EXHIBIT 10.4

 

PURCHASE, SALE AND CAPITAL CONTRIBUTION AGREEMENT

 

 

 

BETWEEN:

 

MOXY TRADING LLC

332 Shadow Creek Drive

Brentwood, TN 37027

 

(“SELLER”)

 

AND:

 

VIKING INVESTMENTS GROUP, INC.

1330 Avenue of the Americas, Suite 23A

New York, NY 10019

 

(“BUYER”)

 

RE: PURCHASE AND SALE OF WORKING INTEREST AND OTHER PROPERTY IN AN OIL AND GAS
LEASE IN KANSAS

 

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Purchase Price:

As Per Section 3

Closing Date:

August 1, 2016

 

 

Effective Date:

August 1, 2016

 

 

 

1. CONSIDERATION. The supporting consideration for this Agreement will be the
exchange of the Purchase Price for the Property and the agreement to make
capital contributions to Seller, and the mutual covenants and agreements
contained herein. The Parties stipulate and agree that said consideration is
sufficient to support this Agreement.

 

2. SALE OF PROPERTY. Seller is the owner of certain working interest in and to
the oil and gas leases described on Exhibit 'A' attached hereto and incorporated
herein by reference (the "Leases"). Seller shall sell, transfer, convey and
deliver to Buyer at closing, free and clear of all encumbrances, and Buyer shall
purchase and acquire at closing: (a) the entire percentage of the Seller’s
working interest in the Leases (the "Working Interests"); and (b) the undivided
interest in and to all oil and gas wells, equipment, fixtures and other personal
property located upon the Leases and used in connection with oil and gas
operations upon the Leases attributable to the Working Interests being purchased
by Buyer. The property sold and to be conveyed hereby as hereinabove described
may hereinafter be referred to collectively as the "Property."

 

3. PURCHASE PRICE. Buyer shall purchase a portion of the Property for Thirty
Thousand Three Hundred Seventy Five and 00/100 Dollars ($30,375.00) and Seller
agrees to make a capital contribution to Buyer of the remainder of the Property
in exchange for One Hundred Twelve Thousand Five Hundred (112,500) shares of
common stock in Buyer which are currently valued at $0.20 per share being traded
under the trading symbol VKIN (the “Shares”).

 

4. ASSIGNMENT FORM. Seller shall at closing execute an Assignment Agreement and
Bill of Sale conveying to Buyer the Property, including, without limitation, the
stated Working Interest in and to the Leases. Such Assignment Agreement and Bill
of Sale shall be in the form requested by the Buyer.

 

5. CLOSING. Closing shall be on or before August 1, 2016 at a time and place
mutually agreeable to Buyer and Seller. This transaction shall be made effective
as of 12:01 a.m. on August 1st, 2016 (the "Effective Time"). At closing Buyer
shall tender the full purchase price in collected funds, and shall deliver the
agreed upon common stock of Buyer to Seller and Seller shall deliver the fully
executed Assignment and Bill of Sale. The respective obligations of each Party
to effect the transactions contemplated hereby are subject to the fulfillment or
waiver at or prior to closing of the conditions set forth in the paragraphs
below:

 

 

a. Financing. Buyer shall have obtained on terms and conditions satisfactory to
it all of the financing it needs in order to consummate the purchase of the
Property and to fund the working capital requirements of the Buyer after
closing; and

 

 

 

 

b. Due Diligence. The Buyer shall have conducted and been satisfied with such
further due diligence as Buyer deems appropriate to evaluate the viability of
the purchase contemplated by this Agreement. During such due diligence process
the Seller will give the Buyer and its representatives and professional advisors
access to all of the Seller’ properties, facilities, books, documents and
records that the Buyer may reasonably request. The Buyer agrees to coordinate
its due diligence with the Seller. If the purchase is not completed, upon the
written request of the Seller, the Buyer will return to the Seller, or destroy,
all information in the Buyer’s possession derived from its due diligence
activities and which was not otherwise known by the Buyer.

