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  Exhibit 10.1

 

THIS NOTE, AND THE SHARES OF COMMON STOCK ISSUABLE UPON CONVERSION
OF THIS NOTE (THE “SECURITIES”) HAVE BEEN
ACQUIRED FOR INVESTMENT PURPOSES ONLY AND MAY NOT BE TRANSFERRED
UNTIL (i) A REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE “ACT” OR THE
“SECURITIES
ACT”) SHALL HAVE BECOME EFFECTIVE WITH RESPECT THERETO
OR (ii) RECEIPT BY THE COMPANY OF AN OPINION OF COUNSEL REASONABLY
SATISFACTORY TO THE COMPANY TO THE EFFECT THAT REGISTRATION UNDER
THE ACT IS NOT REQUIRED IN CONNECTION WITH SUCH PROPOSED TRANSFER
NOR IS IN VIOLATION OF ANY APPLICABLE STATE SECURITIES LAWS. THIS
LEGEND SHALL BE ENDORSED UPON ANY NOTE ISSUED IN EXCHANGE FOR THIS
NOTE AND ANY SECURITIES ISSUABLE UPON CONVERSION OF THIS NOTE
(EXCEPT AS OTHERWISE PROVIDED BELOW).

 

CONVERTIBLE PROMISSORY NOTE

 

[CN-__]  Effective
August 1, 2018

 

NOW THEREFORE FOR VALUE RECEIVED, the
undersigned,

PEDEVCO Corp., a Texas corporation (the “Borrower”),
hereby promises to pay to the order of ______________________ and assigns
(“Holder”),
the principal amount of _________________________________ (US
$_______________)(the “Principal”),
in lawful money of the United States of America, which shall be
legal tender, bearing interest and payable as provided herein. This
Convertible Promissory Note (this “Note”
or “Promissory
Note”) has
an effective date of August 1, 2018 (the “Effective
Date”). This Note is entered into to evidence the loan
of the Principal to the Borrower on the Effective Date (the
“Loan”).
This Note is one of six Convertible Promissory Notes entered into
between the Borrower and various lenders, including the Holder, on
or around the date hereof in the aggregate amount not to exceed
$25,000,000 (collectively, with the Holder, the holders of the
other Convertible Promissory Notes are defined herein as the
“Note
Holders” and this Note, collectively with the
Convertible Promissory Notes of the other Note Holders (identified
as Convertible Promissory Notes CN-1 through CN-__), including any
replacement notes, notes which are assigned, reissued, or broken
into smaller notes, are defined as the “Note Holders’
Notes”). “Required Note
Holders” means Note Holders holding at least a
majority in interest of the then aggregate dollar value of the Note
Holders’ Notes outstanding at such time of determination. The
payment of any amounts due to the Note Holders under the Note
Holders’ Notes is expressly subordinated and deferred until
full payment and satisfaction of that certain Promissory Note,
dated June 25, 2018, in the amount of $7.7 million, issued by the
Company to SK Energy, LLC, as the same may be amended or modified
in accordance with its terms (the “Senior
Note”), unless otherwise waived or permitted by SK
Energy, LLC, provided, however, nothing in the Senior Note or any
Note Holders’ Notes shall restrict a Note Holder from
exercising its Holder Conversion Option (as defined below) as set
forth, and in accordance with, the provisions set forth
herein.

 

 

 

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Convertible
Promissory Note CN-__

PEDEVCO
Corp.

 

 

 

1. Interest
(“Interest”)
shall accrue on the Principal amount of this Note then outstanding
at the rate of eight and one-half percent (8.5%) per annum (the
“Interest
Rate”), compounded monthly at the rate of
1/12th of
such annual interest per month, on the last day of each calendar
month (“Monthly
Interest”). The Monthly Interest shall accrue and be
payable on the Maturity Date, if not paid prior to such Maturity
Date, or converted into Shares (as defined in Section 2) as provided
herein.

 

2. Holder’s
Option to Convert This Note Into Shares.

 

(a) At any time
following (i) the date that the VWAP Price is determined (as
defined below) and (ii) prior to the payment in full by the
Borrower of this Note, subject to the provisions of Section 2, below, Holder shall
have the option to convert the Principal (or any portion thereof)
and accrued Interest (or any portion thereof), into
shares (the
“Shares”)
of common stock of the Borrower (“Common
Stock”), at the applicable Conversion Price (the
“Holder Conversion
Option”), which shall apply for the conversion of
Principal and all accrued Interest (each a “Conversion”).
The “Conversion
Price” shall equal: the greater of (x) $0.10 above the
Book/Market Price; (y) $1.63 per Share; and (z) the VWAP
Price.

 

(b) In order to
exercise this Holder Conversion Option, the Holder shall provide
the Borrower a written notice of its intentions to exercise this
Holder Conversion Option, which notice shall set forth the amount
of this Promissory Note to be converted, the applicable Principal
and Interest to be converted and the calculation of the applicable
Conversion Price, which shall be in the form of Exhibit A, attached hereto
(“Notice of
Conversion”). Within ten (10) business days of the
Borrower’s receipt of the Notice of Conversion (reflecting
Conversion Price confirmed by the Borrower), the Borrower shall
deliver or cause to be delivered to the Holder, written
confirmation that the Shares have been issued in the name of the
Holder. If the Borrower reasonably believes that there is an error
in Holder’s calculation of the Shares issuable in connection
with the Notice of Conversion or the Conversion Price provided for
therein, or another issue with the conversion, the Borrower shall
not be obligated to honor such defective Notice of Conversion and
shall promptly notify Holder of such errors. Notwithstanding
anything herein to the contrary, the Holder shall not be required
to physically surrender this Note to the Borrower until the Holder
has converted the entire amount of this Note, in which case, the
Holder shall surrender this Note to the Borrower for cancellation
within three (3) business days of the date the final Notice of
Conversion is delivered to the Borrower. Partial conversions of
this Note shall have the effect of lowering the outstanding
Principal amount of this Note. The Holder and the Borrower shall
maintain records showing the actual Principal Amount of this Note,
provided that absent manifest error, the Borrower’s records
shall control.

 

 

 

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Convertible
Promissory Note CN-__

PEDEVCO
Corp.

 

 

 

(c)           In
the event of the exercise of the Holder Conversion Option, Holder
shall cooperate with the Borrower to promptly take any and all
additional actions required to make Holder a stockholder of the
Borrower including, without limitation, in connection with the
issuance of the Shares and providing the Borrower or its legal
counsel or Transfer Agent, representations as to financial
condition, investment intent and sophisticated investor status of
such Holder as may be reasonably requested or required. The
Borrower shall at all times take any and all additional actions as
are necessary to maintain the required authority to issue the
Shares to the Holder, in the event the Holder exercises its rights
under the Holder Conversion Option.

 

(d)           Following
the effective time of any Conversion, all rights of any Holder with
respect to the amount of this Note converted, will terminate,
except only for the rights of any such Holder to receive
certificates (if applicable) for the number of Shares which this
Note has been Converted.

 

(e)           The
following terms have the meanings given to them below as used in
this Section
2:

 

(i) “VWAP”
means, for any Trading Day, the volume-weighted average price,
calculated by dividing (a) the aggregate value of all shares of
Common Stock traded on the Principal Market during regular trading
hours, calculated by multiplying the closing price per share of
Common Stock on such applicable Trading Date, by the aggregate
number of shares of Common Stock traded on such Trading Day, by (b)
the total volume (number of shares) of Common Stock traded on the
Principal Market for such Trading Day, or if such volume-weighted
average price is unavailable, the market value of one share of
Common Stock on such Trading Day as determined by the Board of
Directors of the Company in a commercially reasonable
manner.

 

(ii) “VWAP
Price” means the average of the VWAP during the twenty
(20) Trading Days subsequent to, but not including, the date that
the Loan has been publicly disclosed by the Borrower pursuant to
the filing of a Current Report on Form 8-K with the Securities and
Exchange Commission.

 

(iii)  “Trading
Day” means any day on which the Common Stock is traded
on the Principal Market, or, if the Principal Market is not the
principal trading market for the Common Stock, then on the
principal securities exchange or securities market on which the
Common Stock is then traded; provided that “Trading
Day” shall not include any day on which the Common
Stock is scheduled to trade on such exchange or market for less
than 4.5 hours or any day that the Common Stock is suspended from
trading during the final hour of trading on such exchange or market
(or if such exchange or market does not designate in advance the
closing time of trading on such exchange or market, then during the
hour ending at 4:00:00 p.m., New York Time).

 

 

 

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Convertible
Promissory Note CN-__

PEDEVCO
Corp.

 

 

 

(iv) “Principal
Market” means initially the NYSE American, and shall
also include the NASDAQ Capital Market, New York Stock Exchange,
the NASDAQ National Market, the OTCQB Market, the OTCQX Market, or
the OTC Pink Market, whichever is at the time the principal trading
exchange or market for the Common Stock, based upon share
volume.

 

(v) “Book/Market
Price” means the greater of (i) the book value of one
share of Common Stock, as calculated pursuant to the applicable
rules and regulations of the Principal Market; and (ii) the closing
sales price of the Common Stock on the Principal Market, each (i)
and (ii), calculated on the Effective Date.

 

3. General
Provisions Relating to the Shares and
Conversions.

 

(a) Conversion
calculations pursuant to Section 2, shall be rounded to
the nearest whole share of Common Stock.

 

(b) If the Borrower at
any time or from time to time on or after the Effective Date
effects a subdivision of its outstanding Common Stock, the
Conversion Price, VWAP Price and Book/Market Price then in effect
immediately before that subdivision shall be proportionately
decreased, and conversely, if the Borrower at any time or from time
to time on or after the Effective Date combines its outstanding
shares of Common Stock into a smaller number of shares, the
Conversion Price, VWAP Price and Book/Market Price then in effect
immediately before the combination shall be proportionately
increased.

