EXHIBIT 10.2

 

August 1, 2013

 

 

Gulfex Petroleum, LLC

P.O. Box 18978

Sugar Land, Texas 77496

 

Re: Sale of Properties / Port Hudson Field, East Baton Rouge Parish, Louisiana

 

Dear Sirs:

 

GULFEX PETROLEUM, LLC (“GULFEX”) has agreed to participate with WEST TEXAS
RESOURCES, INC. (“WTR”) in order to facilitate the acquisition by WTR of certain
oil and gas properties and interests in Louisiana. Specifically, GULFEX has
agreed to acquire an undivided 45% of the interests to be acquired by WTR
through its acquisition of PORT HUDSON VENTURES, LLC, a Texas limited liability
company (“PHV”). PHV owns certain undivided interests in producing oil and gas
leases, wells and production assets, and related contract and other rights in
the Port Hudson Field in East Baton Rouge Parish, Louisiana (which assets are
collectively referred herein to as the “Properties” and are more particularly
described on Exhibit A hereto). By execution of this letter agreement (the
“Agreement”), the parties are formalizing their agreement to the above described
transaction, upon the following terms and conditions:

 

1.Purchase Price: GULFEX agrees to advance to WTR the sum of $ 505,442.23 in
consideration for the conveyance by WTR of an undivided 45% interest in the
Properties, which for purposes of this Agreement are understood and agreed to
equate to 5.92875% (of 8/8ths) Working Interest and a 4.62443% (of 8/8ths) Net
Revenue Interest for the Properties described on Exhibit A hereof.

 

2.Effective Date and Time: The Effective Date and Time for the conveyance of the
45% interest in the Properties shall be 7:00 a.m., Central Daylight Time, April
1, 2013 ("Effective Time").

 

3.Closing Date: Closing for the conveyance of the subject interest in the
Properties shall take place at WTR’s Houston offices on or before August 15,
2013 (the “Closing Date”).

 

4.Future Operations: Pursuant to the terms of the Joint Operating Agreement
governing the Properties, GULFEX shall have the right to participate
proportionately in all future operations related to the Properties.

 

5.Definitive Assignment: Title to the Properties resides in PHV which will
become a wholly owned subsidiary of WTR. WTR shall cause PHV to execute and
deliver at Closing, the Assignment and Bill of Sale for the subject interest in
the Properties, in the form attached as Exhibit B hereto.

 

 

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6.Liens and Encumbrances: The Properties to be assigned to GULFEX shall be free
and clear of all liens and encumbrances.

 

7.Warranty of Title: WTR and PHV make no warranty of any kind, expressed or
implied, except as to parties claiming or to claim by, through or under them,
but not otherwise.

 

8.Title Review; Records Research: Following execution of this Agreement and
through the Closing Date, GULFEX shall be entitled to review and photocopy all
title material relating to the Properties in the possession of WTR and PHV at
the offices of WTR. In addition to the review of title, and in order to
facilitate GULFEX's due diligence work with respect to the Properties, WTR shall
permit GULFEX's representatives access to all accounting, engineering,
geological, geophysical and other records, books, contracts relating to the
Properties.

 

9.Facilities Inspection: Following execution of this Agreement and through the
Closing Date, GULFEX, at its sole risk and expense, shall complete any and all
inspections and "As Is" approval of all equipment and facilities attributable to
or owned or used in connection with the Properties, to confirm for itself that
the Properties are in reasonable operating condition consistent with oil and gas
industry standards.

 

10.Governing Law: The construction and interpretation of this letter agreement
shall be governed by the Laws of the State of Texas without reference to the
conflict of laws provisions thereof.

 

11.Allocation of Liability and Expenses: Each party shall pay and discharge all
liabilities, obligations and expenses incurred by such party or on such party’s
behalf in connection with the preparation, authorization, execution and
performance of this Agreement and the Assignment and Bill of Sale, including
without limitation all fees and expenses of agents, representatives, counsel,
accountants, and auditors retained by such party, as well as all amounts payable
with respect to any claim for brokerage, finder's fees or other commissions
based in any way on any agreements, arrangements, or understandings made by such
party.

 

 

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12.Post Effective Time Assumption of Liabilities: GULFEX shall assume its
proportionate share of the responsibility and liability, and does hereby
indemnify and hold WTR and PHV harmless as to the interest in the Properties
acquired herein, arising from the ownership or operation of the Properties after
the Effective Time.

 

13.Confidentiality: This letter and its contents are confidential and shall not
be disclosed to any third party by either party hereto, other than to (a)
administrative agencies to which such disclosure is required by law, contract or
administrative regulation, and (b) personnel, agents, or representatives as each
party believes are necessary in good faith for completing the transactions
represented by this Agreement.

 

 

 

Very truly yours,

 

WEST TEXAS RESOURCES, LLC

 

        By: /s/ Stephen E. Jones     Stephen E. Jones, President  

 

 

 

Agreed to and accepted

This 13th day of August, 2013

 

 

GULFEX PETROLEUM, LLC         By: /s/ Brian G. Donnelly     Brian G. Donnelly,
Manager  

 

 

 

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EXHIBIT A

Schedule of Properties

 

Attached to and made a part of that certain Agreement between

WEST TEXAS RESOURCES, INC. and GULFEX PETROLLEUM, LLC

dated August 13, 2013

 

 

 

 

TO FOLLOW BEFORE CLOSING

 

 

 

 

 

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EXHIBIT B

Form of Assignment

 

Attached to and made a part of that certain Letter Agreement between

WEST TEXAS RESOURCES, INC. and GULFEX PETROLLLEUM, LLC

dated August 13, 2013

 

 

 

 

TO FOLLOW BEFORE CLOSING

 

 

 

 

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