Document:

EXHIBIT
10.4

 

NET
PROFITS INTEREST AGREEMENT

 

This
Net Profits Interest Agreement (this “Agreement”) dated October [●], 2021 (the “Effective Date”),
is by and among Lustre Oil Company LLC, a Montana limited liability company (“Lustre”), Erehwon Oil &
Gas, LLC, a Colorado limited liability company (“Erehwon” and together with Lustre, “Owners”),
Olfert No. 11-4 Holdings, LLC, a Montana limited liability company (“Holdings”), and Laredo Oil,
Inc., a Delaware corporation (for the limited purpose of the Payment Credit as set forth in Section 2) (“Laredo”).
Lustre, Erehwon and Holdings may collectively be referred to herein as the “Parties” and each as a “Party.”

 

RECITALS

 

A.       Owners
desire to drill, complete and equip the Olfert #11-4 well located (or to be located) in Section 4, Township 30 North, Range 44 East,
Valley County, Montana (the “Well”).

 

B.       Subject
to the terms and conditions of this Agreement, Holdings has agreed to pay the Well Development Costs (defined below) in exchange for
the grant and payment of the Net Profits Interest (defined below).

 

AGREEMENT

 

In
consideration of the mutual promises, premises, covenants and agreements set forth and referenced in this Agreement, and other good and
valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

 

1.         Grant
of Net Profits Interest. Subject to the terms and conditions of this Agreement (including Holdings paying the Well Development Costs
as provided in Sections 2 and 3), Owners hereby agree to pay Holdings the Applicable Percentage of the Net Profits (the “Net
Profits Interest”) is accordance with the following terms:

 

(a)       Applicable
Percentage. The term (i) “Applicable Percentage” means (A) prior to Payout, 90%, and (B) after Payout, 50%;
(ii) “Payout” means the point in time when the aggregate of all Net Profits Interest payments made to Holdings
hereunder equal 105% of the Well Development Costs; and (iii) “Well Development
Costs” means all costs and expenses incurred by Owners, whether before, on or after the Effective Date, to drill
(including any activity related to moving in, rigging up, logging and testing the Well, constructing and upgrading access roads,
obtaining and preparing the drillsite, obtaining permits and division order or drill site title opinions, obtaining drilling
contractor services and consultants necessary for the drilling of the Well, obtaining mud, chemicals, pipe and supplies, and any
other activities related to the foregoing), complete (including any activity related to preparing the Well drilled to total depth
for production, installation of production casing, perforating, conducting fracture stimulation and drilling out of fracture plugs
or, in the event the Well is not completed as a well capable of producing in paying quantities, plugging and abandoning the Well),
and equip (including installing tubing and any other equipment or activities required to bring the Well to first sale, artificial
lift, well stimulation and production testing) the Well.

 

(b)       Net
Profits. Lustre shall maintain an account (the “Net Profits Account”) that sets forth the Net Profits for
each calendar quarter. The term “Net Profits” shall mean an amount (not less than zero) determined for each
calendar quarter by (i) deducting (A) the aggregate of any negative balance existing in the Net Profits Account at the first of such
calendar quarter, plus (B) the total charges properly made thereto pursuant to Section 1(b)(ii) during such calendar quarter, from
(ii) the total credits properly made thereto pursuant to Section 1(b)(i) during such calendar quarter. To the extent that the
aggregate charges exceed aggregate credits at the end of any calendar quarter, such excess charges shall be carried forward to the
following calendar quarter. The Net Profits Account balance as of the Effective Date is $0.

     

     

    

(i)       Credits
to Net Profits Account. Each calendar quarter the Net Profits Account shall be credited with an amount equal to the sum of: (A)
all proceeds actually received during such quarter by Owners from the sale or other disposition of oil, gas, casinghead gas,
condensate and other gaseous and liquid hydrocarbons (“Hydrocarbons”) produced from the Well, after deducting
therefrom all third-party royalties, overriding royalties, production payments and other burdens upon, measured by, or payable out
of production of Hydrocarbons from the Well; (B) monies received by Owners attributable to
any future contracts, forward contracts, swap, cap or collar contracts, option contracts, hedging contracts or other derivative
contracts or similar agreements covering oil and gas commodities or prices with respect to Hydrocarbons produced from the Well; (C)
monies received by Owners pursuant to any gas balancing agreement pertaining to Hydrocarbons produced from the Well; and (D) amounts
received by Owners as a result of a refund of taxes (other than income taxes) previously paid on Hydrocarbons produced from the Well
to the extent that such taxes were previously charged against the Net Profits Account pursuant to Section 1(b)(ii).

 

(ii)      Charges
Against the Net Profits Account. Each calendar quarter there shall be charged against the Net Profits Account an amount equal to
the sum of the following items of costs and expenses actually paid by Owners during such calendar quarter: (A) all costs and expenses
incurred in the operation and maintenance of the Well and the production and marketing of Hydrocarbons therefrom (excluding Well Development
Costs), such items of cost to include but not be limited to: (1) all costs of complying with applicable local, state, tribal and federal
statutes, ordinances, rules and regulations; (2) all costs of lifting and producing Hydrocarbons from the Well, including all costs of
labor, fuel, repairs, hauling, materials, supplies, utility charges, minor workover and other remedial well servicing operations and
other costs incident thereto; (3) all costs of gathering, marketing, compressing, dehydrating, separating, treating, processing, transporting,
and marketing Hydrocarbons produced from the Well; (4) all direct charges and operating charges paid, pursuant to joint operating agreements,
master services agreements or similar agreements or arrangements, to any third-party(ies) for services rendered in conducting operations
and/or maintenance on the Well (and related equipment and facilities); and (5) all delay rentals, shut-in well payments, minimum royalties,
and other payments made in connection with the maintenance of the Well and the oil and gas leases attributable thereto; (B) all taxes
(except income taxes) paid by Owners relating to the Well, including, without limitation, ad valorem, property, production, severance,
gathering, windfall profit, occupation and any other similar taxes assessed against or attributable to the Well or Hydrocarbons produced
therefrom; (C) all capital expenditures of Owners related to the operation and maintenance of the Well; (D) monies paid by Owners attributable
to any future contracts, forward contracts, swap, cap or collar contracts, option contracts, hedging contracts or other derivative contracts
or similar agreements covering oil and gas commodities or prices with respect to Hydrocarbons produced from the Well; and (E) proceeds
reclaimed from or returned by Owners as the result of the insolvency, bankruptcy or reorganization of a purchaser of production, which
proceeds have been previously paid to Holdings.

