Attached files
| file | filename |
|---|---|
| EX-99.1 - PRESS RELEASE, DATED FEBRUARY 15, 2018 - Petro River Oil Corp. | ex99-1.htm |
| 8-K - CURRENT REPORT - Petro River Oil Corp. | ptrc8k_feb142018.htm |
Exhibit 10.1
RED FORK RESOURCES, LLC
2458 167th
Street
Fairfield, Iowa 52556
641-469-5510
______________________________________________________________________________
February
14, 2018
Petro
River Oil Corp.
55
Fifth Avenue, Suite 1702
New
York, NY 10003
Attn:
Scot Cohen
RE:
Purchase and Exchange of Certain Conveyed Assets
Gentlemen:
When
fully executed, this letter shall constitute a binding purchase and
exchange agreement (“Agreement”) between Petro River
Oil Corporation (“Trader
1”) and Red Fork Resources (“Trader 2”) in regard to the
subject matter contained herein. Trader 1 owns a 13.75% working
interest (“Trader 1
Assets”) in and to an AMI (as that term is defined in that
certain Amended and Restated Asset Purchase and Sale and
Exploration Agreement between Trader 1 and Compass Global
Resources, LLC, et al, dated June 6, 2016, effective March 4, 2019,
including exhibits thereto (“APSEA”)) situated in the Mountain
View Project in Kern County, California (“MV AMI”). Trader 2 owns the
exclusive rights to an 85% working interest (“Trader 2 Assets”) in and to an
AMI (as that term is defined
in that certain Exploration Agreement dated December 27, 2016,
effective January 1, 2017, including exhibits thereto
(“EA”)) situated
in Kay County, Oklahoma (“KC
AMI”). Trader 1 and Trader 2 desire to exchange
certain assets in the MV AMI and KC AMI in accordance with the
terms set forth in this Agreement. Trader 1 and Trader 2 may
sometimes hereinafter be referred to individually as a “Party” and collectively as
“Parties”.
The
Parties hereby agree as follows:
1.
Assets to be Purchased and
Exchanged: Trader 1 shall convey to Trader 2 one-hundred
percent (100%) of the Trader 1 Assets, including all rights and
liabilities attendant thereto and Trader 2 shall convey to Trader 1
sixty four decimal seven zero percent (64.70%) of the Trader 2
Assets (resulting in in Trader 1 owning a 55% working interest and
Trader 2 retaining a 30% working interest in the Trader 2 Assets),
including all rights and liabilities attendant
thereto.
2.
Assignments: The Trader 1
Assets and Trader 2 Assets shall be conveyed to the respective
Parties by a mutually acceptable assignment and bill of sale, which
shall include a special warranty of title, defending against the
claims of any person claiming by, through or under transferor, but
not otherwise. The Parties agree that the Trader 1 Assets shall be
conveyed to Mountain View Resources, LLC, an affiliate of Trader 2,
instead of Trader 2, and the assignment and bill of sale shall
reflect same.
3.
Liens and Encumbrances: Except
as otherwise provided for herein, the Trader 1 Assets and Trader 2
Assets shall be conveyed from the respective Parties free and clear
of all liens, mortgages, taxes, obligations, claims, suits, and any
other encumbrances.
-1-
4.
Purchase Price: The purchase
and exchange of assets pursuant to this Agreement shall be
construed as a simultaneous like-kind exchange within the meaning
of Section 1031 of Internal Revenue Code of 1986 as in effect on
the date hereof and as may be amended from time to time. For
purposes hereof the Parties agree that the Trader 1 Assets and
Trader 2 Assets to be conveyed shall be considered to be of equal
value.
5.
Closing Date and Effective
Date: Unless otherwise agreed by the Parties, the closing of
the purchase and exchange shall occur on or before March 1, 2018
(the “Closing
Date”). The period between the execution of the
Agreement and the Closing Date shall provide the necessary time for
the Parties to complete final due-diligence and to obtain all
necessary internal approvals, as well as any required third party
consents. The effective date of the Agreement shall be January 1,
2018 (the “Effective
Date”). On the Closing Date, if a conveying Party has
received revenues attributable to production occurring between the
Effective Date to the Closing Date on an asset which it has
conveyed, the conveying Party shall reimburse the other Party for
that amount. Conversely if a conveying Party has made payments for
costs incurred attributable to operations occurring between the
Effective Date to the Closing Date on an asset which it has
conveyed, the other Party shall reimburse the conveying Party for
that amount.
6.
Pre-Effective Date and Post-Effective
Date Obligations:
All revenues
received and all costs, expenses, obligations and liabilities
earned or incurred prior to the Effective Date in regard to the
Trader 1 Assets conveyed to Trader 2 shall be owned and/or borne by
Trader 1, and all revenues received and all costs, expenses,
obligations and liabilities earned or incurred after the Effective
Date in regard to the Trader 1 Assets conveyed to Trader 2 shall be
owned and/or borne by Trader 2. All revenues received and all
costs, expenses, obligations and liabilities earned or incurred
prior to the Effective Date in regard to the Trader 2 Assets
conveyed to Trader 1 shall be owned and/or borne by Trader 2, and
all revenues received and all costs, expenses, obligations and
liabilities earned or incurred after the Effective Date in regard
to the Trader 2 Assets conveyed to Trader 1 shall be owned and/or
borne by Trader 1.