 

(c) Unless the Holder
provides the Borrower a valid legal opinion within five (5) days of
the date the Conversion Notice is received that such Shares can be
issued free of restrictive legend, the Shares shall be issued with
a standard Rule 144 restrictive legend.

 

(d) No Shares shall be
issued by the Borrower hereunder unless or until the additional
listing of such Shares has been approved by the NYSE
American.

 

(e) At any time this
Note is held by SK Energy LLC, a Delaware limited liability
company, or its assigns, or any affiliate (as such term is defined
and/or interpreted under the rules and regulations of the
Securities Act (as defined in Section 15)) of SK Energy LLC
(collectively, “SK
Energy”), the applicable portion of this Note shall
not be convertible by the applicable Holder pursuant to the Holder
Conversion Option during any time that, and only to the extent
that, the number of Shares to be issued to Holder upon such
Conversion, when added to the number of shares of Common Stock, if
any, that such applicable Holder otherwise beneficially owns
(outside of this Note, and not including any other securities of
the Borrower held by Holder having a provision substantially
similar to this paragraph) at the time of such Conversion, would
exceed 49.9% (the “SK
Energy Maximum
Percentage”) of (A) the number of shares of Common
Stock of the Borrower; or (B) the voting rights of the security
holders of the Borrower; outstanding immediately after giving
effect to the issuance of the Shares upon Conversion of this Note
held by the Holder, as determined in accordance with Section 13(d)
of the Securities Exchange Act of 1934, as amended (the
“SK
Energy Beneficial
Ownership Limitation”).

 

 

 

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Convertible
Promissory Note CN-__

PEDEVCO
Corp.

 

 

 

(f) At any time this
Note is not held or
beneficially owned by (i) SK Energy; (ii) any officer of the
Borrower; (iii) any director of the Borrower; or (iv) any person
which at the time of obtaining beneficial ownership (as defined in
the Securities Exchange Act of 1934, as amended) beneficially owns
more than 9.99% of the Borrower’s outstanding Common Stock or
voting stock (each of (ii) through (iv) above, a
“Borrower
Affiliate”), the applicable portion of this Note shall
not be convertible by the applicable Holder pursuant to the Holder
Conversion Option during any time that, and only to the extent
that, the number of Shares to be issued to such applicable Holder
upon such Conversion, when added to the number of shares of Common
Stock, if any, that the applicable Holder otherwise beneficially
owns (outside of this Note, and not including any other securities
of the Borrower held by Holder having a provision substantially
similar to this paragraph) at the time of such Conversion, would
exceed 4.99% (the “Non-Affiliate
Maximum Percentage” and together with the SK Energy
Maximum Percentage, as applicable, the “Maximum
Percentage”) of (A) the number of shares of Common
Stock of the Borrower; or (B) the voting rights of the security
holders of the Borrower; outstanding immediately after giving
effect to the issuance of Shares upon Conversion of this Note held
by the Holder, as determined in accordance with Section 13(d) of
the Securities Exchange Act of 1934, as amended (the
“Non-Affiliate
Beneficial
Ownership Limitation” and together with the SK Energy
Beneficial Ownership Limitation, as applicable, the
“Beneficial
Ownership Limitation”).

 

(g)   For the
sake of clarity, at any time that this Note or any portion hereof
shall be beneficially owned by a Borrower Affiliate (other than SK
Energy), no Maximum Percentage or Beneficial Ownership Limitation
shall apply to this Note while beneficially owned (as defined in
the Securities Exchange Act of 1934, as amended) by such Borrower
Affiliate (other than SK Energy), provided that the Maximum
Percentage and Beneficial Ownership Limitation, each as applicable,
shall automatically apply to such Note or portion thereof, at any
time this Note or the applicable portion thereof, is transferred,
sold or assigned to such non-Borrower Affiliate, effective
immediately upon such transfer, sale or assignment.

 

4. All past-due
Principal and Interest shall bear interest at the lesser of (a) the
rate of ten percent (10%) per annum; and (b) the Maximum Rate,
until paid in full (the “Default
Rate”).

 

5. The
“Maturity
Date” of this Note shall be the earlier of (a) August
1, 2021; and (b) the date that the Required Note Holders have
effected an Acceleration as described in Section 16, below.

 

6. Upon
the occurrence of an Event of Default hereunder the Principal
amount of this Note and any accrued Interest thereon shall bear
interest at the Default Rate.

 

 

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Convertible
Promissory Note CN-__

PEDEVCO
Corp.

 

 

 

7. This
Note may be prepaid in whole or in part, at any time and from time
to time, without premium or penalty, with such payments to be
applied as described in Section 8 below.

 

8. All
payments made by Borrower under this Note will be applied: (i)
first, to late charges, costs of collection or enforcement, and
similar amounts due, if any, under the Note; (ii) second, to
Interest that is due and payable under this Note, if any; and (iii)
third, the remainder to Principal due and payable under this
Note.

 

9. If
any payment of Principal or Interest on this Note shall become due
on a non-Business Day, such payment shall be made on the next
succeeding Business Day. “Business
Day” means a day other than (i) a Saturday, (ii) a
Sunday or (iii) a day on which commercial banks in the City of
Houston, Texas are authorized or required to be closed for
business.

 

10. This
Note shall be binding upon Borrower and inure to the benefit of
Holder and Holder’s respective successors and assigns. Each
holder of this Note, by accepting the same, agrees to and shall be
bound by all of the provisions of this Note (including, but not
limited to Section
25 hereof). Holder may assign this Note or any of its rights,
interests or obligations to this Note to another party with the
prior written approval of Borrower, which shall not be unreasonably
withheld, conditioned or delayed, provided that the Borrower may
require such subsequent holder to consent to and to agree to the
assumption of the terms and conditions of this Note, including, but
not limited to Section
25.

 

11. No
provision of this Note shall alter or impair the obligation of
Borrower to pay the Principal of and Interest on this Note at the
times, places and rates, and in the coin or currency, herein
prescribed.

 

12. Borrower
will do or cause to be done all things reasonably necessary to
preserve and keep in full force and effect its corporate existence,
rights and

franchises
and comply with all laws applicable to Borrower, except where the
failure to comply could not reasonably be expected to have a
material adverse effect on Borrower.

 

13. Notwithstanding
anything to the contrary in this Note or any other agreement
entered into in connection herewith, whether now existing or
hereafter arising and whether written or oral, it is agreed that
the aggregate of all Interest and any other charges constituting
interest, or adjudicated as constituting interest, and contracted
for, chargeable or receivable under this Note or otherwise in
connection with this loan transaction, shall under no circumstances
exceed the Maximum Rate.

 

 

 

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Convertible
Promissory Note CN-__

PEDEVCO
Corp.

 

 

 

14. Borrower
represents and warrants to Holder as follows:

 

(a) The execution and
delivery by Borrower of this Note (i) are within Borrower’s
power and authority, and (ii) have been duly authorized by all
necessary action.

 

(b) This Note is a
legally binding obligation of Borrower, enforceable against
Borrower in accordance with the terms hereof, except to the extent
that (i) such enforceability is limited by bankruptcy, insolvency,
reorganization, moratorium or other laws relating to or affecting
generally the enforcement of creditors’ rights, and (ii) the
availability of the remedy of specific performance or injunctive or
other equitable relief is subject to the discretion of the court
before which any proceeding therefore may be brought.

 

(c) The Shares, when
issued, sold and delivered in accordance with the terms of this
Note, will be duly and validly issued, fully paid and
nonassessable, and will be free and clear of any pledges, liens and
encumbrances, other than restrictions on transfer under this Note
and applicable securities laws of any state or other
jurisdiction.

 

15. Holder
represents and warrants to the Borrower, and agrees, as follows
(collectively the “Representations”):

 

(A) The
execution and delivery by the Holder of this Note (i) are within
the Holder’s corporate power and authority, and (ii) have
been duly authorized by all necessary corporate action. Further,
the undersigned is a duly authorized representative of the Holder
who has been authorized by a resolution of the governing body of
the Holder to exercise any and all documents necessary to
effectuate the purchase of this Note.

 

(B) This
Note and any Shares issuable pursuant to the terms of this are
being acquired by Holder for its own account for investment and not
with a view to, or for sale in connection with, any distribution
thereof.

 

(C) Holder
acknowledges that it is an “accredited
investor” as such term is defined in Rule 501 of
Regulation D of the Securities Act of 1933, as amended (the
“Act”
or the “Securities
Act”).

 

(D) Holder
has sufficient knowledge and experience in financial and business
matters and is capable of evaluating the risks and merits of
Holder’s investment in the Note and where applicable the
Shares; Holder believes that Holder has received or had access to
all information Holder considers necessary or appropriate to make
an informed investment decision with respect to this Note (and
where and if applicable, the Shares), including the opportunity ask
the Borrower or its officers any questions it has regarding the
Borrower or the Note; and Holder is able financially to bear the
risk of losing Holder’s full investment in this Note and
where applicable, the Shares.

 

 

 

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Convertible
Promissory Note CN-__

PEDEVCO
Corp.

 

 

 

(e) Holder has not
become aware of and has not been offered the Note by any form of
general solicitation or advertising, including, but not limited to,
advertisements, articles, notices or other communications published
in any newspaper, magazine, or other similar media or television or
radio broadcast or any seminar or meeting where, to such
Holder’s knowledge, those individuals that have attended have
been invited by any such or similar means of general solicitation
or advertising.