    2

     

    

HOLDINGS,
BY ITS ACCEPTANCE OF THE NET PROFITS INTEREST, CLEARLY AND UNEQUIVOCALLY EXPRESSES ITS INTENT THAT THE CHARGES TO THE NET PROFITS ACCOUNT
CONTAINED IN SECTION 1(b)(ii) SHALL BE APPLICABLE REGARDLESS OF WHETHER OR NOT THE LOSSES, COSTS, EXPENSES AND DAMAGES THAT MAY BE DEBITED
IN ACCORDANCE WITH SUCH SECTION AROSE SOLELY OR IN PART FROM THE ACTIVE, PASSIVE OR CONCURRENT NEGLIGENCE, STRICT LIABILITY OR OTHER
FAULT OF OWNERS OR ANY OF THEIR RESPECTIVE AFFILIATES, OTHER THAN THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF AN OWNER OR ANY OF ITS
AFFILIATES.

 

Nothing
set forth in this Agreement shall be interpreted or applied in any manner that shall ever require or permit any duplication of all or
any part of any credit or debit (or reduction thereto) to the Net Profits Account with respect to the same transaction, item of expense
or charge, under this Agreement, or that shall ever require or permit any inclusion of any charge to the Net Profits Account that is
reimbursed to Owners by nonaffiliated third-parties.

 

2.         Payment
of Initial Well Development Costs. As consideration for the Net Profits Interest granted herein, Holdings hereby agrees to pay 100%
of the Well Development Costs. The Parties and Laredo hereby acknowledge and agree that, prior to the Effective Date, Laredo paid (either
directly or on behalf of Lustre) $59,935 of Well Development Costs, which payments shall be deemed to have been made by or on behalf
of Holdings for purposes of this Agreement (the “Payment Credit”). Within ten business days after the execution of
this Agreement, Holdings shall deliver, or cause to be delivered, $690,065 by wire transfer in immediately available funds (the “Development
Funds”) to Lustre at the following account:

 

	Bank
    Name:	First
    Interstate Bank
	Bank
    Address:	7265
    US Hwy 93 S, Lakeside, Montana 59922-0769
	Routing
    number:	092901683
	Beneficiary
    name:	Lustre
    Oil Company LLC
	Beneficiary
    account:  	1007520776
	Beneficiary
    address:	398
    Sage Lane, Winnett, Montana 59087
	 	 

The
Development Funds may be held as part of Lustre’s general funds but shall be segregated for accounting purposes. Lustre shall use
the Development Funds only to pay or reimburse itself and/or Erehwon for payment of Well Development Costs. If Lustre from time to time
reasonably determines that the Well Development Costs will (or will likely) exceed the Development Funds, Lustre shall submit a written
notice (an “Additional Funds Notice”) to Holdings describing the amount by which the Well Development Costs are expected
to exceed the Development Funds (the “Additional Development Funds”). Within five business days following receipt
of an Additional Funds Notice, Holdings shall remit the Additional Development Funds to Lustre by wire transfer of immediately available
funds to the account set forth above or as otherwise specified by Lustre in writing (and confirmed by telephone) in the applicable Additional
Funds Notice. Within 90 days after Hydrocarbons are produced from the Well (or the Well is plugged and abandoned if it is a dry hole),
Lustre shall refund to Holdings any Development Funds (including any Additional Development Funds), without any interest thereon, received
by Lustre in excess of the total Well Development Costs.

    3

     

    

3.         Payment
of Subsequent Well Development Costs. If Owners desire to rework, sidetrack, deepen, recomplete or plug back the Well (including
after the Well is no longer capable of producing in paying quantities), Owners shall give written notice of the proposed operation
to Holdings and the estimated Well Development Costs of the proposed operation (a “Subsequent Operations
Notice”). Holdings shall have 20 days after receipt of the Subsequent Operations Notice within which to notify Owners
whether it elects to pay the Well Development Costs of the proposed operation. Failure of Holdings to reply within the specified
period shall constitute an election by Holdings not to pay the Well Development Costs of the proposed operation. If Holdings does
not elect to pay the Well Development Costs of the proposed operation, or if Holdings does not timely pay such Well Development
Costs, then following such election (or deemed election) or failure to timely pay, this Agreement shall terminate and Owners shall
have no further obligation to pay the Net Profits Interest, except with respect to amounts which were accrued but unpaid prior to
such termination. If Holdings elects to pay the Well Development Costs of the proposed operation, then Holdings shall remit such
Well Development Costs in the same manner as Additional Development Funds are paid to Lustre in Section 2.

 

4.         Payment
of Operating Costs and Expenses. Except for the Well Development Costs, Holdings shall not be personally responsible for the payment
of any of the costs and expenses charged against the Net Profits Account pursuant to Section 1(b)(ii) or for any liabilities incurred
in connection with the operation and maintenance of the Well.

 

5.         Disbursements
to Holdings. To the extent that, at the end of any calendar quarter, there exists a positive balance in the Net Profits Account (the
“Quarterly Net Profits”), (a) Lustre shall disburse to Holdings at the address set forth in Section 15, within 60
days after the end of such calendar quarter, an amount equal to the Applicable Percentage of such Quarterly Net Profits, and (b) the
balance in the Net Profits Account shall reset to $0 as of the first day of the following calendar quarter.

 

6.         Overpayment.
If Lustre ever pays Holdings more than the amount of money then due and payable to Holdings under this Agreement, Holdings shall not
be obligated to return the overpayment, but the Company may at any time thereafter reduce the gross proceeds used to calculate the Net
Profits and retain for its own account an amount equal to the overpayment.

 

7.         Statements.
On each payment date, Lustre shall deliver to Holdings a summary of the computation of the Net Profits Interest for the calendar quarter
for which such payment relates, including the charges and credits made to the Net Profits Account.

