Document:

Unassociated Document

    Exhibit
10.2

     

    Bonanza Oil & Gas, Inc.

    3417
Mercer, Suite E

    Houston,
Texas  77027

    

    December 2, 2009

    

    Kenneth
Orr, CEO

    Triumph
Small Cap Fund, Inc.

    

    Re:           Bonanza
Oil & Gas, Inc. (the “Company”)

    

    Gentlemen:

    

    The Company hereby acknowledges that
Triumph Small Cap Fund, Inc. (“TSC”) has acquired 14% secured
promissory note in the principal amount of $750,000 (the “14% Note”) and (ii) a
convertible promissory note in the principal amount of $750,000 issued on May
2008 (the “May 2008 Note” and
collectively with the 14% Note, the “Notes”) from Samuel
Weiss.

    

    The Company and TSC hereby agree that
the 14% Note shall be amended and restated to incorporate the following
provision:

    

    The
Lender shall have the right from time to time to convert all or any part of the
outstanding and unpaid principal amount of this Note into fully paid and
non-assessable shares of Common Stock at the conversion price (the “Conversion Price”) determined
as provided herein (a “Conversion”); provided, however, that in no
event shall the Lender be entitled to convert any portion of this Note in excess
of 4.9% of the outstanding shares of Common Stock. For purposes of the proviso
to the immediately preceding sentence, beneficial ownership shall be determined
in accordance with Section 13(d) of the Securities Exchange Act of 1934, as
amended, and Regulations 13D-G thereunder.  The number of shares of
Common Stock to be issued upon each conversion of this Note shall be determined
by dividing the Conversion Amount (as defined below) by the applicable
Conversion Price then in effect on the date specified in the notice of
conversion.  The term “Conversion Amount” means, with
respect to any conversion of this Note, the sum of (1) the principal amount of
this Note to be converted in such conversion plus (2) accrued and
unpaid interest, if any.  The Conversion Price is the lesser of (i)
the Variable Conversion Price (as defined herein) and (ii) the Fixed Conversion
Price (as defined herein). The “Variable Conversion Price”
shall mean the Applicable Percentage (as defined herein) multiplied by the
Market Price (as defined herein). “Market Price” means the
average of the lowest three (3) Trading Prices (as defined below) for the Common
Stock during the twenty (20) Trading Day period ending one Trading Day prior to
the date the Conversion Notice is sent by the Holder to the Borrower via
facsimile (the “Conversion
Date”). “Trading
Price” means, for any security as of any date, the intraday trading price
on the Over-the-Counter Bulletin Board (the “OTCBB”) as reported by a
reliable reporting service mutually acceptable to and hereafter designated by
Holders of a majority in interest of the Notes and the Borrower or, if the OTCBB
is not the principal trading market for such security, the intraday trading
price of such security on the principal securities exchange or trading market
where such security is listed or traded or, if no intraday trading price of such
security is available in any of the foregoing manners, the average of the
intraday trading prices of any market makers for such security that are listed
in the “pink sheets” by the National Quotation Bureau, Inc. If the Trading Price
cannot be calculated for such security on such date in the manner provided
above, the Trading Price shall be the fair market value as mutually determined
by the Borrower and the holders of a majority in interest of the Notes being
converted for which the calculation of the Trading Price is required in order to
determine the Conversion Price of such Notes. “Trading Day” shall mean any
day on which the Common Stock is traded for any period on the OTCBB, or on the
principal securities exchange or other securities market on which the Common
Stock is then being traded. “Applicable Percentage” shall
mean 50.0%. The “Fixed
Conversion Price” shall mean $0.005.

     

     

    
      
         

      

      
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    The
Company and TSC hereby agree that Section 1.2 of the May 2008 Note shall be
amended and restated as follows:

    

    1.2
Conversion Price.  The Conversion Price is the lesser of (i) the
Variable Conversion Price (as defined herein) and (ii) the Fixed Conversion
Price (as defined herein). The “Variable Conversion Price”
shall mean the Applicable Percentage (as defined herein) multiplied by the
Market Price (as defined herein). “Market Price” means the
average of the lowest three (3) Trading Prices (as defined below) for the Common
Stock during the twenty (20) Trading Day period ending one Trading Day prior to
the date the Conversion Notice is sent by the Holder to the Borrower via
facsimile (the “Conversion
Date”). “Trading
Price” means, for any security as of any date, the intraday trading price
on the Over-the-Counter Bulletin Board (the “OTCBB”) as reported by a
reliable reporting service mutually acceptable to and hereafter designated by
Holders of a majority in interest of the Notes and the Borrower or, if the OTCBB
is not the principal trading market for such security, the intraday trading
price of such security on the principal securities exchange or trading market
where such security is listed or traded or, if no intraday trading price of such
security is available in any of the foregoing manners, the average of the
intraday trading prices of any market makers for such security that are listed
in the “pink sheets” by the National Quotation Bureau, Inc. If the Trading Price
cannot be calculated for such security on such date in the manner provided
above, the Trading Price shall be the fair market value as mutually determined
by the Borrower and the holders of a majority in interest of the Notes being
converted for which the calculation of the Trading Price is required in order to
determine the Conversion Price of such Notes. “Trading Day” shall mean any
day on which the Common Stock is traded for any period on the OTCBB, or on the
principal securities exchange or other securities market on which the Common
Stock is then being traded. “Applicable Percentage” shall
mean 50.0%. The “Fixed
Conversion Price” shall mean $0.005.

