Document:

ex10-4

 

  Exhibit
10.4 

 

Assignment of Net Profit Interest Agreement

 

This
Assignment of Net Profit Interest Agreement
(“Agreement”) is made and entered this 31st day of January, 2019 by
and between the individuals and entities (collectively,
“Investors”) listed on the signature page hereto, and
Bandolier Energy, LLC (“Bandolier”), 4582 Kingwood
Drive, Suite E, Kingwood, TX 77345.

 

WHEREAS,
Investors, Bandolier and Petro River Oil Corp (“Petro
River”) have entered into a Securities Purchase Agreement
dated as of January 9, 2019 (the “Purchase
Agreement”);

 

WHEREAS,
Bandolier owns oil & gas leases and leasehold (“Bandolier
Leasehold”) in Osage County, Oklahoma; and

 

WHEREAS,
pursuant to the Purchase Agreement, Petro River and Bandolier wish
to use the Investors’ funds to drill ten (10) new oil &
gas wells (“Ten Wells”) on the Bandolier Leasehold as
identified on Exhibit B hereto.

 

NOW
THEREFORE, for good and valuable consideration, the sufficiency of
which is hereby acknowledged, the parties hereby agree as
follows:

 

1)

Identity and Location of the Ten
Wells: Bandolier currently owns an undivided 75% working
interest in and to 82,240 net mineral acres of oil & gas
leases, leasehold and/or concession options in Osage County,
Oklahoma. Bandolier has drilled fifteen oil & gas wells on the
Bandolier Leasehold, and currently is producing from twelve of
these fifteen wells. The proposed Ten Wells will be drilled in
close proximity to Bandolier’s existing wells and are listed
on Exhibit “B”, attached hereto and made a part hereof.
As each of the Ten Wells are drilled, Bandolier will evaluate its
results before electing to complete that well, and will elect to
complete or plug said well in its sole discretion. Bandolier also
will monitor and evaluate the production results of each completed
well, and does reserve the right to change or modify the location
of some or all of the remaining Ten Wells if early drilling and/or
completion results so warrant.

 

2)

Net Profit Interest.

 

a.

Bandolier hereby
agrees to assign and transfer to the Investors a 75% Net Profit
Interest (as defined below) in and to the Ten Wells. Payments of
the Net Profit Interest shall be made to the Investors, pro rata,
on a quarterly basis following the full completion of the Ten Well
Program.

 

b.

 Bandolier
owns an undivided 75% working interest in and to the leasehold on
which the Ten Wells will be drilled. Bandolier will contribute the
net proceeds that accrue to 75% of said 75% working interest to the
Net Profit Interest. 25% of Bandolier’s working interest in
the Ten Wells will not be attached or burdened by the Net Profit
Interest.

 

 

 

-1-

 

 

 

This
means that Bandolier will distribute to the Investors 75% of the
proceeds that Bandolier receives to its leasehold interest (net of
royalties, overriding royalties and production taxes) from the sale
of oil, gas and other hydrocarbon substances, if any, which may be
produced, saved sold and marketed from the Ten Wells. Bandolier
will deduct therefrom 75% of the Lease Operating Expenses charged
to Bandolier’s leasehold working interest in the Ten Wells
plus any administrative and overhead expenses reasonably allocated
to the Ten Wells. Such net payment to the Investors is referred to
as the “Net Profit Interest.”

 

c.

For all purposes
under this Agreement, “Lease Operating Expenses” shall
be defined to include all costs incurred to run, produce, maintain,
and repair a well and its equipment and leasehold from and after
its first day of production. These expenses shall include but not
be limited to the cost of all labor, supplies, equipment and
services required to keep the well producing, fuel and or
electricity, administrative and allocated overhead expenses, road
and location maintenance, and ultimately well plugging and site
restoration.

d.

Notwithstanding
anything to the contrary, the Net Profit Interest payable to any
Investor shall be proportionately reduced by any conversion of the
Series A Preferred Stock by such Investor.

 

 

3)

Record Title: Bandolier will
continue to hold record title as to its undivided 75% working
interest in and to the Ten Wells.

