Document:

rexx-ex101_325.htm

 

Exhibit 10.1

 

Eleventh Amendment

To

 

Amended and Restated Credit Agreement

Among

 

Rex Energy Corporation,

as Borrower,

The Guarantors,

Royal Bank of Canada,

as Administrative Agent,

KeyBank National Association,

as Syndication Agent,

SunTrust Bank,

as Documentation Agent,

RBC Capital Markets,

KeyBank National Association,

and

SunTrust Bank,

as Joint Lead Arrangers and Joint Bookrunners,

and

The Lenders Signatory Hereto

Dated as of July 1, 2016

 

 

LEGAL_US_W # 85608773.2

 

Eleventh Amendment to Amended and Restated Credit Agreement

This Eleventh Amendment to Amended and Restated Credit Agreement (this “Eleventh Amendment”) dated as of July 1, 2016 is among Rex Energy Corporation, a corporation formed under the laws of the State of Delaware (the “Borrower”); each of the undersigned guarantors (the “Guarantors”, and together with the Borrower, the “Obligors”); Royal Bank of Canada, as administrative agent for the Lenders (in such capacity, together with its successors, the “Administrative Agent”); and the Lenders signatory hereto.

Recitals

A.The Borrower, the Administrative Agent and the Lenders are parties to that certain Amended and Restated Credit Agreement dated as of March 27, 2013 (as amended by the First Amendment to Amended and Restated Credit Agreement dated as of January 14, 2013, the Second Amendment to Amended and Restated Credit Agreement dated as of March 26, 2014, the Third Amendment to Amended and Restated Credit Agreement dated as of July 11, 2014, the Fourth Amendment to Amended and Restated Credit Agreement dated as of August 15, 2014, the Fifth Amendment to Amended and Restated Credit Agreement dated as of September 12, 2014, the Sixth Amendment to Amended and Restated Credit Agreement dated as of December 16, 2014, the Seventh Amendment to Amended and Restated Credit Agreement dated as of March 27, 2015, the Eighth Amendment to Amended and Restated Credit Agreement dated as of September 4, 2015, the Ninth Amendment to Amended and Restated Credit Agreement dated as of February 3, 2016 and the Tenth Amendment to Amended and Restated Credit Agreement dated as of March 14, 2015, the “Credit Agreement”), pursuant to which the Lenders have made certain credit available to and on behalf of the Borrower.

B.The Borrower and Guarantors are parties to that certain Amended and Restated Guaranty and Collateral Agreement dated as of March 27, 2013 made by each of the Grantors (as defined therein) in favor of the Administrative Agent (such agreement, as may be from time to time be amended, amended and restated, supplemented or otherwise modified, the “Guaranty”).

C.The Borrower, the Administrative Agent and the Lenders have agreed to amend certain provisions of the Credit Agreement as more fully set forth herein.

NOW, THEREFORE, in consideration of the premises and the mutual covenants herein contained, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

Section 1.Defined Terms.  Each capitalized term which is defined in the Credit Agreement, but which is not defined in this Eleventh Amendment, shall have the meaning ascribed such term in the Credit Agreement.  Unless otherwise indicated, all section and article references in this Eleventh Amendment refer to sections or articles of the Credit Agreement.

Section 2.Amendment to Section 1.02 – Certain Defined Terms. 

2.1The following definitions are hereby added where alphabetically appropriate to read as follows:

 “Benefit Street Partners Joint Development Agreement” means that certain Joint Exploration and Development Agreement dated March 1, 2016 by and between R.E. Gas Development LLC and OhPa Drillco, LLC, together with the ancillary documents executed in connection therewith.

 

“Capital Expenditures” means, in respect of any Person, for any period, the aggregate (determined without duplication) of all exploration and development expenditures and costs that are capital in nature and any other cash expenditures that are capitalized on the financial statements of such Person in accordance with GAAP.

 

 

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“Eleventh Amendment” means that certain Eleventh Amendment to Amended and Restated Credit Agreement, dated as of July 1, 2016, among the Borrower, the Guarantors, the Administrative Agent and the Lenders party thereto.

 

“Eleventh Amendment Effective Date” has the meaning ascribed to such term in the Eleventh Amendment.

 

“Illinois Disposition Documents” means (a) that certain Purchase and Sale Agreement dated June 14, 2016 among PennTex Illinois Resources, Inc., Rex Energy I, LLC, Rex Energy IV, LLC, Rex Energy Marketing, LLC, R.E. Ventures Holdings, LLC, and Rex Energy Operating Corp. (collectively as the “Seller”) and Campbell Development Group, LLC (as the “Purchaser”) and (b) all bills of sale, assignments, agreements, instruments and documents executed and delivered in connection therewith.

 

“IL Disposition Properties” means the Oil and Gas Properties and other Properties disposed of by the Borrower and or its Subsidiaries pursuant to the Illinois Disposition Documents.

 

“PDP Coverage Ratio” means, as of any date of determination, the ratio of (a) Total PDP PV-9 as of such date to (b) Net Senior Secured Debt as of such date. 

 

“Strip Price” means, as of any date of determination with respect to each of the appropriate crude oil or natural gas categories included in the then most recent Reserve Report, 

	
 
	
(a)
	
for each of the first 12 months following such date (the “Initial Strip”), the average of the closing contract prices for the 12 succeeding monthly futures contracts following such date; 

	
 
	
(b)
	
for each of the 12 months following the Initial Strip (the “Second Strip”), the average of the closing contract prices for the next 12 succeeding monthly future contracts following the Initial Strip; 

	
 
	
(c)
	
for each of the 12 months following the Second Strip (the “Third Strip”), the average of the closing contract prices for the next 12 succeeding monthly future contracts following the Second Strip; 

	
 
	
(d)
	
for each of the first 12 months following the Third Strip (the “Fourth Strip”), the average of the closing contract prices for the 12 succeeding monthly futures contracts following the Third Strip; and 

	
 
	
(e)
	
for each month thereafter, the average of the closing contract prices for the next 12 succeeding monthly future contracts following the Fourth Strip, and

	
 
	
(f)
	
in each case as quoted on the New York Mercantile Exchange or any equivalent exchange (in either case, the “Exchange”) and published in a nationally recognized publication for such pricing or obtained from a nationally recognized third party as selected by the Borrower; 

provided that: 

 

	
 
	
(1)
	
if the Exchange no longer provides futures contract price quotes for 60-month periods, the Strip Price shall be:

	
 
	
(a)
	
for each month of the longest available period of quotes of less than 60 months (the “Initial Testing Period”), the average of the closing contract prices for the “X” 

 

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succeeding monthly future contracts (where “X” equals the number of months in the Initial Testing Period), and  

	
 
	
(b)
	
to the extent the Initial Testing Period is longer than 12 months, for each month after the Initial Testing Period, the average of such contract prices for the last 12 months of such Initial Testing Period, in each case as quoted on the Exchange and published in a nationally recognized publication for such pricing as selected by the Administrative Agent, and 

	
 
	
(2)
	
if the Exchange no longer provides such futures contract quotes or has ceased to operate, the Borrower shall designate another nationally recognized commodities exchange to replace the Exchange for purposes of the references to the Exchange herein.

“Total PDP PV-9” means, as of any date of determination, the net present value, discounted at nine percent (9%) per annum, of the future net revenues expected to accrue to the Borrower’s and the Guarantors’ collective interests in the Proved Developed Producing Reserves included in the Reserve Report most recently delivered pursuant to Section 8.12 during the remaining expected economic lives of such Proved Developed Producing Reserves, as calculated as set forth in this definition.  Each calculation of such expected future net revenues shall be made in accordance with SEC guidelines for reporting proved developed producing oil and gas reserves, provided that in any event (a) appropriate deductions shall be made for severance and ad valorem taxes, capital expenditures, and for operating, gathering, transportation and marketing costs required for the production and sale of such Oil and Gas Properties, (b) the pricing assumptions used in determining Total PDP PV-9 for any Oil and Gas Properties shall be based upon the Strip Price (and the Strip Price shall be determined as of the date of determination of Total PDP PV-9), adjusted in a manner reasonably acceptable to Administrative Agent to reflect the Borrower’s and the Guarantors’ Swap Agreements then in effect and (c) the cash flows derived from the pricing assumptions set forth in clause (b) above shall be further adjusted to account for the basis differential in a manner reasonably acceptable to the Administrative Agent.  The Total PDP PV-9 shall be calculated on a pro forma basis, giving effect to (x) acquisitions and dispositions of Oil and Gas Properties consummated by the Borrower and the Subsidiaries (provided that in the case of any acquisition, the Administrative Agent shall have received a Reserve Report, in form and substance reasonably satisfactory to it, evaluating the Proved Developed Producing Reserves subject thereto) and (y) the Liquidation of any Swap Agreements to which the Borrower or any Subsidiary is a party, in each case, occurring since the date of the Reserve Report most recently delivered pursuant to Section 8.12.

Section 3.Amendment to Section 8.13(c).  Section 8.13(c) is hereby amended by replacing the phrase “and the Administrative Agent may send a notice to the Borrower and the Lenders that the then outstanding Borrowing Base shall be reduced by an amount as determined by the Required Lenders to cause the Borrower to be in compliance with the requirement to provide acceptable title information on 80% of the value of the Oil and Gas Properties” therein with the phrase “and the Administrative Agent may send a notice to the Borrower and the Lenders that (i) the then outstanding Borrowing Base shall be reduced by an amount as determined by the Required Lenders to cause the Borrower to be in compliance with the requirement to provide acceptable title information on 80% of the value of the Oil and Gas Properties and (ii) the unacceptable Mortgaged Property consisting of Proved Developed Producing Reserves shall be excluded from the determination of Total PDP PV-9.

