Document:

pedo_ex1036.htm

EXHIBIT 10.36

 

March 28, 2012

 

Excellong, Inc.

77 Sugar Creek Center Boulevard

Suite 215

Sugar Land, Texas 77478

Attention: Yng-Jou Joe Hwang, President

 

Re:          Amendatory Letter Agreement No. 3

Stock Purchase Agreement, dated December 16, 2011

 

Ladies and Gentlemen:

 

Reference is hereby made to that certain Stock Purchase Agreement (the “Purchase Agreement”), dated December 16, 2011, between Pacific Energy Development Corp., a Nevada corporation (“Buyer”), the shareholders (“Sellers”) of Excellong E&P-2, Inc., a Texas corporation (the “Corporation”), and Excellong, Inc., a Texas corporation (“Excellong”). Buyer, Sellers and Excellong are sometimes referred to herein individually, as a “Party” and collectively, as the “Parties.” All capitalized terms used but not otherwise defined herein shall have the meanings set forth in the Purchase Agreement.

 

The Purchase Agreement sets forth the terms and conditions by which Buyer agrees to acquire from Sellers all of the issued and outstanding shares of capital stock of the Corporation. The Parties amended the Purchase Agreement with that certain Amendatory Letter Agreement, dated February 9, 2012, and with that certain Amendatory Letter Agreement No. 2, dated February 29, 2012.

 

As of the date of this Amendatory Letter No. 3 (this “Amendment”), those certain consents to assignment described on Schedule 8(f) to the Purchase Agreement have not been obtained by Excellong or the Corporation and provided to Buyer.

 

In addition, as of the date of this Amendment, neither Excellong nor the Corporation has provided to Buyer, pursuant to Buyer’s due diligence review under Section 5 of the Purchase Agreement, evidence satisfactory to Buyer that notices of assignment as required under the terms of the Leases described in Schedule 8(f) to the Purchase Agreement have been delivered to the respective lessor.

 

Section 3(b) of the Purchase Agreement requires Buyer to issue to each Seller at Closing such Seller’s Pro Rata Share of Closing Stock.

 

Section 3(c) of the Purchase Agreement requires that, sixty (60) days following Closing, Buyer pay each Seller such Seller’s Pro Rata Share of the Post-Closing Cash.

 

  

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Section 16(b) of the Purchase Agreement sets forth the “Put” pursuant to which, on the first anniversary of the Effective Date, any Seller may require Buyer to repurchase some or all of such Seller’s shares of Closing Stock still then-held by such Seller for cash in an amount equal to one hundred twenty-five percent (125%) of the issuance price attributable thereto.

 

Pursuant to Section 17 of the Purchase Agreement, Mr. Y. Joe Hwang (the “Shareholder Representative”) may act as agent for the Sellers and may amend or waive any rights of Sellers under the Purchase Agreement.

 

In consideration of the mutual premises and covenants contained herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows:

 

1. The Parties hereby amend Section 3(b) of the Purchase Agreement to read in its entirety as follows (additions in bold italics):

 

“(b) Series A Stock.  Subject to Section 3(d), at Closing, Buyer shall issue to each Seller such Seller's Pro Rata Share of a total of 1,666,667 shares of Series A Stock ("Closing Stock"), which is equivalent to one million dollars worth of Buyer's Series A Offering Price with a twenty percent (20%) discount.”

 

2. The Parties hereby amend Section 3(c) of the Purchase Agreement to read in its entirety as follows (additions in bold italics):

 

“(c) Post-Closing Cash.  Subject to Section 3(d), sixty (60) days following Closing, Buyer shall pay to each Seller an amount of cash equal to such Seller’s Pro Rata Share of One Million Dollars ($1,000,000), as such amount may be adjusted pursuant to Section 4 (the “Post-Closing Cash”).”