 

(F) The
Holder understands that the Note and the Shares are being offered
to it in reliance on specific exemptions from or non-application of
the registration requirements of federal and state securities laws
and that the Borrower is relying upon the truth and accuracy of the
representations, warranties, agreements, acknowledgments and
understandings of the Holder set forth herein in order to determine
the applicability of such exemptions and the suitability of Holder
to acquire the Note and Shares. All information which Holder has
provided to the Borrower concerning the Holder’s financial
position and knowledge of financial and business matters is correct
and complete as of the date hereof, and if there should be any
material change in such information, the Holder will immediately
provide Borrower with such information.

 

(G) Holder
understands that this Note and any Shares issuable upon the terms
hereof have not been registered under the Securities Act or
registered or qualified under any securities laws of any state or
other jurisdiction, are “restricted
securities,” and cannot be resold or otherwise
transferred unless they are registered under the Securities Act,
and registered or qualified under any other applicable securities
laws, or an exemption from such registration and qualification is
available. Prior to any proposed transfer of this Note, subject to
the terms and conditions of this Note or any Shares, Holder shall,
among other things, give written notice to the Borrower of its
intention to effect such transfer, identifying the transferee and
describing the manner of the proposed transfer and, if requested by
the Borrower, accompanied by (i) investment representations by the
transferee similar to the Representations and (ii) an opinion of
counsel satisfactory to the Borrower to the effect that the
proposed transfer may be effected without registration under the
Securities Act and without registration or qualification under
applicable state or other securities laws. Each certificate issued
to evidence the Shares shall bear a legend as follows:

 

 

“The
securities represented by this certificate have not been registered
under the Securities Act of 1933 or any state securities act. The
securities have been acquired for investment and may not be sold,
transferred, pledged or hypothecated unless (i) they shall have
been registered under the Securities Act of 1933 and any applicable
state securities act, or (ii) the corporation shall have been
furnished with an opinion of counsel, satisfactory to counsel for
the corporation, that registration is not required under any such
acts.”

 

 

 

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Convertible
Promissory Note CN-__

PEDEVCO
Corp.

 

 

 

 

16. If
an Event of Default (as defined herein) occurs (unless all Events
of Default have been cured or waived by the Required Note Holders),
 SK
Energy, LLC (or its assign(s))(the “Designated
Holder”), with the consent of the Required Note
Holders may, by written notice to the Borrower, declare the
Principal amount then outstanding of, and the accrued Interest and
all other amounts payable on, this Note to be immediately due and
payable (an “Acceleration”)
(provided that upon the occurrence of an Event of Default described
in Section 16(c)
below, the Principal amount then outstanding of, and the accrued
Interest and all other amounts payable on, this Note shall
immediately be due and payable) and can take any and all other
actions provided for under applicable law. The following events
and/or any other Events of Default defined elsewhere in this Note
are “Events of
Default” under this Note, unless waived in writing by
the Designated Holder with the consent of the Required Note
Holders:

 

 

(A) Borrower
shall fail to pay, when and as due, the Principal, Interest or any
other amount payable hereunder (including, the Shares), and such
failure has continued for ten (10) days from the date that the
Required Note Holders have provided the Borrower written notice of
such failure; or

 

 

(B) Borrower
shall have breached in any material respect any covenant, term or
conditions in this Note, and, with respect to breaches capable of
being cured, such breach shall not have been cured within ten (10)
days from the date that the Required Note Holders have provided the
Borrower written notice of such breach; or

 

 

(C) Borrower
shall: (i) become insolvent or take any action which constitutes
its admission of inability to pay its debts as they mature; (ii)
make an assignment for the benefit of creditors, file a petition in
bankruptcy, petition or apply to any tribunal for the appointment
of a custodian, receiver or a trustee for it or a substantial
portion of its assets; (iii) commence any proceeding under any
bankruptcy, reorganization, arrangement, readjustment of debt,
dissolution or liquidation or statute of any jurisdiction, whether
now or hereafter in effect; (iv) have filed against it any such
petition or application in which an order for relief is entered or
which remains undismissed for a period of ninety (90) days or more;
(v) indicate its consent to, approval of or acquiescence in any
such petition, application, proceeding or order for relief or the
appointment of a custodian, receiver or trustee for it or a
substantial portion of its assets; or (vi) suffer any such
custodianship, receivership or trusteeship to continue undischarged
for a period of ninety (90) days or more; or

 

 

(D) Borrower
shall take any action authorizing, or in furtherance of, any of the
foregoing.

 

 

 

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Convertible
Promissory Note CN-__

PEDEVCO
Corp.

 

 

 

In case
any one or more Events of Default shall occur and be continuing,
the Designated Holder, with the consent of the Required Note
Holders, may proceed to protect and enforce the rights of all of
the Note Holders by an action at law, suit in equity or other
appropriate proceeding, whether for the specific performance of any
agreement contained herein or for an injunction against a violation
of any of the terms hereof, or in aid of the exercise of any power
granted hereby or thereby or by law or otherwise. In case of a
default in the payment of any Principal of or premium, if any, or
Interest on this Note, Borrower will pay to the Designated Holder
(for the benefit of the Note Holders, where applicable) such
further amount as shall be sufficient to cover the reasonable cost
and expenses of collection, including, without limitation,
reasonable attorneys’ fees, expenses and disbursements. No
course of dealing and no delay on the part of the Designated Holder
or the Required Note Holders in exercising any right, power or
remedy shall operate as a waiver thereof or otherwise prejudice the
Designated Holder’s or the Required Note Holders’
rights, powers or remedies. No right, power or remedy conferred by
this Note upon the Designated Holder or the Required Note Holders
shall be exclusive of any other right, power or remedy referred to
herein or therein or now or hereafter available at law, in equity,
by statute or otherwise.

 

17. Rights
and Obligations of Designated Holder.

 

(a) Each Note Holder
hereby designates and appoints Designated Holder as its
representative and agent under the Note Holders’ Notes, and
each Note Holder hereby irrevocably authorizes Designated Holder to
act on its behalf under the provisions of the Note Holders’
Notes and to exercise such powers and perform such duties as
instructed by the Required Note Holders or all of the Note Holders,
as applicable, by the terms of the Note Holders’ Notes,
together with such powers as are reasonably incidental thereto. The
provisions of this Section
17 are solely for the benefit of Designated Holder and the
Note Holders, and Borrower shall have no rights as a third party
beneficiary of any of the provisions contained herein, except that
Borrower shall be able to rely on the authority of Designated
Holder to take action under the Note Holders’ Notes as
described herein. Any provision to the contrary contained elsewhere
in the Note Holders’ Notes notwithstanding, Designated Holder
shall not have any duties or responsibilities, except those
expressly set forth herein, nor shall Designated Holder have or be
deemed to have any fiduciary relationship with any Note Holder, and
no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into the Note
Holders’ Notes or otherwise exist against Designated
Holder.

 

(b) Each Note Holder
agrees that any action taken by Designated Holder in accordance
with the terms of the Note Holders’ Notes and the exercise by
Designated Holder of its powers set forth herein or therein,
together with such other powers that are reasonably incidental
thereto, shall be binding upon all of the Note
Holders.

 

 

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Convertible
Promissory Note CN-__

PEDEVCO
Corp.

 

 

 

(c) Designated Holder
may execute any of its duties under the Note Holders’ Notes
by or through agents, employees or attorneys in fact or other
persons and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. Designated Holder shall not be
responsible for the negligence or misconduct of any agent or
attorney in fact that it selects as long as such selection was made
without gross negligence or willful misconduct.

 

(d) The Designated
Holder may assign its rights and obligations hereunder to a
replacement Designated Holder with written notice to the Note
Holders.

 

18. Except
as expressly provided otherwise in this Note, Borrower and every
endorser or guarantor, if any, of this Note waive presentment,
demand, notice, protest and all other demands and notices in
connection with the delivery, acceptance, performance, default or
enforcement of this Note, and assent to any extension or
postponement of the time of payment or any other indulgence, to any
substitution, exchange or release of collateral available to the
Designated Holder and/or the Required Note Holders, if any, and to
the addition or release of any other party or person primarily or
secondarily liable.

 

19. If
from any circumstance any holder of this Note shall ever receive
Interest or any other charges constituting interest, or adjudicated
as constituting interest, the amount, if any, which would exceed
the Maximum Rate shall be applied to the reduction of the Principal
amount owing on this Note, and not to the payment of interest; or
if such excessive interest exceeds the unpaid balance of Principal
hereof, the amount of such excessive interest that exceeds the
unpaid balance of Principal hereof shall be refunded to Borrower.
In determining whether or not the interest paid or payable exceeds
the Maximum Rate, to the extent permitted by applicable law (i) any
non-Principal payment shall be characterized as an expense, fee or
premium rather than as Interest; and (ii) all Interest at any time
contracted for, charged, received or preserved in connection
herewith shall be amortized, prorated, allocated and spread in
equal parts during the period of the full stated term of this Note.
The term “Maximum
Rate” shall mean the maximum rate of interest allowed
by applicable federal or state law.

 

20. It
is the intention of the parties hereto that the terms and
provisions of this Note are to be construed in accordance with and
governed by the laws of the State of Texas, except as such laws may
be preempted by any federal law controlling the rate of Interest
which may be charged on account of this Note. The parties hereby
consent and agree that, in any actions predicated upon this Note,
venue is properly laid in Texas and that the Circuit Court in and
for Harris County, Texas, shall have full subject matter and
personal jurisdiction over the parties to determine all issues
arising out of or in connection with the execution and enforcement
of this Note.

 

 

 

Page
11 of
16

Convertible
Promissory Note CN-__

PEDEVCO
Corp.