    

    TSC acknowledges that the Company
presently does not have an adequate amount of authorized and available shares of
common stock to convert all amounts owed under the Notes.  The Company
is presently in the process of increasing its authorized shares of common stock
to 1,500,000,000 shares of common stock (the “Increase”).  As such, in
the event that the Company does not have an adequate number of shares of common
stock, TSC shall refrain from converting the Notes until the Increase has been
implemented.  The parties further acknowledge that the holder of the
Notes is not an affiliate of the Company and TSC represents that it is not an
affiliate of the Company.  As a result, the shares of common stock
issued upon conversion of the Notes (the “Conversion Shares”) will be eligible
to resold under Rule 144 as the Conversion Shares holding period will tack to
the initial date of issuance of the Notes.  Accordingly, the Company,
upon conversion of the Notes and receipt of the standard representation letters
from TSC, will direct the transfer agent to issue the Conversion Shares without
the standard “33 Act” restrictive legend.

    

    Further, the Company hereby represents
and warrants that it has reserved and the Company shall continue to reserve and
keep available at all times, free of preemptive rights, all shares of common
stock available enabling the Company to issue the Conversion
Shares.  Upon increasing the authorized shares of common stock to
1,500,000,000, the Company shall reserve a sufficient number of shares of common
stock for the purpose of enabling the Company to issue the Conversion
Shares.

    

    This letter agreement may be executed
in one or more counterparts.  We hereby request that you execute this
letter agreement below acknowledging and agreeing to the terms set forth
herein.

     

     

     

    
      
        	 	Sincerely,	 
	 	 	 
	 	Bonanza
      Oil & Gas, Inc.	 
	 	 	 	 
	
                 

              	
                By:
      

              	/s/ William
      Wiseman	 
	 	 	Name:
      William Wiseman	 
	 	 	Title:
      CEO	 
	 	 	 	 

    

    
 

    AGREED
AND ACKNOWLEDGED:

    

    Triumph
Small Cap Fund, Inc.

    

    

    By:
/s/Kenneth Orr

    Name:
Kenneth Orr

    Title:
CEO

     

     

     

     

    2Unassociated Document

    Exhibit 10.3

     

    AGREEMENT

    This Agreement (the “Agreement”) is
dated November 30, 2009 and is made by and between Bonanza Oil & Gas, Inc.
(the “Company”), and Whalehaven
Capital Fund Limited (”Whalehaven”).

    WHEREAS, on June 30, 2008 the
Company and Whalehaven entered into that certain Securities Purchase Agreement
dated June 30, 2008 (the "Purchase Agreement"),
as amended on August 18, 2008, providing for the sale by the Company to the
Whalehaven of units with each unit consisting of one share of common stock (the
“Shares”) and
one common stock purchase warrant half of which are exercisable at $1.00 (the
“A Warrant”)
and half are exercisable at $1.00 (the “B
Warrant”).

     

    WHEREAS, the Company and
Whalehaven have been in discussions regarding the application of the ratchet and
price protection contained in the Purchase Agreement, the A Warrant and the B
Warrant.

     

    WHEREAS, the Company and
Whalehaven have agreed to settle this dispute as outlined below.

     

    NOW, THEREFORE, in
consideration of the mutual conditions and covenants contained in this
Agreement, and for other good and valuable consideration, the sufficiency and
receipt of which is hereby acknowledged, it is hereby stipulated, consented to
and agreed by and between the Company and Whalehaven as follows:

     

    1.  Section
3(b) of the A Warrant and of the B Warrant is hereby deleted in its entirety and
all Dilutive Issuances (as defined in the A Warrant and B Warrant) that may have
potentially resulted in a reduction of the Base Share Price (as defined in the A
Warrant and B Warrant) are hereby of no force and effect.  Section
3(c) of the A Warrant and the B Warrant is deleted.  The parties agree
that the pursuant to this Agreement, the Company has satisfied its obligations
to Whalehaven with respect to ratchet rights.

     

    2.  The
first sentence of Section 2(a) of the  A Warrant and the B Warrant is
restated as follows:

     

    Exercise
of the purchase rights represented by this Warrant may be made, in whole or in
part, at any time or times on or after February 28, 2010 and on or before the
Termination Date by delivery to the Company (or such other office or agency of
the Company as it may designate by notice in writing to the registered Holder at
the address of the Holder appearing on the books of the Company) of a duly
executed facsimile copy of the Notice of Exercise Form annexed hereto; and,
within 3 Trading Days of the date said Notice of Exercise is delivered to the
Company, the Company shall have received  payment of the aggregate
Exercise Price of the shares thereby purchased by wire transfer or cashier’s
check drawn on a United States bank.