Section 4.Amendments to Article VIII.  Article VIII is hereby amended by adding new Sections 8.19 and 8.20 to the end thereof to read as follows:

Section 8.19Acquisition of Oil and Gas Properties – Mortgage Coverage. In connection with the acquisition of any Oil and Gas Property by the Borrower or its Subsidiaries after the Eleventh Amendment Effective Date, the Borrower shall, and shall cause its Subsidiaries to, grant within 30 days of such acquisition of such Oil and Gas Properties by the Borrower or such Subsidiary, to the Administrative Agent as security for the Indebtedness a first-priority Lien (provided that Excepted Liens of the type described in clauses (a) to (d) and (f) of the definition thereof may exist, but subject to the provisos at the end of such definition) on 95% of the total proved value of such additional Oil and Gas Properties being 

 

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acquired.  All such Liens will be created and perfected by and in accordance with the provisions of deeds of trust, security agreements and financing statements or other Security Instruments, all in form and substance reasonably satisfactory to the Administrative Agent and the Borrower and in sufficient executed (and acknowledged where necessary or appropriate) counterparts for recording purposes.  In order to comply with the foregoing, if any Subsidiary places a Lien on its Oil and Gas Properties and such Subsidiary is not a Guarantor, then it shall become a Guarantor and comply with Section 8.14(b). 

Section 8.20Weekly Cash Flow Model. The Borrower shall provide 13-week cash flow forecasts for the Borrower and its Subsidiaries, which shall be reported bi-weekly beginning on August 1, 2016 and shall include a variance to budget analysis and a description of material variances, and otherwise be in form and substance reasonably satisfactory to the Agent and the Lenders, which shall be delivered to the Agent on Tuesday of each applicable week.

Section 5.Amendment to Section 9.01(a).  Section 9.01(a) is hereby amended and restated in its entirety to read as follows:

(a)PDP Coverage Ratio.  The Borrower will not permit, as of the last day of any fiscal quarter ending on or after September 30, 2016, the PDP Coverage Ratio to be less than 1.65 to 1.00.

Section 6.Amendment to Section 9.01(c).  Section 9.01(c) is hereby amended and restated in its entirety to read as follows:

(c)Current Ratio.  The Borrower will not permit, as of the last day of any fiscal quarter ending on or after March 31, 2016, its ratio of (i) consolidated current assets (including (a) reimbursements owed to the Borrower and its Subsidiaries pursuant to the Benefit Street Partners Joint Development Agreement which will be received within 90 days following the end of such fiscal quarter and (b) the unused amount of the total Commitments, but excluding (1) non-cash assets under FASB ASC 815 and (2) non-cash deferred taxes) as of such day to (ii) consolidated current liabilities (excluding (u) non-cash obligations under FASB ASC 815, (v) current maturities under this Agreement, (w) non-cash deferred taxes, (x) accruals related to bond and loan costs that are capitalized and amortized over the term of such Debt per GAAP; (y) accruals for discretionary payments which are currently suspended; and (z) non-cash accruals related to ASC 840) as of such day to be less than 1.0 to 1.0. 

Section 7.Amendment to Section 9.21.  Section 9.21 is hereby amended by amending and restating the first proviso therein in its entirety to read as follows:

provided that, (x) so long as no Default, Event of Default or Borrowing Base Deficiency would exist immediately after giving effect to any concurrent repayment of Debt with the net cash proceeds of such issuance, exchange or sale, if any, the Borrower may prepay Second Lien Notes with the net cash proceeds of any issuance, exchange or sale of common Equity Interests (other than Disqualified Capital Stock) of the Borrower and (y) following (1) the disposition of all of the IL Disposition Properties and receipt of cash proceeds by the Borrower or its Subsidiaries from such dispositions in an aggregate amount equal to or greater than $40,000,000 (as such amount is reduced pursuant to customary purchase price adjustments included in the Illinois Disposition Documents) and (2) the Borrower’s Redemption of Second Lien Notes in an aggregate stated principal amount of greater than $200,000,000 on or after June 28, 2016, then so long as (A) no Default or Event of Default would exist immediately after giving effect to any concurrent payment of Debt with the proceeds from the IL Disposition Properties, if any, and (B) the Borrower has Liquidity of at least $10,000,000 immediately after giving effect to any concurrent payment of Debt with the proceeds from the IL Disposition Properties, if any, the Borrower may prepay Second Lien Notes with up to $10,000,000 of proceeds received from the sale of the IL Disposition Properties on or prior to October 1, 2016;

 

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Section 8.Amendment to Article IX.  Article IX is hereby amended by adding a new Section 9.22 at the end thereof to read as follows: 

Section 9.22Capital Expenditures. If at the end of any fiscal quarter during fiscal year 2016 or fiscal year 2017, the aggregate amount of Capital Expenditures made by the Borrower and the Consolidated Subsidiaries for such fiscal year exceeds $65,000,000, then the Borrower will not permit any additional Capital Expenditures to be made by the Borrower and the Consolidated Subsidiaries unless the PDP Coverage Ratio as of the last day of such fiscal quarter is greater than 2.00 to 1.00.

Section 9.Amendment to Section 10.01(d).  Section 10.01(d) is hereby amended by replacing the phrase “Section 8.18” therein with the phrase “Section 8.18, Section 8.19”. 

Section 10.Borrowing Base Maintenance.  For the period from and including the Eleventh Amendment Effective Date (as defined below) to but excluding the next Redetermination Date, the Borrowing Base shall be an amount equal to $190,000,000. Notwithstanding the foregoing, the Borrowing Base may be subject to further adjustments from time to time pursuant to Sections 2.07(e), 2.07(f), 2.07(g), 8.13(c) or 9.12(d) of the Credit Agreement.  This Borrowing Base maintenance shall constitute the July 2016 Redetermination.

Section 11.Conditions Precedent.  This Eleventh Amendment shall become effective on the date on which each of the following conditions is satisfied (or waived in accordance with Section 12.02) (the “Eleventh Amendment Effective Date”):

11.1Eleventh Amendment. The Administrative Agent shall have received multiple counterparts as requested of this Eleventh Amendment from the Borrower, each other Obligor and the Required Lenders. 

11.2No Default.  No Default or Event of Default shall be continuing as of the Eleventh Amendment Effective Date.

11.3Payment of Outstanding Invoices.  Payment by the Borrower to the Administrative Agent of all fees and other amounts due and payable on or prior to the Eleventh Amendment Effective Date, including, to the extent invoiced, reimbursement or payment of all reasonable out-of-pocket expenses required to be reimbursed or paid by the Borrower (including, but not limited to the reasonable fees of Paul Hastings LLP). 

11.4Moraine East Area and Warrior North Area Wells.  The Administrative Agent shall have received a certificate from a Responsible Officer certifying that, as of the Eleventh Amendment Effective Date, and for each of the Moraine East Area and the Warrior North Area, attached thereto is a true and complete list of (i) all wells of the Borrower and its Subsidiaries for which drilling has commenced (but has not been completed), (ii) all drilled and completed (but not producing) wells of the Borrower and its Subsidiaries, (iii) all producing wells of the Borrower and its Subsidiaries, and (iv) each of the 23 wells for which the Borrower expects to drill in the Moraine East Area and Warrior North Area in calendar year 2016 as contemplated under the Benefit Street Partners Joint Development Agreement (the wells identified in this clause (iv), the “2016 Scheduled Wells”).  

11.5Mortgage and Title Coverage.  The Administrative Agent shall have received: 

(a)executed and notarized deeds of trust/mortgages or amendments and supplements to existing deeds of trust/mortgages in form satisfactory to the Administrative Agent, to the extent necessary so that the Mortgaged Properties represent at least 95% of the total value of the proved Oil and Gas Properties of the Borrower and the Subsidiaries evaluated in the most recently delivered Reserve Report; and 

(b)together with title information previously delivered to the Administrative Agent, title information satisfactory to the Administrative Agent on at least 80% of the total value of the proved Oil and Gas Properties of the Borrower and the Subsidiaries evaluated in the most recently delivered Reserve Report.

 

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The Administrative Agent is hereby authorized and directed to declare this Eleventh Amendment to be effective and to declare the occurrence of the Eleventh Amendment Effective Date when it has received documents confirming compliance with the conditions set forth in this Section 11 or the waiver of such conditions in accordance with Section 12.02 of the Credit Agreement.  Such declaration shall be final, conclusive and binding upon all parties to the Credit Agreement for all purposes.  For purposes of determining compliance with the conditions specified in this Section 11, each Lender that has signed this Eleventh Amendment shall be deemed to have consented to, approved or accepted, or to be satisfied with, each document or other matter required thereunder to be consented to or approved by or acceptable or satisfactory to such Lender, unless the Administrative Agent shall have received written notice from such Lender prior to the Eleventh Amendment Effective Date specifying its objection thereto.

Section 12.Limited Waivers.  

(a)Section 9.01(c) provides that the Borrower will not, as of the last day of any fiscal quarter ending on or after March 31, 2016, permit its ratio of (i) consolidated current assets to (ii) consolidated current liabilities as of such day to be less than 1.0 to 1.0 (such financial covenant, the “Current Ratio Covenant”).  The Borrower has informed the Administrative Agent and the Lenders that the Borrower does not expect to be in compliance with the Current Ratio Covenant as of the last day of the fiscal quarter ending June 30, 2016.  Accordingly, the Borrower has requested that the Lenders waive, and the Lenders do hereby waive, the Borrower’s compliance with the Current Ratio Covenant as of the last day of the fiscal quarter ending June 30, 2016.

(b)The Borrower has informed the Administrative Agent and the Lenders that the disposition of the Illinois Disposition Properties will result in an automatic reduction of the Borrowing Base then in effect pursuant to Section 9.12(d) (the “Asset Disposition BB Reduction Requirement”).  The Borrower has requested that the Lenders waive, and the Lenders do hereby waive, the Asset Disposition BB Reduction Requirement that would occur solely as a result of the disposition of the Illinois Disposition Properties; provided that, it is a condition to the foregoing waiver that the Illinois Disposition Properties are disposed of on or before the next Scheduled Redetermination Date; and provided further, for the avoidance of doubt, the foregoing waiver is only given for the Asset Disposition BB Reduction Requirement and this waiver shall in no event be construed to waive any other reductions to the Borrowing Base made in accordance with the terms and conditions of the Credit Agreement that are based on dispositions of any other Property or the Liquidation of any Swap Agreements (it being understood and agreed that a disposition of any other Property or the Liquidation of any Swap Agreements regulated by Section 2.07(f) or a disposition of Property regulated by Section 9.12(d) in each case on or prior to the next Scheduled Redetermination Date will result in a reduction of the Borrowing Base pursuant to Section 2.07(f) or Section 9.12(d), as the case may be, unless, in each case, the requirements of such sections are otherwise waived in a separate written agreement in accordance with Section 12.02).