 

6. DUE DILIGENCE PERIOD. Buyer may perform any inspections or commission any
studies or evaluations of the Property at Buyer's sole cost and expense as part
of its due diligence prior to Closing. Such due diligence shall include but not
be limited to reservoir studies, title work, surveying, or appraisal.

 

7. NO BUSINESS RELATIONSHIP. Nothing in this Agreement will be deemed, held, or
construed to make either party a partner or associate of the other in the
operation of the Leases, or to render either party liable for any debts,
liabilities, or obligations incurred by the other party. It is expressly
understood and agreed that the relationship between the parties hereto will
always be that of vendor and vendee.

 

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8. SELLERS RETENTION. Seller shall not terminate any operating agreements with
respect to the Leases prior to the Closing. Seller shall retain all production
from said operations prior to closing and shall pay all expenses and liabilities
to the date of closing. All continuing services such as utilities, pumper fees
and related expenses shall become on the date of closing Buyer’s liability.

 

9. TIME IS OF THE ESSENCE. It is very important to the Parties that this sale is
performed in a prudent and timely manner. Time is of the essence, thus all
things which are required to be done by certain dates must be done, otherwise
such failure shall be deemed a material default. If either party breaches this
agreement the non-breaching party may elect to declare this null and void and
all right of the defaulting party hereunder shall terminate. If the
non-breaching party does not exercise its option to terminate this agreement,
said non-breaching party may require specific performance and also exercise any
other legal rights and remedies available to it, and said non-breaching party
shall be entitled to recover from the breaching party its cost, expenses and
attorney fees incurred in enforcing the terms of this agreement or pursuing a
remedy as a result of the breach of this agreement.

 

10. POSSESSION AT CLOSING. Possession of the Property shall be on the date of
closing and Seller shall have any risk of casualty loss prior to said date, and
Buyer the risk of casualty loss on and after that date. Buyer shall be permitted
to come upon the Leases to make such inspections of the Property as it may
reasonably desire. Nothing shall be removed from the Leases while making such
inspections and respect must be paid to the landowner rights.

 

11. TAXES. All property, ad valorem, severance or other taxes assessed against
the Property shall be prorated as of the closing. All such taxes which are
currently due or payable shall be paid by Seller prior to closing. Buyer will
bear all applicable sales or similar taxes imposed by any state, county,
municipal or other governmental entity as a result of this sale.

 

12. SELLER’S REPRESENTATIONS AND WARRANTIES. This Agreement is made and entered
into based upon the belief that the following representations made by Seller are
true and will continue to be true as of the date of closing:

 

a. Title. Seller owns the interest in and to the Property which is to be
transferred to Buyer at closing. The title to the Property is such that upon
purchase by Buyer, the title to the Property will be free of any encumbrances.
"Encumbrances" shall mean any, liens, mortgages, security interests, unitization
agreements, pooling agreements, orders to plug wells, penalties for
overproduction, or production curtailment orders.

 

b. Authority to Enter Into This Agreement. (i) Seller have the authority to
enter into this Agreement; (ii) its signatories have been properly authorized to
enter into this Agreement (including the execution and delivery of any other
agreement (including with respect to any Assignment, on the date of that
Assignment), document, certificate, or instrument contemplated by this Agreement
as to be executed and delivered by Seller) and to perform all of the covenants
and agreements contained herein; (iii) Seller are not a party to, subject to, or
bound by any agreement or instrument or any statute, regulation, judgment, or
decree of any court or governmental body which could at the date of the Closing
prevent the performance of any of Seller’s obligations under this Agreement or
adversely affect Buyer's Interests obtained in the Property; (iv) to the extent
not disclosed, there are no other contracts or agreements relating to the
Property; and (v) all suppliers, contractors and subcontractors who have
supplied labor or materials upon the Leases have been fully paid.