 

3. The Parties hereby add the following new Section 3(d) to the Purchase Agreement:

 

“(d) Consents to and Notices of Assignment.  Within sixty (60) days following the Closing, Excellong shall provide to Buyer evidence reasonably satisfactory to Buyer that (i) the consents described on Schedule 8(f) for the assignment of certain Leases to Excellong and the assignment of those Leases from Excellong to the Corporation have been obtained and (ii) notices of such assignments have been given in accordance with the terms of such Leases. In the event Excellong fails to provide Buyer such evidence within such time period, then, as liquidated damages therefor, (i) the issuance of the Closing Stock to each Seller shall be rescinded, (ii) Buyer shall not be required to pay to Sellers the Post-Closing Cash, and the (iii) Put shall be null and void. With respect to the liquidated damages described in this Section 3(d), the Parties hereby acknowledge and agree that, (i) the anticipated damages in the event Excellong fails to perform hereunder are difficult to ascertain, (ii) the Parties mutually intend to liquidate such damages in advance, (iii) the amount of such liquidated damages is a reasonable estimate of the potential actual damages such breach would cause, and (iv) such liquidated damages are not so disproportionate to any possible loss as to constitute a penalty.

 

  

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4. The Parties hereby amend the first sentence of Section 16(b) of the Purchase Agreement to read in its entirety as follows (additions in bold italics):

 

“In the event that, on the first anniversary of the Effective Time, (i) the Series A Stock has no Public Market Value, or (ii) the Series A Stock has a Public Market Value but the total Public Market Value of the Closing Stock issued to Sellers hereunder is less than $1,250,000, then, subject to Section 3(d), each Seller shall have the right to require Buyer to repurchase some or all of such Seller’s shares of Closing Stock still then-held by such Seller for cash in an amount equal to one hundred twenty-five percent (125%) of the issuance price attributable thereto (the “Put”).”

 

5. The Parties hereby amend the first sentence of Section 13(e) of the Purchase Agreement to read in its entirety as follows (additions in bold italics):

 

“Subject to Section 3(d), effective as of Closing, each Seller hereby grants to Buyer a security interest in his Closing Stock (including proceeds) to secure his indemnity obligations in this Section 13.”

 

6. As previously amended and as amended hereby, the Purchase Agreement is in full force and effect, and valid and binding upon the Parties. In the event of a conflict between this Amendment and the Purchase Agreement the terms and conditions of this Amendment shall control and govern the point in conflict. Notwithstanding anything to the contrary, failure of this Amendment to address a point in the Purchase Agreement shall not be deemed to be a conflict.

 

7. This Amendment shall be binding upon and inure to the benefit of the Parties, and their respective successors and assigns. This Amendment may not be altered, or amended, nor any rights hereunder waived, except by an instrument in writing executed by the Party or Parties to be charged with such amendment or waiver. This Amendment may be executed in counterparts, and each counterpart shall be deemed to be an original, but all of which shall be deemed to be one amendment. This Amendment may be executed by telefax or electronic signatures, and telefax and electronic signatures shall be valid and binding upon the Parties.

 

[Remainder of page left blank intentionally]

 

  

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Please execute this Amendment in the space provided below indicating your agreement with the above and return the executed Amendment to the undersigned by fax or email at your earliest convenience. Please do not hesitate to contact me if you have any questions. Thank you for your prompt attention to this matter.

 

	 	
Sincerely,

	 
	 	 	 
	 	
Pacific Energy Development Corp.

	 
	 	 	 	 
	 	
By: 

	/s/ Frank C. Ingriselli	 
	 	 	Frank C. Ingriselli	 
	 	 	Chief Executive Officer	 

 

ACCEPTED AND AGREED

 

	Sellers	 	Excellong, Inc.	 
	 	 	 	 	 	 
	By:	
/s/ Yng-Jou Joe Hwang

	 	By:	
/s/ Yng-Jou Joe Hwang 

	 
	 	
Y. Joe Hwang

	 	 	
Yng-Jou Joe Hwang

	 
	 	
Shareholder Representative

	 	 	
President

	 

 

 

 

4pedo_ex1037.htm

EXHIBIT 10.37

 

 

PROMISSORY NOTE

 

Silver Springs, Nevada

March 7, 2012

 

This PROMISSORY NOTE (this “Note”) is made this 7th day of March, 2012, by Condor Energy Technology LLC, a Nevada limited liability company (the “Borrower”) in favor of MIE Jurassic Energy Corporation (the “Holder”) pursuant to the Borrower’s Operating Agreement, dated as of October 31, 2011.  Pursuant to the terms and conditions of this Note, the Holder shall, from time to time and at the request of the Borrower, make cash advances to the Borrower (any such advance made by the Holder being referred to herein as an “Advance”).  Upon each Advance, the parties agree that this Note shall represent the obligations of the Borrower with respect to such Advance and with respect to any Advances previously made by the Holder and still outstanding.  Each Advance shall be reflected on the Payment Schedule attached hereto pursuant to the terms hereof.

