AMENDMENT TO PURCHASE AND SALE AGREEMENT
EXHIBIT 10.2
AMENDMENT TO PURCHASE AND SALE AGREEMENT
AMENDMENT TO PURCHASE AND
SALE AGREEMENT
This
Amendment to Purchase and Sale Agreement (the “Amendment”) dated May 23,
2008, is by and between PetroHunter Energy Corporation, a Maryland corporation,
and PetroHunter Operating Company, a Maryland corporation, (together, “Seller”), with an address of
0000 Xxxxx Xxxxxx, Xxxxx 0000, Xxxxxx, Xxxxxxxx and Laramie Energy II, LLC, a
Delaware limited liability company (“Buyer”), with an address of
0000 Xxxxxxx Xxxxxx, Xxxxx 0000, Xxxxxx, Xxxxxxxx 00000. Seller and
Buyer are sometimes referred to as a “Party” or, collectively, as
the “Parties.”
RECITALS
A. Seller
and Buyer entered into a Purchase and Sale Agreement dated April 25, 2008 (the
“Purchase Agreement”)
pursuant to which Seller agreed to sell, and Buyer agreed to buy certain
interests owned by Seller in certain oil and gas leases and related property in
Mesa and Garfield Counties, Colorado.
B. All
capitalized terms used but not defined herein shall have the meanings given to
them in the Purchase Agreement.
C. Seller
and Buyer wish to amend the terms of the Purchase Agreement as set forth
below.
AGREEMENT
In
consideration of the mutual promises contained herein, and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Seller and Buyer hereby agree to amend the Purchase Agreement as
follows:
1. The
Effective Time of the purchase and sale, set forth in Section 1.3 of the
Purchase Agreement as April 1, 2008 at 7:00 a.m., Mountain Time, is changed to
the Closing Date, as defined in Section 11.1 of the Purchase
Agreement.
2. Section
11.1, Date of Closing, is revised to state that, subject to the conditions
stated in the Agreement, consummation of the Transaction (the “Closing”) shall be held on or
before May 30, 2008. If any condition of closing under the Purchase
Agreement has not been satisfied by May 30, 2008, or if the Closing cannot occur
by May 30, 2008 for any reason other than a material breach by either Party,
then either Seller or Buyer may elect to extend the date on or before which
Closing shall occur to a mutually agreeable date on or before June 16, 2008 by
written notice to the other Party.
3. Subsection
11.4.h.ii. shall be replaced in its entirety with the following
provision:
ii. Upon
Buyer’s confirmation that all Scheduled Creditors (as defined in Section 6.18)
have been paid their respective Creditor Settlement Amounts in full and that
releases of all liens and claims, in forms acceptable to Buyer, have been
executed and delivered to the Title Escrow Agent by such parties, Seller and
Buyer shall execute and deliver written instructions to the Escrow Agent
instructing the Escrow Agent to (i) transfer the Creditor Settlement Amounts to
the Scheduled Creditors by wire transfer of immediately available funds or by
check; (ii) retain in the Escrow Account an amount equal to the sum of Seven
Hundred Twenty-Five Thousand Dollars ($725,000) as the Seller’s Performance
Deposit, as defined in Section 12.1 and the Title Escrow Amount, as defined in
Section 4.4.b.iv., and (iii) transfer to Seller an amount equal to the Closing
Amount less Creditor
Settlement
Amounts, Seller’s Performance Deposit and the Title Escrow Amount by wire
transfer of immediately available funds;
4. Section
12.1 shall be replaced in its entirety with the following
provision:
Seller’s
Performance Deposit. Seven Hundred
Twenty-Five Thousand Dollars ($725,000) shall be retained in the Escrow Account
following Closing for the purposes and time periods stated in this
section. Five Hundred Thousand Dollars ($500,000) shall be retained
in the Escrow Account for 91 days following Closing to cover Defect Values
related to Title Defects which have not been cured by Seller on or before the
Closing Date and Losses, as defined in Section 14.3, incurred by Buyer as a
result of breach of Seller’s representations and warranties in Article 6 of this
Agreement or Seller’s failure to perform all covenants and agreements required
to be performed and satisfied by Seller under this Agreement. Two
Hundred Twenty-Five Thousand Dollars ($225,000) shall be retained in the Escrow
Account until the earlier of the date it is determined that a lease extension
payment (“Xxxxxx Extension
Payment”) will not be required to extend the term of Oil and Gas Lease
from Xxxxxx X. Xxxxxx, et al (“Lessors”) to MAB Resources,
LLC dated February 15, 2006, recorded in Book 1802, Page 933, Garfield County,
(“Xxxxxx Lease”) or
February 16, 2009, to be paid (i) to the Lessors, their successors and assigns,
if the Xxxxxx Extension Payment is due or (ii) to Seller if the Xxxxxx Extension
Payment does not become due and Buyer has received a fully executed extension of
the Xxxxxx Lease satisfactory to Buyer. Buyer shall use reasonable
efforts to perform the completion and drilling operations that would replace the
obligation to make the Xxxxxx Extension Payment, pursuant to that certain
Amendment and Ratification of Oil and Gas Lease, dated May 26, 2008, by and
between Xxxxxx X. Xxxxxx , et al. and Laramie Energy II, LLC.
5. The
following Subsection 2.3.b.v. is added to the Purchase Agreement as a downward
adjustment to the Purchase Price:
v. An
amount equal to Sixty Thousand Dollars ($60,000), which amount is twenty percent
(20%) of the settlement amount for pre-Effective Time Property Expenses under
the Settlement Agreement and Release dated May 22, 2008, between Seller and
Xxxxx Xxxxxx Oil Field Operations, Inc. (the “Xxxxx Xxxxxx
Payment”). The Xxxxx Xxxxxx Payment shall be made by Buyer
directly to Xxxxx Xxxxxx Oil Field Operations, Inc. at Closing.
6. The
following telephone and facsimile numbers are added to Section 15.3, Notices,
for notices to Seller:
Telephone: 000-000-0000
Facsimile: 000-000-0000
7. This
Amendment may be executed by Buyer and Seller in any number of counterparts,
each of which shall be deemed an original instrument, but all of which together
shall constitute one and the same instrument. Execution can be
evidenced by fax or electronic signatures with original signature pages to
follow in due course.
The terms and conditions of the
Purchase Agreement, as modified by the terms of this Amendment, are ratified and
confirmed in their entirety.
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The Parties
have executed this Amendment on May 23, 2008, to be effective April 25, 2008,
the date of the Purchase Agreement.
SELLER:
PETROHUNTER ENERGY CORPORATION
By: /s/ Xxxxx X.
Xxxxx
Xxxxx X. Xxxxx
Vice President and General
Counsel
PETROHUNTER OPERATING COMPANY
By: /s/ Xxxxx X.
Xxxxx
Xxxxx X. Xxxxx
Vice President and General
Counsel
BUYER:
LARAMIE ENERGY II, LLC
By: /s/ Xxxxxx X.
Xxxxxxx
Xxxxxx X. Xxxxxxx
Chairman and Chief Executive
Officer
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