 

 

 

21. The
term “Borrower”
as used herein in every instance shall include Borrower’s
successors, legal representatives and permitted assigns, including
all subsequent grantees, either voluntarily by act of Borrower or
involuntarily by operation of law and shall denote the singular
and/or plural and the masculine and/or feminine and natural and/or
artificial persons, whenever and wherever the contexts so requires
or properly applies. The term “Holder”
as used herein in every instance shall include Holder’s
successors, legal representatives and permitted assigns, as well as
all subsequent assignees and endorsees of this Note, either
voluntarily by act of the parties or involuntarily by operation of
law (subject in each case to Section 22 hereof). Captions
and paragraph headings in this Note are for convenience only and
shall not affect its interpretation. As used herein, words in the
singular shall be held to include the plural and vice versa, and
words of one gender shall be held to include the other gender as
the context requires.

 

22. If
and whenever this Note shall be assigned and transferred, or
negotiated, including transfers to substitute or successor
trustees, in each case subject to the terms of this Note,
applicable law and the availability of an exemption from
registration for such transfer, which shall be confirmed by the
Holder by the Holder providing the Borrower a legal opinion for
such transfer, which opinion shall be reasonably accepted by the
Borrower, the holder hereof shall be deemed the “Holder”
for all purposes under this Note.

 

23. Anything
else in this Note to the contrary notwithstanding, in any action
arising out of this Agreement, the prevailing party shall be
entitled to collect from the non-prevailing party all of its
attorneys’ fees. For the purposes of this Note, the party who
receives or is awarded a substantial portion of the damages or
claims sought in any proceeding shall be deemed the
“prevailing”
party and attorneys’ fees shall mean the reasonable fees
charged by an attorney or a law firm for legal services and the
services of any legal assistants, and costs of litigation,
including, but not limited to, fees and costs at trial and
appellate levels.

 

24. If
any term or other provision of this Note is invalid, illegal or
incapable of being enforced by any rule of law, or public policy,
all other conditions and provisions of this Note shall nevertheless
remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not affected
in any manner adverse to any party. Upon such determination that
any term or other provision is invalid, illegal or incapable of
being enforced, the parties hereto shall negotiate in good faith to
modify this Note so as to affect the original intent of the parties
as closely as possible in an acceptable manner to the end that
transactions contemplated hereby are fulfilled to the extent
possible.

 

 

 

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16

Convertible
Promissory Note CN-__

PEDEVCO
Corp.

 

 

 

25. Neither
this Note nor any term hereof may be amended or waived orally or in
writing, except that any term of this Note and the other Note
Holders’ Notes may be amended and the observance of any term
of this Note and the other Note Holders’ Notes may be waived
(either generally or in a particular instance and either
retroactively or prospectively), and such amendment or waiver shall
be applicable to all of the Note Holders’ Notes (without any
required action by such non-consenting Note Holders), upon the
approval of the Borrower and the written consent of the Required
Note Holders; provided, however, that any amendment that would (i)
reduce the principal amount of any Note Holders’ Note, (ii)
reduce the percentage in aggregate principal amount of Note
Holders’ Notes outstanding necessary to modify or amend the
Note Holders’ Notes pursuant to this Section 25; or (iii) increase
the Conversion Price, shall, in each case, require the approval of
the holder of each Note Holders’ Note to which such amendment
shall apply. Separately, the Borrower may, without the consent of
any holder of the Note Holders’ Notes, amend the Note
Holders’ Notes for the purpose of curing any ambiguity or
correcting or supplementing any defective provision contained in
the Note Holders’ Notes; provided that such modification or
amendment does not, in the good faith opinion of the Borrower,
adversely affect the interests of the Note Holders of the Note
Holders’ Notes in any material respect, or add or modify any
other provisions with respect to matters or questions arising under
the Note Holders’ Notes which the Borrower may deem necessary
or desirable and which will not adversely affect the interests of
the Note Holders of the Note Holders’ Notes. The Borrower
will not amend any provision of any Note Holders’ Note in a
manner more favorable to any other Note Holder, unless a similar
amendment is made or offered with respect to all of the Note
Holders’ Notes.

 

26. The
Note constitutes the entire agreement of the parties regarding the
matters contemplated herein, or related thereto, and supersedes all
prior and contemporaneous agreements, and understandings of the
parties in connection therewith.

 

27. This
Note and any signed agreement or instrument entered into in
connection with this Note, and any amendments hereto or thereto,
may be executed in one or more counterparts, all of which shall
constitute one and the same instrument. Any such counterpart, to
the extent delivered by means of a facsimile machine or by .pdf,
..tif, .gif, .jpeg or similar attachment to electronic mail (any
such delivery, an “Electronic
Delivery”) shall be treated in all manner and respects
as an original executed counterpart and shall be considered to have
the same binding legal effect as if it were the original signed
version thereof delivered in person. At the request of any party,
each other party shall re execute the original form of this Note
and deliver such form to all other parties. No party shall raise
the use of Electronic Delivery to deliver a signature or the fact
that any signature or agreement or instrument was transmitted or
communicated through the use of Electronic Delivery as a defense to
the formation of a contract, and each such party forever waives any
such defense, except to the extent such defense relates to lack of
authenticity.

 

 

 

Page
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16

Convertible
Promissory Note CN-__

PEDEVCO
Corp.

 

 

 

28. Each
party herein expressly represents and warrants to all other parties
hereto that (a) before executing this Note, said party has fully
informed itself of the terms, contents, conditions and effects of
this Note; (b) said party has relied solely and completely upon its
own judgment in executing this Note; (c) said party has had the
opportunity to seek and has obtained the advice of its own legal,
tax and business advisors before executing this Note; (d) said
party has acted voluntarily and of its own free will in executing
this Note; and (e) this Note is the result of arm’s length
negotiations conducted by and among the parties and their
respective counsel.

 

29. All
notices, approvals, consents, requests, and other communications
hereunder shall be in writing and shall be delivered (i) by
personal delivery, or (ii) by national overnight courier service,
or (iii) by certified or registered mail, return receipt requested,
or (iv) via facsimile transmission, with confirmed receipt, or (v)
via email. Notice shall be effective upon receipt except for notice
via fax (as discussed above). Such notices shall be sent to the
applicable party or parties at the address specified on the
signature page hereof, subject to notice of changes thereof from
any party with at least ten (10) business days’ notice to the
other parties. Rejection or other refusal to accept or the
inability to deliver because of changed address of which no notice
was given shall be deemed to be receipt of the notice as of the
date of such rejection, refusal or inability to
deliver.

 

 

 

 

 

 

 

 

 

[Remainder of page left intentionally blank. Signature page
follows.]

 

 

 

 

 

Page
14 of
16

Convertible
Promissory Note CN-__

PEDEVCO
Corp.

 

 

 

IN WITNESS
WHEREOF, Borrower has duly
executed this Promissory Note as of August 1,
2018, with an Effective Date as
provided above.

 

“Borrower”

 

PEDEVCO
Corp.

 

 

By:_________________________

 

Its:_________________________

 

Printed
Name:________________________

 

Address
for Notice:

 

4125
Blackhawk Plaza Circle, Suite 201

Danville,
California 94506

Attn:
Clark R. Moore

Email:
cmoore@pacificenergydevelopment.com

 

 

“Holder”

 

____________________________

 

By:_________________________

 

Printed
Name:________________________

 

Position
with Entity (if Holder is an
entity):_________________________

 

If held jointly, joint holder:

 

By:_________________________

 

Printed
Name:________________________

 

Address
for Notice:

 

Page
15 of
16

Convertible
Promissory Note CN-__

PEDEVCO
Corp.

 

 

EXHIBIT A

Conversion Election Form

____________,
20__

 

Re:            

Conversion of Convertible Promissory Note [CN- ]

 

Ladies
and Gentlemen:

 

You are
hereby notified that, pursuant to, and upon the terms and
conditions of that certain Convertible Promissory Note CN-__ of
PEDEVCO Corp. (the “Company”)
dated August 1, 2018 in the amount of $_____________ (the
“Note”
– certain capitalized terms used herein have the meanings
given to such terms in the Note), held by us, we hereby elect to
exercise our Holder Conversion Option (as such term in defined in
the Note), in connection with $__________ of the amount currently
owed under the Note (including $___________ of Principal and
$_________ of accrued Interest), effective as of the date of this
writing, which amount will convert into __________ shares of the
common stock of the Company (the “Conversion”),
respectively, based on Conversion Price of $___________ (as defined
in the Note). Please issue certificate(s) for the applicable
securities issuable upon the Conversion, in the name of the person
provided below. The Conversion will not cause us to exceed the
Beneficial Ownership Limitation. We hereby re-confirm and
re-certify the Representations in connection with, and as of the
date of, this notice.

	
 

	

Very
truly yours,

	
 

	

___________________________

	
 

	

Name:_______________________

	
 

	
 

	
 

	

If on behalf of Entity:

	
 

	

Entity
Name:______________

	
 

	

Signatory’s
Position with Entity:

_____________________________

 

If held jointly:

Joint
Holder:___________________

Name:________________________

 

Please
issue certificate(s) for common stock as follows:

 

Name______________________________________________

Address______________________________________________

Social
Security No./EIN of Shareholder
______________________________________

 

Please
send the certificate(s) evidencing the common stock
to:

Attn:___________________________________________

Address:________________________________________

 

Page
16 of
16

Convertible
Promissory Note CN-__

PEDEVCO
Corp.Blueprint

  Exhibit 10.2

 

STOCK PURCHASE

AGREEMENT

 

THIS STOCK PURCHASE AGREEMENT, dated as
of August 1, 2018 (the “Agreement”), is by and
among Pacific Energy Development Corp. (“Buyer”), a Nevada
corporation and wholly-owned subsidiary of PEDEVCO Corp., a Texas
corporation, and Hunter Oil Production Corp., a Florida corporation
(the “Shareholder”).