 

1. Principal and Interest.  The Borrower, for value received, hereby promises to pay to the order of the Holder, in lawful money of the United States, the principal amount set forth on the Payment Schedule attached hereto (as such Payment Schedule is adjusted from time to time pursuant to the terms hereof), together with interest accrued on the unpaid principal of each Advance at the Agreed Interest Rate (as defined below) commencing on the date of each such Advance hereunder and compounding monthly.  Accrued interest with respect to any Advance made under this Note shall be payable in cash at the time the Borrower pays the principal amount of this Note representing such Advance.

 

“Agreed Interest Rate” means the rate per annum equal to the one (1) month term, London Interbank Offered Rate (LIBOR rate) for U.S. dollar deposits, as published in London by the Financial Times or if not published, then by The Wall Street Journal, plus four (4.0) percentage points.

 

Each Advance made under this Note is due and payable (a) on the date (the “Applicable Maturity Date) that is 36 months from the date that such Advance is made, or (b) on demand by written notice following the occurrence of an Event of Default (as defined below).  The Borrower shall, on each Applicable Maturity Date or, if earlier, within one (1) business day of receipt of the written notice referred to in the immediately preceding sentence (the “Payment Date”), pay the outstanding principal and all accrued and unpaid interest on this Note with respect to such Advance, as of the Applicable Maturity Date or the Payment Date, as applicable.

 

The Borrower may request Advances under this Note at any time and from time to time by delivering a written request (subject to approved budget of the Borrower and together with supporting documents) therefor to the Holder, and the Holder shall deliver the requested Advance to the Borrower within two (2) business days after its receipt of the Borrower’s request.  Notwithstanding anything to the contrary expressed or implied herein, any Advances made hereunder, once repaid, may not be re-borrowed. At no time shall the outstanding principal amount of all outstanding Advances hereunder exceed US$8,000,000 (Eight Million US dollars).

 

  

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2. Adjustments to Note; Payment Schedule.  The Payment Schedule attached hereto shall reflect, at all times while any amounts are outstanding under this Note, the total principal amount outstanding under this Note and the amounts and dates of all Advances made under this Note.  Adjustments to the Payment Schedule shall be made as follows:

 

(a) Additional Advances.  Upon the funding of each Advance, the Holder and the Borrower shall execute an “Advance Form” in substantially the form attached hereto as Exhibit A.  Each such Advance Form shall state the amount and date of the Advance.  Promptly after the execution of the Advance Form by both parties, the Holder shall update the total principal amount outstanding under this Note as reflected on the Payment Schedule and sign each such adjustment, shall attach the executed Advance Form to the Payment Schedule, and shall promptly deliver a copy of the foregoing to the Borrower.

 

(b) Prepayment Adjustment.  Promptly upon the Holder’s receipt of any repayment by the Borrower of principal and interest on any Advance, the Holder shall make the appropriate adjustment to the total principal amount outstanding under this Note on the Payment Schedule.  The Holder shall sign each such payment adjustment and attach evidence of such prepayment to the Payment Schedule.  The Holder shall promptly provide the Borrower with a copy of the adjusted Payment Schedule.

 

3. Payment Schedule Controls.  At all times while any amounts are outstanding under this Note, the most recent signed and dated entries on the Payment Schedule shall, in the absence of manifest error, be conclusive as to the outstanding balance of this Note; provided, however, that the failure by the Holder to make the adjustments to the Payment Schedule required by Section 2 hereof with respect to any Advance or repayment shall not limit or otherwise affect the obligations of the Borrower under this Note.

 

4. Prepayment.  This Note may be repaid in whole or in part at any time without penalty or premium.

 

5. No Usury. This Note is hereby expressly limited so that in no event whatsoever, whether by reason of deferment or advancement of loan proceeds, acceleration of maturity of the loan evidenced hereby, or otherwise, shall the amount paid or agreed to be paid to the Holder hereunder for the loan, use, forbearance or detention of money exceed the maximum interest rate permitted by the laws of any applicable jurisdiction.  If at any time the performance of any provision involves a payment exceeding the limit of the price that may be validly charged for the loan, use, forbearance or detention of money under applicable law, then automatically and retroactively, ipso facto, the obligation to be performed shall be reduced to such limit, it being the specific intent of the Borrower and the Holder hereof that all payments under this Note are to be credited first to interest as permitted by law, but not in excess of (i) the agreed rate of interest hereunder, or (ii) that permitted by law, whichever is the lesser, and the balance toward the reduction of principal.

