First Right of Refusal Agreement
Exhibit 10.6
This First Right of Refusal Agreement (this “Agreement”) is entered into as of January 1, 2013 (the “Effective Date”) by and between Contango Oil & Gas Company, a Delaware Corporation (“Contango”) and Juneau Exploration, L.P., a Texas limited partnership (“XXX”). Contango and XXX may be referred to herein collectively as the “Parties” or individually as “Party”.
RECITALS
Contango is an independent oil and gas company whose business is to explore, develop, produce and acquire natural gas and oil properties onshore and offshore in the Gulf of Mexico.
XXX is in the business of generating and marketing exploration prospects for oil and gas as well as ownership in production of oil and gas and other related interests.
NOW THEREFORE, in consideration of the mutual covenants and agreements set forth herein, Contango and XXX agree, as follows:
1. | First Right of Refusal. Subject to the terms and conditions set forth in this Agreement, XXX hereby grants to Contango a first right of refusal to Contango to purchase any exploration prospects generated and recommended by XXX during the term of this Agreement. XXX will present its recommended prospects to Contango along with its terms and conditions for purchasing each prospect and Contango shall have the first right of refusal to purchase the prospect from XXX for a period of 10 days, subject to mutually acceptable terms. |
2. | Compensation. During the terms of this Agreement Contango shall pay to XXX as consideration for this First Right of Refusal the sum of Five hundred thousand dollars ($500,000) annually to be paid quarterly in the amount of One hundred twenty five thousand dollars ($125,000) at the beginning of each quarter being January 1st, April 1st, July 1st and October 1st during the term of this Agreement. |
3. | Term of Agreement. This agreement shall commence on the Effective Date and remain in full force and effect through December 31, 2014. This Agreement may be terminated by either party with 10 days prior written notice with said termination being effective at the end of the quarter for which said First Right of Refusal Compensation has been paid. |
4. | Confidentiality. Contango agrees that the prospect information shall be kept strictly confidential and shall not be sold, traded, published, or otherwise disclosed to anyone in any manner whatsoever, including by means of photocopy or reproduction, without the prior written consent of XXX. Furthermore, Contango agrees not to use the prospect |
information or allow the use thereof, for purposes adverse to or in competition with XXX for the acquisition of oil and gas interests located within the prospect
5. | SOLE RISK. XXX MAKES NO REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED, AS TO THE QUALITY, ACCURACY AND COMPLETENESS OF THE PROSPECT INFORMATION, AND CONTANGO EXPRESSLY ACKNOWLEDGES THE INHERANT RISK OF ERROR IN THE ACQUISITION, PROCESSING AND INTERPRETATION OF PROSPECT INFORMATION. CONTANGO AGREES THAT IT IS NOT ENTITLED TO RELY ON THE ACCURACY OR COMPLETENESS OF THE PROSPECT INFORMATION. CONTANGO AGREES THAT IT IS ACCEPTING AND USING THE PROSPECT INFORMATION AT ITS SOLE RISK. |
6. |
WHEREFORE, the Parties hereto have executed this Agreement as of the date first above written.
CONTANGO OIL & GAS COMPANY
By: /s/ XXXXXX XXXXXX
Name: Xxxxxx Xxxxxx
Title: Vice President
JUNEAU EXPLORATION, L.P.
By Juneau GP, LLC
Its General Partner
By: /s/ XXXX X. XXXXXX
Name: Xxxx X. Xxxxxx
Title: Sole Manager