Except as expressly waived herein, all covenants, obligations and agreements of the Obligors contained in the Credit Agreement and the other Loan Documents shall remain in full force and effect in accordance with their terms.  Without limitation of the foregoing, the foregoing waivers are hereby granted to the extent and only to the extent specifically stated herein and for no other purpose and shall not be deemed to (a) be a consent or agreement to, or waiver or modification of, or amendment to, any other term or condition of the Credit Agreement, any other Loan Document or any of the documents referred to therein, (b) except as expressly set forth herein, prejudice any right or rights which the Administrative Agent or the Lenders may now have or may have in the future under or in connection with the Credit Agreement, any other Loan Document or any of the documents referred to therein, or (c) constitute any course of dealing or other basis for altering any obligation of any Obligor or any right, privilege or remedy of the Administrative Agent or the Lenders under the Credit Agreement, the other Loan Documents, or any other contract or instrument.  Granting the waivers set forth herein does not and should not be construed to be an assurance or promise that consents or waivers will be granted in the future, whether for the matters herein stated or on other unrelated matters.

 

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Section 13.Affirmative Covenants Regarding Mortgage the Title.  On or prior to 30 days following the Eleventh Amendment Effective Date (or on or prior to such later date as the Administrative Agent may agree in its sole discretion), the Administrative Agent shall have received: 

13.1executed and notarized deeds of trust/mortgages or amendments and supplements to existing deeds of trust/mortgages in form satisfactory to the Administrative Agent, to the extent necessary so that (i) 100% of the Borrower’s and its Subsidiaries’ interests in the leases covering tracts traversed by the wellbore related to each drilled and completed (but not producing) well and each well for which drilling has commenced (but has not been completed) identified in the certificate delivered pursuant to Section 11.4 are Mortgaged Properties, (ii) 100% of the Borrower’s and its Subsidiaries’ interests in the leases comprising the lands included in any designated unit related to each producing well identified in the certificate delivered pursuant to Section 11.4 are Mortgaged Properties, (iii) 100% of the Borrower’s and its Subsidiaries’ Prospective Interest in the leases covering tracts which will be traversed by the wellbore related to each 2016 Scheduled Well are Mortgaged Properties, and (iv) 100% of the Borrower’s and its Subsidiaries’ Prospective Interest in the leases comprising the lands included in any designated unit (or, to the extent it has been defined at such time, the unit to be designated) related to each 2016 Scheduled Well are Mortgaged Properties; and 

13.2title information satisfactory to the Administrative Agent on (a) 100% of the Borrower’s and its Subsidiaries’ interests in the leases covering tracts traversed by the wellbore related to each drilled and completed (but not producing) well and each well for which horizontal drilling has commenced (but has not been completed) identified in the certificate delivered pursuant to Section 11.4, (ii) 100% of the Borrower’s and its Subsidiaries’ interests in the leases comprising the lands included in any designated unit related to each producing well identified in the certificate delivered pursuant to Section 11.4, (iii) 100% of the Borrower’s and its Subsidiaries’ Prospective Interest in the leases covering tracts which will be traversed by the wellbore related to each 2016 Scheduled Well, and (iv) 100% of the Borrower’s and its Subsidiaries’ Prospective Interest in the leases comprising the lands included in any designated unit (or, to the extent it has been defined at such time, the unit to be designated) related to each 2016 Scheduled Well.

Any failure by the Borrower to comply with the mortgage and title requirements of Section 13.1 or Section 13.2 (as it relates to 2016 Scheduled Wells) of this Eleventh Amendment shall constitute an immediate Event of Default.  Any failure by the Borrower to comply with the title requirements of Section 13.2 of this Eleventh Amendment (as it relates to Oil and Gas Property other than 2016 Scheduled Wells) shall not constitute a Default or Event of Default, but instead to the extent that the Administrative Agent is not satisfied with title to any of such Oil and Gas Property, the Administrative Agent may send a notice to the Borrower and the Lenders that the Borrowing Base then in effect shall be reduced by an amount equal to the value, if any, assigned to such Oil and Gas Property in the then effective Borrowing Base, as determined by the Administrative Agent, and such new Borrowing Base shall become effective immediately after the Borrower’s receipt of such notice.  Upon any adjustment to the amount of the Borrowing Base in accordance the previous sentence, if the total Revolving Credit Exposure exceeds the adjusted Borrowing Base, then the Borrower shall (A) prepay the Borrowings in an aggregate principal amount equal to such excess, and (B) if any excess remains after prepaying all of the Borrowings as a result of an LC Exposure, cash collateralize such excess as provided in Section 2.08(j).  The Borrower shall be obligated to make such prepayment and/or cash collateralize such excess within ninety (90) days following the date the adjustment occurs; provided that such payment required to be made pursuant to this sentence must be made on or prior to the Termination Date.  The provisions of Section 3.04(c)(iv) and Section 3.04(c)(v) shall apply, mutatis mutandis, to such prepayment required pursuant to the previous sentence.

Section 14.Representations and Warranties; Etc.  Each Obligor hereby affirms:  (a) that as of the date of execution and delivery of this Eleventh Amendment, after giving effect to the terms of this Eleventh Amendment, all of the representations and warranties made by it contained in each Loan Document to which it is a party are true and correct in all material respects as though made on and as of the Eleventh Amendment Effective Date (unless made as of a specific earlier date, in which case, was true and correct in all material respects as of such date); and (b) that after giving effect to this Eleventh Amendment and to the transactions contemplated hereby, no Default exists or will exist under any Loan Document to which it is a party.

 

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Section 15.Miscellaneous. 

15.1Confirmation.  The provisions of the Credit Agreement (as amended by this Eleventh Amendment) shall remain in full force and effect in accordance with its terms following the effectiveness of this Eleventh Amendment.

15.2Ratification and Affirmation of the Obligors.  Each Obligor hereby expressly (a) acknowledges the terms of this Eleventh Amendment; (b) ratifies and affirms its obligations under, and acknowledges, renews and extends its continued liability under, each Loan Document to which it is a party, and agrees that each Loan Document to which it is a party remains in full force and effect, as amended hereby; and (c) agrees that from and after the Eleventh Amendment Effective Date each reference to the Credit Agreement in the Guaranty and the other Loan Documents shall be deemed to be a reference to the Credit Agreement, as amended by this Eleventh Amendment.

15.3Loan Document.  This Eleventh Amendment is a “Loan Document” as defined and described in the Credit Agreement and all of the terms and provisions of the Credit Agreement relating to Loan Documents shall apply hereto.

15.4Severability.  Any provision of this Eleventh Amendment which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

15.5Successors and Assigns.  This Eleventh Amendment shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.

15.6Counterparts. This Eleventh Amendment may be executed by one or more of the parties hereto in any number of separate counterparts, and all of such counterparts taken together shall be deemed to constitute one and the same instrument.  Delivery of an executed counterpart of a signature page of this Eleventh Amendment by telecopy, facsimile or email transmission shall be effective as delivery of a manually executed counterpart of this Eleventh Amendment.

15.7No Oral Agreement. This written Eleventh Amendment, the Credit Agreement and the other Loan Documents executed in connection herewith and therewith represent the final agreement between the parties and may not be contradicted by evidence of prior, contemporaneous, or subsequent oral agreements of the parties.  There are no unwritten oral agreements between the parties.

15.8Governing Law.  This Eleventh Amendment (including, but not limited to, the validity and enforceability hereof) shall be governed by, and construed in accordance with, the laws of the State of Texas.

 

[Signatures Begin on Next Page]

 

 

 

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IN WITNESS WHEREOF, the parties hereto have caused this Eleventh Amendment to be duly executed effective as of the Eleventh Amendment Effective Date.

 

	
BORROWER:
	
REX ENERGY CORPORATION

	
 
	
 
	
 
	
 

	
 
	
By:
	
 
	
/s/Thomas Rajan

	
 
	
Name:
	
 
	
Thomas Rajan

	
 
	
Title:
	
 
	
Chief Financial Officer

	
 
	
 
	
 
	
 

	
GUARANTORS:
	
REX ENERGY OPERATING CORP.

	
 
	
 
	
 
	
 

	
 
	
By:
	
 
	
/s/Thomas Rajan

	
 
	
Name:
	
 
	
Thomas Rajan

	
 
	
Title:
	
 
	
Chief Financial Officer

	
 
	
 
	
 
	
 

	
 
	
REX ENERGY I, LLC

	
 
	
PENNTEX RESOURCES ILLINOIS, INC.

	
 
	
REX ENERGY IV, LLC

	
 
	
R.E. GAS DEVELOPMENT, LLC

	
 
	
 
	
 
	
 

	
 
	
By:
	
 
	
/s/Thomas Rajan

	
 
	
Name:
	
 
	
Thomas Rajan

	
 
	
Title:
	
 
	
Chief Financial Officer

 

 

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ADMINISTRATIVE
	
ROYAL BANK OF CANADA,

	
AGENT, ISSUING
	
as Administrative Agent

	
BANK AND LENDER:
	
 

	
 
	
By:
	
 
	
/s/Susan Khokher

	
 
	
Name:
	
 
	
Susan Khokher

	
 
	
Title:
	
 
	
Manager, Agnecy

	
 
	
 
	
 
	
 

	
 
	
ROYAL BANK OF CANADA,

	
 
	
as Issuing Bank and as Lender

	
 
	
 
	
 
	
 

	
 
	
By:
	
 
	
/s/Don J. McKinnerney

	
 
	
Name:
	
 
	
Don J. McKinnerney

	
 
	
Title:
	
 
	
Authorized Signatory

 

 

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SYNDICATION AGENT
	
KEYBANK NATIONAL ASSOCIATION

	
AND LENDER:
	
 

	
 
	
 

	
 
	
By:
	
 
	
/s/John Dravenstott

	
 
	
Name:
	
 
	
John Dravenstott

	
 
	
Title:
	
 
	
Vice President

 

 

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DOCUMENTATION AGENT
	
SUNTRUST BANK

	
AND LENDER:
	
 

	
 
	
 
	
 
	
 

	
 
	
By:
	
 
	
/s/William S. Krueger

	
 
	
Name:
	
 
	
William S. Krueger

	
 
	
Title:
	
 
	
First Vice President

 

 

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LENDERS:
	
BMO HARRIS FINANCING, INC.