 

6. Attorneys’ Fees.  If the indebtedness represented by this Note or any part hereof is collected in bankruptcy, receivership or other judicial proceedings or if this Note is placed in the hands of attorneys for collection after default, the Borrower agrees to pay, in addition to the principal and interest payable hereunder, reasonable attorneys’ fees and costs incurred by the Holder.

 

  

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7. Successors and Assigns. The rights and obligations of the Borrower and the Holder will be binding upon and inure to the benefit of the successors, assigns, administrators and transferees of the parties hereto.

 

8. Events of Default.

 

(a) General.  If an Event of Default (as defined below) occurs, the Holder may declare the principal amount then outstanding of, and the accrued but unpaid interest on, this Note to be immediately due and payable.

 

(b) Definition.  For purposes of this Note, an “Event of Default” is any of the following occurrences:

 

(i) The Borrower shall fail to pay the outstanding principal and all accrued but unpaid interest with respect to any Advance made under this Note on the Applicable Maturity Date;

 

(ii) If the Borrower shall (i) become insolvent or take any action which constitutes his admission of inability to pay his debts as they mature; or (b) file a petition in bankruptcy; or

 

(iii) Any event or series of events occurs which has or is reasonably likely to have a Material adverse Effect as reasonably determined by Holder.

 

For purposes of this Note, a “Material Adverse Effect” means any effect, change, event, occurrence, circumstance or state of facts that would reasonably be expected to (i) be materially adverse to the business, condition (financial or otherwise), assets, liabilities, prospects or results of operations of the Borrower, or (ii) materially adversely affect the ability of Borrower to perform its obligations hereunder and consummate the transactions contemplated hereby in a timely manner.

 

(c) Remedies on Default, etc.  In case any one or more Events of Default shall occur and be continuing, the Holder may proceed to protect and enforce its rights 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 by law or otherwise.  In case of a default in the payment of any principal of or interest on this Note, the Borrower will pay to the Holder such further amount as shall be sufficient to cover the 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 Holder in exercising any right, power or remedy shall operate as a waiver thereof or otherwise prejudice the Holder’s rights, powers or remedies.  No right, power or remedy conferred by this Note upon the Holder shall be exclusive of any other right, power or remedy referred to herein or now or hereafter available at law, in equity, by statute or otherwise.

 

  

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9. All financial indebtedness provided to the Borrower by the Holder or Pacific Energy Development Corp (“PEDCO”) as members of Borrower shall be documented using the same form of promissory note as this Note (collectively, the “Member Notes”), and the Borrower shall not have any outstanding financial indebtedness provided to it by any other parties, except where such financial indebtedness is subordinated to the Member Notes on terms which are satisfactory to the holders of the Member Notes.  Indebtedness under all Member Notes shall be senior to all other indebtedness of the Borrower, and, notwithstanding Section 4 (“Prepayment”), any prepayment of advances made under Member Notes shall be done pro rata in chronological order, such that unpaid principal and interest with respect to advances made earliest in time will be repaid first until repaid in full, on a pro rata basis based on the respective member’s proportionate amount of unpaid principal and interest advanced on such date..

 

10. Waivers and Amendments.  The Borrower hereby waives presentment, demand for performance, notice of non-performance, protest, notice of protest and notice of dishonor.  No delay on the part of the Holder in exercising any right hereunder shall operate as a waiver of such right or any other right.  Any term of this Note may be amended or waived only with the written consent of the Borrower and the Holder.

 

11. Governing Law.  This Note is being delivered in, and shall be governed by and construed in accordance with, the laws of the State of Nevada, without regard to conflicts of laws provisions thereof.

 

  

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IN WITNESS WHEREOF, the Borrower has executed this Note as of the date first set forth above.

