Explortex Energy Inc.
Exhibit 2.2
CONFIDENTIAL
February 29, 2012
POINT CAPITAL XXXXXXX SHALE INVESTORS II, L.P.
c/o Point Capital Partners, LLC
000 Xxxx Xxxxxx, Xxxxx 000
Chatham NJ 07928
Attention: Xxxxxxxx X. Xxxxxxxx
Dear Sirs:
This acquisition agreement sets forth the terms and conditions under which Explortex Energy Inc. ("Explortex" or the "Company") agrees to purchase Point Capital Xxxxxxx Shale Investors II, L.P. ("PCBSI2"). As defined in Appendix I, PCBSI2 owns various Working Interests in nineteen (19) Xxxxxxx Shale xxxxx located in Wise, Cook and Denton Counties, TX which are operated by X.X. Xxxxxx Corp. As consideration, Explortex Energy, Inc. will issue $1,150,000.00 (the "Purchase Price") of Convertible Preferred A Securities, with a designated value of $1,000 per share (collectively, the "Transaction") The Company will not be required to make any deposit in advance of the Transaction (the "peposit").
Purchase and Sale Agreement
1. The purchase and sale will be completed on and subject to the terms and conditions of a formal purchase and sale agreement (the "Purchase and Sale Agreement") which, in addition to the customary terms and conditions for agreements of this type, would have the following key terms:
|
(a)
|
upon execution of the Purchase and Sale Agreement, the Deposit will become subject to the terms thereof;
|
|
(b)
|
at Closing, (i) Explortex will pay to PCBSI2 the Purchase Price, (ii) PCBSI2 will cause your legal counsel to place the Deposit into an escrow account (the "Escrow Account") with an escrow agent that is mutually acceptable to us and PCBSI2;
|
|
(c)
|
at Closing, PCBSI2 will transfer and convey to us documentation representing all of the ownership interests, duly endorsed in blank and ready for transfer;
|
|
(d)
|
at Closing, Explortex will own 100% of the working interest held by PCBSI2 in the Xxxxxxx Property which will provide the Company ownership of the working interests in the Xxxxxxx Property,
|
1
|
(e)
|
the Closing will be subject to the following conditions precedent: |
|
(i)
|
100% of the working interest held by PCBSI2 in the Xxxxxxx Property, and the Xxxxxxx Property will be subject to no other security interests, charges, encumbrances or burdens of any nature or kind whatsoever save and except for any burdens encumbering the working interests related to, or created, PCBSI2's role as a creditor in the current bankruptcy of X.X. Xxxxxx Corp., the operator;
|
|
(ii)
|
PCBSI2 will have delivered to the Company financial statements of PCBSI2 for the years of ownership, recognizing that X.X.Xxxxxx Corp. may not have delivered to PCBSI2 all the material fmancial information from which PCBSI2 can derive accurate financial statements and, if required,
|
|
(iii)
|
Explortex will have completed our due diligence review of PCBSI2 and the Xxxxxxx Property;
|
|
(iv)
|
Explortex will have executed a mutually acceptable Purchase and Sale Agreement which will name the entity taking title to the working interests in the Xxxxxxx Property as the acquisition holding corporation, or"buyer," thereunder; and
|
|
(v)
|
PCBSI2 shall obtain approval from its managing general partners and all other necessary approvals, if any.
|
|
(f)
|
upon delivery to Explortex of the financial information and completion of our due diligence on the Company and the Xxxxxxx Property (which due diligence will be deemed to be completed within fourteen business days of our receipt of the financial records, less Explortex advises PCBSI2 prior to such time that our due diligence review has uncovered items which prevent us from closing the transactions contemplated herein) the Deposit will become non-refundable;
|
|
(g)
|
following the Closing, PCBSI2 will covenant to us to co-operate fully in the preparation of su h pro forma fmancial statements as are required by Regulation SB;
|
|
(h)
|
following the Closing, Explortex will covenant to PCBSI2 to provide all of the shareholders of the Company overriding royalties on the Xxxxxxx Property with copies, at least ually, of engineering reports with respect to the Xxxxxxx Property;
|
|
(i)
|
following the Closing, the Company will agree to the following governance provisions and sh 11 cause all the necessary approvals to establish the following:
|
|
(a)
|
the Company all form a board of five members; |
|
(b)
|
Point Capital Partners ("PCP"), the investment manager of PCBSI2, and/or its designees, shall have a permanent right to hold two of the Company's board seats, provided, however, that should other assets be acquired by the Company from PCP or entity managed or controlled by PCP, these other acquisitions shall not increase this number;
|
|
(c)
|
The Company shall amend its operating agreement to reflect the provisions that major decisions (i.e. bringing in outside investors and suffering major dilution, selling the Company or substantially all the Company, etc.) shall be decisions made by the majority of its shareholders; |
2
|
(d)
|
PCP shall have the right to manage the books and records of the Company and shall be compensated in cash under a separate agreement. Xxx Xxxxxxxx shall be named as a signatory required for the Company's bank accounts and the Board of the Company shall define other signatory requirements;
|
|
(e)
|
the Company will contemplate hiring one or more permanent employees to assist in managing the day-to-day affairs of the Company. The necessary funding requirements for this will be contemplated in the fund raisings of the Company.