     
 

    3. Section
2(b) of the A Warrant and the B Warrant is restated as follows:

    Exercise
Price.  The exercise price per share of the Common Stock under
this Warrant shall be $0.001, subject to adjustment
hereunder (the “Exercise
Price”).

    

    4.           The
Company acknowledges that the holding period of the Series A Warrant and the
Series B Warrant for purposes of Rule 144 under the Securities Act of 1933 began
on June 30, 2008 and remains unchanged and uninterrupted.

     

     

    
      
         

      

      
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    5. The
definition of “Warrants” in Section
1.1 of the Purchase Agreement is restated as follows:

    
      	
               
      

            	 

    

    
      	
               
      

            	
              “Warrants” means the
      Series A Warrant, the Series B Warrant and the Series C
      Warrant.

            

    

    

    
      	
              6.  

            	
              Section
      4.12 of the Purchase Agreement is hereby deleted in its
      entirety.

            

    

    

    7. Section
4.17 of the Purchase Agreement is hereby deleted in its entirety and any
issuances of shares of common stock or other securities that the Company may
have been required to make prior to the date of this Agreement are hereby
waived.

     

    8. The
Company shall issue to Whalehaven, on the date of this Agreement, a common stock
purchase warrant to acquire 6,000,000 shares of common stock for a period of
three years (the “Series C Warrant”).  The holding period, for Rule
144 purposes, for the Series C Warrant shall commence on the date
hereof.  The form of Series C Warrant is attached hereto as Exhibit
A.

     

    9. Whalehaven
and the Company warrant and represent that no other person or entity has any
interest in the matters released herein, and that it has not assigned or
transferred, or purported to assign or transfer, to any person or entity all or
any portion of the matters released herein.  Whalehaven specifically
represents that it is the owner of the A Warrant and the B Warrant and that
there are no liens, mortgage, deed of trust, pledge, claim, security interest,
covenant, restriction, easement, preemptive right, or any other encumbrance or
charge of any kind.

     

    10. Each
party shall be responsible for their own attorneys’ fees and costs.

     

    11. Each
party acknowledges and represents that: (a) they have read the Agreement; (b)
they clearly understand the Agreement and each of its terms; (c) they fully and
unconditionally consent to the terms of this Agreement; (d) they have had the
benefit and advice of counsel of their own selection; (e) they have executed
this Agreement, freely, with knowledge, and without influence or duress; (f)
they have not relied upon any other representations, either written or oral,
express or implied, made to them by any person; and (g) the consideration
received by them has been actual and adequate.

     

    12. This
Agreement contains the entire agreement and understanding concerning the subject
matter hereof between the parties and supersedes and replaces all prior
negotiations, proposed agreement and agreements, written or
oral.  Each of the parties hereto acknowledges that neither any of the
parties hereto, nor agents or counsel of any other party whomsoever, has made
any promise, representation or warranty whatsoever, express or implied, not
contained herein concerning the subject hereto, to induce it to execute this
Agreement and acknowledges and warrants that it is not executing this Agreement
in reliance on any promise, representation or warranty not contained
herein.

     

    13. This
Agreement may not be modified or amended in any manner except by an instrument
in writing specifically stating that it is a supplement, modification or
amendment to the Agreement and signed by each of the parties
hereto.

     

    14. Should
any provision of this Agreement be declared or be determined by any court or
tribunal to be illegal or invalid, the validity of the remaining parts, terms or
provisions shall not be affected thereby and said illegal or invalid part, term
or provision shall be severed and deemed not to be part of this
Agreement.

     

    15. The
parties agree that this Agreement is governed by the Laws of the State of New
York and that any and all disputes that may arise from the provisions of this
Agreement shall be tried in the Supreme Court, State of New York, County of New
York.  The Parties agree to waive their right to trial by jury for any
dispute arising out of this Agreement.

     

    16. This
Agreement may be delivered electronically and or executed in facsimile
counterparts, each of which, when all Parties have executed at least one such
counterpart, shall be deemed an original, with the same force and effect as if
all signatures were appended to one instrument, but all of which together shall
constitute one and the same Agreement.

    

    [REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK]

     

     

    
      
         

      

      
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    IN WITNESS WHEREOF, the
Parties have duly executed this Agreement as of the date first indicated
above.

     

    
      
        	 	BONANZA
      OIL & GAS, INC.	 
	 	 	 	 
	
                 

              	
                By:
      

              	/s/ 	 
	 	 	Name: William
      Wiseman	 
	 	 	Title:
      CEO	 
	 	 	 	 

      
 

    
      
        	 	WHALEHAVEN
      CAPITAL FUND LIMITED	 
	 	 	 	 
	
                 

              	
                By:
      

              	/s/ 	 
	 	 	Name 	 
	 	 	Title 	 
	 	 	 	 

      

    

     

     

     

    3

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