EXHIBIT 10.1
OPTION AGREEMENT
(OPTION TO ACQUIRE OIL
AND GAS LEASES IN BEAVER COUNTY, OKLAHOMA)
Morgan Creek Energy Corp.
5050 Quorum Drive, Suite 700
Dallas, Texas 75254
AND
Bonanza Resources (Texas), Inc.
6200 Virginia Parkway, Ste. 200
McKinney, Texas 75071
Further to the Letter Agreement signed by Morgan Creek Energy Corp.
(hereinafter
referred to as "Morgan") and Bonanza
Resources (Texas), Inc. (hereinafter
referred to as"Bonanza"). Morgan and/or
its affiliates, wish to purchase a
percentage of Bonanza's eighty-five
(85) percent leasehold interest (the
"Bonanza Interest") in and to the Property on the terms
set forth below. The
Bonanza Interest is held by Bonanza
pursuant to a letter agreement between
Bonanza, Ryan Petroleum, LLC and Radian Energy, LC, dated February
25, 2008 (the
"Original Agreement'), a copy of which is
attached as Schedule "A" to this
Agreement.
Morgan has utilized information provided by Bonanza for
purposes of entering in
to this Option Agreement.
This is Option Agreement is
based on the
representation that Bonanza owns all rights to all
depths pursuant to the oil
and gas leases (totaling up to approximately eighty-five (85)
percent 8,500 net
acres with a 75% net revenue interest).
Morgan and Bonanza have agreed to the following:
1. PAYMENT. Morgan
agrees to pay Bonanza a non-refundable deposit
of
USD$50,000.00 (fifty thousand). Payment due and payable by
August 10,
2009.
2. OPTION PERIOD.
Bonanza hereby grants to Morgan an option, having
an
exercise period of one year (the "Option Period") to
purchase sixty
(60) percent
(the "Partial Interest") of the Bonanza
Interest (the
"Option"). In order to exercise
the Option, Morgan must incur
USD$2,400,000 in exploration
and drilling expenditures (the
"Exploration
Expenditures") on the Property within the Options Period.
During the
Option Period, Morgan Creek shall assume
that amount of
Bonanza's
rights, title, interest and obligations under the
Original
Agreement as
is proportionate to the Partial Interest.
3. EXERCISE
PERIOD. In order to exercise the Option, Morgan must
incur
USD$2,400,000 in exploration
and drilling expenditures (the
"Exploration
Expenditures") on the Property within the Options Period.
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4. FAILURE TO EXERCISE OPTION.
In the event that Morgan does not exercise
the Option,
Bonanza shall retain the Cash Considerations as liquidated
damages for
Morgan's failure to incur the Exploration Expenditures.
5. ASSIGNMENT.
Bonanza, at Closing upon expenditure
by Morgan of
USD$2,400,000, shall convey the sixty percent of Bonanza's
eighty-five
percent in Bonanza Interest to
Morgan by a mutually acceptable