	
 
	
 
	
 
	
 

	
 
	
By:
	
 
	
/s/James A. Jerz

	
 
	
Name:
	
 
	
James A. Jerz

	
 
	
Title:
	
 
	
Director

	
 
	
 
	
 
	
 

	
 
	
WELLS FARGO BANK, NATIONAL ASSOCIATION

	
 
	
 
	
 
	
 

	
 
	
By:
	
 
	
/s/Stephanie Harrell

	
 
	
Name:
	
 
	
Stephanie Harrell

	
 
	
Title:
	
 
	
Vice President

	
 
	
 
	
 
	
 

	
 
	
MUFG UNION BANK, N.A.

	
 
	
 
	
 
	
 

	
 
	
By:
	
 
	
/s/Lara Francis

	
 
	
Name:
	
 
	
Lara Francis

	
 
	
Title:
	
 
	
Vice President

	
 
	
 
	
 
	
 

	
 
	
CAPITAL ONE, NATIONAL ASSOCIATION

	
 
	
 
	
 
	
 

	
 
	
By:
	
 
	
/s/Stephen Hartman

	
 
	
Name:
	
 
	
Stephen Hartman

	
 
	
Title:
	
 
	
Assistant Vice President

	
 
	
 
	
 
	
 

	
 
	
M&T BANK

	
 
	
 
	
 
	
 

	
 
	
By:
	
 
	
/s/James B. Hallock

	
 
	
Name:
	
 
	
James B. Hallock

	
 
	
Title:
	
 
	
Vice President

	
 
	
 
	
 
	
 

	
 
	
U.S. BANK NATIONAL ASSOCIATION

	
 
	
 

	
 
	
By:
	
 
	
 

	
 
	
Name:
	
 
	
 

	
 
	
Title:
	
 
	
 

	
 
	
 
	
 
	
 

	
 
	
THE HUNTINGTON NATIONAL BANK

	
 
	
 
	
 
	
 

	
 
	
By:
	
 
	
 

	
 
	
Name:
	
 
	
 

	
 
	
Title:
	
 
	
 

	
 
	
 
	
 
	
 

	
 
	
CIT BANK, N.A.

	
 
	
 
	
 
	
 

	
 
	
By:
	
 
	
/s/Zachary Holly

	
 
	
Name:
	
 
	
Zachary Holly

	
 
	
Title:
	
 
	
Vice President

 

Eleventh Amendment

Signature Page

LEGAL_US_W # 85608773.2rexx-ex102_326.htm

 

Exhibit 10.2

PURCHASE AND SALE AGREEMENT

among

PENNTEX RESOURCES ILLINOIS, INC.,

REX ENERGY I, LLC,

REX ENERGY IV, LLC,

REX ENERGY MARKETING, LLC

R.E. VENTURES HOLDINGS, LLC, and

REX ENERGY OPERATING CORP.
collectively as Seller

and

CAMPBELL DEVELOPMENT GROUP, LLC
as Purchaser

DATED June 14, 2016

 

 

 

 

 

 

 

PURCHASE AND SALE AGREEMENT

 

This Purchase and Sale Agreement (“Agreement”) is entered into on June 14, 2016 by and among Penntex Resources Illinois, Inc., Rex Energy I, LLC, Rex Energy IV, LLC, Rex Energy Marketing, LLC, R.E. Ventures Holdings, LLC, and Rex Energy Operating Corp., all of which are Delaware corporations or limited liability companies, executing this Agreement jointly and severally (hereinafter collectively referred to as the “Seller”) with a principal address of 366 Walker Drive, State College, PA 16801, and CAMPBELL DEVELOPMENT GROUP, LLC a Delaware limited liability company with a principal address of 591 Delaware Ave., Buffalo, NY 14202 (hereinafter referred to as the “Purchaser”).

 

WHEREAS, Seller desires to sell and Purchaser desires to purchase all of Seller’s oil and gas interests, properties and related rights in the Illinois basin (located in Illinois, Indiana and Kentucky); and,

 

WHEREAS, Seller and Purchaser desire to enter into this Agreement with respect to the sale of all of Seller’s oil and gas interests, properties and related rights located in Illinois, Indiana and Kentucky; and

 

WHEREAS, Seller and Purchaser have agreed to memorialize the terms and conditions applicable to the sale of all of Seller’s oil and gas interests, properties and related rights located in Illinois, Indiana and Kentucky by this Agreement.

 

NOW, THEREFORE, for and in consideration of the foregoing recitals, the mutual benefits to be derived herefrom and Ten Dollars and other valuable consideration, Seller and Purchaser agree as follows:

 

PURCHASE AND SALE:

 

	
 
	
1.1
	
Effective Date and Assets.

 

On the date of the closing (the “Closing”), Seller shall sell and Purchaser shall purchase and pay for, all of Seller’s right, title and interest in and to the following described oil and gas leases, lands, equipment and related assets (the “Assets”).  The effective date for the transaction shall be July 1, 2016 (the “Effective Date”).

 

	
 
	
(a)
	
All interest in and to the oil and gas leases and lands described on Exhibit A attached hereto (the “Oil and Gas Leases”).

 

	
 
	
(b)
	
All operative and existing surface leases and other agreements associated with the Oil and Gas Leases and operations.

 

	
 
	
(c)
	
All real estate owned by Seller in the State of Illinois, State of Indiana and Commonwealth of Kentucky and any other interest in oil and gas leases or lands owned by Seller in the State of Illinois, State of Indiana and Commonwealth of Kentucky whether described on Exhibit A or not. (Collectively, the Assets described in Sections 1.1(a), 1.1(b), and 1.1(c) are referred to herein as the “Properties”.)

 

	
 
	
(d)
	
All wells, tank batteries, water storage facilities, injection pumps and all associated production and injection equipment located on the lands corresponding to the Properties or otherwise associated with the Oil and Gas Leases, with said wells and tank batteries being described on Exhibit B attached hereto.  Said list to contain all applicable last MIT or T/A dates for each well, if applicable.

 

	
 
	
(e)
	
All files, records and data related to the Assets to the extent that Seller has the same in its possession or control, including without limitation lease records, well records, division order records, well files, title records, contracts, agreements, seismic data and other geological or operational documents and information.

~2~

 

 

	
 
	
(f)
	
All rights of operation as to the wells corresponding to the Properties and all rights under existing operating agreements, governmental orders, permits and other agreements related to operations.

 

	
 
	
1.2
	
Represented Interests.

 

Seller represents but does not warrant that it currently owns the gross working interest, overriding royalty interest and net revenue interest as to oil and gas produced pursuant to the Oil and Gas Leases in the amounts as set forth on Exhibit C attached hereto.  Said decimal equivalent is based upon 1.0 being all oil produced.  It is understood that the purchase price set forth herein assumes that the amount of the interest set forth on Exhibit C is true and correct.  In the event that Seller does not own the interest set forth on Exhibit C, then it is agreed that the Purchase Price may be proportionately reduced in an amount agreed to by the parties of the Allocated Amount corresponding to the affected Property listed on Schedule 1 if Purchaser elects to continue with the Closing, provided that such discrepancy meets or exceeds the threshold set forth herein.

 

	
 
	
1.3
	
Limited Warranty.

 

Seller does not warrant title to the Assets but the Seller covenants with the Purchaser that they have not conveyed away, assigned, disposed of, or encumbered, with the exception of any mortgages that will be satisfied by Seller and released at Closing, the Assets during their period of ownership.  All other warranties, whether express or implied, are expressly disclaimed and excluded from the terms and operation of this Agreement.  Notwithstanding, Seller shall transfer and quit claim to Purchaser, by means of the quit claim deeds in the forms attached hereto as Exhibits D-1 and D-2, all right, title, and interest in and to all warranties and covenants of title previously created of record as to the Assets and which have inured to the benefit of the Seller.  The representations of the extent of ownership as set forth in Section 1.2 shall not be deemed a warranty.  Notwithstanding said representation, it is the obligation of Seller to sell and transfer to Purchaser all of Seller’s interest, free and clear of all encumbrances, in the Oil and Gas Leases and Properties.

 

	
 
	
1.4
	
Closing.

 

Closing shall mean the date on which the balance of the purchase price (as defined herein) is paid to Seller and the transfer documents (as described herein) are delivered to Purchaser.  Closing shall occur on or before the August 16, 2016 and shall be effective for July 1, 2016, at 7:00 a.m., at the offices of Basin Law Group LLP, or at such other place, date, and time as may be mutually agreed upon by Seller and Purchaser.  

 

	
 
	
1.5
	
Assumption of Obligations.

 

The sale of the Assets shall be subject to and Purchaser shall assume, pay for, and perform the duties and obligations relating to the Assets including but not limited to the Oil and Gas Leases and all agreements, contracts, and instruments, and all duties imposed by governmental laws and regulations which arise subsequent to Closing.

 

	
 
	
1.6
	
Personal Property and Fixtures.

 

Seller makes no warranty or representation concerning the grade, quality or soundness as to any or all of the personal property and fixtures pertaining to the Assets including casing and other down hole equipment.  Purchaser will take all of the Assets on an as is and where is condition and basis subject to all latent and patent defects therein and in the condition and installation thereof.

 

~3~

 

PURCHASE PRICE:

 

	
 
	
2.1
	
Purchase Price.

