangement would result in a fraction of a Purchaser
Share being issuable, each such former Westbrick Shareholder otherwise entitled to a fractional interest in a Purchaser Share will receive
the nearest whole number of Purchaser Shares (with fractions equal to or greater than 0.5 being rounded up and fractions less than 0.5
being rounded down). No cash settlements shall be made with respect to fractional shares eliminated by rounding. |
| 4.7 | Subject to Section 4.5, all dividends payable in respect of Purchaser Shares to which a former Westbrick
Amalco Shareholder is entitled, but for which a certificate representing such Purchaser Shares has not been delivered to such former Westbrick
Amalco Shareholder (or the electronic non-certificated deposit of such Purchaser Shares has not been completed) in accordance with this
Article 4, shall be paid or delivered to the Depositary to be held in trust for such former Westbrick Amalco Shareholder for delivery
to the former Westbrick Amalco Shareholder, net of all withholding and other taxes, upon delivery of the certificate representing the
Purchaser Shares (or the electronic deposit of Purchaser Shares) in accordance with this Article 4. |
Article 5
DISSENTING SHAREHOLDERS
| 5.1 | Unless a Written Resolution has been executed by every Westbrick Shareholder, each registered holder of
Westbrick Shares that has not executed a Written Resolution shall have the right to dissent with respect to the Arrangement in accordance
with section 191 of the ABCA, as modified by the Interim Order and this Article 5; provided that, notwithstanding subsection 191(5)
of the ABCA, the written objection to the Arrangement Resolution referred to in subsection 191(5) of the ABCA must be received by Westbrick
from the Dissenting Shareholder not later than the Election Deadline. A Dissenting Shareholder may not exercise Dissent Rights in respect
of only a portion of the Westbrick Shares it holds, but may only exercise Dissent Rights in respect of all, and not less than all¸
of the Westbrick Shares it holds. A Dissenting Shareholder shall, at the Effective Time, cease to have any rights as a holder of Westbrick
Shares and shall only be entitled to be paid the fair value of the holder’s Westbrick Shares (less any applicable withholdings).
Only registered holders of Westbrick Shares can elect to be Dissenting Shareholders and such Dissenting Shareholders must dissent with
respect to all Westbrick Shares held by the Dissenting Shareholder. Dissent Rights are not available to holders of Westbrick Options,
Westbrick Amalco Options, Westbrick RSUs or Westbrick DSUs. Notwithstanding the provisions of section 191 of the ABCA, a Dissenting Shareholder
who is entitled to be paid the fair value of the holder’s Westbrick Shares (less any applicable withholdings) shall be deemed to
have transferred the holder’s Westbrick Shares to Westbrick (free and clear of any and all Encumbrances) for cancellation at the
Effective Time. A Dissenting Shareholder who, for any reason, is not entitled to be paid the fair value of the holder’s Westbrick
Shares, shall be treated as if the holder had participated in the Arrangement on the same basis as a non-dissenting holder of Westbrick
Shares and shall receive the consideration to which a Cash Electing Shareholder is entitled under the Arrangement, notwithstanding the
provisions of section 191 of the ABCA. The fair value of the Westbrick Shares shall be determined as of the close of business on the last
Business Day before the day on which the Arrangement is approved by the Westbrick Shareholders pursuant to the Written Resolution; but
in no event shall Purchaser or Westbrick Amalco be required to recognize such Dissenting Shareholder as a shareholder of Westbrick Amalco
after the Effective Time and each Dissenting Shareholder will cease to be entitled to the rights of a Westbrick Shareholder in respect
of the Westbrick Shares in relation to which such Dissenting Shareholder has exercised Dissent Rights and the name of such holder shall
be removed from the applicable Westbrick register of shareholders as at the Effective Time to reflect that such former holder is no longer
the holder of such Westbrick Shares as at and from the Effective Time. For greater certainty, in addition to any other restrictions in
section 191 of the ABCA, no Person who has executed a Written Resolution shall be entitled to dissent with respect to the Arrangement. |
Article 6
WITHHOLDING
| 6.1 | Subject to the Arrangement Agreement, the Company, Westbrick Amalco, Purchaser and the Depositary shall
be entitled to deduct and withhold from any amounts payable to any Person under this Plan of Arrangement, such amounts as Company, Westbrick