 

	 	
BORROWER

	 
	 	 	 	 
	 	Condor Energy Technology LLC	 
	 	 	 	 
	 	
By: 

	/s/ Frank C. Ingriselli	 
	 	 	
Frank C. Ingriselli

	 
	 	 	
President and Chief Executive Officer

	 

 

	ACCEPTED AND AGREED TO:	 	 	 	 
	 	 	 	 	 	 
	HOLDER	 	 	 	 
	 	 	 	 	 	 
	MIE Jurassic Energy Corporation	 	 	 	 
	 	 	 	 	 	 
	By:	/s/ Forrest Lee Dietrich	 	 	 	 
	Name:	Forrest Lee Dietrich 	 	 	 	 
	Title:	Chairman	 	 	 	 

 

  

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PAYMENT SCHEDULE

 

	
Date

	 	
Amount of 

Advance

	 	
Amount of 

Repayment

	 	
Adjusted Unpaid

Principal Balance of Note

	 	
Signature,

Name and Title of Holder

	 
	 	 	 	 	 	 	 	 	 	 	 
	
December 28, 2011

	 	
US$150,000.00

	 	  	 	
US$150,000.00

	 	By:	
/s/ Forrest Lee Dietrich

	 
	 	 	 	 	 	 	 	 	Name:	
Forrest Lee Dietrich

	 
	 	 	 	 	 	 	 	 	Title:	
Director

	 
	 	 	 	 	 	 	 	 	 	 	 
	
March 12, 2012

	 	
US$350,000.00

	 	  	 	
US$500,000.00

	 	By:	
/s/ Forrest Lee Dietrich

	 
	 	 	 	 	 	 	 	 	Name:	Forrest Lee Dietrich	 
	 	 	 	 	 	 	 	 	Title:	Director	 
	 	 	 	 	 	 	 	 	 	 	 
	
April 2, 2012

	 	
US$1,156,666

	 	  	 	
US$1,656,666.00

	 	By:	
/s/ Forrest Lee Dietrich

	 
	 	 	 	 	 	 	 	 	Name:	
Forrest Lee Dietrich

	 
	 	 	 	 	 	 	 	 	Title:	
Director

	 
	 	 	 	 	 	 	 	 	 	 	 
	
April 18, 2012

	 	
US$3,300,000.00

	 	  	 	
US$4,956,666.00

	 	By:	
/s/ Forrest Lee Dietrich

	 
	 	 	 	 	 	 	 	 	Name:	
Forrest Lee Dietrich

	 
	 	 	 	 	 	 	 	 	Title:	
Director

	 
	 	 	 	 	 	 	 	 	 	 	 
	
June 26, 2012

	 	
US$1,000,000.00

	 	  	 	
US$5,956,666.00

	 	By:	
/s/ Forrest Lee Dietrich

	 
	 	 	 	 	 	 	 	 	Name:	
Forrest Lee Dietrich

	 
	 	 	 	 	 	 	 	 	Title:	
Director

	 
	 	 	 	 	 	 	 	 	 	 	 
	
September 24, 2012

	 	
US$1,105,309.04

	 	  	 	
US$7,061,975.04

	 	By:	
/s/ Forrest Lee Dietrich

	 
	 	 	 	 	 	 	 	 	Name:	
Forrest Lee Dietrich

	 
	 	 	 	 	 	 	 	 	Title:	
Director

	 

 

  

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EXHIBIT A

 

FORM OF ADVANCE FORM

 

 

This Advance Form (this “Form”) is executed by MIE Jurassic Energy Corporation (the “Holder”), and Condor Energy Technology LLC (the “Borrower”), with reference to the following:

 

A.         The Holder and the Borrower are parties to that certain Promissory Note (the “Note”) dated as of March 7, 2012, as adjusted, modified, and amended from time to time.

 

B.         The parties desire to increase the total principal amount outstanding under the Note to reflect an Advance made by the Holder to the Borrower, as set forth below.

 

NOW, THEREFORE, for good and valuable consideration, the parties hereto agree that the total principal amount outstanding under the Note is hereby increased by $                               , to reflect an Advance made by the Holder to the Borrower dated as of  .

 

IN WITNESS WHEREOF, the parties hereto have executed this Advance Form as of the date set forth below.

 

	 	BORROWER	 
	 	 	 
	 	Condor Energy Technology LLC	 
	
 

	 	 	 
	 	 	 	 
	 	 	 	 
	 	
HOLDER

	 
	 	 	 	 
	 	
MIE Jurassic Energy Corporation

	 
	 	 	 	 

 

 

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