 

The purchase price for the Assets is FORTY MILLION DOLLARS ($40,000,000 USD), which is allocated as set forth on the attached Schedule 1.  The purchase price shall be paid as follows:

 

	
 
	
(a)
	
A non-refundable, except as set forth in Section 12.2, earnest money down payment (the “Deposit”) of TWO MILLION FIVE HUNDRED THOUSAND DOLLARS ($2,500,000 USD) shall be paid by Purchaser by wire transfer or account transfer to the trust account (IOLTA) of Seller’s counsel, Basin Law Group LLP, for the benefit of Seller, and said payment may be made prior to the execution of this Agreement by all parties in order to meet deadlines for Seller’s notifications.  Upon the execution of this Agreement by all parties, Basin Law Group LLP shall remit such deposit unto Seller to be held subject to the terms of this Agreement.

 

	
 
	
(b)
	
The balance of the purchase price of THIRTY SEVEN MILLION FIVE HUNDRED THOUSAND DOLLARS ($37,500,000 USD) shall be paid by Purchaser to Seller at Closing subject to the following adjustments:

 

	
 
	
i)
	
Less the prorated taxes, which shall be prorated to the date of Closing, using the previous year’s ad valorem taxes as the basis for such calculation, as more fully set forth in paragraph 9.1 below.

 

	
 
	
ii)
	
Plus the value of oil attributable to the Seller’s interest in storage above the pipeline connection as of the Effective Date, excluding therefrom bottoms and unmarketable crude stored on the leases.

 

	
 
	
iii)
	
Less or plus any expenses relating to the Assets from and after the Effective Date and other amounts mutually agreed upon in writing by the parties.

 

	
 
	
iv)
	
Subject to proportionate reduction, as set forth in Section 1.2 above and agreed to prior to the Closing.

 

	
 
	
(c)
	
The balance of the purchase price shall be paid by wire transfer of funds to the Seller to an account specified by Seller within 3 days of Closing.

 

	
 
	
(d)
	
The purchase of the Assets is conditioned upon the transfer of the Assets being in the amount set forth on Exhibit C on the terms and conditions set forth herein, unless otherwise agreed upon by both parties in writing.

 

	
 
	
2.2
	
Tax Matters.

 

Seller and Purchaser have allocated the purchase price among the Properties as set forth on Schedule 1 attached hereto (the “Allocated Amounts”).  For tax purposes, the Allocated Amounts are consistent with Section 1060 of the Internal Revenue Code of 1986, as amended (the “Code”) and the Treasury Regulations promulgated thereunder.  Each party, Seller and Purchaser, shall use the Allocated Amounts on IRS Form 8594.  Seller and Purchaser agree to file all information reports and tax returns in a manner consistent with the purchase price allocation set forth on Schedule 1.  Neither Seller nor Purchaser shall take, or permit any of their respective affiliates to take, any position inconsistent with such allocation on any tax return or otherwise, unless required to do so by applicable law or a “determination” within the meaning of Section 1313(a)(1) of the Code.  The purchase price allocation may be revised from time to time, by the mutual written consent of all parties, so as to reflect any matters that need to be updated, including purchase price adjustments, if any.

 

~4~

 

TITLE EXAMINATION:

 

	
 
	
3.1
	
Access to Seller’s Records.

 

After the date of this Agreement and until Closing, Seller shall make the records described in Section 1.1(d) available to Purchaser, including the authorization of Countrymark Refining and Logistics, LLC to release any title documentation for which it may have on file for the Assets covered hereby.  Seller shall not be obligated to perform any additional title work and any additional abstracts and title opinions will not be made current by Seller.  Purchaser may conduct an investigation and review of the applicable county and governmental records and Purchaser may conduct a physical inspection of the Assets prior to the Closing.

 

	
 
	
3.2
	
Title Defects.

 

For the purpose of this Agreement, “title defect” shall mean a deficiency in one or more of the following:

 

	
 
	
(a)
	
Seller’s title at the Effective Date as to one or more of the Assets is subject to an outstanding mortgage, deed of trust, lien or encumbrance, or any adverse claim, in each case that was created by Seller and will not be released in connection with Closing.

 

	
 
	
(b)
	
Seller owns less than the interest shown on Exhibit C as to the Assets.

 

	
 
	
(c)
	
Seller’s rights and interest are subject to being reduced by virtue of the exercise by a third party of a reversionary, back in or similar right, or preferential right to purchase that has not been waived prior to Closing. 

 

	
 
	
(d)
	
Seller is in default under some material provision of a lease, farmout agreement, joint operating agreement, sales contract, or other contract or agreement affecting the Assets, whether such defect is “material” shall be determined in the sole discretion of Purchaser, in a reasonable manner.

 

	
 
	
3.3
	
Notice of Title Defects.

 

Upon discovery of a title defect, the Purchaser shall notify the Seller of the nature of the title defect.  The notice shall be given as soon as reasonably practical after discovery, but no later than seven (7) days prior to the date of the Closing.  

 

	
 
	
3.4
	
Remedies for Title Defects.

 

Upon discovery of a title defect, the purchase price shall be adjusted in accordance with the following guidelines:

 

	
 
	
(a)
	
Seller shall have the right but not the obligation to attempt to cure any title defect with respect to which it has received timely notice from Purchaser.

 

	
 
	
(b)
	
With respect to any title defect that Seller elects not to cure or that Seller fails to cure prior to Closing after receiving notice of the title defect, then the following shall occur.

 

	
 
	
i)
	
If the title defect is not of a nature that results in economic loss to the Purchaser, the purchase price shall not be reduced and the Assets subject to the title defect shall be sold to Purchaser hereunder;

 

	
 
	
ii)
	
If a title defect pertains to a specific interest and/or lease, the value of the defect shall be deducted from the amount allocated to such specific interest and/or lease set forth on 

~5~

 

	
 
		
Schedule 1 and the Assets subject to the title defect shall be sold to Purchaser hereunder; and 

 

	
 
	
iii)
	
If the title defects in the aggregate correspond to 10% or more of the purchase price of the Assets (based on the Allocated Amounts attributed to the affected interests as set forth on Schedule 1), then in Seller’s sole discretion, either (x) the parties may attempt to agree on an amount by which the purchase price shall be reduced, and, if such agreement is reached, proceed to Closing; or (y) Seller may terminate this Agreement with no further liability to either of the parties, and any Deposit moneys shall be returned to Purchaser.

 

ENVIRONMENTAL CONDITIONS:

 

	
 
	
4.1
	
Environmental Assessment.

 

Attached hereto as Schedule 4.1 is a list of all known environmental issues pertaining to the Assets, including any and all violations, decrees, or orders that affect the Assets.  Upon execution of this Agreement by both parties, Seller shall provide Purchaser (or its contractors or consultants) with reasonable access to the Assets during which Purchaser, at its option, can conduct at its sole risk and expense an environmental site review.  Between the execution date and the Closing, Purchaser shall be entitled to review any relevant documents pertaining to the environmental issues listed on Schedule 4.1 at Seller’s offices. At least five (5) days prior to the Closing, Seller shall provide Purchaser with an updated Schedule 4.1.

 

	
 
	
4.2
	
Purchaser’s Access to Assets.

 

Seller shall assist Purchaser in gaining access to the Assets to conduct the environmental site review, and in exchange for said access, Purchaser waives and releases all claims against Seller for injury to or death of persons or damage to property arising in any way from the exercise of rights granted to Purchaser hereby or the activities of Purchaser or its employees, agents, or contractors on the Assets.

 

	
 
	
4.3
	
Notice of Access.

 

Prior to accessing the Assets as provided in Sections 4.1 and 4.2, Purchaser shall provide reasonable notice to Seller in order to allow Seller the opportunity to contact landowners and advise as to the nature of Purchaser’s access.

 

	
 
	
4.4
	
Release and Indemnification.

 

	
 
	
(a)
	
The Assets have been utilized by Seller for the purpose of exploration, development and production of oil and gas and may contain pits, pipelines, and facilities no longer in use.  Purchaser acknowledges that there may have been surface or subsurface spills or leaks of oil, gas, or produced substances or other materials including but not limited to salt water.  In addition, the Assets may contain asbestos and/or naturally occurring radioactive material (NORM).  In this regard, Purchaser expressly understands that NORM may affix or attach itself to the inside of wells, materials, and equipment as scale or in other forms and that said wells, materials and equipment located on the Assets may contain NORM.

 

	
 
	
(b)
	
The Purchaser understands and agrees that the sale of the Assets is made on an "as is, where is" basis and Purchaser releases Seller from any liability with respect thereto, whether or not caused by or attributable to Seller's negligence.  Without limiting the foregoing, from and after the Closing, Purchaser waives its right to recover from Seller and forever releases and discharges Seller from any and all damages, claims, losses, liabilities, penalties, fines, liens, judgments, costs, or expenses whatsoever, including attorney’s fees and costs, whether direct or indirect, that may arise on or account of or in any way connected with the physical or environmental condition of the Assets or any law or regulation applicable thereto.  Purchaser shall assume all liability and obligations as to said physical or environmental conditions as of Closing.

~6~

 

 

	
 
	
(c)
	
Purchaser recognizes and specifically assumes the obligation to properly plug and abandon any and all wells, remove all equipment and facilities, including but not limited to pipelines, closure of all pits, and restoration of the surface associated with the Assets when appropriate in accordance with the rules, regulations, and requirements of any governmental authority having jurisdiction thereof and with all obligations in any lease, contract, or agreement assumed by Purchaser whether or not such obligation arises prior to or after the Effective Date.  Purchaser agrees to pay all costs and expenses associated with any such plugging and abandoning, removal, closing, or restoration.

 

	
 
	
(d)
	
Purchaser agrees to indemnify and defend Seller from any and all damages, losses, claims, demands, and causes of action including but not limited to any civil fines, penalties, expenses, costs of cleanup and restoration and environmental and plugging liabilities for any and all aspects of the Assets, including all wells thereon, brought by any and all persons including any private citizens, persons, organizations and agency, branch or representative of the federal, state, or local government on account of any personal injury, death, damage, destruction or loss of property, contamination of natural resources (including soil, surface water or ground water) resulting from or arising out of any liability caused by or connected with any physical, environmental, or well plugging condition of the Assets from and after the Closing Date, including, but not limited to, the presence, disposal, or release of any material of any kind on or under the Assets caused by or connected with acts or omissions of Purchaser, its employees, representatives, or agents with regard to its use, ownership, or operation of the Assets.  Purchaser’s indemnification shall extend to and include the negligence of Seller, Purchaser, and parties acting on behalf of Purchaser whether such negligence is active or passive, joint, sole or concurrent and Seller’s strict liability.  This indemnification shall be in addition to any other indemnity provision contained in this Agreement.