 

4)

Option to Participate in the
Subsequent Drilling Program: If Bandolier elects to drill
more wells on the Bandolier Leasehold after it completes the
drilling of the Ten Wells, within 2 years of the date hereof, each
of the Investors will have the right to participate in and fund the
drilling and production of the next ten wells drilled (the
“Subsequent Ten Well Program”) on the same terms and
conditions and at the same percentage of Net Profits ownership set
forth in the Purchase Agreement and this Agreement for the Ten
Wells. As such, Investors in the Subsequent Ten Well Program will
pay 100% of Bandolier’s share of the cost to drill and
complete said wells in order to earn a Net Profit Interest based
upon 75% of Bandolier’s working interest
therein.

 

Investors will need
to exercise its right to participate in the Subsequent Ten Well
Program within 30 days of receipt of written notice by Bandolier.
If only some of the Investors wish to participate in said
subsequent drilling program, the amount not funded by the
non-interested investor(s) will be offered to those investors who
do wish to fund and participate in the subsequent drilling program,
pro rata.

 

5)

Notices. Notices hereunder
shall be given in writing and delivered in person, via email, or by
Western Union or certified mail, return receipt requested, to the
addresses of the parties as set forth in Exhibit "A".

 

6)

Counterparts. This agreement
may be executed in one or more counterparts, each of which, when
properly executed, shall be deemed an original.

 

 

 

-2-

 

 

 

7)

Investment Covenant. Each Investor: (i)
acknowledges that the interest purchased hereunder is being sold
without registration under the Securities Act of 1933, as amended,
nor under similar provisions of state law; (ii) represents and
warrants to Bandolier and the other investors that it is acquiring
such interest without a view to the distribution thereof; and (iii)
agrees not to transfer or attempt to transfer such interest without
registration under that act and any applicable state securities
laws, unless exemptions form such registration requirements are
available. The Investors recognize that the oil and gas business is
highly speculative and that Bandolier makes no guarantee or
representation to any Investor as to the possibility or the
probability of gain or against loss from the conduct of the Ten
Wells. Bandolier has not made nor does it herewith make any
representation as to title to the leases subject to this Agreement.
Bandolier shall exercise diligence and prudence in approving title
to the leasehold as allowed by this Agreement, but shall assume no
liability for errors it may make in connection therewith, excluding
those errors caused by Bandolier's lack of diligence or prudence.
The Investors understand and agree that their liabilities hereunder
may be joint and several; provided, however, that the Investors
herewith agree to cross-indemnify and mutually hold harmless each
other with respect to any liability or loss an Investor may suffer
hereunder in excess of an Investor's proportionate share thereof,
it being the intent that liabilities of the venture shall be borne
by the Investors based on their respective shares of interest as
shown in Columns III of Exhibit "A". The references herein to
securities laws shall not be deemed an admission by any party that
an interest in Net Profit Interest or in the Agreement constitute a
security. This agreement supersedes all prior representations by
Bandolier to the Investors. The rights of the Investors in and to
the leases subject to the Agreement are specifically subject to the
terms of the leases, the Industry Agreement and all attachments
thereto.

 

8)

Assignability. An Investor may not assign
nor sub-divide its Net Profit Interest without the advance written
consent of Bandolier, which consent may not be unreasonably
withheld.

 

 

IN
WITNESS WHEREOF, this Assignment of Net Profit Interest Agreement
is executed the date indicated below by the parties
hereto.

 

 

Bandolier Energy,
LLC

 

By:_______________________

Name:
Stephen Brunner

Title:
Manager

INVESTOR SIGNATURE PAGE

 

 

 

__________________________

 

 

By:_______________________

Name

Title

 

Address:

 

 

-3-

 

 

 

Exhibit B

 

 

List of
Ten Wells to be Drilled

 

	

Well Name

	

Qtr

	

Qtr

	

Qtr

	

Qtr

	

Section

	

Township

	

Range

	

County

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	

Osage County, OK

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	

Osage County, OK

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	

Osage County, OK

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	

Osage County, OK

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	

Osage County, OK

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	

Osage County, OK

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	

Osage County, OK

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	

Osage County, OK

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	

Osage County, OK

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	

Osage County, OK

 

 

 

B-1ex10-5

 

  Exhibit
10.5 

 

DEBT CONVERSION AGREEMENT

 

This
Debt Conversion Agreement (the “Agreement”) is entered
into this 31stday of January, 2019 among Petro Exploration Funding,
LLC, a Delaware limited liability company (“Petro Funding I”) and
Petro River Oil Corp., a Delaware corporation (“Petro”). Each of Petro
Funding I and Petro may be referred to herein, individually, as a
“Party”
and, collectively, as the “Parties”.