 

RECITALS:

 

WHEREAS, the
Shareholder owns all of the issued and outstanding shares of stock
of 
Ridgeway Arizona Oil Corp., an Arizona corporation
(“RAOC”), and EOR Operating
Company, a Texas corporation (“EOR”) (RAOC and EOR are
sometimes referred to collectively as the “Companies” or separately
as a “Company”);

 

WHEREAS, Buyer,
Milnesand Mineral, Inc., a Delaware corporation
(“MMI”),
and Chaveroo Minerals, Inc., a Delaware corporation
(“CMI”), have entered into
that certain Purchase and Sale Agreement dated the date hereof (the
“PSA”)
concerning the purchase of certain oil and gas assets (the
“Assets”);

 

WHEREAS, Buyer
desires to acquire all of shares of stock of the Companies from the
Shareholder; and

 

WHEREAS,
Shareholder, MMI, CMI, Buyer, and Doherty & Doherty LLP (the
“Escrow
Agent”) have entered into that certain Escrow
Agreement dated the date hereof (the “Escrow Agreement”);
and

 

NOW,
THEREFORE, in consideration of the premises and the
representations, warranties, covenants and agreements contained
herein, the parties hereto, intending to be legally bound, agree as
follows:

 

ARTICLE I

THE TRANSACTION

 

Section
1.1. Closing. The
closing (the “Closing”) of the
transaction contemplated herein (the “Transaction”) is
conditioned upon the closing of the transactions contemplated in
the PSA, and will occur simultaneously therewith. Termination of
the PSA in accordance with section 7.4 thereof shall, except as
provided in the Escrow Agreement, terminate this Agreement and the
parties shall have no liability or obligation hereunder except and
to the extent such termination results from the willful breach by a
party of any of its covenants or agreements hereunder, in which
case the non-breaching party shall have the right to seek all
remedies available at law or in equity, including specific
performance, for such willful breach.

 

Section
1.2. Purchase. At
the Closing, Buyer will acquire from the Shareholder 10 shares of
the common stock of RAOC and 300 shares of the common stock of EOR
(collectively, the “Shares”), in each case
representing all of the issued and outstanding equity stock of the
respective Company. The purchase provided for pursuant to this
Section 1.2 shall be effective as of the effective date of the
transactions contemplated in the PSA (the “Effective
Time”).

 

Section
1.3.     Purchase
Price. At the Closing, as consideration for the purchase of
the Shares pursuant to the terms hereof, Buyer will pay the
Shareholder $2,815,636 in cash (the “Stock Purchase Price”) by
wire transfer in clear funds to the account designed in Exhibit
A.

 

 

 

1

 

 

Section
1.4.     Taking of Necessary
Action; Further Action. At and after the Closing,
each of the Parties will take all such reasonable and lawful action
as may be necessary or appropriate in order to effectuate the
Transaction in accordance with this Agreement as promptly as
possible. The Transaction shall be effective as of the Effective
Time.

 

Section
1.5.     Definitions.
The definitions of certain capitalized terms are set forth in
Section 6.2.

 

ARTICLE II

REPRESENTATIONS

AND WARRANTIES OF
BUYER

 

Buyer
represents and warrants to the Shareholder as follows:

 

Section
2.1.     Authority; Non
Contravention; Approvals.

 

(a)             The
execution and delivery of this Agreement by Buyer and the
consummation by Buyer of the Transaction does not and will not
violate or result in a breach of any provision of, or constitute a
default (or an event which, with notice or lapse of time or both,
would constitute a default) under, or result in the termination of,
or accelerate the performance required by, or result in a right of
termination or acceleration under, or result in the creation of any
Lien upon any of the properties or assets of Buyer under any of the
terms, conditions or provisions of (i) the charter or bylaws of
Buyer, (ii) any statute, law, ordinance, rule, regulation,
judgment, decree, order, injunction, writ, permit or license of any
court or Governmental Authority applicable to Buyer or any of its
properties or assets, or (iii) any note, bond, mortgage, indenture,
deed of trust, license, franchise, permit, concession, contract,
lease or other instrument, obligation or agreement of any kind to
which Buyer is now a party or by which Buyer or any of their
properties or assets may be bound or affected.

 

(b)             No
declaration, filing or registration with, or notice to, or
authorization, consent or approval of, any Governmental Authority
is necessary for the execution and delivery of this Agreement by
Buyer or the consummation by Buyer of the Transaction.

 

Section
2.2      No Brokers.
Buyer has incurred no obligation or liability for brokers’ or
finders’ fees relating to the matters provided for in this
Agreement which will be the responsibility of Shareholder, and any
such obligation or liability that might exist shall be the sole
obligation of Buyer.

 

Section
2.2      No
Distribution. Buyer is acquiring the Shares for its own
account and not with the intent to make a distribution in violation
of the Securities Act of 1933 as amended (and the rules and
regulations pertaining thereto) or in violation of any other
applicable securities laws, rules or regulations.

 

Section
2.3      Knowledge and
Experience. Buyer has (and had prior to negotiations
regarding the Shares) such knowledge and experience in the
ownership and the operation of oil and gas companies and financial
and business matters as to be able to evaluate the merits and risks
of an investment in the Assets. Purchaser is able to bear the risks
of an investment in the Shares and understands the risks of, and
other considerations relating to, a purchase of the
Shares.

 

ARTICLE III

REPRESENTATIONS
AND WARRANTIES

OF THE
SHAREHOLDER

 

Shareholder
represents and warrants to Buyer that as of the date hereof and as
of the Closing:

 

 

2

 

 

Section
3.1. Organization
and Qualification. The Shareholder and each Company is a
corporation duly organized, validly existing and in good standing
under the laws of their state of formation indicated in this
Agreement and each has the requisite corporate power and authority
to own, lease and operate its assets and properties and to carry on
its business as it is now being conducted. The Companies are duly
qualified to do business as a foreign corporation and is in good
standing in each jurisdiction in which the properties owned,
leased, or operated by it or the nature of the business conducted
by it makes such qualification necessary, each of which
jurisdiction is listed in Schedule 3.1. True, accurate and complete
copies of the Charter Documents of the Companies, in each case as
in effect on the date hereof, including all amendments thereto,
have heretofore been delivered to Buyer.

 

Section
3.2. Capitalization.
The Shareholder owns the Shares, free and clear of Liens. The
Shares are duly and validly issued, fully paid, and nonassessable.
The Shares are the only issued and outstanding equity stock of the
Companies. Neither the Companies nor the Shareholder are a party to
any option, warrant, purchase right, conversion right, commitment
or other Contract that could require the Companies or the
Shareholder to issue, sell, transfer, or otherwise dispose of any
shares of stock of the Companies. There is no voting trust, proxy,
or other agreement or understanding with respect to the voting of
any stock of the Companies. Notwithstanding any other provision of
this Agreement to the contrary, Seller and the Companies may enter
into such re-capitalization transactions as are necessary to
reorganize the Companies and eliminate inter-company liabilities
provided that the re-capitalization transactions shall not be
detrimental to the financial position of the Companies or otherwise
to the Purchaser.

 

Section
3.3. Subsidiaries.
Neither Company owns any stock or equity interests in any other
entity.

 

Section
3.4. Authority; Non
Contravention; Approvals.

 

(a) The Shareholder has
full power and authority to execute and deliver this Agreement and
to consummate the Transaction. This Agreement has been duly
executed and delivered by the Shareholder, and, assuming the due
authorization, execution and delivery hereof by Buyer, constitutes
a valid and legally binding agreement of Shareholder, enforceable
against him in accordance with its terms, except that such
enforcement may be subject to (i) bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting or
relating to enforcement of creditors’ rights generally and
(ii) general equitable principles.

 

(b) The execution and
delivery of this Agreement by Shareholder and the consummation by
Shareholder of the Transaction does not and will not violate or
result in a breach of any provision of, or constitute a default (or
an event which, with notice or lapse of time or both, would
constitute a default) under, or result in the termination of, or
accelerate the performance required by, or result in a right of
termination or acceleration under, or result in the creation of any
Lien, upon any of the properties or assets of Companies under any
of the terms, conditions or provisions of (i) the Charter Documents
of the Companies entity, (ii) any statute, law, ordinance, rule,
regulation, judgment, decree, order, injunction, writ, permit or
license of any court or Governmental Authority applicable to the
Companies or any of their respective properties or assets, or (iii)
any note, bond, mortgage, indenture, deed of trust, license,
franchise, permit, concession, or any Operating
Agreement.

 

Section
3.5. Limited
Activity. Neither Company owns
any real estate. The only Liabilities of the Companies as at the
date hereof are listed on Schedule 3.5. The only activity of each
Company is to act as a bonded operator with the Bureau of Land
Management, New Mexico State Land Office, or the New Mexico Oil
Conservation Division of oil and gas properties whose record title
interests are owned by MMI and CMI.

 

 

3

 

 

Section
3.6. Personal
Property.

 

(a) Schedule 3.6(a)
lists each material item of equipment, machinery, furniture,
trucks, trailers and other rolling stock and each other item of
tangible personal property (the “Personal
Property”).

 

(b) Except as set forth
on Schedule 3.6(b), (i) the Companies have good title to all
Personal Property free and clear of all Liens, and (ii) the
Personal Property is in good operating condition, free of any
defects.

 

Section 3.7. Labor, Benefit and
Employment Agreements. The Companies do not have any
employees.

 

Section
3.8. Litigation.
There are no claims, suits, actions, investigations, or proceedings
pending or, to the Knowledge of the Shareholder, threatened against
or relating to the Companies, before any court, Governmental
Authority, or any arbitrator. Neither the Shareholder nor the
Companies are subject to any judgment, decree, injunction, rule or
order of any court or Governmental Authority.

