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PURCHASE AND SALE CONTRACT
This Purchase and Sale Contract is made and entered
into this 14 th day of September, 2007 by and between
PETROL OIL AND GAS, INC. a corporation incorporated under the laws
of the State of Nevada (“ Seller ”) and ENERJEX
RESOURCES, INC., a corporation incorporated under the laws of the
State of Nevada (“ Buyer
”).
A. Seller owns
certain oil leases and wells in Franklin, Miami, and Johnson
Counties Kansas.
B. Buyer desires
to purchase and assume the leases, wells and all existing equipment
on the leases.
C. The parties
mutually desire to enter into this Purchase and Sale Contract for
the expressed purpose of the foregoing.
1 .
Consideration : Buyer
shall pay Seller the sum of $800,000 cash, due in certified funds
or wire transfer at closing (the “ Purchase Price ”). Closing
shall occur at the law offices of Caldwell & Moll, L.C., 11903
W. 119 th Street, Overland Park, Kansas at 4:00 p.m.
Kansas time on September 14, 2007, or such other time or date as
may be agreed upon in writing by the parties (the “
Closing Date ” or
“ Closing ”) The effective date of the transfer of the Assets (as
defined below) shall also be the Closing Date.
2 Assets
. Subject to the terms and conditions of this
Purchase and Sale Contract, Seller agrees to sell and convey to
Buyer and Buyer agrees to purchase, accept and pay for the Assets
(as defined below). As used herein, the term "Assets" means the
following:
(a) All of Seller's right, title and interest in and
to (i) the estates and mineral rights created by the oil and gas
leases and mineral estates (the " Leases "), described in
Exhibit A , attached
hereto and incorporated herein by this reference, and (ii) all oil,
gas, water disposal and other wells located on the Leases or on
lands pooled therewith (the " Wells "), together with all of
Seller's interest in the rights and appurtenances incident thereto,
but excluding any orphaned and abandoned wells;
(b) All of Seller's rights in, to and under, and
obligations arising from, all agreements relating to the Leases or
Wells, including, but not limited to, joint operating agreements,
unitization agreements, pooling agreements, farmout agreements,
drilling agreements, exploration agreements, oil or gas product
purchase and sale contracts, gas processing or transportation
agreements, leases, permits, rights-of-way, easements, licenses,
options, orders and decisions of state and federal regulatory
authorities establishing units which appear of record;
(c) All of Seller's interest in fixtures and
facilities used or held for use or charged to the Leases or Wells
for the production, treatment, transportation, sale or disposal of
hydrocarbons or water produced therefrom or attributable thereto;
and
(d) All books, files, data and records in Seller's
possession relating to the Leases or Wells, or the maintenance or
operation thereof, that Seller is not otherwise precluded from
transferring to a third party by proscription of contract (the
" Records ”).
3.
Adjustments to Consideration
: Oil revenue shall be prorated through the date of
Closing. Operating expenses of the Leases from and after September
1, 2007 shall be the responsibility of the Buyer. Seller shall
receive all oil revenues which include any amount to be prorated
and shall pay over to Buyer, Buyer’s prorated share thereof,
less any operating expenses
of the Leases which are the responsibility of Buyer
but which have been paid by Seller. Seller shall make the payment
to Buyer required by this paragraph within fourteen (14) days of
Seller’s receipt of oil revenue.
4.
Transfer and Title :
The conveyance to be delivered by Seller to Buyer shall be
substantially in the form of Exhibit
B (the “ Assignment ”), attached hereto
and incorporated herein by this reference, and shall be with
warranty of title against the claims of third parties claiming the
same or any part. As reasonably requested by Buyer, Seller also
agrees to execute and deliver at and after Closing such other
assignments, bills of sale and other documents which are
appropriate to transfer the Assets to Buyer.
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5.
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Representations and Warranties of
Seller
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(a)
Existence . Seller is a
corporation duly formed, validly existing and in good standing
under the laws of the State of Nevada and is duly registered to do
business as a foreign corporation in the Kansas.
(b)
Power . Seller has the
power to enter into and perform this Purchase and Sale Contract and
the transactions contemplated by this Purchase and Sale Contract.
Subject to filings with or other actions by governmental entities
where the same are customarily obtained subsequent to the
assignment of oil and gas interests, the execution, delivery and
performance of this Purchase and Sale Contract by Seller, and the
transactions contemplated by this Purchase and Sale Contract, will
not violate (i) any provision of the certificate or agreement of
formation of Seller, (ii) any material agreement or instrument+ to
which Seller is a party or by which Seller or any of the Assets are
bound, (iii) any judgment, order, ruling, or decree applicable to
Seller as a party in interest, or (iv) any law, rule or regulation
applicable to Seller relating to the
Assets other than a violation which would not have a
material adverse effect on Seller or the Assets.
(c) Authorization and
Enforceability . The execution, delivery
and performance of this Purchase and Sale Contract, and the
transaction contemplated hereby, have been duly and validly
authori
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