 

WHEREAS, Petro and Petro Funding I wish to restructure the
$2,000,000 of senior debt issued to Petro Funding I (the
“Senior Debt”) into a new class of Series A Convertible
Preferred Stock of the Petro (the “Series A
Preferred”); and

 

NOW, THEREFORE, for good and valuable consideration, the
sufficiency of which is hereby acknowledged, the Parties hereby
agree as follows:

 

1.
Conversion. Petro
and Petro Funding I hereby agree to convert the $2,000,000
principal amount of the Senior Debt plus accrued and unpaid
interest of $327,473 into
116,374 shares of Series A Preferred Stock.

 

2. Representations and Warranties.
Each Party represents and warrants to each other Party, as of the
date hereof, that with respect to itself, (a) it is duly formed and
existing and in good standing under its jurisdiction of formation,
and is duly qualified to do business under the laws of such
jurisdiction and each other jurisdiction in which such
qualification is required to perform its obligations under this
Agreement, (b) it has the limited liability company and corporate
power, as applicable, to execute and deliver this Agreement and
perform its obligations under this Agreement, (c) this Agreement
has been duly executed and delivered by it and is legally binding
upon it (assuming that each other Party has duly executed and
delivered this Agreement), enforceable in accordance with its
terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors’ rights and
to general principles of equity and (d) the execution, delivery and
performance of this Agreement by the Parties, and the consummation
of the transactions contemplated by this Agreement, will not (i)
violate any provision of any governing instruments of the Parties,
(ii) result in a material default (with due notice or lapse of time
or both) or the creation of any lien or encumbrance or give rise to
any right of termination, cancellation or acceleration under any
material note, bond, mortgage, indenture, or other financing
instrument to which the Parties are parties or by which they are
bound, (iii) violate any judgment, order, ruling or regulation
applicable to the Parties as parties in interest or (iv) violate
any law applicable to the Parties, except any matters described in
Clauses (ii) or (iii) above which would not have a material adverse
effect on the Parties or their properties.

 

3.
Notices.

 

(a) Subject to clause
(b) below, all notices and other communications provided for herein
shall be in writing and shall be delivered by hand or overnight
courier service, mailed by certified or registered mail or sent by
facsimile or e-mail to the address of such Party set forth on the
signature page hereto.

 

(b)  Any Party
hereto may change its address or facsimile number for notices and
other communications hereunder by notice to the other in the manner
set forth above.

 

 

 

-1-

 

 

 

4.
GOVERNING
LAW; JURISDICTION.

 

(a) THIS
AGREEMENT AND ANY CLAIMS, CONTROVERSY, DISPUTE OR CAUSE OF ACTION
(WHETHER IN CONTRACT OR TORT OR OTHERWISE) BASED UPON, ARISING OUT
OF OR RELATING TO THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED
HEREBY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAW OF THE STATE OF NEW YORK WITHOUT REGARD TO PRINCIPLES OF
CONFLICTS OF LAW WHICH WOULD REQUIRE THE APPLICATION OF THE LAWS OF
ANOTHER JURISDICTION.

 

(b) THE PARTIES HEREBY IRREVOCABLY AND
UNCONDITIONALLY SUBMIT TO THE EXCLUSIVE JURISDICTION OF THE COURTS
OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY AND OF THE
UNITED STATES DISTRICT COURT OF THE SOUTHERN DISTRICT OF NEW YORK,
AND ANY APPROPRIATE APPELLATE COURTS THEREFROM, AND EACH PARTY
HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY
DISPUTE, CONTROVERSY OR CLAIM ARISING OUT OF, OR IN CONNECTION
WITH, THIS AGREEMENT MAY BE HEARD AND DETERMINED IN SUCH COURTS.
THE PARTIES HEREBY IRREVOCABLY WAIVE, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAWS, ANY OBJECTION WHICH THEY MAY NOW OR
HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUCH DISPUTE,
CONTROVERSY OR CLAIM BROUGHT IN ANY SUCH COURT OR ANY DEFENSE OF
INCONVENIENT FORUM FOR THE MAINTENANCE OF SUCH DISPUTE, CONTROVERSY
OR CLAIM IN ANY SUCH COURT. EACH OF THE PARTIES HERETO
AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION, LITIGATION OR
PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER
JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER
PROVIDED BY APPLICABLE LAW.

