SURRENDER AND CANCELLATION OF EP 468 EARNING AGREEMENT
Exhibit 10.3
SURRENDER AND CANCELLATION OF EP 468 EARNING AGREEMENT
THIS SURRENDER OF ALL RIGHTS UNDER THE EP 468 EARNING AGREEMENT AND CANCELLATION OF THE EP 468 EARNING AGREEMENT (“Surrender”) is made as of the 9th day of August, 2017 (the “Effective Date”), by and among Nation Energy (Australia) Pty Ltd, an Australian company, with an address of 0000 Xxxx 00xx Xxxxxx, Xxxxx X, Xxxxxxxxx, X.X. Xxxxxx X0X 0X0 (“Nation Australia”), and Officer Petroleum Ltd., an Australian company, with an address of Xxxxx 00, 00 Xxxxxx Xxxxx, Xxxxxx, Xxx Xxxxx Xxxxx 0000 (“Officer”). Nation Australia and Officer may be referred to collectively as the “Parties” or individually as a “Party”.
RECITALS
WHEREAS, pursuant to the terms of the Earning Agreement dated May 31, 2016, attached hereto as Exhibit “A”, between Nation Australia and Officer regarding exploration permit EP 468 (the “Permit”), Nation Australia incurred certain work permit payment obligations, and other billable charges, including administrative and general expenses, to Officer;
WHEREAS, Nation Australia is in arrears for payment to Officer for USD$1,029,955.53 at March 31, 2017, which consists of unpaid work permit expenses and other billable charges, including administrative and general expenses, to be paid by Nation Australia pursuant to the EP 468 Earning Agreement (the “EP 468 Expenses”), whereby such failure of payment has resulted in the cancelation of the EP 468 exploration permit by the Australian Government, further resulting in an impairment loss of USD$5,797,476.00 to Officer (the “EP 468 Impairment”);
WHEREAS, related to amounts owed by Nation Australia under the Earning Agreement and other earning agreements, pursuant to the terms of that certain Promissory Note dated May 31, 2016, issued by Nation Australia to Paltar Petroleum Limited (“Paltar”) in the principal amount of AUD$24,322,501.00, with a maturity date of May 31, 2019, Nation Australia is obligated to pay the full principal amount to Paltar plus currently accrued interest, for a total amount owed, as converted into United States Dollars, of USD$19,368,913.78 at March 31, 2017 (the “Promissory Note”), and Nation Energy Inc. has guaranteed payment of the Promissory Note;
WHEREAS, by written notice delivered on the 10th of July, 2017, to Nation Australia, Officer has asserted that Nation Australia has failed to comply fully with the Earning Agreement and the Promissory Note. Nation Australia neither admits nor denies this claim;
WHEREAS, given Nation Australia’s default of the Earning Agreement, and with knowledge of its inability to remedy and cure the default within 30 days following Officer’s notice as provided in Section 7.3 of the Earning Agreement, Nation Australia is required to surrender its entire interest in the Earning Agreement to Officer, free of all encumbrances arising by, though or under Nation Australia, and Nation Australia will execute this surrender agreement;
Now therefore, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledge and intending to be legally bound, Nation Australia and Officer agree as follows:
1. Incorporation of Recitals. The foregoing recitals are incorporated herein by reference.
2. Surrender and Release. Nation Australia hereby surrenders, terminates its entire interest in the aforementioned Permit and Officer cancels the Earning Agreement. Nation Australia’s rights and interests to the Permit under the Earning Agreement are hereby terminated. Termination of the Earning Agreement does not eliminate Nation Australia’s obligation to pay the Promissory Note.
3. Entire Agreement. This Surrender sets forth the entire agreement between the Parties, and fully supersedes any and all prior contemporaneous agreements of understandings between the Parties which pertain to the subject matter hereof. The terms of this Surrender may not be contradicted by evidence of any prior contemporaneous agreement and no extrinsic evidence whatsoever may be introduced to vary its terms in any judicial proceeding involving this Surrender or the subject matter of this Surrender.
4. Binding Effect. As used in this Surrender, the terms Nation Australia and Officer include their respective heirs, personal representatives, successors, assigns, affiliates, predecessors in interest, successors in interest, assignors, assignees, agents, independent contractors, employees, attorneys, directors, shareholders, investors, insurers, sureties, and anyone claiming by, through or under the respective Party.
5. Applicable Law. This Surrender shall be governed by, construed, interpreted and applied in accordance with the laws of Western Australia, Australia, excluding any choice of law rules which would refer the matter to the laws of another jurisdiction.
[Signature and Acknowledgement Page Follows]
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IN WITNESS WHEREOF, the Parties hereto have duly executed this Surrender on the Effective Date indicated above.
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Executed by Nation Energy (Australia) Pty Ltd (ACN 606 533 046) in accordance with section 127 of the Corporations Xxx 0000 by authority of its directors:
/s/ Xxxxxxx Xxxxxxx |
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/s/ Xxxxxx Madzej |
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Chief Executive Officer/Director
Xxxxxxx Xxxxxxx |
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Director
Xxxxxx Madzej |
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Print name |
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Print name |
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Executed by Officer Petroleum Pty Ltd (ACN 142 330 738) in accordance with section 127 of the Corporations Xxx 0000 by authority of its directors:
/s/ Xxxx Xxxxxx |
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/s/ Xxxxx Xxxxxx |
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Director
Xxxx Xxxxxx |
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Director
Xxxxx Xxxxxx |
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Print name |
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Print name |