|
|
(j)
|
from the date of execution of the Purchase and Sale Agreement until the Closing, PCBSI2 will agree not to, directly or indirectly, solicit, initiate or encourage submission of proposals or offers from any third party relating to any acquisition, purchase, option to purchase, merger, consolidation, business combination or sale of assets of the Company which would impair in any way your ability to perform your obligations der the Purchase and Sale Agreement;
|
|
(k)
|
the Closing will b required to occur on or before March 30, 2012. |
Confidentiality
2. Except as may be require by any rule, regulation or law of any kind whatsoever which is applicable to either of us, and except for discussions and communications with our existing or potential advisors, counsel, affiliates, and funding sources (provided that such persons are subject to confidentiality agreements or ties no less stringent that those provided for herein) for a period of two (2) years from the term nation of this Acquisition Agreement, each of us shall keep confidential all discussionsd communications between us regarding the transactions
contemplated in this Acquisition Agreement, including, without limitation, all information communicated herein and all written and printed materials of any kind whatsoever exchanged between us concerning such transactions. Explortex will work in good faith to enter into a mutually agreeable non-disclosttre agreement if requested by either party subsequent to the execution of this Acquisition Agreement. In the event that either of us is required by law to disclose any such information, that party shall first provide the other with prior written notice of such requirement so that that party, at its option, may seek a protective order. If, in the absence of a protective order, that party is nonetheless, in the written opinion of its legal counsel, required by law to disclose any such information, disclosure may be made only as to the information legally required to be disclosed. All information disclosed shall be and shall remain the property of the party disclosing the information. Within five (5) days after being so requested by either party, both parties shall return or destroy all documents furnished by the other. Any oral information shall remain subject to the confidentiality obligations set forth in this Acquisition Agreement. Explortex further agrees that, except as necessary to facilitate the transactions contemplated herein, the existence and terms of this Acquisition Agreement are confidential and shall not be disclosed to any person or entity until such disclosure is approved in advance by both of us in writing and then only to the pers9n or entity specified in such approval.
3
Non-Circumvention
3. We both agree that we will not solicit business from any existing supplier, customer, client or contact of each other for the purpose of circumventing our relationships with such supplier, customer, client or contact and/or competing with each other during the Term of this Agreement or for a period of two (2) years from the termination of this Acquisition Agreement without prior written authorization. We both further agree that we will not solicit any of the employees of the other to leave employment in any manner whatsoever (save and except as expressly provided for herein), nor employ or engage the services of any employee or existing independent contractor of the other other who is or was an employee or independent contractor of the other during the currency of this of this Acquisition Agreement or for a period of two (2) years from the termination thout prior written consent. We both acknowledge and agree that we both have a material interest in preserving the relationships we have developed with our respective suppliers, customers, clients or contacts against impairment by competitive activities of other persons and entities. Accordingly, we both agree that the restrictions and covenants contained in this Acquisition Agreement are of the essence of this Acquisition Agreement and constitute a material inducement by each party to the other to disclose the information referred to in section 5 hereof.
Injunction
4. We both agree that mone3k damages would not be a sufficient remedy for breach of either section 5 or 6 this Agreement and that in addition to other remedies, each offended party shall be entitled to specific performance and injunctive or other equitable relief, and in such circumstances the offending party agrees to waive posting of a bond to secure any such equitable relief hereunder.
Termination
5. Unless otherwise agreed by both of us in writing, this Acquisition Agreement will terminate at the close of business on March 30, 2012, in the event that the Purchase and Sale Agreement is not executed by such time. In such case, neither of us will have any obligation to the other hereunder except to the extent of the provisions that are expressly stated to survive termination. In addition, we may terminate this Agreement at any time in the event that, as a result of the due diligence review, Explortex becomes aware of an adverse material fact with respect to the Xxxxxxx Property not previously disclosed to us. In addition, this Acquisition Agreement may be terminated b PCP if the initial funding for our contemplated bid for X.X. Xxxxxx corporation does not materialize.