 

Section
3.9. No Violation of
Law. Neither Company is in violation, in any material
respect, of or has not been given written notice or been charged
with any violation of, any law, statute, order, rule, regulation,
ordinance or judgment (including, without limitation, any
applicable Environmental Law, as hereinafter defined) of any
Governmental Authority. No investigation or review by any
Governmental Authority with respect to either Company is pending or
threatened, nor has any Governmental Authority indicated an
intention to conduct the same. The Companies have all permits
(including without limitation environmental Permits, licenses,
franchises, variances, exemptions, orders and other governmental
authorizations, necessary to conduct its business as presently
conducted (collectively, the “Company Permits”).
Neither Company is in violation, in any material respect, of the
terms of any Company Permits. The consummation of the Transaction
will not cause the Companies to lose for any period its right or
ability to conduct its business pursuant to the Company
Permits.

 

Section
3.10.   Insurance
Policies. Schedule 3.10 sets forth a true and accurate list
and summary of current insurance coverage or information concerning
any self-insurance program with respect to either of the Companies.
The Companies have not received written notice from any current
insurance carrier of the intention of such carrier (a) to
discontinue any material insurance coverage afforded to the
Companies, or (b) to materially increase the premium costs of such
insurance.

 

Section
3.11.   Taxes.
Except as disclosed on Schedule 3.11:

 

(a) all Tax Returns
required to be filed by the Companies have been duly and timely
filed with the appropriate Governmental Authority and all such Tax
Returns are correct and complete in all material
respects;

 

(b) all Taxes for which
the Companies have liability have been timely paid in full and all
Tax withholding and deposit requirements imposed on or with respect
to the Companies (including with respect to any payments to its
employees) have been satisfied;

 

(c) no assessment,
deficiency or adjustment has been asserted, proposed or threatened
in writing with respect to any Taxes due from or Tax Returns
required to be filed by the Companies; the Companies are not
currently under audit or examination by any Governmental Authority
with respect to any Taxes or Tax Returns; there are no Liens on any
of the Company Assets that arose in connection with any failure (or
alleged failure) to pay any Tax; and no claim has ever been made by
a Governmental Authority in a jurisdiction in which the Companies
do not file Tax Returns that it is or may be required to file a Tax
Return in that jurisdiction; and

 

 

4

 

 

(d) true, correct and
complete copies of all Tax Returns filed by the Companies during
the past three years, and all correspondence to the Companies from,
or from the Companies to, a Governmental Authority relating to such
Tax Returns or Taxes due from the Companies, have been made
available to Buyer.

 

Section
3.12. Contracts.
Schedule 3.12 lists the agreements pursuant to which either of the
Companies is operating the oil and gas assets of other parties (the
“Operating
Agreements”). There are no agreements to which the
Companies are a party with respect to which any party thereto
(including the Companies), is subject to any performance
obligations subsequent to the Closing other that the Operating
Agreements. True and complete copies (including all amendments) of
each Operating Agreement have been provided to Buyer. Except as
disclosed on Schedule 3.12: (i) each Operating Agreement is the
legal, valid obligation of the Companies and, to the Knowledge of
the Shareholder, each other Person party thereto, binding and
enforceable against the Companies and, to the Knowledge of the
Shareholder, each other Person party thereto except as limited by
bankruptcy, insolvency, reorganization, moratorium, fraudulent
conveyance and transfer, and similar laws affecting the rights and
remedies of creditors generally and general principles of equity,
regardless of whether such enforceability is considered in a
proceeding at law or in equity; (ii) no Operating Agreement has
been terminated, and neither the Companies nor, to the Knowledge of
the Shareholder, any other Person is in material breach or default
thereunder, and, to the Knowledge of the Shareholder, no event has
occurred that with notice or lapse of time, or both, would
constitute a material breach or default, or permit termination,
modification in any manner adverse to the Companies or acceleration
thereunder; (iii) no party to any Operating Agreement has asserted
or has any right to offset, discount or otherwise abate any amount
owing under any Operating Agreement except as expressly set forth
in such Operating Agreement; and (iv) there are no waivers
regarding any Operating Agreement that have not been disclosed in
writing to Buyer.

 

Section
3.13. Bank
Accounts. Schedule
3.13 sets forth each bank, savings institution and other financial
institution with which the Companies have an account, credit card,
or safe deposit box and the names of all persons authorized to draw
thereon or to have access thereto. Except as disclosed on Schedule
3.13, the Companies have not given any revocable or irrevocable
powers of attorney or similar grant of authority to any Person
relating to its business for any purpose whatsoever.

 

Section 3.14. Restricted
Cash. As at the date hereof the Company has $2,315,636 in
the accounts listed on Schedule 3.14-1 (the “Restricted Cash”). The
balance of the Restricted Cash at Closing will at least equal such
amount. The restrictions and encumbrances that are applicable to
the Restricted Cash are set forth on Schedule 3.14-2.

 

Section
3.15. Disclosure.
No representation or warranty made by the Shareholder in this
Article III contains any untrue statement of a material fact, or
omits to state a material fact necessary to make such
representation or warranty, in light of the circumstances in which
it is made, not misleading.

 

ARTICLE IV

POST CLOSING ADJUSTMENT

 

Section
4.1.      Amount of
Adjustments. The purchase price payable pursuant to Section
2.1 of the PSA and the Stock Purchase Price (in the aggregate, the
“Total Purchase
Price”) shall be subject to adjustment as
follows:

 

 

5

 

 

(a) The Total Purchase
Price shall be adjusted upward by the following:

 

(i) The amount of
expenditures made by the Companies, MMI, and CMI (the
“Seller
Parties”) that are attributable to the Assets after
the Effective Time including royalties, rentals and similar charges
and expenses billed under applicable operating agreements and all
prepaid expenses related to the Wells (as defined in the
PSA);

 

(ii) An
amount equal to the value of all Seller Parties’ net revenue
interest in the hydrocarbons in storage above the pipeline
connections, exclusive of tank bottoms, at the Effective Time, that
is credited to the Wells and which stored hydrocarbons have not
been sold by Seller Parties, calculated using the actual pricing
received by Seller as posted and set
forth in the Phillips 66 Sales Statements for July
2018;

 

(iii) The
amount of cash, other than the Restricted Cash, in the bank
accounts of the Companies as of the Effective Time;
and

 

(iv) The
receivables of the Companies as of the Effective Time with respect
to products produced from the Assets sold before the Effective
Time.

 

(b) The Total Purchase
Price shall be adjusted downward by the following:

 

(i)           The
amount of the proceeds received by Seller Parties, if any, that are
attributable to the Assets after the Effective Time (net of any
royalties and any production, severance, sales or other similar
taxes not reimbursed to Seller by the purchaser of
production);

 

(ii)           The
accounts payable and other liabilities of the Seller Parties
attributable to periods prior to the Effective Time;
and

 

(iii)           Seller’s
estimated share of ad valorem taxes for 2018 through the Effective
Time pursuant to Section 10.1 of the PSA.

 

Section 4.2.    
Post-Closing
Settlement Statement. Within sixty (60) days following
Closing, Seller shall prepare and deliver to Purchaser a final,
post-closing settlement statement consistent with the provisions of
Section 4.1. Purchaser and Seller will in good faith negotiate to
resolve all disputes associated with the post-closing settlement
statement within ninety (90) days following Closing, and any
adjustments from the Purchase Price paid at Closing shall be paid
to the appropriate party by the obligated party. Notwithstanding the foregoing, however, amounts
owed to the Seller Parties (i) pursuant to Section 4.1(a)(ii) of
this Agreement shall be paid within three business days of Closing
and (ii) amounts owed to the Seller Parties pursuant to Section
4.1(a) (iv) of this Agreement shall be paid within three business
days of the receipt by the Companies of the payment for the
purchase of August 2018 production, based on the actual product
prices applicable thereto at the time of sale in August 2018 as
posted and set forth in the Phillips 66 Sales Statements for August
2018.

 

ARTICLE V

SURVIVAL; INDEMNIFICATION

 

Section
5.1.      Indemnification by
the Shareholder. The Shareholder shall indemnify Buyer, and
its Affiliates (including its respective officers, directors,
employees and agents) (a “Buyer Indemnified Party”)
against, and hold each of them harmless from and against, any
Damages suffered, paid, or incurred by the Buyer Indemnified Party
as a result of (a) any inaccuracy or breach of any of the
representations and warranties made by or on behalf of the
Shareholder in Article III of this Agreement (in each case without regard to any
qualification as to materiality) (the “Representation
Indemnity”), (b) any violation or breach by
Shareholder of or default by a Shareholder under the terms of this
Agreement, (c) Pre-Closing Taxes, and (d) Liabilities arising from
the operations of the Companies prior to the Effective
Time.

 

 

 

6

 

 

Section
5.2.      Indemnification by
Buyer. Buyer will indemnify, protect and defend each
Shareholder against, and hold the Shareholder harmless from and
against, any and all Damages suffered, paid, or incurred by such
Shareholder as a result of (a) any inaccuracy or breach of the
representations and warranties made by or on behalf of Buyer in
Article II of this Agreement (in each case without regard to any
qualification as to materiality), (b) any violation or breach by
Buyer of or default by Buyer under the terms of this Agreement, and
(c) Liabilities arising from the operations of the Companies after
the Effective Time.

 

Section
5.3.      Limitations. The
representations and warranties of Shareholder set forth in Article
III shall survive Closing for a period of two years. Shareholder
shall have no liability pursuant to the Representation Indemnity
until the aggregate amount of damages suffered as a result of all
breaches of representations and warranties exceeds $25,000 (the
“Threshold”), in which case indemnification shall be made by
Shareholder including damages up to that amount. The maximum
liability of Shareholder pursuant to the Representation Indemnity
shall be $1,000,000 (the “Cap”). The Threshold and
Cap shall be reduced to the extent damages are paid by MMI or CMI
pursuant to the Article IV of the PSA.