 

(a)       If
Holdings disputes any item or items included in any statement required by this Section 7, it must notify Lustre in writing within 60
days following the date that Holdings receives such statement. Such notice must set forth in reasonable detail the specific charges complained
of and to which exception is taken or the specific credits which should have been made and allowed.

 

(b)       Lustre
and Holdings shall make reasonable efforts to resolve any disagreement regarding the calculation of the Net Profits Interest. If
Lustre and Holdings are unable to resolve a disagreement or dispute with respect to the calculation of the Net Profits Interest,
either Party may submit the dispute to a mutually agreeable, nationally recognized accounting firm to act as sole arbitrator (the
“Accounting Arbitrator”) to decide all such unresolved points of disagreement and dispute. If Lustre and Holdings
are unable to mutually agree on the selection of an accounting firm to serve as the Arbitrator, either Party may apply to the
Denver, Colorado office of the American Arbitration Association to choose the Accounting Arbitrator. The Accounting Arbitrator shall
conduct the arbitration proceedings in Denver, Colorado in accordance with the Commercial Arbitration Rules of the American
Arbitration Association, to the extent such rules do not conflict with the terms of this Section 7. The Accounting Arbitrator’s
determination shall be made within 45 days after submission of the matters in dispute and shall be final and binding on the Parties.
In making its decision, the Accounting Arbitrator shall be bound by the terms of this Agreement. The Accounting Arbitrator shall act
as an expert for the limited purpose of determining the specific disputed aspects of the calculation of the Net Profits Interest
submitted by a Party and may not award damages, interest or penalties to any Party with respect to any matter. Each Party bear its
own legal fees and other costs of presenting its case. Owners shall bear one-half and Holdings shall bear one-half of the costs and
expenses of the Accounting Arbitrator.

    4

     

    

(c)       Notwithstanding
anything to the contrary herein, all matters reflected in Lustre’s statement that are not objected to by Holdings in the manner
provided by this Section 7 shall be deemed correct as rendered by Lustre to Holdings.

 

8.         Information/Access.
Lustre shall maintain true and correct books, records and accounts of (a) all transactions
required or permitted by this Agreement and (b) the financial information necessary to effect such transactions, including the
financial information needed to calculate the Net Profits Interest with respect to any quarterly payment period. Holdings or its
representative, at the expense of Holdings, may inspect, audit and copy such books, records and accounts in the offices of Lustre
during normal business hours and upon not less than ten business days’ written notice. However, Holdings shall not inspect or
audit such books and records more often than once per year unless otherwise agreed to in writing by Lustre, and no period may be
audited more than once. Holdings shall keep confidential all information provided by Lustre to Holdings, maintain such information
in strictest confidence, and not disclose such information to any person or entity not a Party to this Agreement, except to the
extent (x) such information has lawfully entered the public domain from a source other than Holdings, (y) disclosure is required by
law or court order, or (z) disclosure is necessary to enforce this Agreement. Holdings also agrees to notify Lustre promptly upon
learning of any requests, subpoenas or other efforts to obtain documentation or materials related to this Agreement by private
parties or governmental persons or entities, and to cooperate with Lustre in responding to such requests or other efforts to obtain
any such documentation or materials.

 

9.         Operations.
Lustre agrees to operate and maintain the Well in a good and workmanlike manner as a prudent operator would in accordance with sound
oil field practice and applicable federal, state, tribal and local laws, rules, regulations and orders. Except as otherwise provided
in the immediately preceding sentence, this Agreement does not create any obligation or duty (including a fiduciary duty) on the part
of Lustre. For the sake of clarity, Lustre in its sole discretion (and without the consent of Holdings) may (a) determine the terms of
any marketing and sale of Hydrocarbons produced from the Well; (b) determine the timing, amount and nature of all operating and capital
expenditures incurred in connection with the ownership and operation of the Well; (c) elect to pool or unitize all or any of the oil
and gas leases attributable to the Well as to any one or more of the formations or horizons thereunder, when, in the reasonable judgment
of Lustre, it is necessary or advisable to do so in order to form a drilling or proration unit to facilitate the orderly development
of Lustre’s oil and gas leases or to comply with the requirements of any law or governmental order or regulation relating to the
spacing of wells or proration of the production therefrom if a reasonable and prudent operator, acting in conformity with sound oilfield
practices, would make such election; and (d) elect to amend, renew, extend, modify, release, surrender and/or abandon its interest in
oil and gas leases (including those that are attributable to the Well), or any part thereof, or interest therein.

    5

     

    

10.       Assignment; Right of First Refusal.

 

(a)       Transfer
Restrictions. Each Owner may, but is not obligated to, assign, transfer and convey this Agreement, including all of its respective
rights and obligations hereunder, to a nonaffiliated third-party purchaser of its interest in the Well. Holdings may not sell, assign,
transfer or convey (“Transfer”) this Agreement or any of its rights or obligations hereunder to a third-party without
(i) complying with Section 11(b) below and (ii) obtaining the prior written consent of Owners, which consent shall not be unreasonably
withheld, conditioned or delayed.

 

(b)       Right
of First Refusal. If Holdings desires to Transfer its rights and obligations under this Agreement to a third-party, Holdings shall
promptly give written notice thereof to Owners, with full information concerning its proposed Transfer, which shall include the name
of the prospective transferee, who must be ready, willing and able to consummate the Transfer. Owners shall then have the option, but
not the obligation, for a period of 20 days after notice of such proposed Transfer is received by Owners to purchase Holdings’
rights and obligations under this Agreement for the stated consideration and on the same terms and conditions that Holdings proposed
to Transfer to the third-party.

 

11.       Ownership
of Certain Property; No In-Kind Right. The Net Profits Interest does not include any right, title or interest in or to any real or
personal property, fixtures or equipment and is exclusively a contractual right to certain payments from the net profits of the Well,
and Holdings shall look solely to Owners as provided herein for the satisfaction and realization of the Net Profits Interest. Holdings
shall have no right to take in-kind any Hydrocarbons produced from the Well.