 

	
 
	
4.5
	
Environmental Pollution Control Insurance.

 

Seller currently has in place an environmental pollution control insurance policy with CHUBB Limited Insurance with coverage in the amount of $25,000,000.00 with an effective date of 2002.  Such policy is “occurrence based,” covers the Assets to the extent and in accordance with the policy’s terms and conditions, and is in full force and effect on the date of this Agreement.  Seller covenants to make no changes to said policy and to keep said policy in full force and effect until the Closing.  

 

OPERATIONS/CASUALTY LOSS:

 

	
 
	
5.1
	
Operations.

 

Seller shall continue to operate the Assets until the Closing in the normal and customary manner, which shall include the maintenance of all producing wells, injection wells and associated production equipment that are being utilized as of the date of this Agreement in a good and working condition.  Said Assets shall be in good and working condition on the date of Closing, or Seller shall reimburse Purchaser for such costs incurred to bring said equipment back into good working order.  Seller agrees that during the period between the date of this Agreement and the Closing, no reworks, opening of new intervals or formations or recompletions shall occur without the consent of Purchaser.  All rights of operation and all contracts and agreements relating thereto shall be transferred by Seller to Purchaser as of the date of Closing.  Seller shall assist Purchaser in the transition of the operations to Purchaser.  Seller shall insure that all utility meters are read upon Closing and Seller shall be responsible for Seller’s proportionate share of such utilities and shall pay such immediately upon becoming due and payable.  Seller shall assist in the transfer of all utilities to Purchaser by providing utility records and account numbers to Purchaser on or before Closing.

 

~7~

 

	
 
	
5.2
	
Casualty Loss. 

 

Seller shall assume the risk of casualty loss relating to the Assets until Closing.  In the event of a casualty loss prior to closing, the loss shall be remedied in the same manner as a title defect as set forth in Section 3.4.

 

	
 
	
5.3
	
Purchaser’s Operations.

 

At Closing, Seller shall provide all documents required by any governmental agency having jurisdiction over the Assets necessary to transfer the operations and permits to Purchaser.  Purchaser shall promptly file all documents with the appropriate agencies including required bonds or financial security.

 

EMPLOYEES 

 

Seller covenants and agrees as follows:

 

	
 
	
6.1
	
Notice to Employees and Employee List.

 

Seller shall be responsible for giving notice of transactions contemplated under this Agreement to all employees of Seller that service the Assets as required by law (“Seller’s Employees.”)  Seller has attached hereto as Exhibit E, as of the date hereof, the name, current annual salary rate, bonus year to date as of May 31, 2016, classification, accrued paid time off, permitted paid time off, date of employment and position of each of Seller’s Employees.  Except as set forth on Exhibit E, each employee is an employee at-will, and no severance is payable upon the cessation of employment. 

 

	
 
	
6.2
	
Worker’s Compensation Insurance and Taxes.

 

Seller shall be responsible for all worker’s compensation insurance that is owed on each of Seller’s Employees until the Closing.  In addition, Seller shall be responsible for the payment of all taxes associated with each of Seller’s Employees during their time of employment with Seller, which shall include but is not limited to the following: FICA, Medicare, City, State and Federal Income Tax withholdings and unemployment insurance payments.

 

	
 
	
6.3
	
Obligations Regarding Employees.

 

(a)Prior to Closing, Seller shall not terminate any of Seller’s Employees without first providing notice to Purchaser and providing Purchaser an opportunity to make an offer of employment.  In addition, no later than 10 days prior to Closing, Purchaser shall submit a list of employees to whom it will make offers of employment with compensation and benefits at least substantially the same as those terms provided by Seller.  Other than those employees identified by Purchaser as those to whom it will make offers of employment, Seller is free to terminate its employment of the remaining of Seller’s Employees before, at, or after Closing. With respect to each such employee who accepts Purchaser’s offer of employment (each, a “Transferred Employee”), Seller shall be responsible for all compensation and benefits arising prior to Closing (in accordance with Seller’s employment terms) and Purchaser shall be responsible for all compensation and benefits arising after Closing (in accordance with Purchaser’s employment terms).  

(b)Seller shall be solely responsible for any severance obligations to Seller’s Employees.  Purchaser does not assume any of Seller’s Employee obligations (including but not limited to any severance obligations or accrued paid time off).

(c)The terms of this Agreement are solely for the benefit of (and may be enforced only by) the parties hereto and their respective successors and permitted assigns. Without limiting the foregoing, nothing in this Agreement gives any rights to any employee, and no employee may enforce any provision of this Agreement against any of the parties hereto.

~8~

 

(d)In accordance with Treasury Regulation §54.4980B 9, Q&A 7, Seller shall be responsible for coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended and the rules and regulations issued thereunder (“COBRA”), for all M&A qualified beneficiaries (determined in accordance with Treasury Regulation §54.4980B-9, Q&A 4 or any successor provision).  Purchaser shall be solely responsible for offering and providing any COBRA coverage required with respect to any Transferred Employees (or other qualified beneficiary) who becomes covered by any welfare benefit plans maintained by Purchaser. For purposes hereof, each of “qualified beneficiary”, “M&A qualified beneficiaries” and “group health plan” shall have the meaning ascribed thereto in Section 4980B of the Code and the related regulations. 

ARTICLE 1

ARTICLE 2

ARTICLE 3

ARTICLE 4

ARTICLE 5

ARTICLE 6

	
 
	
6.6
	

	
 
	
6.7
	

	
 
	
6.8
	

6.4   WARN Act.  Seller shall provide any notices required pursuant to the Worker Adjustment and Retraining Notification Act, 29 U.S.C. Sections 2101-2109, or any similar laws (the “WARN Act”) in connection with the transactions contemplated by this Agreement.  Seller shall be responsible for any liability or obligation incurred by Purchaser under the WARN Act as a result of failing to provide any such notice.  

6.5   Survival of Obligations.  All obligations of Seller contained in Section 6 shall survive Closing and Seller shall remain responsible for all liabilities and obligations which Seller retained in Section 6 after Closing.  Seller shall indemnify and hold harmless Purchaser for any violation of the terms of this Section by Seller, which shall include damages, expenses, including attorney’s fees and court costs, civil fines, penalties.

 

MUTUAL INDEMNITIES:

 

	
 
	
7.1
	
Purchaser Indemnity.

 

Purchaser agrees to release, defend, indemnify and hold Seller, its agents and employees harmless from any damages, expenses, including attorney’s fees and court costs, civil fines, penalties, and other costs and liabilities incurred as a result of claims, demands, and causes of action arising out of or in any way connected with or related to any bodily injury or death to any persons or damage to personal property occurring or arising subsequent to Closing.  Purchaser’s indemnity is in addition to other indemnities provided herein.

 

	
 
	
7.2
	
Seller Indemnity:

 

Seller agrees to release, defend, indemnify and hold Purchaser, its agents, or employees harmless from any damages, expenses, including attorney’s fees and court costs, civil fines, penalties, and other costs and liabilities incurred as a result of claims, demands, and causes of action arising out of or in any way connected with or related to any bodily injury or death to any persons; damage to personal property; or unresolved Oil and Gas Cases with the Office of Oil and Gas Resource Management, the Indiana Department of Natural Resources, Division of Oil and 

~9~

 

Gas, Kentucky Department for Natural Resources, Division of Oil and Gas, the Illinois Environmental Protection Agency, the Indiana Department of Environmental Management, the Kentucky Department of Environmental Protection, and the United States Environmental Protection Agency, including N.O.V.s, N.N.C.s and other open regulatory matters, which occurred or arose prior to Closing and, in the case of obligations under N.O.V.s and N.N.C.s, have not been expressly assumed by Seller hereunder.  

 

REPRESENTATIONS AND WARRANTIES:

 

As of the date of this Agreement, the parties represent and warrant that:

 

	
 
	
8.1
	
Authorization; Corporate Power; Enforceability; No Conflicts.

 

	
 
	
(a)
	
Each of Seller and Purchaser have all requisite corporate power and authority to enter into this Agreement, perform its obligations hereunder and consummate the transactions contemplated hereby, including, without limitation, the execution and delivery of this Agreement.  All necessary and appropriate corporate action has been taken by Seller and Purchaser with respect to the execution and delivery of this Agreement, this Agreement has been duly executed and delivered on behalf of Purchaser and Seller, respectively, and this Agreement constitutes a valid and binding obligation of each of Seller and Purchaser, enforceable in accordance with its terms. 

	
 
	
(b)
	
Each of Seller and Purchaser is duly organized and validly existing in state of its organization and is duly registered to transact business in each of the states for which such entity is transacting business which is covered by this Agreement.  At Closing, each of Purchaser and Seller covenant that all documents and instruments required hereunder to be executed and delivered by Purchaser and Seller shall have been fully authorized, executed and delivered.

	
 
	
(c)
	
The execution, delivery and performance by each of Seller and Purchaser, respectively, of this Agreement and the consummation by each party of the transactions contemplated by this Agreement does not and will not in any material respect conflict with, violate, result in a breach of the terms and conditions, of, or with or without notice or the passage of time, result in any material breach, event of default or the creation of any lien under any agreement or contract, any organizational documents of such party, or any law, judgment, order, or decree to which the such party is subject or the Assets are bound, or require the consent or approval of, or a filing by the such party with any governmental or regulatory authority.

	
 
	
8.2
	
Brokers.

 

Any obligation or liability that may exist for any fee payable to a broker or finder with respect to the matters provided in this Agreement shall be the sole obligation of the creating party.

 

8.3   Seller’s Additional Representations and Warranties.  Except as set forth on Schedule 8.3, Seller represents that:

 

	
 
	
(a)
	
There is no known lawsuit, action, investigation or administrative proceeding pending or threatened against Seller that has not been disclosed to Purchaser.