 

c. Warranty. Seller warrants that no act or omission by it or any of its agents
or employees could give rise to an action or claim of any kind relating to the
Property, the operator of the Leases, or to impair the title to the same. The
terms "action or claim" as used in this paragraph shall mean any action in tort,
contract or regulatory agency claim, by any person or entity.

 

d. Production. Seller warrants that it is not aware of any facts or
circumstances which would cause such production to decline at rates greater than
normal and customary decline rates for the Working Interests, and Seller agree
to provide current run tickets for all of the Leases to the Buyer within 5
business days of the execution hereof and prior to the Closing Date.

 

e. Brokers' Fees. Seller has not incurred any liability, contingent or
otherwise, for brokers' or finders' fees relating to the transactions
contemplated by this Agreement for which Buyer, any of its affiliates, or any of
Buyer's interests in the Property shall have any liability.

 

The terms of this paragraph shall survive closing and shall not merge with the
assignment and bill of sale executed by Seller and delivered to Buyer at
closing. If it is determined at any time prior to closing that any of the above
representations is not true or that there is a substantial likelihood that any
of the above representations are not true, Buyer shall have the right to cancel
this Agreement.

 

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13. WARRANTIES BY SELLER. In the event Buyer ultimately purchases the Leases and
related property, Seller warrants that all the "Representations by Seller"
contained in paragraph 12 of this Contract are true and in the event that it is
ever determined a representation is not true, Seller will, at Buyer's election,
either (1) take the necessary remedial action to make the situation consistent
with Seller's representation plus pay to Buyer the difference between the
Property as represented and the value of the Property once the problem is
identified and remedied; or (2) pay to Buyer an amount equal to the cost of
remedying the problem plus the difference between the Property as represented
and the value of the Property once the problem is identified and remedied. In
addition, Seller shall indemnify Buyer against all actual losses and damages
sustained as a result of such breach of Seller's warranty. The terms of this
paragraph shall survive closing and shall not merge with the assignment and bill
of sale executed by Seller and delivered to Buyer at closing.

 

14. BUYER'S REPRESENTATIONS AND WARRANTIES. This Agreement is made and entered
into based upon the belief that the following representations made by Buyer are
true and will continue to be true as of the date of closing:

 

a. Buyer's Stock. The shares of common stock to be transferred to Seller at
Closing represent unimpaired shares of common stock in and to Buyer, which are
currently valued at $0.20 per share and are traded under the trading symbol
VKIN. Such shares shall be considered restricted securities pursuant to the
Securities Act of 1933, as amended, but Buyer warrants that Rule 144 is
currently available for the Buyer generally as a safe harbor under Rule 4(a)(1)
of the Securities Act of 1933, as amended, as Buyer meets the current
information and non-shell requirements therein. Buyer further agrees that Seller
shall have piggy-back registration rights as to such shares and that Buyer will
include as many of such shares as can be registered pursuant to registration
limitations in any Form S-1 registration statement filed by the Buyer during the
two years following the Closing Date.

 

b. Authority to Enter Into This Agreement. (i) Buyer has the authority to enter
into this Agreement; (ii) its signatories have been properly authorized to enter
into this Agreement (including the execution and delivery of any other agreement
(including with respect to any Assignment on the date of that Assignment),
document, certificate, or instrument contemplated by this Agreement as to be
executed and delivered by Buyer) and to perform all of the covenants and
agreements contained herein; (iii) Buyer is not a party to, subject to, or bound
by any agreement or instrument or any statute, regulation, judgment, or decree
of any court or governmental body which could at the date of the Closing prevent
the performance of any of Buyer's obligations under this Agreement or adversely
affect Seller's interest obtained in the common stock of Buyer.

 

c. Accredited Investor. Buyer and will acquire the Property for its own account
and not with a view to a sale or distribution thereof in violation of the
Securities Act and the rules and regulations thereunder, any applicable state
Blue Sky Laws or any other applicable securities laws.