 

12.       No
Operating Rights. It is the express intent of Owners and Holdings that the Net Profits Interest shall constitute (and this Agreement
shall conclusively be construed for all purposes as creating) a single, separate contractual right to certain payments based upon the
sale of Hydrocarbons produced from the Well. Without limitation of the generality of the immediately preceding sentence, Owners and Holdings
acknowledge that Holdings has no right or power to participate in the selection of a drilling contractor, to determine the timing or
sequence of drilling operations, to commence or shut down production, to take over operations, or to share in any development or operating
decision whatsoever. Owners and Holdings hereby expressly negate any intent to create (and this Agreement shall never be construed as
creating) a mining or other partnership or joint venture or other relationship subjecting Owners and Holdings to joint liability.

 

13.       Limitation
on Damages. NOTWITHSTANDING ANYTHING TO THE CONTRARY, EXCEPT WITH RESPECT TO A BREACH OF A PARTY’S CONFIDENTIALITY OBLIGATIONS
HEREUNDER, NONE OF LUSTRE, EREHWON, HOLDINGS OR ANY OF THEIR RESPECTIVE AFFILIATES SHALL BE ENTITLED TO SPECIAL, CONSEQUENTIAL, INDIRECT,
PUNITIVE OR EXEMPLARY DAMAGES IN CONNECTION WITH THIS AGREEMENT, AND EACH PARTY, FOR ITSELF AND ON BEHALF OF ITS AFFILIATES, HEREBY EXPRESSLY
WAIVES ANY RIGHT TO SPECIAL, CONSEQUENTIAL, INDIRECT, PUNITIVE, OR EXEMPLARY DAMAGES IN CONNECTION WITH THIS AGREEMENT AND THE TRANSACTIONS
CONTEMPLATED HEREBY.

    6

     

    

14.       Notice.
All notices and other communications that are required or may be given pursuant to this Agreement must be given in writing and delivered
personally, by courier, by email, or by registered or certified mail, postage prepaid, as follows:

 

	If
    to Lustre:	Lustre
    Oil Company LLC
	 	398
    Sage Lane
	 	Winnett,
    Montana 59087
	 	Attn:
    Mark See
	 	Email:
    msee@stranded-oil.com
	 	 
	If
    to Erehwon:	Erehwon
    Oil & Gas, LLC
	 	9876
    Clairton Way
	 	Highlands
    Ranch, Colorado 80126
	 	Attn:
    John M. Stafford
	 	Email:
    john@larisoil.com
	 	 
	If
    to Holdings:	Olfert
    No. 11-4 Holdings, LLC
	 	398
    Sage Lane
	 	Winnett,
    Montana 59087
	 	Attn:
    Mark See
	 	Email:
    msee@stranded-oil.com
	 	 
	With
    copies to:	Anatoma
    Fields LLC
	 	Attn:
    Mr. Ken Lipson
	 	Email:
    klips026@gmail.com
	 	 
	 	Dr.
    Kevin Foley
	 	Email:
    kfoley@usit.net
	 	 
	 	Daniels
    Petroleum
	 	Attn:
    Mr. Barrett Baker
	 	Email:
    Barrett@Danielspetroleum.com
	 	 

A
Party may change its address for notice by notice to the other Parties in the manner set forth above. All notices shall be deemed to
have been duly given at the time of receipt by the Party to which such notice is addressed.

 

15.       Governing
Law; Jurisdiction, Etc. This Agreement shall be governed by and construed in accordance with the laws of the State of Colorado, regardless
of the laws that might otherwise govern under applicable principles of conflict of law hereof. The Parties further agree that all disputes,
other than as provided in Section 7(b), shall be resolved exclusively in state or federal courts in the City and County of Denver, Colorado.

 

16.       Waiver
of Jury Trial. EACH OF THE PARTIES HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT
OF OR RELATED TO THIS AGREEMENT.

 

17.       Waiver.
Any failure by any Party to comply with any of its obligations, agreements, or conditions herein contained may be waived by the Party
to whom such compliance is owed by an instrument signed by such Party and expressly identified as a waiver, but not in any other manner.
No waiver of, or consent to a change in, any of the provisions of this Agreement shall be deemed or shall constitute a waiver of, or
consent to a change in, other provisions hereof (whether or not similar), nor shall such waiver constitute a continuing waiver unless
otherwise expressly provided.

 

18.       Successors.
This Agreement shall be binding upon and inure to the benefit of the Parties and their respective successors and permitted assigns.

    7

     

    

19.       Entire
Agreement. This Agreement constitutes the entire agreement between the Parties pertaining to the subject matter hereof, and supersedes
all prior agreements, understandings, negotiations, and discussions, whether oral or written, of the Parties pertaining to the subject
matter hereof.

 

20.       Term.
Unless otherwise terminated pursuant to the terms of this Agreement, this Agreement shall remain in full force and effect until the Well
is permanently plugged and abandoned.

 

21.       Amendment.
This Agreement may be amended or modified only by an agreement in writing executed by all Parties and expressly identified as an amendment
or modification.

 

22.       Construction.
Any rule of construction that a contract be construed against the drafter shall not apply to the interpretation or construction of this
Agreement.

 

23.       Severability.
The invalidity or unenforceability of any term or provision of this Agreement in any situation or jurisdiction shall not affect the validity
or enforceability of the other terms or provisions hereof or the validity or enforceability of the offending term or provision in any
other situation or in any other jurisdiction and the remaining terms and provisions shall remain in full force and effect, unless doing
so would result in an interpretation of this Agreement that is manifestly unjust.

 

24.       Confidentiality.
The Parties agree that the provisions of this Agreement are confidential and shall not be shared with third-parties without the prior
written consent of the other Parties. Notwithstanding the foregoing, each Party shall have the right to make disclosures without the
consent of the other Parties: (i) to its officers, directors, employees, partners, debt and equity providers, attorneys, accountants,
financial advisors, consultants, agents or representatives on a need-to-know basis, (ii) as permitted in this Agreement, or (iii) as
otherwise required by law, court order, rule, regulation or stock exchange rules, provided that the disclosing Party shall give immediate
notice of any demand of a Party to divulge any information concerning or relating to this Agreement and provide further that the disclosing
Party cooperate with the Party(ies) opposing disclosure, including the assertion of all proper objections to such disclosure.

