LETTER OF INTENT
EXHIBIT
10.1
THIS LETTER OF INTENT,
hereinafter referred to as the “LOI”, is entered into, dated and made effective
this 4th day of
May, 2009,
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BETWEEN:
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AMERICAN XXXXX-XXXXXX,
INC.
(“APH”)
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AND:
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S&W
OIL & GAS, LLC
(“S&W”)
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WHEREAS S&W owns one
hundred percent (100%) of the working interest in and the exclusive rights to
drill an oil well in the Xxxxxx Prospect #1 Xxxxxxx (the
“Prospect”);
AND WHEREAS APH wishes to
acquire a twenty five percent (25%) working interest and eighty-one and one-half
percent (81.5%) net revenue interest in the Prospect, and S&W wishes to sell
and transfer to APH, such interests in exchange for payment to S&W of a
total of $64,536, due and payable as set forth below.
AND WHEREAS the parties wish
to enter into this letter of intent (the “LOI”) that sets forth the material
terms of agreement and payment structure.
NOW, THEREFORE, in
consideration of $10.00 and other good and valuable consideration, the parties
agree as follows:
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1.
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APH
agrees to acquire 16/64ths or twenty five percent (25%) working interest
and eighty-one and one-half percent (81.5%) net revenue interest in the
Prospect for a cash payment of $64,536. S&W will issue 16 units
representing the twenty five percent (25%) working interest and eighty-one
and one-half percent (81.5%) net revenue interest, to APH after receiving
the $64,536 payment.
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2.
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In
the event S&W or its representatives determine that the drill stem
tests and or logs support commercial production, an additional $44,624 per
16/64th
working interest held by APH is due from APH for completion of the oil
well and for the purchase of necessary
equipment.
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3.
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If
any party hereto decides to not pursue the transactions contemplated by
this LOI, and if the drilling rig is not on site by May 25th,
2009, all funds advanced by APH pursuant to this LOI will be due
immediately and shall be repaid in full to APH. Any outstanding
balance shall be subject to a late charge interest rate of one percent
(1%) per month.
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4.
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S&W,
represents and warrants to APH
that:
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1
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(a)
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it
is validly incorporated and is in good standing with all regulatory
agencies;
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(b)
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there
are no legal actions against S&W or its directors or officers nor does
S&W know of any intended legal actions against it or any of its
officers or directors and S&W is not engaged in any legal actions
against other parties, and is current in all filings with tax and
regulatory authorities;
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(c)
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it
owns one hundred percent (100%) of the working interest in and the
exclusive rights to drill an oil well in the Xxxxxx Prospect #1 Xxxxxxx,
subject to any liens, charges, securitizations, UCC filings or debts
disclosed to APH prior to the execution of this LOI;
and
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(d)
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it
has the authority and is not precluded by law or contract from issuing the
twenty five percent (25%) working interest and eighty-one and one-half
percent (81.5%) net revenue interest in the Prospect contemplated under
this LOI.
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5.
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Neither
APH, on the one hand, nor S&W on the other, will make any disclosure
or public announcements of the proposed transactions, this LOI, or the
terms hereof without the prior knowledge of the
other.
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6.
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Each
party agrees and acknowledges that such party and its directors, officers,
employees, agents and representatives will and may disclose business
information and information about the proposed transaction in the course
of securing financings for APH and S&W and that both parties and their
representatives may be required to disclose that information under
applicable regulatory requirements, if
any.
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7.
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This
LOI shall be construed in accordance with, and governed by, the laws of
the State of Nevada, and each party separately and unconditionally
subjects to the jurisdiction of any court of competent authority in the
State of Nevada, and the rules and regulations thereof, for all purposes
related to this agreement and/or their respective performance hereunder
and regardless of whether or not any business, transaction of business or
other connection to the State of Nevada is
absent.
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8.
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This
LOI sets forth the entire understanding of the parties with respect to the
subject matter hereof and may be modified only by a written document
signed by all parties.
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9.
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If
any term or provision hereof shall be held illegal or invalid, this LOI
shall be construed and enforced as if such illegal or invalid term or
provision had not been contained
herein.
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10.
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All
references to currency in this LOI are references to the lawful currency
of the United States of America.
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2
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11.
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APH,
and its successors, assigns or affiliates may, at any time upon prior
consent of S&W, which consent shall not be unreasonably withheld, at
their sole discretion, assign any or all of their interest in and to this
LOI. The purpose of this paragraph is to permit APH to engage
in a going public, financing or similar
transaction.
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DATED
EFFECTIVE THIS 4th DAY OF
MAY, 2009
AMERICAN
XXXXX-XXXXXX, INC.
_________________________________
Name:
___________________________
Title:
____________________________
The
above terms are hereby read, understood, acknowledged and accepted effective the
4th
day of May, 2009.
S&W
GAS & OIL, LLC
_________________________________
Name:
___________________________
Title:
____________________________
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