 

Section
5.4.      Assumption of
Liability. From and after the Effective Time, Purchaser
agrees to and will assume all surface, plugging and abandonment,
and other Environmental Liabilities of whatsoever kind and nature
as to the Assets whether from ownership, operation, use or
contract. Purchaser acknowledges that there may exist obligations
to surface owners or tenants of the surface, such as grazing
lessees, of the subject lands to negotiate and execute a surface
use and compensation agreement in compliance with the New Mexico
Surface Owner’s Protection Act, which obligation may include
providing notice of Purchaser’s oil and gas operations and
non-oil and gas operations. After the Effective Time, SHAREHOLDER
GIVES NO WARRANTY AS TO ITS COMPLIANCE WITH STATE OR FEDERAL
GOVERNMENTAL ENTITIES OR REGULATIONS PERTAINING TO ENVIRONMENTAL
COMPLIANCE OR PLUGGING LIABILITY AND ADDITIONALLY GIVES NO WARRANTY
AS TO THE CONDITION OF THE SURFACE OR OTHER ENVIRONMENTAL
LIABILITIES AND PURCHASER ACKNOWLEDGES IT IS ACQUIRING THE ASSETS
IN AN EXISTING “AS IS” AND “WHERE IS”
CONDITION.

 

Section
5.5       Indemnification.
NOTWITHSTANDING ANY OTHER PROVISION OF THIS AGREEMENT TO THE
CONTRARY, FROM AND AFTER THE
EFFECTIVE TIME PURCHASER AGREES TO AND WILL INDEMNIFY,
DEFEND AND HOLD HARMLESS SHAREHOLDER FROM AND AGAINST ANY AND ALL
CLAIMS, LIABILITIES, LOSSES, COSTS AND EXPENSES (INCLUDING COURT
COSTS AND REASONABLE ATTORNEYS’ FEES) THAT ARE ATTRIBUTABLE
TO (I) ENVIRONMENTAL LIABILITIES ARISING FROM SELLER’S
OWNERSHIP, OPERATION, OR USE OF THE ASSETS COVERED BY THE PSA, (II)
PLUGGING AND ABANDONING ALL WELLS NOW OR HEREAFTER LOCATED ON THE
LANDS INCLUDED IN THE ASSETS, (III) ANY AND ALL COSTS INCIDENT TO
SUCH PLUGGING AND ABANDONMENT, (IV) ANY ASSET RETIREMENT
OBLIGATIONS ASSOCIATED WITH THE ASSETS, AND (V) ALL CLAIMS
PERTAINING TO RESTORATION OF THE SURFACE OR ENVIRONMENTAL CLAIMS.
THIS SECTION 5.5 SHALL SURVIVE THE EFFECTIVE TIME. THE DEFENSE,
INDEMNIFICATION, HOLD HARMLESS AND RELEASE PROVISIONS PROVIDED FOR
IN THIS AGREEMENT SHALL BE APPLICABLE WHETHER OR NOT THE
LIABILITIES, COSTS, EXPENSES AND DAMAGES IN QUESTION AROSE OR
RESULTED SOLELY OR IN PART FROM THE GROSS, SOLE, ACTIVE, PASSIVE,
CONCURRENT OR COMPARATIVE NEGLIGENCE, STRICT LIABILITY OR OTHER
FAULT OR VIOLATION OF LAW OF OR BY ANY INDEMNIFIED PARTY. SELLER
AND PURCHASER ACKNOWLEDGE THAT THIS STATEMENT COMPLIES WITH THE
EXPRESS NEGLIGENCE RULE AND IS CONSPICUOUS.

 

 

 

7

 

 

ARTICLE VI

DEFINITIONS AND
RULES OF CONSTRUCTION

 

Section
6.1.      Definitions; Rules
of Construction.

 

(a) All article,
section, schedule and exhibit references used in this Agreement are
to articles, sections, schedules and exhibits to this Agreement
unless otherwise specified. The schedules and exhibits attached to
this Agreement constitute a part of this Agreement and are
incorporated herein for all purposes.

 

(b) If a term is
defined as one part of speech (such as a noun), it shall have a
corresponding meaning when used as another part of speech (such as
a verb). Terms defined in the singular have the corresponding
meanings in the plural, and vice versa. Unless the context of this
Agreement clearly requires otherwise, words importing the masculine
gender shall include the feminine and neutral genders and vice
versa. The term “includes” or “including”
shall mean “including without limitation.” The words
“hereof,” “hereto,” “hereby,”
“herein,” “hereunder” and words of similar
import, when used in this Agreement, shall refer to this Agreement
as a whole and not to any particular section or article in which
such words appear.

 

(c) The Parties
acknowledge that each Party and its attorney has reviewed this
Agreement and that any rule of construction to the effect that any
ambiguities are to be resolved against the drafting Party, or any
similar rule operating against the drafter of an agreement, shall
not be applicable to the construction or interpretation of this
Agreement.

 

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

 

(e) Except as
specifically provided otherwise in this Agreement, all accounting
terms used herein that are not specifically defined shall have the
meanings customarily given them pursuant to GAAP.

 

Section
6.2.     Definitions.
For purposes of this Agreement:

 

“Affiliates” means a
Person controlling, controlled by, or under common control with,
the Person to whom the reference is made.

 

“Business Days” means any
day other than a Saturday, Sunday or legal holiday under the laws
of the United States or the State of Texas.

 

“Charter Documents” means,
with respect to a Person, the organizational documents that govern
such Person pursuant to its jurisdiction of formation or
organization, including as applicable, certificates or articles of
incorporation, certificates or articles of formation, bylaws,
limited liability company operating agreements, regulations,
partnership or limited partnership agreements, and similar
instruments.

 

“Claim” means any and all
claims, causes of action, demands, lawsuits, suits, proceedings,
governmental investigations or audits and administrative
orders.

 

“Company Assets” means all
of the assets, whether real, personal (tangible or intangible) or
mixed, owned or leased by the Companies.

 

 

8

 

 

“Contract” means any
legally binding obligation or agreement, whether or not reduced to
writing, and specifically including, without limitation, any client
or customer agreement, note, bond, mortgage, lease of real or
personal property (including, without limitation, automobile,
vehicle and other equipment leases), license and other
instrument.

 

“Damages” means any loss,
damage, injury, Liability, claim, demand, settlement, judgment,
award, fine, penalty, Tax, fee (including any reasonable legal fee,
expert fee, accounting fee or advisory fee), charge, cost
(including any cost of investigation) or expense of any nature, but
will not include (i) any consequential damages, (ii) any exemplary
or speculative damages, or (iii) any punitive damages except, in
the case of clauses “(i)” through “(iii)”
of this definition, such damages relate to or arise out of a
Third-Party Claim in which case, such damages shall constitute
“Damages.”

 

“Environmental
Laws” shall mean any and all applicable laws, rules
and regulations pertaining to the safety, health or conservation or
protection of the Assets, the environment, wildlife, or natural
resources in effect in any and all jurisdictions in which the
Assets are located, including, without limitation, the Clean Air
Act, as amended, the Federal Water Pollution Control Act, as
amended, the Safe Drinking Water Act, as amended, the Comprehensive
Environmental Response, Compensation and Liability Act, as amended
(“CERCLA”), the Superfund
Amendments and Reauthorization Act of 1986, as amended
(“SARA”), the Resource
Conservation and Recovery Act, as amended (“RCRA”), the Hazardous and
Solid Waste Amendments Act of 1984, as amended, the Toxic
Substances Control Act, as amended, the Occupational Safety and
Health Act, as amended (“OSHA”), and any
applicable state, tribal, or local counterparts

 

“Environmental
Liabilities” means any condition that exists with
respect to the air, land, soil, surface, subsurface strata, surface
water, ground water or sediments which causes an Asset to be
subject to fine, liability, clean-up or remediation under any of
the Environmental Laws.

 

“GAAP” means generally
accepted accounting principles, consistently applied, of the United
States of America, as applicable.

 

“Governmental Authority”
means any nation, province, state or political subdivision thereof,
and any agency, natural Person or other entity exercising
executive, legislative, regulatory or administrative functions of
or pertaining to government.

 

“Knowledge of the
Shareholder” means (i) the actual knowledge of the
Shareholder, and/or (ii), the knowledge that the Shareholder would
be expected to have if he had conducted a reasonable inquiry of
those individuals within the Company who had responsibility over
the subject matter at issue.

 

“Liabilities” means all
damages, liabilities or obligations of any nature whatsoever,
whether absolute or contingent, due or to become due, accrued or
unaccrued, known or unknown, or otherwise, including indebtedness
for money borrowed, accounts payable, liabilities imposed by law
and/or Governmental Authorities BUT SPECIFICALLY EXCLUDES all
Environmental Liabilities.

 

“Liens” means all
mortgages, restrictions, liens, pledges, charges, claims, options,
calls, or encumbrance of any nature whatsoever.

 

“Party” means any one of
the Parties.

 

“Parties” means Buyer and
the Shareholder.

 

 

9

 

 

“Person” means any natural
person, firm, general or limited partnership, association,
corporation, limited liability company, company, trust, other
organization (whether or not a legal entity), public body or
government, including any Governmental Authority.

