AGREEMENT
Exhibit 10.3
AGREEMENT
This Agreement (the “Agreement”) is
dated November 30, 2009 and is made by and between Bonanza Oil & Gas, Inc.
(the “Company”), and Whalehaven
Capital Fund Limited (”Whalehaven”).
WHEREAS, on June 30, 2008 the
Company and Whalehaven entered into that certain Securities Purchase Agreement
dated June 30, 2008 (the "Purchase Agreement"),
as amended on August 18, 2008, providing for the sale by the Company to the
Whalehaven of units with each unit consisting of one share of common stock (the
“Shares”) and
one common stock purchase warrant half of which are exercisable at $1.00 (the
“A Warrant”)
and half are exercisable at $1.00 (the “B
Warrant”).
WHEREAS, the Company and
Whalehaven have been in discussions regarding the application of the ratchet and
price protection contained in the Purchase Agreement, the A Warrant and the B
Warrant.
WHEREAS, the Company and
Whalehaven have agreed to settle this dispute as outlined below.
NOW, THEREFORE, in
consideration of the mutual conditions and covenants contained in this
Agreement, and for other good and valuable consideration, the sufficiency and
receipt of which is hereby acknowledged, it is hereby stipulated, consented to
and agreed by and between the Company and Whalehaven as follows:
1. Section
3(b) of the A Warrant and of the B Warrant is hereby deleted in its entirety and
all Dilutive Issuances (as defined in the A Warrant and B Warrant) that may have
potentially resulted in a reduction of the Base Share Price (as defined in the A
Warrant and B Warrant) are hereby of no force and effect. Section
3(c) of the A Warrant and the B Warrant is deleted. The parties agree
that the pursuant to this Agreement, the Company has satisfied its obligations
to Whalehaven with respect to ratchet rights.
2. The
first sentence of Section 2(a) of the A Warrant and the B Warrant is
restated as follows:
Exercise
of the purchase rights represented by this Warrant may be made, in whole or in
part, at any time or times on or after February 28, 2010 and on or before the
Termination Date by delivery to the Company (or such other office or agency of
the Company as it may designate by notice in writing to the registered Holder at
the address of the Holder appearing on the books of the Company) of a duly
executed facsimile copy of the Notice of Exercise Form annexed hereto; and,
within 3 Trading Days of the date said Notice of Exercise is delivered to the
Company, the Company shall have received payment of the aggregate
Exercise Price of the shares thereby purchased by wire transfer or cashier’s
check drawn on a United States bank.
3. Section
2(b) of the A Warrant and the B Warrant is restated as follows:
Exercise
Price. The exercise price per share of the Common Stock under
this Warrant shall be $0.001, subject to adjustment
hereunder (the “Exercise
Price”).
4. The
Company acknowledges that the holding period of the Series A Warrant and the
Series B Warrant for purposes of Rule 144 under the Securities Act of 1933 began
on June 30, 2008 and remains unchanged and uninterrupted.
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5. The
definition of “Warrants” in Section
1.1 of the Purchase Agreement is restated as follows:
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“Warrants” means the
Series A Warrant, the Series B Warrant and the Series C
Warrant.
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6.
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Section
4.12 of the Purchase Agreement is hereby deleted in its
entirety.
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7. Section
4.17 of the Purchase Agreement is hereby deleted in its entirety and any
issuances of shares of common stock or other securities that the Company may
have been required to make prior to the date of this Agreement are hereby
waived.
8. The
Company shall issue to Whalehaven, on the date of this Agreement, a common stock
purchase warrant to acquire 6,000,000 shares of common stock for a period of
three years (the “Series C Warrant”). The holding period, for Rule
144 purposes, for the Series C Warrant shall commence on the date
hereof. The form of Series C Warrant is attached hereto as Exhibit
A.
9. Whalehaven
and the Company warrant and represent that no other person or entity has any
interest in the matters released herein, and that it has not assigned or
transferred, or purported to assign or transfer, to any person or entity all or
any portion of the matters released herein. Whalehaven specifically
represents that it is the owner of the A Warrant and the B Warrant and that
there are no liens, mortgage, deed of trust, pledge, claim, security interest,
covenant, restriction, easement, preemptive right, or any other encumbrance or
charge of any kind.
10. Each
party shall be responsible for their own attorneys’ fees and costs.
11. Each
party acknowledges and represents that: (a) they have read the Agreement; (b)
they clearly understand the Agreement and each of its terms; (c) they fully and
unconditionally consent to the terms of this Agreement; (d) they have had the
benefit and advice of counsel of their own selection; (e) they have executed
this Agreement, freely, with knowledge, and without influence or duress; (f)
they have not relied upon any other representations, either written or oral,
express or implied, made to them by any person; and (g) the consideration
received by them has been actual and adequate.
12. This
Agreement contains the entire agreement and understanding concerning the subject
matter hereof between the parties and supersedes and replaces all prior
negotiations, proposed agreement and agreements, written or
oral. Each of the parties hereto acknowledges that neither any of the
parties hereto, nor agents or counsel of any other party whomsoever, has made
any promise, representation or warranty whatsoever, express or implied, not
contained herein concerning the subject hereto, to induce it to execute this
Agreement and acknowledges and warrants that it is not executing this Agreement
in reliance on any promise, representation or warranty not contained
herein.
13. This
Agreement may not be modified or amended in any manner except by an instrument
in writing specifically stating that it is a supplement, modification or
amendment to the Agreement and signed by each of the parties
hereto.
14. Should
any provision of this Agreement be declared or be determined by any court or
tribunal to be illegal or invalid, the validity of the remaining parts, terms or
provisions shall not be affected thereby and said illegal or invalid part, term
or provision shall be severed and deemed not to be part of this
Agreement.
15. The
parties agree that this Agreement is governed by the Laws of the State of New
York and that any and all disputes that may arise from the provisions of this
Agreement shall be tried in the Supreme Court, State of New York, County of New
York. The Parties agree to waive their right to trial by jury for any
dispute arising out of this Agreement.
16. This
Agreement may be delivered electronically and or executed in facsimile
counterparts, each of which, when all Parties have executed at least one such
counterpart, shall be deemed an original, with the same force and effect as if
all signatures were appended to one instrument, but all of which together shall
constitute one and the same Agreement.
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IN WITNESS WHEREOF, the
Parties have duly executed this Agreement as of the date first indicated
above.
| BONANZA OIL & GAS, INC. | |||
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By:
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/s/ | |
| Name: Xxxxxxx Xxxxxxx | |||
| Title: CEO | |||
| WHALEHAVEN CAPITAL FUND LIMITED | |||
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By:
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/s/ | |
| Name | |||
| Title | |||
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