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Immediately before the Samson acquisition, CDC had four
employees: Mr. Arnold, Mr. West, and two secretaries who
provided office administration and clerical services at its
Oklahoma City office. After the Samson acquisition, H. John
Rogers became the president of CDC, and Mr. Carlton served as the
chairman of CDC's board of directors.
CDC and Suits entered into a service and management
agreement (Suits agreement) effective December 31, 1986. On
March 29, 1989, CDC and Suits Rig Corp. (an affiliate of Suits)
entered into a first amended and restated service and management
agreement which retroactively amended and restated the Suits
agreement, effective to December 31, 1986. The Suits agreement
provided for Suits to maintain CDC's rigs. The Suits agreement
also required Suits to use its best efforts and devote such time
as might be necessary to promote utilization of CDC rigs,
including marketing the rigs for contract drilling. Suits was an
independent contractor. Suits was also a drilling contractor
with significant experience in the contract drilling business.
Suits also drilled wells for the Samson group after the Samson
acquisition. From 1992 through 1996, 26 wells were drilled under
a lease agreement between CDC and Suits.
Collection of Old CDC Receivables
For the first 11 months following the Samson acquisition,
CDC collected $16,085 a month from Good Hope Refinery for
drilling services performed by CDC in 1982.
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