"a Belize company" lol
google.com
24.Admitted that on May 31, 2001, Hyperdynamics executed a Stock ExchangeAgreement with DJX Ltd. a Belize company owned by the grandchildren of Ernest M.Watts, the father of Kent Watts and Michael Watts; that two of the grandchildren are the minorchildren of Kent Watts; that Ernest Watts has voting rights over DJX; and that as a result of theStock Exchange Agreement, DJX acquired effective voting control over Hyperdynamics. To theextent that the allegations of this paragraph differ in substance or in context from the terms of theStock Exchange Agreement, same are denied, and Answering Defendants respectfully refer thisCourt to such Stock Exchange Agreement for an accurate statement of its terms. In all otherrespects, denied.
25.Admitted that Hyperdynamics acquired 100 percent of the stock of SCSCorporation a company owned by DJX for a purchase price of that Michael Watts formed SCS in March 2001; that Michael Watts was the sole director of SCS; thatKent Watts was President of SCS; that SCS acquired the assets of Computer Systems(“Seacon”); that Hyperdynamics had analyzed the possible acquisition of in 2000 anddetermined that debt burden was too high; and that SCS acquired assets inexchange for 100,000 shares of Hyperdynamics common stock, plus a $700,000 PromissoryNote payable out of and contingent upon the production of operations. To the extent thatthe allegations of this paragraph differ in substance or in context from the terms of the StockExchange Agreement, same are denied, and Answering Defendants respectfully refer this Court5
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to such Stock Exchange Agreement for an accurate statement of its terms. In all other respects,denied.26.Admitted that Hyperdynamics created a new series of Series B Preferred Stock.Denied that approval of the holders of Series A Preferred Stock was required. To the extent thatthe allegations of this paragraph differ in substance or in context from the terms of the Series Aand Series B Preferred Stock Certificates of Designations, respectively, same are denied, andAnswering Defendants respectfully refer this Court to such Certificates of Designations for anaccurate statement of their terms. In all other respects, denied.27.Admitted that DJX has effective voting control over Hyperdynamics; that theshares of Series B Preferred Stock issued to DJX are convertible into shares ofCommon Stock; and that if all of the Series B Preferred Stock were to be converted, theCommon Stock would be diluted. To the extent that the allegations of this paragraph differ insubstance or in context from the terms of the Stock Exchange Agreement, same are denied, andAnswering Defendants respectfully refer this Court to such Stock Exchange Agreement for anaccurate statement of its terms. In all other respects, denied.28.Admitted that the Stock Exchange Agreement and the issuance of the Series BPreferred Stock were approved at the Hyperdynamics Board meeting held on June 6, 2001; thatHyperdynamics’ then-four directors were present at the meeting; that defendants Hill and Briersvoted for the transaction; that Kent Watts abstained; and that Christopher St. Laurent votedagainst the Stock Exchange Agreement. In all other respects, denied.29.Admitted that St. Laurent submitted a letter of resignation on July 10, 2001. Tothe extent that the allegations of this paragraph differ in substance or in context from the terms ofthe July letter, same are denied, and Answering Defendants respectfully refer this Courtto such letter for an accurate statement of its contents. In all other respects, denied.6
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30.Admitted that no outside advice was sought or received with respect to Exchange Agreement, that one Hyperdynamics director voted against the transaction, and that nofairness opinion was obtained. Denied that outside advice or a fairness opinion were required,and, in all other respects, denied.31.Admitted that the Stock Exchange Agreement was disclosed publicly toHyperdynamics’ stockholders after it was approved by the Hyperdynamics board. In all otherrespects, denied.32.Admitted that Hyperdynamics and James W. Christian, Esquire, a Texas attorney,entered into a Legal Services Agreement that was first publicly disclosed on the referenced FormS-8. To the extent that the allegations of this paragraph differ in substance or in context from theterms of the Legal Services Agreement and the Form S-8, same are denied, and AnsweringDefendants respectfully refer this Court to the Legal Services Agreement and the Form S-8 foran accurate statement of their terms. In all other respects, denied.33.To the extent that the allegations of this paragraph differ in substance or incontext from the terms of the Legal Services Agreement, same are denied, and AnsweringDefendants respectfully refer this Court to such Legal Services Agreement for an accuratestatement of its terms. In all other respects, denied.34.Admitted that the recited provision of the Delaware Constitution is accuratelyquoted. In all other respects, denied.35.Admitted that the recited provision of 8 Del. 152 is accurately quoted. In other respects, denied.36.To the extent that the allegations of this paragraph differ in substance or incontext from the terms of the Legal Services Agreement, same are denied, and AnsweringDefendants respectfully refer this Court to such Legal Services Agreement for an accurate7
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statement of its terms. The allegations of the penultimate sentence of this paragraph state legalconclusions to which no response is required. In all other respects, denied.COUNT I37.Answering Defendants incorporate their responses to the foregoing paragraphsherein by reference.38.To the extent that the allegations of this paragraph differ in substance or incontext from the terms of the Certificate of Designations for the Series A Preferred Stock, sameare denied, and Answering Defendants respectfully refer this Court to such Certificate ofDesignations for an accurate statement of its terms. In all other respects, denied.39.Denied.COUNT II40.Answering Defendants incorporate their responses to the foregoing paragraphsherein by reference.41.Denied.COUNT III42.Answering Defendants incorporate their responses to the foregoing paragraphsherein by reference.43.Admitted that on December 4, 2000, Wellington submitted $35,000 of PreferredStock for conversion into Common Stock, that Hyperdynamics issued 37,706 shares of CommonStock in response, and that Hyperdynamics has properly refused to issue to Wellington theremaining shares that plaintiff claims. In all other respects, denied.44.The allegations of this paragraph state legal conclusions to which no response isrequired. To the extent that the allegations of this paragraph imply wrongdoing on behalf ofHyperdynamics, same are denied.