 

25.       Captions.
The captions used in this Agreement are for convenience of reference only, do not constitute a part of this Agreement, and will not be
deemed to limit, characterize, or in any way affect any provision of this Agreement. All provisions of this Agreement will be enforced
and construed as if no caption had been used in this Agreement.

 

26.       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. A Party’s delivery of an executed counterpart signature page by email (e.g., .pdf) is as effective
as executing and delivering this Agreement in the presence of the other Parties. No Party shall be bound until such time as all of the
Parties have executed and delivered counterparts of this Agreement.

 

[Signature
Page Follows]

    8

     

    

The
Parties have executed this Agreement to be effective as of the Effective Date.

 

	LUSTRE:	 	HOLDINGS:
	LUSTRE
    OIL COMPANY LLC	 	OLFERT
    NO. 11-4 HOLDINGS, LLC
	 	 	 	 	 
	By:	/s/
    Mark See	 	By:	/s/
    Mark See
	Name: 	MARK
    SEE	 	Name: 	MARK
    SEE
	Title:	PRESIDENT	 	Title:	MANAGER
	 	 	 	 	 
	EREHWON:	 	 	 
	EREHWON
    OIL & GAS, LLC	 	 	 
	 	 	 	 	 
	By:	/s/
    John M Stafford	 	 	 
	Name:	JOHN
    M STAFFORD	 	 	 
	Title:	PRESIDENT	 	 	 
	 	 	 	 	 
	LAREDO
    HEREBY ACKNOWLEDGES AND AGREES TO THE PAYMENT CREDIT AS SET FORTH IN SECTION 2:	 	 	 
	 	 	 	 	 
	LAREDO:	 	 	 
	LAREDO
    OIL, INC.	 	 	 
	 	 	 	 	 
	By:	/s/
    Mark See	 	 	 
	Name:	MARK
    SEE	 	 	 
	Title:	CEO	 	 	 
	 	 	 	 	 

[Signature
Page to Net Profits Interest Agreement]Document

EXHIBIT (10-1)

Company’s Form of Separation Agreement & Release

SEPARATION AGREEMENT AND RELEASE

To:      «Employee_Name»
Date:   «Actual_Offer_Date»

«Company» (“P&G”) is willing to provide you with certain assistance in connection with your employment separation from the Company.  The following describes the terms under which you are separating from employment.  Your receipt of the benefits described below is conditioned upon your accepting and abiding by the terms of this Agreement.

						
	Last Day of Employment:	Your last day of employment will be «Exit_Date», referred to as your “Last Day of Employment.” You understand and agree that if P&G determines that you engaged in misconduct during your employment, or if you fail to perform your work and responsibilities in a satisfactory manner up to and including your Last Day of Employment, P&G may terminate your employment immediately and will not provide, nor be obligated to provide, the payment(s) and other benefits described in this Agreement. Otherwise, unless noted below, your pay and benefits will cease as of your Last Day of Employment.

	Separation Payment:	As soon as administratively practical after your Last Day of Employment, P&G will provide you with a Separation Payment of «Total_Amount», less legally required withholdings and deductions. In no event will payment be made before expiration of the seven-day revocation period discussed below or later than the March 15th of the year following the year which includes your last day of employment

Amounts you owe to P&G as of your Last Day of Employment, including, but not limited to, wage and/or benefit overpayments and unpaid loans, will also be deducted from the Separation Payment.

	Payment for Unvested PST:
	If you are not fully-vested in the Procter & Gamble Profit Sharing Trust and Employee Stock Ownership Plan (“PST”) as of your Last Day of Employment, as soon as administratively practical after your Last Day of Employment, but no later than the March 15th of the year following the year which includes your Last Day of Employment, you will receive a lump sum payment in an amount substantially equivalent to the non-vested credits in your account in the PST.

	STAR Awards:	As of your Last Day of Employment, if you worked at least 28 days (4 calendar weeks) during that fiscal year, you will receive a pro-rated STAR award for that fiscal year. Your STAR award will be pro-rated by dividing the number of calendar days during the fiscal year from July 1 through your Last Day of Employment by 365. Your STAR award will be paid in cash in the September (but no later than September 15th) immediately following the end of the fiscal year in which you terminate.

						
	Equity Awards
	Your separation will be treated as a Special Separation for purposes of any outstanding equity awards granted under the Procter & Gamble 2009 Stock and Incentive Compensation Plan, the Procter & Gamble 2001 Stock and Incentive Compensation Plan, the Procter & Gamble 1992 Stock Plan, or the Gillette Company 2004 Long-Term Incentive Plan and, as a result, you will retain the awards subject to the original terms and conditions of the awards. You will also retain awards granted under the Procter & Gamble 2014 Stock and Incentive Compensation Plan and the Procter & Gamble 2019 Stock and Incentive Compensation Plan subject to the terms and conditions of those Awards. For awards granted on or after October 1, 2020, pursuant to the Long-Term Incentive Program (LTIP) and/or Performance Stock Program (PSP), awards will be prorated based on the number of days worked in the 12 months following the October 1 grant date, with a minimum requirement of 28 days worked beyond October 1.

This agreement does not alter the rights and obligations that you may have under the Procter & Gamble 2019 Stock and Incentive Compensation Plan, the Procter & Gamble 2014 Stock and Incentive Compensation Plan, the Procter & Gamble 2009 Stock and Incentive Compensation Plan, the Procter & Gamble 2001 Stock and Incentive Compensation Plan, the Procter & Gamble 1992 Stock Plan, and the Gillette Company 2004 Long-Term Incentive Plan.
	Current Medical, Dental, and Life Insurance Benefits:	If you are enrolled in P&G’s active health (including medical, prescription drug, and EAP coverage), active dental, and company-paid life insurance coverage, that coverage will continue under the same terms until «Benefits_End_Date».

If you continue to receive P&G active health coverage during the extension of benefits period, that coverage will be impacted if you (or your eligible dependents, including but not limited to your spouse or domestic partner) are or become eligible for Medicare. For more information on this impact, see the Coordination With Medicare section in the Summary Plan Description for your P&G active health coverage.

If you continue to receive P&G active health coverage during the extension of benefits period, you may be entitled to continue your health and dental coverage under COBRA when the extension of benefits period ends. If you are entitled to COBRA continuation coverage, you will receive a notice of your right to elect COBRA.