 

5. WAIVER OF JURY
TRIAL. EACH OF THE PARTIES HEREBY IRREVOCABLY WAIVES ALL
RIGHT TO TRIAL BY JURY IN CONNECTION WITH ANY DISPUTE, CONTROVERSY
OR CLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT.

 

6.
Waivers;
Amendments.

 

(a) No failure or delay
by the Parties in exercising any right or power hereunder shall
operate as a waiver hereof, nor shall any single or partial
exercise of any such right or power, or any abandonment or
discontinuance of steps to enforce such a right or power, preclude
any other or further exercise hereof or the exercise of any other
right or power. The rights and remedies of the Parties hereunder
are cumulative and are not exclusive of any rights or remedies that
they would otherwise have. No waiver of any provision of this
Agreement or consent to any departure by any Party therefrom shall
in any event be effective unless the same shall be permitted by
clause (b) of this Section, and then such waiver or consent
shall be effective only in the specific instance and for the
purpose for which given.

 

(b) Neither this
Agreement nor any other provision hereof may be waived, amended or
modified except pursuant to an agreement in writing entered into by
the Parties and expressly identified as a waiver, amendment or
modification.

 

 

 

-2-

 

 

 

7.
Assignment. The
provisions of this Agreement shall be binding upon and inure to the
benefit of the Parties hereto and their respective successors and
assigns.

 

8.
No Third-Party
Beneficiaries. Nothing in this Agreement, expressed or
implied, shall be construed to confer upon any person (other than
the Parties hereto, their respective successors and assigns
permitted hereby) any legal or equitable right, cause of action,
remedy or claim under or by reason of this Agreement.

 

9.
Severability. Any
provision of the Agreement held to be invalid, illegal or
unenforceable in any respect in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity,
illegality or unenforceability without affecting the validity,
legality and enforceability of the remaining provisions thereof;
and the invalidity of a particular provision in a particular
jurisdiction shall not invalidate such provision in any other
jurisdiction.

 

10.
Counterparts. This
Agreement may be executed in counterparts, each of which shall be
deemed an original instrument, but all such counterparts together
shall constitute but one agreement.

 

11.
Headings. Article
and Section headings used herein are for convenience of reference
only, are not part of this Agreement and shall not affect the
construction of, or be taken into consideration in interpreting,
this Agreement.

 

12.
Interpretation. The
Parties acknowledge and agree that (i) each Party has had the
opportunity to exercise business discretion in relation to the
negotiation of the details of the transaction contemplated hereby,
(ii) this Agreement is the result of arms-length negotiations from
equal bargaining positions and (iii) each Party and its counsel
participated in the preparation and negotiation of this Agreement.
Any rule of construction that a contract be construed against the
drafter shall not apply to the interpretation or construction of
this Agreement.

 

13.
Entire Agreement.
This Agreement constitute the entire agreement among the Parties
pertaining to the subject matter hereof, and supersede all prior
agreements, understandings, negotiations and discussions, whether
oral or written, of the Parties pertaining to the subject matter
hereof.

 

 

 

-3-

 

 

IN
WITNESS WHEREOF, the Parties hereto have caused this Agreement to
be duly executed by their respective authorized officers as of the
day and year first above written.

 

 

PETRO
FUNDING I, LLC

 

 

By:
/s/ Scot
Cohen

Name:
Scot
Cohen

Title:
Manager

 

 

 

PETRO
RIVER OIL CORP.

 

 

By:
/s/ Stephen
Brunner

Name:
Stephen
Brunner

Title:
President

 

 

 

-4-

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00291-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00291-of-00352.parquet"}]]