 

	
 
	
(b)
	
Seller has not received a written claim or written demand notice that has not been resolved, that has not been disclosed to Purchaser.

 

	
 
	
(c)
	
All ad valorem taxes corresponding to the Assets which have become due and payable prior to the Effective Date have been timely and properly paid.

 

	
 
	
(d)
	
Seller has paid or shall pay within the terms of payment required by third party vendors all lease operating expenses attributable to the Assets which have accrued prior to the Effective Date.

~10~

 

 

	
 
	
(e)
	
The permittee of the wells corresponding to the Assets for regulatory purposes shall be qualified at Closing to transfer said permits to Purchaser.

 

	
 
	
(f)
	
There are no substantial environmental conditions or defects which have been disclosed to or asserted against Seller concerning the Assets during the past five years which have not been disclosed to Purchaser in accordance with Section 4.1.

 

	
 
	
(g)
	
All Assets which are the subject of notices of violations and director’s decisions in conjunction with enforcement of applicable laws and regulations by the Illinois Department of Natural Resources, Office of Oil and Gas Resource Management, the Indiana Department of Natural Resources, Division of Oil and Gas, Kentucky Department for Natural Resources, Division of Oil and Gas, the Illinois Environmental Protection Agency, the Indiana Department of Environmental Management, the Kentucky Department of Environmental Protection, and the United States Environmental Protection Agency have been disclosed to Purchaser.  Said disclosure shall be deemed satisfied by Purchaser’s receipt of a printout of Seller’s enforcement summary as maintained by each Department.

 

	
 
	
(h)
	
There are no pending surface owner complaints as to the Assets that were first asserted during the two years immediately preceding the date of this Agreement and have yet to be resolved.

 

	
 
	
(i)
	
Seller represents and covenants with Purchaser that all tax returns required of Seller have been properly filed and all taxes, penalties and interest on such taxes have been paid and that there are no undisclosed known liabilities for which Purchaser shall be responsible for after closing.

 

	
 
	
8.4
	
Labor Matters; Employee Benefit Plans.  

	
 
	
(a)
	
Except as set forth on Schedule 8.4(a) Seller has complied in all material respects with all labor and employment laws, rules and regulations, including those which relate to wages, hours, terms and conditions of employment, discrimination in employment and collective bargaining, equal opportunity, harassment, immigration, disability, workers’ compensation, unemployment compensation, occupational health and safety and the collection and payment of withholding.  Except as set forth on Schedule 8.4(a), as of the date hereof, there is no unfair labor practice charge against Seller pending or, to Seller’s knowledge, threatened before the National Labor Relations Board, any state labor relations board or any court or tribunal, nor has any written complaint pertaining to any such charge or potential charge been delivered to Seller, and there is no strike, dispute, request for representation, slowdown or stoppage pending or, to Seller’s knowledge, threatened.  None of Seller’s employees being hired by Purchaser participate in a multiemployer pension plan (within the meaning of Section 4001(a)(3) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”)) that is covered by Title IV of ERISA (a “Multiemployer Plan”).

	
 
	
(b)
	
Set forth on Schedule 8.4(b) is a complete and correct list, as of the date hereof, of each material employee benefit plan as to Seller’s Employees.  There is not now in effect or to become effective after the date of this Agreement and until the Closing, any new employee benefit plan or any amendment to an existing employee benefit plan which, in either case, will materially affect the benefits of the Assets (other than customary merit and performance pay increases and other than as required by applicable law) and that will on or after the Closing impose liability on Purchaser. After the Closing, Purchaser shall have no liability, funding or otherwise, for any employee benefit plan, including without limitation, any “employee pension benefit plan” (as defined under Section 3(2) of ERISA) set forth on Schedule 8.4(b).

	
 
	
(c)
	
Seller is not party to any collective bargaining, union or similar agreement with respect to Seller’s Employees, and, to Seller’s knowledge, no labor union or other collective bargaining representative represents or claims to represent or is attempting to organize such employees.

~11~

 

All representations set forth above shall be deemed to be on a basis of actual knowledge of Seller.  The fact that Seller should have known of a particular fact or event shall not be deemed a violation of any representation.  The representations set forth in Sections 8.1, 8.2, 8.3(i) and 8.4 shall survive Closing; all other representations in Section 8 shall not survive Closing.

 

CLOSING:

 

	
 
	
9.l
	
Closing.

 

At Closing, the following shall occur:

 

	
 
	
(a)
	
Seller shall execute, acknowledge, and deliver quit claim deeds substantially in the form and substance of Exhibit D-1 (Mineral Interests) and Exhibit D-2 (Surface Interests) attached hereto covering all of the fee interests to be sold pursuant hereto.

 

	
 
	
(b)
	
Seller shall execute, acknowledge, and deliver an assignment substantially in the form and substance of Exhibit F-1 (Indiana), Exhibit F-2 (Kentucky) and Exhibit F-3 (Illinois) attached hereto covering all of the Oil and Gas Leases to be sold pursuant hereto.

 

	
 
	
(c) 
	
Seller shall execute, acknowledge, and deliver the Bill of Sale substantially in the form and substance of Exhibit G attached hereto covering all remaining Assets to be sold pursuant hereto.

 

	
 
	
(d)
	
Seller’s representative and Purchaser shall execute an Application for Permit Transfer (Form A2) with the State of Indiana transferring permits to the wells and tank batteries described on Exhibit B-IN and Seller’s representative and Purchaser shall execute a Notification of Well Transfer (OG-26 Form) which shall be delivered unto the Illinois Department of Natural Resources.

 

	
 
	
(e)
	
Seller shall deliver an executed statement described in Treasury Regulation §1.1445-2(b)(2) certifying that such Seller is not a “foreign person” within the meaning of the Code.

 

	
 
	
(f)
	
Purchaser shall deliver to the Seller, by wire transfer of funds to an account specified by Seller at least two (2) business days prior to Closing, the purchase price as adjusted herein.

 

	
 
	
(g)
	
Seller shall deliver to Purchaser exclusive possession and operation of the Assets as of the date of Closing.

 

	
 
	
9.2
	
Recording.

 

Purchaser shall, at its own expense, record the assignment, the quit claim deed, and any other relevant documents in the County Clerk and Recorder’s Office where the Properties are located.  Purchaser shall supply Seller with a true and accurate photocopy of all recorded documents within a reasonable period of time after their recording.

 

TAXES:

 

	
 
	
10.1
	
Apportionment of Ad Valorem Taxes.

 

All ad valorem taxes shall be apportioned as of the Effective Date between Purchaser and Seller.  All such taxes allocable to the periods before the Effective Date shall be paid by Seller and all such taxes allocable after the Effective Date shall be paid by Purchaser.  The portion of such allocable tax liability which is attributable to Seller shall be credited to Purchaser’s account and may, with the agreement of the parties, be an adjustment to the purchase price (rather than having Seller pay the amount directly).  In the event that the parties agree to adjust the 

~12~

 

purchase price for Seller’s obligations under this Section 10.1, Purchaser shall make all payments for all such taxes when due. Allocation shall be based on the most recent tax statement.

 

POST CLOSING ADJUSTMENT:

 

	
 
	
11.1
	
Adjustment Post Closing. 

 

Within 60 days after Closing, Purchaser and Seller shall review any additional information which may then be available pertaining to post-closing adjustments for the period between the Effective Date and the Closing Date, and shall determine if any additional adjustments should be made beyond those made at Closing (whether the same be made to account for expenses or revenues not considered in making the adjustments made at Closing, or to correct errors made in the adjustments made at Closing), and shall make any such adjustments by appropriate payments from Seller to Purchaser or from Purchaser to Seller, no later than 90 days after Closing.

 

BREACH OR DEFAULT:

 

	
 
	
12.1
	
Seller’s Default.

 

In the event this Agreement is not closed by reason of any breach or default by Seller, then Purchaser may pursue all of its legal or equitable remedies and the Deposit shall be returned to Purchaser.

 

	
 
	
12.2
	
Purchaser’s Default.

 

In the event this Agreement is not closed by reason of any breach or default by Purchaser, other than (a) failure of title under Section 3.4(b) ii) or 3.4(b) iii); (b) ownership of less working interest than that set forth on Exhibit C (as set forth in Section 1.2) (both of (a) and (b) to be determined prior to Closing); or a material and adverse change to the environmental conditions set forth in Section 4.1 that has not been remedied by Seller or waived by Purchaser prior to Closing, then Seller shall be entitled to retain the Deposit paid unto Seller as set forth in Section 2.1(a) as its sole remedy for Purchaser’s Default, Section 13.16 notwithstanding.  

 

MISCELLANEOUS:

 

	
 
	
13.1
	
Governing Law.

 

This Agreement shall be governed by and interpreted in accordance with the laws of the State of Illinois.

 

	
 
	
13.2
	
Entire Agreement.

 

This Agreement constitutes the entire agreement between the parties and supersedes all prior agreements, understandings, negotiations and discussions whether oral or written of the parties.  No supplement, amendment, alteration, modification, waiver, or termination of this Agreement shall be binding unless executed in writing by the parties hereto.

 

	
 
	
13.3
	
Waiver.

 

No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provisions hereof nor shall any waiver constitute a continuing waiver unless otherwise expressly provided.

 

	
 
	
13.4
	
Captions.

 

The captions in this Agreement are for convenience only and shall not be considered a part of or affect the construction or interpretation of any provision of this Agreement.

~13~

 

 

	
 
	
13.5
	
Assignment.

 

Neither party hereto shall assign this Agreement or any of its rights or obligations hereunder without the prior written consent of the other party which shall not be unreasonably withheld, and any assignment made without such consent shall be void.

 

	
 
	
13.6
	
Binding on Successors.

 

This Agreement shall be binding upon and inure to the benefit of the parties hereto together with their successors and permitted assigns.

 

	
 
	
13.7
	
Expenses.

 

Except as otherwise provided herein, each party shall be solely responsible for all expenses incurred by it in connection with this Agreement and the transactions contemplated hereunder including, without limitation, fees and expenses of attorneys and accountants.

 

	
 
	
13.8
	
Severability.