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45.Denied.COUNT IV46.Answering Defendants incorporate their responses to the foregoing paragraphsherein by reference.47.To the extent that the allegations of this paragraph differ in substance or incontext from the terms of the Subscription Agreement, same are denied, and AnsweringDefendants respectfully refer this Court to such Subscription Agreement for an accuratestatement of its terms. In all other respects, denied.COUNT VAnswering Defendants incorporate their responses to the foregoing paragraphsherein by reference.49.The allegations of the first sentence of this paragraph state legal conclusions towhich no response is required. In all other respects, denied.COUNT VI50.Answering Defendants incorporate their responses to the foregoing paragraphsherein by reference.51.The allegations of this paragraph are directed toward a person who is not one ofthe Answering Defendants. To the extent that the allegations of this paragraph purport to allegewrongdoing by any of the Answering Defendants, same are denied.52.The allegations of this paragraph are directed toward a person who is not one ofthe Answering Defendants. To the extent that the allegations of this paragraph purport to allegewrongdoing by any of the Answering Defendants, same are denied.9
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COUNT VII53.Answering Defendants incorporate their responses to the foregoing paragraphsherein by reference.54.Denied.COUNT VIII55.Answering Defendants incorporate their responses to the foregoing paragraphsherein by reference.56.Denied.COUNT IX57.Answering Defendants incorporate their responses to the foregoing paragraphsherein by reference.58.The allegations of this paragraph are directed toward persons who are notincluded among the Answering Defendants. To the extent the allegations of this paragraphpurport to allege wrongdoing by any of the Answering Defendants, same are denied.COUNT X59.Answering Defendants incorporate their responses to the foregoing paragraphsherein by reference.60.Denied.61.Denied.AFFIRMATIVE DEFENSESA.The Amended Complaint fails to state a claim upon which relief can be granted.B.Counts VII-X are derivative in nature, no demand was made on Hyperdynamics’board prior to instituting this suit, and demand was not excused.C.Wellington is an inadequate derivative plaintiff.10
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D.The relief sought by the plaintiff is barred by the doctrines of fraud, uncleanhands, estoppel, wavier and acquiescence.E.The Amended Complaint fails to join indispensable parties.WHEREFORE, Answering Defendants request that this Court enter an Order:(A)dismissing the plaintiffs Amended Complaint with prejudice;awarding Answering Defendants their costs and expenses, includingreasonable attorneys’ fees; and(C)granting such other and further relief as this Court shall deem appropriate.THE BAYARD FIRMR. ProctorKurt M. Patricia L. Enerio222 Delaware Avenue, Suite 900P.O. Box 25130Wilmington, DE 19899(302) 655-5000Attorneys for DefendantsDATED: October 11
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CERTIFICATE OF SERVICEPatricia L. Enerio, Esquire, hereby certifies that an October 15, 2000, copies of theforegoing Hyperdynamics Corporation, Kent Watts, Robert Hill and Harry J. Briers’ Answer toAmended Complaint and Affirmative Defenses, were served upon counsel as follows:VIA HAND DELIVERYElizabeth M. EsquirePrickett, Jones Elliott13 10 King StreetWilmington, DE 19801Patricia L. Enerio |