7.
ORRI: Trader 1 shall be
entitled to and shall reserve from the Trader 1 Assets conveyed to
Trader 2 an overriding royalty interest equal to two percent (2%)
of 8/8, proportionately reduced to the working interest so
conveyed. Trader 2 shall be entitled to and shall reserve from the
Trader 2 Assets conveyed to Trader 1 an overriding royalty interest
equal to two percent (2%) of 8/8, proportionately reduced to the
working interest so conveyed.
8.
Operating and Other Agreements:
Trader 1 and Trader 2 shall be bound by the provisions of the
Operating Agreements governing the MV AMI and KC AMI, as well as
the APSEA, the EA and any other agreements applicable to the
respective Trader 1 Assets and Trader 2 Assets.
9.
Due Diligence: Up until the
Closing Date, the Parties shall afford, or shall use reasonable
commercial efforts to afford, each other and its authorized
representatives, upon reasonable notice, at reasonable times, and
at the sole cost, risk, and expense of that Party or its
representatives, as applicable, the following additional due
diligence reviews to the reasonable satisfaction of transferee: (a)
confirmation of the marketability of title and the accuracy of all
ownership, contract rights and status; (b) review of all contract
rights, well and regulatory files, lease agreements, geological,
geophysical and engineering data and other contracts applicable to
the Trader 1 Assets and Trader 2 Assets, as the case may be; and
(c) field inspections and other acts of due diligence appropriate
to the transaction as mutually agreed between the
Parties.
-2-
10.
Cooperation and Exclusivity:
The Parties shall cooperate in good faith and proceed expeditiously
to consummate the transaction by the Closing Date. After execution
of this Agreement and continuing until the Closing Date, neither
Party shall directly or indirectly solicit or entertain any other
offer to acquire the respective assets, or any portion thereof, or
enter into any negotiation or agreement that provides for the sale
of the respective assets, or any portion thereof, to any third
party.
11.
Access to Data: Each Party
agrees to provide reasonable access to the other Party to the
public and confidential books and records of the other Party
pertaining to the Trader 1 Assets and Trader 2 Assets, as the case
may be. All information and data disclosed by either Party pursuant
to this Agreement shall be treated as confidential information and
not disclosed to third parties without securing the other
Party’s prior written consent.
12.
Confidentiality: Except as and
to the extent required by applicable laws (including applicable
federal and state securities laws) or the rules of any public stock
exchange on which the securities of either Party may be listed,
neither Party shall, without the prior written consent of the other
Party, make any public announcement, comment, statement, or other
communication with respect to, or otherwise publicly disclose or
permit the public disclosure of the existence of this Agreement or
any of its terms; provided, however, that this paragraph 12 shall
not apply in the case of any such disclosure by a Party to its
shareholders, members, partners, directors, managers, officers,
employees, lenders, attorneys, accountants, engineers, or other
professional consultants and advisors who have a need to know. If a
Party is required by law or applicable stock exchange rule to make
any such disclosure, it shall first provide to the other Party the
content of the proposed disclosure, the reason that such disclosure
is required by law or applicable stock exchange rule, and the time
and place that the disclosure shall be made.
13.
Representations and Warranties:
Trader 1 and Trader 2 severally represent and warrant to the other
Party, as applicable, the following in regard to the respective
Trader 1 Assets and Trader 2 Assets being conveyed to the other
Party (individually the “Conveyed Assets”), as well as
corporate authority to enter into this Agreement:
(a)
Subject to the terms of the governing agreements of the Conveyed
Assets, the conveying Party owns, or is entitled to own, title to
the Conveyed Assets free and clear of all liens mortgages, taxes,
obligations, claims suits and any other encumbrances, created by,
through or under the conveying Party (excluding the ORRI as
provided for in Article 7 herein), but not otherwise, and the conveying Party is not aware of any liens
mortgages, taxes, obligations, claims suits and any other
encumbrances created by third parties which are not disclosed of
record;
(b)The
Conveyed Assets have not been declared or alleged to be in default,
and the conveying Party is not aware of the existence of any facts
which might lead to a claim of default with regard to the Conveyed
Assets.