Any life insurance coverage other than company-paid life insurance coverage will not continue during this time.

						
	Retiree Medical and Dental Benefits:	If you were eligible for P&G retiree healthcare coverage on your Last Day of Employment, you will be eligible to enroll in P&G’s retiree medical and dental insurance coverage. You are eligible for P&G retiree healthcare coverage if you satisfy the regular retiree eligibility rules (i.e., you are a Regular Retiree) as of your Last Day of Employment. Under the terms of this Agreement, you also are eligible for P&G retiree healthcare coverage as a Special Retiree by satisfying the Rule of 70 as of your Last Day of Employment. You satisfy the Rule of 70 when your full years of age plus your full years of service equal 70.1 If you are eligible for P&G’s retiree healthcare coverage as either a Regular Retiree or a Special Retiree as of your Last Day of Employment, you should contact P&G Employee Care before your extension of coverage ends to request retiree healthcare enrollment information. For details regarding the terms and conditions of your retiree health coverage, please refer to and review the summary plan descriptions, available at Benefits Onl

Important Note: If you become employed by a direct competitor of P&G (as determined by P&G’s Chief Human Resources Officer) in any capacity, you will not be eligible for coverage under P&G’s retiree healthcare coverage as long as you remain employed by such competitor. If you have questions, please contact the P&G Employee Care at [phone].

	Outplacement Services:	P&G’s outplacement supplier, Right Management Consultants, will provide services to assist you in managing your transition to a new future, based on your interest. Services include pre-decision counseling, career transition programs, and job development opportunities. Right Management Consultants will also assist you in preparing for your job search, including résumé preparation, cover letters, other written materials and interview and networking training.
After you accept this Agreement, you may begin utilizing outplacement services on a limited basis prior to your Last Day of Employment, consistent with the needs of the business and your responsibilities to complete and/or transition your work. Note that you must begin utilizing outplacement services within 45 days of your Last Day of Employment to be eligible for this benefit.

	

1 Special rules apply to Gillette Heritage Employees with regard to retiree medical eligibility and the retiree medical cost sharing under the retiree medical plan. If you are a Gillette Heritage Employee, you will receive a separate handout on your retiree medical eligibility.

						
	No Consideration Without Executing this Agreement:	You affirm that you understand and agree that you would not receive the separation payment and/or benefits specified in this Agreement without executing this Agreement and fulfilling the promises contained in it. Except as provided in this Agreement or under the terms and conditions of an applicable benefit plan or policy sponsored by P&G, you shall not be due any payments or benefits from P&G in connection with the termination of your employment.

	Continued Employment Through Your Last Day of Employment:	You agree to perform your work and responsibilities as an employee in a satisfactory manner up to and including your Last Day of Employment, including compliance with all provisions of this “Separation Agreement and Release.” If P&G determines that you have engaged in serious misconduct during your employment, you understand and agree that P&G may terminate your employment immediately and will not provide, nor will it be obligated to provide, you with the Separation Payment, medical benefits, outplacement and other benefits described above. If you have already received any such pay or benefits, you agree to repay them to P&G upon demand.
	Nonadmission of Wrongdoing:	You affirm that you understand and agree that neither this Agreement nor the furnishing of the consideration for this Agreement, including the Separation Payment, shall be deemed or construed at any time for any purpose as an admission by P&G of wrongdoing or evidence of any liability or unlawful conduct of any kind.

	Release of Claims – Including Age Discrimination and Employment Claims:	In consideration of the Separation Payment and other benefits provided above to which you would not have been entitled under any existing P&G Policy, you release P&G from any and all claims you have against P&G. The term “P&G” includes «Company» and any of its present, former and future owners, parents, affiliates and subsidiaries, and its and their directors, officers, shareholders, employees, agents, servants, representatives, predecessors, successors and assigns and their employee benefit plans and programs and their administrators and fiduciaries.

						
		This release applies to claims about which you now know or may later discover, and includes but is not limited to: (1) claims arising under the Age Discrimination in Employment Act, 29 U.S.C. § 621, et seq.; (2) claims arising out of or relating in any way to your employment with P&G or the conclusion of that employment; (3) claims arising under any federal, state and local employment discrimination laws, regulations or ordinances or other orders that relate to the employment relationship and/or employee benefits; and (4) any other federal, state or local law, rule, regulation or ordinance, public policy, contract, tort or common law.

This release does not apply to claims that may arise after the date you accept this Agreement or that may not be released under applicable law.

You are not waiving any rights you may have to: (a) your own vested accrued employee benefits under the P&G health, welfare, or retirement benefit plans as of the Last Day of Employment; (b) benefits and/or the right to seek benefits under applicable workers’ compensation and/or unemployment compensation statutes; (c) pursue claims which by law cannot be waived by signing this Agreement; (d) enforce this Agreement; and/or (e) challenge the validity of this Agreement.  

You agree that the decision as to what would be your Last Day of Employment was made prior to your accepting and executing this Agreement, and you agree that you are releasing any claim in connection with the separation of your employment.

If any claim is not subject to release, to the extent permitted by law, you agree that you waive any right or ability to be a class or collective action representative or to otherwise participate in any putative or certified class, collective or multi-party action or proceeding based on such a claim in which P&G is a party.

						
		Governmental Agencies: Nothing in this Separation Letter & Release prohibits or prevents you from filing a charge with or participating, testifying, or assisting in any investigation, hearing, or other proceeding before the U.S. Equal Employment Opportunity Commission, the National Labor Relations Board or a similar agency enforcing federal, state or local anti-discrimination laws. However, to the maximum extent permitted by law, you agree that if such an administrative claim is made to such an anti-discrimination agency, you shall not be entitled to recover any individual monetary relief or other individual remedies.  Nothing in this Separation Letter & Release, including but not  limited to the “Release of Claims – Including Age Discrimination and Employment Claims” and the “Confidential, Proprietary, Trade Secret Information & Period of Non-Competition” sections of this Separation Letter & Release, prohibits you from: (1) reporting possible violations of federal law or regulations, including any possible securities laws violations, to any governmental agency or entity, including but not limited to the U.S. Department of Justice, the U.S. Securities and Exchange Commission, the U.S. Congress, or any agency Inspector General; (2) making any other disclosures that are protected under the whistleblower provisions of federal law or regulations; or (3) otherwise fully participating in any federal whistleblower programs, including but not limited to any such programs managed by the U.S. Securities and Exchange Commission and/or the Occupational Safety and Health Administration. You understand you do not need the prior authorization from the Company to make any such reports or disclosures, and you are not required to notify the Company that you have made such reports or disclosures. Moreover, nothing in this Separation Letter & Release prohibits or prevents you from receiving individual monetary awards or other individual relief by virtue of participating in such federal whistleblower programs.