 

d. Independent Evaluation. Buyer, through their members and their respective
affiliates, are sophisticated in the evaluation, purchase, ownership,
development, investment in and operation of oil and gas properties. In making
its decision to enter into this Agreement and to acquire the subject interest in
the Property, Buyer, except to the extent of Seller’s express representations
and warranties herein, has relied on its own independent investigation, review
and analysis of such information and material as Buyer in its discretion has
deemed relevant, which investigation, review and analysis was done by Buyer and
their own advisors (including, to the extent deemed necessary by Buyer, legal,
tax, economic, environmental, geological and geophysical, engineering and other
advisors) and not on any factual representations or opinions of Seller or any
representatives or consultants or advisors engaged by or otherwise purporting to
represent Seller or any affiliate or principal of Seller.

 

e. Brokers' Fees. Buyer has not incurred any liability, contingent or otherwise,
for brokers' or finders' fees relating to the transactions contemplated by this
Agreement for which Seller, any of its affiliates, or any of Seller’s interests
in the Property shall have any liability.

 

15. WARRANTIES BY BUYER. Buyer warrants that all the "Representations by Buyer"
contained in paragraph 14 of this Agreement are true and in the event that it is
ever determined a representation is not true, Buyer will, take the necessary
remedial action to make the situation consistent with Buyer's representation,
and pay to Seller all lost profits, consequential damages and other expenses
incurred while waiting for Buyer to complete said remedial action. In addition,
Buyer shall indemnify Seller against all actual losses and damages sustained as
a result of such breach of Buyer's warranty including all costs incurred to
defend any claims, whether or not such claims are ultimately determined to have
been valid. The terms of this paragraph shall survive closing and shall not
merge with the documents executed and delivered at closing.

 

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16. ADJUSTMENTS. The following adjustments shall be made after Closing.

 

a. Oil, gas and other production from or attributable to the working interest in
and to the Leases to be sold to Buyer which is produced prior to the Effective
Time shall belong to Seller, and that which is produced on or after the
Effective Time shall belong to Buyer, subject to third party revenue and royalty
interests. Buyer will assume all responsibility for notifying the purchaser(s)
of production of the change of ownership. Seller and Buyer shall execute such
documents as may be reasonably required by any purchaser of production.

 

b. Buyer and Seller will effect a cash adjustment to account for Saleable Oil in
any oil storage tank on the Leases at the Effective Time. As of the Effective
Time the parties will jointly measure the oil above the commercial draw down
valve in storage tanks on the Leases (the "Saleable Oil") and when oil is next
sold after the Closing Date the amount allocated to Buyer and Seller shall be
divided at that time.

 

c. The parties shall jointly read utility meters so that utility costs can be
allocated pursuant to this Agreement with the adjustment for Seller's share to
be made when the utility bill is next received after the Effective Time.

 

c. Seller shall be responsible for all costs of ownership and operation of the
Leases up to the Effective Time, and Buyer shall be responsible for all such
costs from and after the Effective Time.

 

e. If Seller operates the Leases for the benefit of Buyer after the Effective
Time, or if Buyer operates the Leases prior to the Effective Time for the
benefit of Seller, then the party benefitting from such interregnum operations
shall reimburse the operating party for the reasonable costs of such operations,
including direct field labor and benefits, contract labor and services, repairs,
replacement parts, supplies and fuels.

 

f. Within 45 days following the Effective Time the parties shall settle and pay
the adjustments provided for in this paragraph.

 

17. CONFIDENTIALITY. Buyer agrees that all information obtained from the
examination of Seller’s files and records shall remain confidential. In the
event the transactions contemplated by this Agreement are not closed, Buyer will
return to Seller all copies of such files and all other information relating to
the Property obtained pursuant to this Agreement, except as to that information
obtained from records available to the public. This Agreement and the
transaction contemplated herein shall be kept confidential and shall not be
disclosed to any other party without the written consent of all Parties. Prior
to closing, neither party shall make or release any public statements or
announcements, including those to the media, concerning this Agreement or any
transactions contemplated by this Agreement without the prior written consent of
the other. To the extent that either party has a legal obligation or duty to
release any public statements or announcements, such announcements shall
describe the transaction as one entered into with "an undisclosed Buyer" or "an
undisclosed Seller" and shall not specifically describe the Property to he sold
or acquired.