General Provisions
6. We will receive legal advice concerning this Acquisition Agreement and request that PCBSI2 obtain independent leg advice with respect to same before executing it. In executing this Agreement, PCBSI2 represent and warrant to us that PCBSI2 have been advised to obtain independent legal advice, and that prior to the execution of this Agreement PCBSI2 have obtained independent legal advice or have, in your discretion, knowingly and willingly elected not to do so.
Assignment
7. PCBSI2 may not assign any part of this Acquisition Agreement.
Expiry
8. The Acquisition Agreement will expire and be of no further force or effect unless accepted in writing prior to the close of business on March 30, 2012.
Please confirm that the foregoing correctly sets forth our understandings by signing and returning to us the enclosed duplicate copy of this Acquisition Agreement. Exploretex looks forward to working with PCBSI2 and to the successful conclusion of the proposed transaction.
4
| Yours very truly, | ||
| EXPLORETEX ENERGY INC. | ||
|
|
/s/ /s/ Xxxxxxx X. Xxxxxx | |
| Director | ||
POINT CAPITAL XXXXXXX SHALE INVESTORS II, L.P.
Accepted and Agreed to as of the 29th day of February, 2012
|
By:
|
/s/ Xxxxxxxx X. Xxxxxxxx | |
| Name: | Xxxxxxxx X. Xxxxxxxx | |
| Title: |
Manager, Point Capital Xxxxxxx Shale Managers, LLC, its Managing General Partner
|
|
| c/o Point Capital Partners, LLC | ||
| 000 Xxxx Xxxxxx, Xxxxx 000 | ||
| Chatham NJ 07928 |
5
Appendix I
1) POINT CAPITAL XXXXXXX SHALE INVESTORS II, L.P. ("PCBSI2")
| General Partner: | Point Capital Xxxxxxx Shale Managers, LLC |
| Signatory of GP: | Xxxxxxxx X. Xxxxxxxx - Manager |
| Address: | c/o Point Capital Partners, LLC |
| 000 Xxxx Xxxxxx, Xxxxx 000 | |
| Chatham NJ 07928 |
Description:
|
LEASE NAME(S) / ASSOCIATED XXXXX
|
OPERATOR
|
OWNERSHIP % (Original)
|
OWNERSHIP % (Current -
Adj for After Payout)
|
|
THE XXXXXXXXXXX LEASES
|
|||
|
XXXXX XXXXXXXXXXX #1
|
X.X. Xxxxxx Corp
|
6.2500%
|
6.2500%
|
|
XXXXX XXXXXXXXXXX #2
|
X.X. Xxxxxx Corp
|
6.2500%
|
6.2500%
|
|
XXXXX XXXXXXXXXXX #3
|
X.X. Xxxxxx Corp |
6.2500%
|
6.2500%
|
|
XXXXX XXXXXXXXXXX #4
|
X.X. Xxxxxx Corp |
6.2500%
|
6.2500%
|
|
XXXXX XXXXXXXXXXX #6
|
X.X. Xxxxxx Corp |
6.2500%
|
6.2500%
|
|
XXXXXXXXX XXXXXXXXXXX #1A
|
X.X. Xxxxxx Corp |
6.2500%
|
6.2500%
|
|
XXXXXXXXX XXXXXXXXXXX #2
|
X.X. Xxxxxx Corp |
6.2500%
|
6.2500%
|
|
XXXXX XXXXXXXXXXX #1
|
X.X. Xxxxxx Corp |
6.2500%
|
6.2500%
|
|
XXXXX XXXXXXXXXXX #2
|
X.X. Xxxxxx Corp |
6.2500%
|
6.2500%
|
|
XXXXX XXXXXXXXXXX #3
|
X.X. Xxxxxx Corp |
6.2500%
|
6.2500%
|
|
XXXXX XXXXXXXXXXX #4
|
X.X. Xxxxxx Corp |
6.2500%
|
6.2500%
|
|
XXXXX XXXXXXXXXXX #5
|
X.X. Xxxxxx Corp |
6.2500%
|
6.2500%
|
|
XXXXX XXXXXXXXXXX #6
|
X.X. Xxxxxx Corp |
6.2500%
|
6.2500%
|
|
KNIGHT #1
|
X.X. Xxxxxx Corp
|
6.2500%
|
6.2500%
|
|
KNIGHT #2
|
X.X. Xxxxxx Corp
|
6.2500%
|
6.2500%
|
|
KNIGHT #3
|
X.X. Xxxxxx Corp
|
6.2500%
|
6.2500%
|
|
KNIGHT #4
|
X.X. Xxxxxx Corp
|
6.2500%
|
6.2500%
|
|
KNIGHT #5
|
X.X. Xxxxxx Corp
|
6.2500%
|
6.2500%
|
6