	Confidential, Proprietary, Trade Secret Information & Period of Non-Competition:

	Subject to the “Governmental Agencies” portion of the “Release of Claims – Including Age Discrimination and Employment Claims” above, you agree that you will not use or share any confidential, proprietary or trade secret information about any aspect of P&G’s business with any non-P&G employee or business entity at any time in the future. You further agree that you will not obtain, transfer or have in your possession any confidential, proprietary or trade secret information on or after your last day of employment, even information you may have created yourself or to which you may have contributed as a P&G employee. Confidential, proprietary or trade secret information includes, but is not limited to, marketing and advertising plans, pricing information, upstream plans, specific areas of research and development, project work, product formulation, processing methods, assignments of individual employees, testing and evaluation procedures, cost figures, construction plans, and special techniques or methods of any kind.

						
		Notwithstanding the requirements of confidentiality contained in this section, the federal Defend Trade Secrets Act of 2016 immunizes you against criminal and civil liability under federal or state trade secret laws for your disclosure of trade secrets that is made i) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney solely for the purpose of reporting or investigating a suspected violation of law; ii) in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal; or iii) to your attorney for use in a lawsuit alleging retaliation for reporting a suspected violation of law, provided that any document containing the trade secret is filed under seal and you do not otherwise disclose the trade secret, except pursuant to court order.

You further understand and agree that, unless you have prior written consent from P&G, you will not engage in any activity or provide any services for a period of three (3) years following your Last Day of Employment in connection with the manufacture, development, advertising, promotion or sale of any product which is the same as, similar to, or competitive with any products of P&G or its subsidiaries (including both existing products as well as products in development which are known to you, as a consequence of your employment with P&G):

1.With respect to which your work has been directly concerned at any time during the two (2) years preceding your Last Day of Employment; or

2.With respect to which during that period of time you, as a consequence of your job performance and duties, acquired knowledge of trade secrets or other confidential information of P&G.

For the purposes of this section, it shall be conclusively presumed that you have knowledge or information to which you were directly exposed through the actual receipt of memos or documents containing such information or through actual attendance at meetings at which such information was discussed or disclosed. The provisions of this section are not in lieu of, but are in addition to, your continuing obligation to not use or disclose P&G’s trade secrets and confidential information known to you until any particular trade secret or confidential information becomes generally known (through no fault of yours). Information regarding products in 

						
		development, in test market or being marketed or promoted in a discrete geographic region, which information P&G is considering for a broader use, shall not be deemed generally known until such broader use is actually commercially implemented. Also, “generally known” means known throughout the domestic United States industry or, if you have job responsibilities outside of the United States, the appropriate foreign country or countries’ industry.

If any restriction in this section is found by any court of competent jurisdiction or arbitrator to be unenforceable because it extends for too long a period of time or over too great a range of activities or in too broad a geographic area, it will be modified and interpreted to extend only over the maximum period of time, range of activities or geographic area so that it may be enforceable. 

As a participant in the 2009 Stock and Incentive Compensation Plan, the 2001 Stock and Incentive Compensation Plan, or the 1992 Stock Plan, you are also bound by the terms of Article F – Restrictions & Covenants of those plans, which are incorporated herein by reference.  

If you are a participant in the Procter & Gamble 2019 Stock and Incentive Compensation Plan and the Procter & Gamble 2014 Stock and Incentive Compensation Plan, you are also bound by the terms of Article 6 – Restrictions and Covenants of this plan which are incorporated herein by reference.

	Non-Solicitation	You acknowledge, as a participant in the Procter & Gamble 2019 Stock and Incentive Compensation Plan, the Procter & Gamble 2014 Stock & Incentive Compensation Plan, the Procter & Gamble 2009 Stock and Incentive Compensation Plan, the Procter & Gamble 2001 Stock and Incentive Plan, the Procter & Gamble 1992 Stock Plan, and/or the Gillette Company 2004 Long-Term Incentive Plan that you are bound to comply with the Plans’ non-solicitation obligations. Specifically, you agree that you will not, at any time following your Employment Separation Date, attempt to directly or indirectly induce any employee of P&G or its affiliates or subsidiaries to be employed or perform services elsewhere or attempt directly or indirectly to solicit the trade or business of any current or prospective customer, supplier or partner of P&G or its affiliates or subsidiaries.

						
	Acknowledgements and Affirmations:	Subject to the “Governmental Agencies” portion of the “Release of Claims – Including Age Discrimination and Employment Claims” above, you affirm that you have not filed, caused to be filed, or presently are a party to any claim against P&G.

You affirm that you have been paid and/or have received all compensation, wages, bonuses, commissions, and/or benefits which are due and payable as of the date you sign this Agreement. To the extent that you are required to report hours worked, you affirm that you have reported all hours worked as of the date you sign this Agreement.

You affirm that you have been granted any leave to which you were entitled under the Family and Medical Leave Act or related state or local leave or disability accommodation laws.

You further affirm that you have no known workplace injuries or occupational diseases that have not been reported.

	Assignment of Intellectual Property:	You will promptly and fully disclose, transfer and assign to P&G all inventions and any other intellectual property (collectively “Intellectual Property”) made or conceived by you during your employment with P&G. You agree to fully cooperate in executing any papers required for establishing or protecting the Intellectual Property and for establishing P&G’s ownership, even if such cooperation is necessary after your Last Day of Employment.