 

“Pre-Closing Taxes” means
any Taxes of the Companies attributable to any Pre-Closing Taxable
Period. In the case of any Taxes that are payable with respect to
any Straddle Period, the portion of any such Taxes that are
attributable to the Pre-Closing Taxable Period is (i) in the
case of any property or ad valorem Taxes or other Taxes determined
without regard to income, receipts or transactions occurring on a
specific date, deemed to be the amount of such Tax for the entire
Straddle Period multiplied by a fraction, the numerator of which is
the number of days in the portion of the Straddle Period up to and
including the Closing Date and the denominator of which is the
number of days in the entire Straddle Period, and (ii) in the
case of all other Taxes, deemed equal to the amount which would be
payable as computed on a “closing-of-the-books” basis
if the relevant Straddle Period ended on and included the Closing
Date; provided,
however, that
exemptions, allowances or deductions that are calculated on an
annual basis (including depreciation and amortization deductions)
shall be allocated between the portion of the Straddle Period up to
and including the Closing Date and the remainder of such Straddle
Period in proportion to the number of days in each period. Any
franchise Tax or other Tax providing the right to do business for a
specified period shall be allocated to the taxable period during
which the income, operations, assets or capital comprising the base
of such Tax is measured, regardless of whether the right to do
business for another period is obtained by the payment of such
Tax.

 

“Pre-Closing Taxable
Period” means any taxable period ending on or before
the Closing Date and that portion of any Straddle Period up to and
including the Closing Date.

 

“Straddle Period” means
any Tax period beginning on or before and ending after the Closing
Date.

 

“Tax” or
“Taxes”
means any federal, state, local, or foreign income, gross receipts,
license, payroll, employment, excise, severance, stamp, occupation,
premium, windfall profits, environmental (including taxes under
Code Section 59A), customs duties, capital stock, franchise,
profits, withholding, social security (or similar), unemployment,
disability, real property, personal property, sales, use, transfer,
registration, value added, alternative or add-on minimum,
estimated, or other tax of any kind whatsoever, whether computed on
a separate or consolidated, unitary or combined basis or in any
other manner, including any interest, penalty, or addition thereto,
whether disputed or not.

 

“Tax Return” means a
return, declaration of estimated Tax, Tax report or information
return relating to any Taxes with respect to the applicable Person
or their income, assets or operations.

 

ARTICLE VII

MISCELLANEOUS

 

Section
7.1.     Remedies. If
any legal action or other proceeding is brought for the enforcement
of this Agreement, or because of an alleged dispute, breach,
default or misrepresentation in connection with any of the
provisions of this Agreement, the successful or prevailing Party or
Parties shall be entitled to recover reasonable attorneys’
fees and other costs incurred in that action or proceeding in
addition to any other relief to which it or he may be entitled at
law or equity.

 

 

10

 

 

Section
7.2.    Notices. All
notices, consents, demands or other communications required or
permitted to be given pursuant to this Agreement shall be deemed
sufficiently given: (i) when delivered personally during a business
day to the appropriate location described below or telefaxed to the
telefax number indicated below (with confirmation of transmission),
or (ii) five (5) Business Days after the posting thereof by United
States first class, registered or certified mail, return receipt
requested, with postage fee prepaid and addressed:

 

	

If to
Buyer:

	

Pacific
Energy Development Corp.

4125
Blackhawk Plaza Circle, Suite 201

Danville,
CA 94506

Attention:
Clark Moore

Fax:
(510) 743-4262

Email:
cmoore@pacificenergydevelopment.com

 

	

With a
copy to:

	

Casey
W. Doherty, Sr.

	
 

	

Doherty
& Doherty LLP

	
 

	

1717
St. James Place, Suite 520

	
 

	

Houston,
Texas 77056

	
 

	

Fax:
(713) 572-1001

	
 

	
 

	

If to
the Shareholder:

	

Hunter
Oil Production Corp.

	
 

	

1040 West Georgia Street Suite 940

Suite 940

Vancouver, B.C. V6E 4H1 CA

	
 

	

Attention:
Corporate Secretary

Fax:
(604) 485-8509

Email:
corpsec@hunteroil.com

 

Section
7.3.     Successors.
This Agreement shall be binding upon each of the Parties upon their
execution, and inure to the benefit of the Parties and their
respective successors and assigns. Specifically, but not by way of
limitation, Buyer shall be permitted to assign and transfer all or
any portion of its rights hereunder to any Affiliate of Buyer
provided that Buyer continues to be an obligor with respect to such
assigned obligations following such assignments.

 

Section
7.4.     Severability.
In the event that any one or more of the provisions contained in
this Agreement or in any other instrument referred to herein,
shall, for any reason, be held to be invalid, illegal, or
unenforceable in any respect, such invalidity, illegality, or
unenforceability shall not affect any other provision of this
Agreement or any such other instrument.

 

Section
7.5.     Section
Headings. The section headings used herein are descriptive
only and shall have no legal force or effect whatsoever. Except to
the extent the context specifically indicates otherwise, all
references to articles and sections refer to articles and sections
of this Agreement, and all references to the exhibits and schedules
refer to exhibits and schedules attached hereto, each of which is
made a part hereof for all purposes.

 

Section
7.6.     Gender.
Whenever the context so requires, the masculine shall include the
feminine and neuter, and the singular shall include the plural and
conversely.

 

 

11

 

 

Section
7.7.     Governing
Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas, U.S.A., applicable
to agreements and contracts executed and to be wholly performed
there, without giving effect to the conflicts of laws principles
thereof. Exclusive venue for any legal or equitable action relating
to this Agreement or the Transaction shall lie in Harris County,
Texas.

 

Section
7.8.     Multiple
Counterparts. This Agreement may be executed in multiple
counterparts, each of which shall be deemed an
original.

 

Section
7.9      Waiver. Any
waiver by any Party to be enforceable must be in writing and no
waiver by any Party shall constitute a continuing
waiver.

 

Section
7.10.   Entire
Agreement. This Agreement and the other agreements referred
to herein set forth the entire understanding of the Parties
relating to the subject matter hereof and thereof and supersede all
prior agreements and understandings among or between any of the
Parties relating to the subject matter hereof and
thereof..

 

Section
7.11.   Termination.
The obligations of the Parties to close the Transaction shall
terminate upon the termination of the obligations of the parties to
the PSA to close the transactions contemplated
thereunder.

 

[SIGNATURE PAGE FOLLOWS]

 

 

 

 

 

 

 

 

12

 

 

IN
WITNESS WHEREOF, the Parties have executed this Agreement as of the
date and year first set forth above.

 

BUYER:

 

PACIFIC
ENERGY DEVELOPMENT CORP.

 

By:            

/s/ Simon Kukes

Name:              

Dr. Simon
Kukes

Title:                

Chief Executive
Officer

 

 

SHAREHOLDER:

 

HUNTER
OIL PRODUCTION CORP.

 

By:            

/s/ Al. H. Denson

Name:      

Al H.
Denson

Title:             

President

 

 

Signature page to Stock Purchase Agreement

 

 

13

 

 

EXHIBIT A

 

Attached
to and made a part of that certain Share Purchase Agreement dated
as of August 1, 2018, by and between Milnesand Minerals Inc. and
Chaveroo Minerals Inc., collectively, Seller, and Pacific Energy
Development Corp., as Purchaser.

 

 

WIRE INSTRUCTIONS

 

 

- redacted -

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exhibit A to Stock Purchase Agreement

 

 

14

 

 

Schedule 3.1

 

Attached
to and made a part of that certain Share Purchase Agreement dated
as of August 1, 2018, by and between Hunter Oil Production Corp, as
Seller, and Pacific Energy Development Corp., as
Purchaser.

 

JURISDICTIONS

 

- redacted -

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

15

 

 

Schedule 3.5

 

Attached
to and made a part of that certain Share Purchase Agreement dated
as of August 1, 2018, by and between Hunter Oil Production Corp, as
Seller, and Pacific Energy Development Corp., as
Purchaser.

 

LIABILITIES

 

- redacted -

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

16

 

 

Schedule 3.6(a)

 

Attached
to and made a part of that certain Share Purchase Agreement dated
as of August 1, 2018, by and between Hunter Oil Production Corp, as
Seller, and Pacific Energy Development Corp., as
Purchaser.

 

TANGIBLE PERSONAL PROPERTY

 

- redacted -

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

17

 

 

Schedule 3.6(b)

 

Attached
to and made a part of that certain Share Purchase Agreement dated
as of August 1, 2018, by and between Hunter Oil Production Corp, as
Seller, and Pacific Energy Development Corp., as
Purchaser.

 

ENCUMBRANCES

 

- redacted -

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

18

 

 

Schedule 3.10

 

Attached
to and made a part of that certain Share Purchase Agreement dated
as of August 1, 2018, by and between Hunter Oil Production Corp, as
Seller, and Pacific Energy Development Corp., as
Purchaser.

 

INSURANCE POLICIES

 

- redacted -

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

19

 

 

Schedule 3.11

 

Attached
to and made a part of that certain Share Purchase Agreement dated
as of August 1, 2018, by and between Hunter Oil Production Corp, as
Seller, and Pacific Energy Development Corp., as
Purchaser.

 

TAXES

 

- redacted -

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

20

 

 

Schedule 3.12

 

Attached
to and made a part of that certain Share Purchase Agreement dated
as of August 1, 2018, by and between Hunter Oil Production Corp, as
Seller, and Pacific Energy Development Corp., as
Purchaser.

 

OPERATING AGREEMENTS

 

 

- redacted -

 

 

OTHER AGREEMENTS

 

- redacted -

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

21

 

 

Schedule 3.13

 

Attached
to and made a part of that certain Share Purchase Agreement dated
as of August 1, 2018, by and between Hunter Oil Production Corp, as
Seller, and Pacific Energy Development Corp., as
Purchaser.

 

BANK ACCOUNTS

 

- redacted -

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

22

 

 

Schedule 3.14-1

 

Attached
to and made a part of that certain Share Purchase Agreement dated
as of August 1, 2018, by and between Hunter Oil Production Corp, as
Seller, and Pacific Energy Development Corp., as
Purchaser.

 

RESTRICTED CASH ACCOUNTS

 

- redacted -

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

23

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