Amalco, Purchaser or the Depositary, as applicable, determines, acting reasonably, are required to be deducted or withheld with respect
to such payment under the Tax Act or any provision of any other Applicable Laws. To the extent that amounts are so deducted and withheld
and paid over to the appropriate Governmental Authority, such deducted or withheld amounts shall be treated for all purposes hereof as
having been paid to the Persons in respect of which such deduction and withholding was made. |
Article 7
AMENDMENTS
| 7.1 | Purchaser, Westbrick and [name of party redacted] may by mutual agreement amend this Plan of Arrangement
at any time and from time to time prior to the Effective Time, provided that each such amendment shall be: (a) set forth in writing; (b)
filed with the Court; and (c) communicated to and/or consented to by the Westbrick Shareholders, if and as required by the Court and in
the manner directed by the Court or if and as required by the Written Resolution. |
| 7.2 | Any amendment to the Plan of Arrangement that is approved by the Court shall be effective only if it is
consented to by each of Purchaser, Westbrick and [name of party redacted], and if required by the Court, is consented to by the
Westbrick Shareholders in the manner directed by the Court. |
SCHEDULE “B”
ARRANGEMENT RESOLUTION
Special
resolution of the holders (the “Shareholders”) of common shares (the “Common Shares”) of WESTBRICK Energy LTD.
(“WESTBRICK”) passed effective [•], 2024 pursuant to the Business Corporations Act (Alberta) (the “ABCA”)
[WHEREAS:
| A. | Westbrick has entered into an arrangement agreement (the “Arrangement Agreement”) dated
December 22, 2024, with Vermilion Energy Inc. (“Purchaser”) and [name of party redacted] (“[name of
party redacted]”) outlining the terms of a plan of arrangement in respect of Westbrick and involving its securityholders, Duvernay
Spinco, [name of party redacted], Purchaser and [name redacted] Holdco, under the provisions of section 193 of the ABCA,
to be conducted substantially as set forth in the plan of arrangement attached as Schedule “A” to the Arrangement Agreement
(the “Plan of Arrangement”), as will be further described in the notice of written resolution to be provided to the
Shareholders on or about January 24, 2025 (the “Notice of Written Resolution”). |
| B. | Pursuant to the Arrangement, inter alia, each issued and outstanding common shares of Westbrick
following the amalgamation of Westbrick and [name redacted] Holdco under the Arrangement will be acquired by Purchaser for cash
consideration or share consideration, in the manner set forth in the Arrangement Agreement and the Plan of Arrangement. |
| C. | The Shareholders have been provided with certain information in relation to the Arrangement, including,
without limitation, copies of the Arrangement Agreement and the Plan of Arrangement and will be provided the Notice of Written Resolution. |
| D. | As set forth in the Arrangement Agreement, the Arrangement is subject to a number of conditions that must
be fulfilled or waived in order for the Arrangement to become effective, including execution of this resolution by holders of at least
two-thirds of the Common Shares and the approval of the Court of King’s Bench of Alberta (the “Court”). |
| E. | Capitalized terms used but not defined in this resolution have the meanings ascribed to them in the Arrangement
Agreement. |
| F. | Each Shareholder acknowledges that by executing this Arrangement Resolution, it will not be entitled to
exercise dissent rights in respect of the Arrangement. |
NOW THEREFORE BE IT RESOLVED BY SPECIAL
RESOLUTION THAT:
| 1. | the Arrangement, as set forth in the Plan of Arrangement, and all transactions contemplated thereby, is
hereby authorized, approved and adopted; |
| 2. | the Arrangement Agreement (including the Plan of Arrangement attached thereto) and all of the transactions
contemplated therein (together with such amendments, modifications or supplements thereto made in accordance with the terms thereof as
may be approved by any of the persons referred to in paragraph 4 hereof, such approval to be evidenced conclusively by their execution
and delivery of any such amendments, modifications or supplements), the actions of the directors of Westbrick in approving the Arrangement,
and the actions of the officers of Westbrick in executing and delivering the Arrangement Agreement and any amendments, modifications or
supplements thereto and causing the performance by Westbrick of its obligations thereunder, are hereby confirmed, ratified and approved; |
| 3. | Westbrick be and is hereby authorized to make an application to the Court for an order approving the Arrangement