						
	Return of P&G Property:	You agree that on or before your Last Day of Employment, you will return to P&G in good condition all of its equipment, materials and information that were in your possession, custody or control (including, but not limited to, computers, files, documents, credit cards, keys and identification badges). You further agree that you will provide your manager with all passwords to P&G electronic communication and data systems before your Last Day of Employment. You further agree that on or before your Last Day of Employment, you will return or if directed to do so by your immediate manager, delete (i.e., destroy all copies of) any and all P&G confidential, proprietary or trade secret information you have maintained in your possession, custody, or control in paper, electronic and/or digital formats, including but not limited to, any such confidential, proprietary, or trade secret information (e.g., files, documents, etc.) that you may have electronically or digitally processed or stored on P&G-issued or on personally-owned or maintained digital devices and/or service accounts. Such digital devices and/or service accounts may include, but are not limited to desktop and laptop computers, notebooks, tablets, iPads, mobile phones, smartphones, personal digital assistants (PDAs), USB and flash drives, external hard drives, CDs, DVDs, and/or external file processing or storage provided by cloud service providers such as box.net, dropbox, Google docs, etc.

	Ethics Compliance:	Subject to the “Governmental Agencies” portion of the “Release of Claims – Including Age Discrimination and Employment Claims” above, you agree that you provided P&G all information known to you regarding any violations of the Procter & Gamble Worldwide Business Conduct Manual and/or any other violations of P&G policy or the law.

						
	Agreement to Arbitrate Disputes:	Resolving any future differences we may have in the courts can take a long time and be expensive. You and P&G therefore agree that the only remedy for all disputes that are not released by this Agreement or that arise out of your employment with or separation from P&G, or any aspect of this Agreement, will be to submit any such disputes (with the exception noted at the end of this section) to final and binding arbitration in accordance with the National Rules for Resolution of Employment Disputes of the American Arbitration Association then in effect.

You and P&G agree that the aggrieved party must send written notice of any claim to the other party by certified mail, return receipt requested. Written notice for P&G will be sent to: Secretary, One Procter & Gamble Plaza, Cincinnati, OH 45202, and to you at the most current address shown for you in P&G’s records. The arbitrator will apply Ohio law. At your written request, P&G will reimburse you for all fees and costs charged by the American Arbitration Association and its arbitrator to the extent they exceed the applicable fees and costs that would have been charged by a court of competent jurisdiction had your claim been filed in court.

There is one exception to this section. P&G may seek injunctive relief in any court of competent jurisdiction if it has reason to believe that you have violated or are about to violate (1) the terms of the “Confidential, Proprietary, Trade Secret Information & Period of Non-Competition” section above, or (2) if you are a participant in the 2009 Stock and Incentive Compensation Plan, the 2001 Stock and Incentive Compensation Plan, or the 1992 Stock Plan, the terms of Article F – Restrictions & Covenants of those plans or (3) if you are a participant in the 2014 Stock and Incentive Compensation Plan, the terms of Article 6 – Restrictions & Covenants of those plans.

	Severability:	If any court of competent jurisdiction or arbitrator should later find that any portion of this Agreement is invalid, that invalidity will not affect the enforceability of any other portion of this Agreement.

						
	Employment References:	You understand that P&G’s historical policy is to not provide employment references to prospective employers. However, P&G is willing to waive that policy in your case on the following basis: You authorize your manager or human resources representative to provide an employment reference upon written or verbal request. In return, you release any claim against P&G and will not bring a lawsuit in court against P&G based upon that employment reference (or lack thereof). You agree that you will refer all reference inquiries to your manager or human resources representative only. You further understand that all disputes regarding employment references or the lack thereof must be resolved through the arbitration process described above.

	No Reliance:	This Agreement sets forth the entire agreement between you and P&G and fully supersedes any prior agreements or understanding between the parties except that if you are a participant in the 2009 Stock and Incentive Compensation Plan, the 2001 Stock and Incentive Compensation Plan, or the 1992 Stock Plan, the terms of Article F – Restrictions & Covenants of those plans remain in full force and effect and are incorporated herein by reference and if you are a participant in the Procter & Gamble 2019 Stock and Incentive Compensation Plan or the Procter & Gamble 2014 Stock and Incentive Compensation Plan, the terms of Article 6 – Restrictions & Covenants of those plans remain in full force and are in effect and are incorporated herein by reference. In deciding to accept this Agreement, you agree that you have not relied upon any statements or promises by P&G, its managers, agents or employees, other than those set forth in this Agreement. No other promises or agreements concerning the matters described in this Agreement shall be binding unless in a subsequent document signed by these parties

						
	Your Attorney:	You acknowledge that you have been and hereby are advised to consult with legal counsel before accepting this Agreement and have either done so or have voluntarily declined to do so.

	Timing for Acceptance or Revocation:	You have forty-five (45) calendar days in which to consider this Agreement in which you waive important rights, including those under the Age Discrimination in Employment Act of 1967. If you choose to sign this Agreement, please do so by indicating your acceptance of this Agreement with your electronic signature in P&G’s electronic system. We advise you to consult with an attorney of your choosing prior to signing this Agreement. Further, you may within seven (7) calendar days following the date you sign this Agreement, cancel and terminate it by giving written notice of your intention to revoke the Agreement to your immediate manager, and by returning to P&G any remuneration or benefits that have been advanced to you in anticipation of your not revoking your agreement and to which you are not entitled. If notice of your revocation is mailed, it must be postmarked within seven (7) calendar days after you sign this Agreement.

You agree that any modifications, material or otherwise, made to this Agreement, do not restart or affect in any manner the original up to forty-five (45) calendar day consideration period.

______________________________________________________________________
The benefits described in this Agreement and pursuant to the summary plan description for the Procter & Gamble Basic Separation Program for U.S. Employees, are the special benefits you will receive by signing this Agreement.  To the extent this Agreement describes benefits under other benefit plans and policies sponsored by P&G, these special benefits are also described in the summary plan descriptions for those plans.  As such, nothing in this Agreement amends or changes the terms of any P&G-sponsored employee benefit plan or policy. 

After your Last Day of Employment, you will no longer be an active P&G employee, which may affect your coverage under those plans and policies.  For example, plans may require that you enroll in Medicare to be eligible for coverage.  For more information on how not being an active P&G employee may affect your coverage, please refer to and review the summary plan descriptions for each plan, available at Benefits Online.

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