 

18. DISCLAIMERS. The parties hereby stipulate and agree that neither party has
made any representations or warranties of any kind to the other which are not
expressly included herein. The parties further stipulate and agree that neither
of them have entered into this agreement or changed their respective positions
based upon any representations or warranties made by the other party which are
not expressly included herein.

 

19. MISCELLANEOUS.

 

A. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon, and inure to
the benefit of, the Parties hereto and their respective successors, heirs,
administrator, and assigns. Either Buyer or Seller may assign all or any portion
of their rights hereunder to a third party.

 

B. AMENDMENTS. This Agreement may be amended or modified only by a written
instrument executed by the Seller and the Buyer.

 

C. GOVERNING LAW. This Agreement shall be governed by, construed and enforced in
accordance with the laws of Kansas. The venue of any action shall be in Miami
County, Kansas.

 

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D. MERGER OF PRIOR AGREEMENTS. This Agreement, as may be amended, and the
exhibits attached hereto constitute the entire Agreement between Buyer and
Seller with respect to the purchase and sale of the Property and supersede all
prior Agreements and understandings between the Parties hereto relating to the
subject matter hereof.

 

E. CONSENT OR WAIVER. No consent or waiver, express or implied, by either Party
to or of any breach or default by the other Party in the performance of this
Agreement shall be construed as a consent or waiver to or of any subsequent
breach or default in the performance by such other Party of the same or any
other obligations hereunder.

 

F. COUNTERPARTS. This Agreement may be executed in counterparts and all
counterparts shall be considered part of one Agreement binding on all parties
hereto.

 

G. CAPTIONS. Captions herein are for convenience of reference only and in no way
define, limit, or expand the scope or intent of this Agreement.

 

H. SEVERABILITY. In the event that one or more of the provisions hereof shall be
held to be illegal, invalid, or unenforceable, such provisions shall be deemed
severable and the remaining provisions hereof shall continue in full force and
effect.

 

I. JOINT DRAFTING. The Parties shall be considered joint drafters of this
Agreement so as not to construe this contract against one Party as drafter more
than the other.

 

J. SURVIVAL OF TERMS. The terms of this Agreement shall survive Closing and
shall not merge with the Assignment and Bill of Sale referenced herein.

 

K. DEFAULT. Time is of the essence of this Agreement. In the event either Party
fails to comply with any of the terms of this Agreement, then this Agreement
shall, at the option of the non‑defaulting Party, be terminated. If the
non‑defaulting Party does not exercise the option to terminate this Agreement,
the non‑defaulting party may require specific performance and also exercise any
other legal rights and remedies available under Kansas law. In the event that
either party brings suit to enforce the terms of this Agreement or for the
breach of any representation or warranty contained herein, the non‑breaching
party shall be entitled to recover its cost, expenses and attorney fees incurred
in bringing such action and enforcing and collecting any judgment obtained
therein from the breaching party.

 

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In WITNESS WHEREOF THE PARTIES HAVE EXEUCTED THIS AGREEMENT on the ____ day of
July, 2016.

 

SELLER:

 

Moxy Trading LLC

     

 

 

 

By:

/s/ Robert Lucas

 

Robert Lucas

I have authority to bind the company

      BUYER:

 

Viking Investments Group, Inc., a Nevada corporation

 

 

 

 

 

 

 

By:

/s/ James A. Doris

 

 

James A. Doris, President & C.E.O.

I have authority to bind the company

 

 

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EXHIBIT 'A'

 

ABC LEASE

 

Lease Details:

Sec 22, T-17S, R-22E

Legal Description and other details to be provided by the Seller.

 

 

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