 

If any term or other provision of this Agreement is invalid, illegal, or incapable of being enforced under any applicable rule or law, all other conditions and provisions of this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the transaction contemplated hereby is not affected in a materially adverse manner with respect to either party.

 

	
 
	
13.9
	
Use of Seller’s Name.

 

As soon as practicable after closing, Purchaser shall remove or cause to be removed from the Assets all names referencing Seller, including signs used by Seller.

 

	
 
	
13.10
	
Survival.

 

Except for the terms provided in Sections 2.2, 4.4, 6, 7, 8.1, 8.2, 8.3(i), 8.4, 9.2, 10, 11, 13.7, 13.8, 13.9, 13.13 13.14, and 13.16, the terms, conditions, and obligations of the parties pursuant to this Agreement shall not survive the Closing and any documents executed pursuant thereto.

 

	
 
	
13.11
	
Counterparts.

 

This Agreement may be executed in counterparts by the parties with counterpart signature pages being combined into a single document.

 

	
 
	
13.12
	
Confidentiality.

 

Except as required by applicable law or contract (including, for the avoidance of doubt, any leases, agreements or contracts of Seller that require notice of sale or assignment, provide for preferential rights, or require consents to assign, as well as any disclosure obligations of Rex Energy Corporation, parent of Seller, as a publicly traded company), neither Seller nor Purchaser shall disclose the terms of this Agreement to another unrelated party, with the exception of either party’s attorneys, accountants, or financial professionals (current and prospective) who are bound by agreement with the applicable party to maintain the confidentiality of this information.  Except as may be required under applicable law (including, for the avoidance of doubt, any disclosure obligations of Rex Energy Corporation, parent of Seller, as a publicly traded company), prior to Closing neither party shall make any public announcement with respect to the transaction contemplated hereby without the consent of the other party, which consent shall not be unreasonably withheld or conditioned.

~14~

 

 

	
 
	
13.13
	
Further Assurances.

 

In addition to the obligations required to be performed hereunder by Seller at the Closing, as soon as possible after Closing (a) as required by law, Purchaser shall notify all relevant governmental agencies that it has purchased the Assets.  Purchaser and Seller agree to execute all documents as may be required by the governmental agencies; (b) Seller and Purchaser agree to execute all other documents required to replace operator of all of the wells transferred by this Agreement and remove all wells, well bores and tank battery registrations from the prior operator’s bond; and (c) Seller and Purchaser agree, from time to time, to perform such other acts, and to execute, acknowledge and deliver subsequent to the Closing such other instruments, documents and other materials, as Purchaser may reasonably request in order to effectuate the consummation of the transactions contemplated herein and to vest title to the Assets in Purchaser.

 

	
 
	
13.14
	
Attorneys Fees and Cost.

 

If either party brings suit against the other in connection with this Agreement, the prevailing party shall be entitled to receive from the other party reasonable attorneys’ fees and other costs and expenses incurred by such party in connection with such suit regardless of whether such suit is prosecuted to judgment.  As used herein, “prevailing party” shall mean, in the case of claimant, one who is successful in obtaining substantially all of the relief sought, and in the case of a defendant or respondent, one who is successful is denying substantially all of the relief sought by claimant.  If neither party is a prevailing party, then each shall be responsible for its own attorneys’ fees and other costs and expenses incurred by such party in connection with such suit.

 

	
 
	
13.15
	
Notices.

 

Any notice or other communication that is required or permitted to be given under the terms of this Agreement (each a “Notice”) shall be in writing and shall be deemed to have been duly given (a) upon being deposited in the mail, postage prepaid for registered or certified mail, return receipt requested, or (b) when personally delivered against written receipt, or when delivered by overnight courier, in each case, to the parties hereto at the following addresses or at such other address as any party hereto shall hereafter specify by 10 days prior Notice given and received in the manner provided in this Section 13.15 to the other parties described in this Section.

 

Seller:  

 

Rex Energy Operating Corp.

C/o Rex Energy Corporation

366 Walker Drive
State College, PA 16801

Attn: Senior Vice President, Land and Business Development

Copy:  General Counsel 

Fax:  814-278-7286

E-Mail: fshodges@rexenergycorp.com

Copy:  jmcdonough@rexenergycorp.com

 

~15~

 

Purchaser:

 

CAMPBELL DEVELOPMENT GROUP, LLC

Attn: Jakob L. Campbell

1238 Co. Rd. 1500 N.

Carmi, IL 62821

E-Mail: jake@campbellenergyllc.com

 

With copy to:

The Law Offices of Matthew L. McArthy, LLC

1220 E. Main St., Suite D.

P.O. Box 519

Carmi, IL 62821

E-Mail: mattmcarthy@gmail.com

 

A Notice shall be deemed to have been duly received (a) if mailed, on the date set forth on the return receipt or (b) if personally delivered or sent by overnight courier on the date of such delivery. The inability to make delivery because of change of address of which no Notice was given, or rejection or refusal to accept any Notice offered for delivery shall be deemed to be receipt of the Notice as of the date of such inability to deliver or rejection or refusal to accept. Any Notice may be given by counsel for the party giving same. Any Notice to be given to Sellers or by Sellers shall be given by or to ABI, as applicable, on behalf of Sellers.

 

	
 
	
13.16
	
Specific Performance.

 

The parties hereto recognize that each party’s remedies at law are inadequate to protect its interests under this Agreement and agree that this Agreement may be enforced by a party hereto by specific performance.  However, specific performance shall not be the exclusive remedy available to a party, and all remedies both at law and equity shall remain available to a party.

 

	
 
	
13.17
	
List of Schedules and Exhibits.

 

Schedule 1 – Allocation of Purchase Price

Schedule 4.1 – Environmental Matters

Schedule 8.3 – Seller Disclosures

Schedule 8.4 – Employee-Related Disclosures

Exhibit A – List of Oil and Gas Leases

Exhibit B – List of Wells and Tank Batteries

Exhibit C – List of Working Interest Ownership in Assets

Exhibit D-1 – Form of Quit Claim Deed (Mineral Interests)

Exhibit D-2 – Form of Quit Claim Deed (Surface Interests)

Exhibit E – List of Employees

Exhibit F-1 – Form of Assignment (Indiana)

Exhibit F-2 – Form of Assignment (Kentucky)

Exhibit F-3 – Form of Assignment (Illinois)

Exhibit G –Form of Bill of Sale

 

 

 

~16~

 

IN WITNESS WHEREOF, the parties have executed this Agreement on the day and year first above written.

 

	
SELLER:

	
 

	
PENNTEX RESOURCES ILLINOIS, INC.

	
 
	
 
	
 

	
 
	
 
	
 

	
By:
	
 
	
/s/Scott Hodges

	
Name:
	
 
	
Scott Hodges

	
Title:
	
 
	
SVP, Land & Business Development

	
 
	
 
	
 

	
REX ENERGY I, LLC

	
 
	
 
	
 

	
 
	
 
	
 

	
By:
	
 
	
/s/Scott Hodges

	
Name:
	
 
	
Scott Hodges

	
Title:
	
 
	
SVP, Land & Business Development

	
 
	
 
	
 

	
REX ENERGY IV, LLC

	
 
	
 
	
 

	
 
	
 
	
 

	
By:
	
 
	
/s/Scott Hodges

	
Name:
	
 
	
Scott Hodges

	
Title:
	
 
	
SVP, Land & Business Development

	
 
	
 
	
 

	
REX ENERGY MARKETING, LLC

	
 
	
 
	
 

	
 
	
 
	
 

	
By:
	
 
	
/s/Scott Hodges

	
Name:
	
 
	
Scott Hodges

	
Title:
	
 
	
SVP, Land & Business Development

	
 
	
 
	
 

	
 
	
 
	
 

	
R.E. VENTURES HOLDINGS, LLC

	
 
	
 
	
 

	
 
	
 
	
 

	
By:
	
 
	
/s/Scott Hodges

	
Name:
	
 
	
Scott Hodges

	
Title:
	
 
	
SVP, Land & Business Development

	
 
	
 
	
 

	
 
	
 
	
 

	
REX ENERGY OPERATING CORP.

	
 
	
 
	
 

	
By:
	
 
	
/s/Scott Hodges

	
Name:
	
 
	
Scott Hodges

	
Title:
	
 
	
SVP, Land & Business Development

	
 
	
 
	
 

 

[Signature Page to Purchase and Sale Agreement]

 

 

			
	
PURCHASER:

	
 
	
 
	
 

	
 
	
 
	
 

	
CAMPBELL DEVELOPMENT GROUP, LLC

	
 
	
 
	
 

	
By:
	
 
	
/s/Jakob L. Campbell

	
Name:
	
 
	
Jakob L. Campbell

	
Title:
	
 
	
Manager

	
 
	
 
	
 

	
CAMPBELL DEVELOPMENT GROUP, LLC

	
 
	
 
	
 

	
By:
	
 
	
/s/Jakob L. Campbell

	
Name:
	
 
	
Jakob L. Campbell

	
Title:
	
 
	
Member of Jake Campbell Services, LLC and Carter Oil, LLC, both Members

	
 
	
 
	
 

	
 
	
 
	
 

	
CAMPBELL DEVELOPMENT GROUP, LLC

	
 
	
 
	
 

	
By:
	
 
	
/s/ Justin Reich

	
Name:
	
 
	
Justin Reich

	
Title:
	
 
	
Manager of APX Energy, LLC, Manager of APX Development Group, LLC, a Member

	
 
	
 
	
 

	
 
	
 
	
 

	
CAMPBELL DEVELOPMENT GROUP, LLC

	
 
	
 
	
 

	
By:
	
 
	
/s/Morris Shohet

	
Name:
	
 
	
Morris Shohet

	
Title:
	
 
	
Manager of North Six Energy, LLC, a Member

	
 
	
 
	
 

	
Escrow Agent for purposes of Escrow paragraphs only.

	
 
	
 
	
 

	
/s/William C. Illingworth, Partner

	
BASIN LAW GROUP LLP

	
By:
	
 
	
William C. Illingworth, Partner

 

[Signature Page to Purchase and Sale Agreement]

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