(the “Final Order”) on the terms set forth in the Arrangement Agreement and the Plan of Arrangement (as they may be
or have been amended, modified or supplemented in accordance with their terms or the Interim Order (as defined in the Arrangement Agreement)); |
| 4. | notwithstanding that this resolution has been passed (and the Arrangement adopted) by the Shareholders
or the Final Order has been granted by the Court, the directors of Westbrick are hereby authorized and empowered, at their discretion
subject to the terms of the Interim Order and Final Order, without further notice to or approval of the Shareholders: (i) to amend, modify
or supplement the Arrangement Agreement or the Plan of Arrangement to the extent permitted by the Arrangement Agreement or the Plan of
Arrangement; and (ii) subject to the terms of the Arrangement Agreement, not proceed with the Arrangement, at any time prior to the issuance
of the certificate or other proof of filing giving effect to the Arrangement; |
| 5. | any officer or director of Westbrick is hereby authorized and directed, for and on behalf of Westbrick,
to deliver to the Registrar of Corporations or Deputy Registrar of Corporations appointed under Section 263 of the ABCA, the articles
of arrangement, a certified copy of the Final Order and to execute and, if appropriate, deliver such other documents as are necessary
or desirable pursuant to the ABCA to give effect to the Arrangement and the Plan of Arrangement in accordance with the Arrangement Agreement,
such determination to be conclusively evidenced by the execution and delivery of such other documents; |
| 6. | any officer or director of Westbrick is hereby authorized and directed, for and on behalf of Westbrick,
to execute, or cause to be executed, and to deliver, or cause to be delivered, all such other documents, agreements and instruments and
to perform, or cause to be performed, all such other acts and things as in such person’s opinion may be necessary or desirable to
give full force and effect to the foregoing resolutions and the matters authorized thereby, such determination to be conclusively evidenced
by the execution and delivery of such documents, agreements or instruments or the doing of any such acts or things; and |
| 7. | this written resolution of the Shareholders may be executed in several counterparts, each of which when
so executed shall be deemed to be an original and such counterparts together (whether provided by way of electronic transmission or otherwise)
shall constitute one and the same instrument and notwithstanding their date of execution they shall be deemed to be dated as of the date
hereof. |
The undersigned, being a Shareholder entitled
to vote on the foregoing resolution, hereby: (a) consents to and approves the foregoing resolution; (b) acknowledges that by signing this
resolution, it is waiving its right to dissent in connection with the Arrangement; and (c) agrees not to exercise any securityholder rights
or remedies available at common law or pursuant to the ABCA or applicable securities legislation to delay, hinder, upset or challenge
the Arrangement or the completion thereof, in each case effective as of the date first written above and as evidenced by the undersigned’s
signature hereto.
Notwithstanding the above paragraph, this resolution
in respect of the undersigned Shareholder:
| 1. | may be revoked and be of no further force or effect if, without the undersigned’s prior written
consent: |
| (a) | there is a decrease (or change in the form of) the Consideration, except as provided for or expressly
contemplated in the Arrangement Agreement; or |
| (b) | the Arrangement Agreement, the Arrangement or the Plan of Arrangement are amended or varied in a manner
that is materially adverse to the undersigned Shareholder; and |
| 2. | will be revoked and be of no further force or effect if: |
| (a) | the Arrangement Agreement is terminated in accordance with the terms thereof; or |
| (b) | if the undersigned Shareholder is party to a Lock-Up Agreement, the Lock-Up Agreement it is party to is
terminated in accordance with its terms. |
_______________________________________
Name of Shareholder (please print)
By: ____________________________________
Signature of Shareholder or its Authorized
Representative
_______________________________________
Official Title or Capacity (please print)
_______________________________________
Name of Signatory (please print name of individual
whose signature appears above if different
than
name of Shareholder)
SCHEDULE “C”
[Escrow Agreement redacted]
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