(c)The
conveying Party has not received any written notice from, or to the
conveying Party’s knowledge there is not any assertion by,
any governmental authority or any other Person claiming any
violation or repudiation of the Conveyed Assets or any violation of
any law, rule, regulation, ordinance, order, decision or decree of
any governmental authority with respect to the Conveyed Assets, and
the conveying Party is not aware of the existence of any facts
which might lead to a claim of any violation with regard to the
Conveyed Assets;
-3-
(d)
No lawsuit or other
legal or administrative proceeding is pending or, to conveying
Party’s knowledge, threatened or potential, that affects, or
has the potential to affect the Conveyed Assets or the ownership of
or operations, if any, thereon;
(e)Except for
consents or approvals of governmental authorities customarily
obtained after the Closing Date, the Conveyed Assets may be
transferred by assignment by the conveying Party without the
consent of any person, free of any preferential rights to purchase,
rights of first refusal and the like with respect to the Conveyed
Assets;
(f)The
conveying Party has not executed any contracts, conveyances,
assignments, agreements or encumbrances separate from the Conveyed
Assets that shall affect the ownership thereof;
(g)Except for the
ORRI as provided for in Article 7 herein, the conveying Party has
not created, and there are not, any payments out of
production;
(h)To
the best of its knowledge, the conveying Party has obtained, and
maintained in effect, all necessary governmental permits, licenses
and other authorizations, if any, with regard to the ownership or
operation of the Conveyed Assets, and there are not any material
violations in respect of such permits, licenses or other
authorizations.
(i)Each
conveying Party is duly formed, validly existing and in good
standing under the laws of the State of its formation, and is duly
qualified to own the Conveyed Assets and hold title
thereto;
(j)The
execution and delivery of this Agreement has been, and the
performance of this Agreement and the transactions contemplated
hereby shall be, at the time required to be performed hereunder,
duly and validly authorized by all requisite action on the part of
conveying Party and the other Party;
(k)This
Agreement has been, and on the
Closing Date shall be reaffirmed to be, duly executed and delivered
on behalf of conveying Party and the other Party and shall constitute
the legal, valid and binding obligation of conveying Party and the
other Party, enforceable in accordance with their respective terms,
except as enforceability may be limited by laws affecting the
rights of creditors generally or
equitable principles;
(l)The
execution and delivery of this Agreement by conveying Party does
not, and the consummation of the transactions contemplated by this
Agreement and the future delivery of the assignment shall not, (i)
violate or be in conflict with, or require the consent of any
person or entity under any provision of conveying Party’s
governing documents, (ii) violate any provision of or require any
consent, authorization or approval under any judgment, decree,
judicial or administrative order, award, writ, injunction, statute,
rule or regulation applicable to the conveying Party or (iii)
result in the creation of any lien, charge or encumbrance on any of
the Conveyed Assets;
(m)No
lawsuit or other legal or administrative proceeding is pending or,
to the conveying Party’s knowledge, threatened, that affects
the conveying Party that would have a material adverse impact on
the Conveyed Assets; and
(n)Neither Party
has incurred any obligation or liability, contingent or otherwise,
for brokers’ or finders’ fees in respect of the matters
provided for in this Agreement that shall be the responsibility of
the other Party, and any such obligation or liability that might
exist shall be the sole obligation of the Party contracting such
fee, and that Party shall indemnify the other Party hereto for any
claims by any third party seeking payment.
-4-
These
representations and warranties are valid as of the date of
execution of this Agreement and unless otherwise noted to the
contrary by the Party making such representations and warranties,
shall be considered reaffirmed as of the Closing Date.
14.
Counterparts: This Agreement
may be executed in counterparts each of which shall be deemed to be
an original but all of which shall be deemed one and the same
document.
15.
Governing Law: This Agreement
shall be governed by and construed and enforced in accordance with
the laws of the State of New York.
16.
Expenses: Other than legal
fees, which the Parties agree to share equally, each Party shall
pay its own expenses and costs incidental to the negotiation and
completion of this Agreement.
17.
Termination: Unless a material
issue arises prior to the Closing Date in regard to title or
quality of the Conveyed Assets, or either Party is unable to
fulfill its promise under any representation or warranty set forth
in Article 13 herein, the transaction as provided for herein shall
be consummated on the Closing Date. If the transaction is not
consummated on the Closing Date for a reason enumerated above, this
Agreement shall terminate and neither Party shall have any rights
of ownership of the assets intended to be conveyed to it, nor any
liability attendant to the assets not conveyed. Notwithstanding the
foregoing, if payments have been made by the other Party to a
conveying Party, or to third parties, for costs incurred on the
Conveyed Assets, in such case these payments shall be immediately
reimbursed by the conveying Party to the other Party. The
provisions in Articles 12, 15 and 16 shall survive any termination
of this Agreement.
If the
foregoing letter is fully acceptable to you, please acknowledge
your agreement by signing and returning a copy of this Agreement to
the undersigned. This Agreement shall become effective when it has
been executed by both Parties. The return of executed documents by
electronic transmission shall be effective between the
Parties.
Sincerely
yours,
/s/ Jonathan B. Rudney
Jonathan
B. Rudney
Manager
AGREED
TO AND ACCEPTED THIS 14 DAY OF FEBRUARY, 2018
PETRO RIVER OIL CORPRATION
By:
/s/ Scot
Cohen
Scot
Cohen
Executive
Chairman
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