AMENDMENT 5 TO JOINT EXPLORATION AGREEMENT
AMENDMENT
5 TO JOINT EXPLORATION AGREEMENT
This Amendment 5 (“Fifth
Amendment”) to that certain Joint Exploration Agreement (“JEA”) dated March 30,
2008 by and between MorMeg, LLC, a Kansas limited liability company, referred to
herein as “MorMeg,” and EnerJex Resources, Inc., a Nevada corporation, referred
to herein as ”EnerJex” is effective as of December 31, 2009. MorMeg and EnerJex
are jointly referred to herein as “the parties”.
Recitals
A. Pursuant
to Section C and D1 of the JEA, EnerJex was to provide $4,000,000 in funding
toward the development of Black Oaks (the “Minimum Funding”);
B. Pursuant
to Section D.5. of the JEA, following the Minimum Funding, EnerJex was required
to, within a reasonable length of time, secure and contribute additional funding
so as not to cause more than thirty (30) days delay of project activities due to
lack of funding to develop Black Oaks;
C. On
or about July 3, 2008, EnerJex entered a new three-year $50 million senior
secured credit facility with Texas Capital Bank, N. A. (the “Credit Facility”);
and
D. MorMeg
and EnerJex desire to amend the JEA pursuant to the terms of this Fifth
Amendment.
NOW, THEREFORE, for and in
consideration of the foregoing, and of the mutual covenants, agreements,
undertakings, representations and warranties contained herein, the parties
hereto agree as follows:
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1.
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Section
D5 of the JEA is hereby amended and restated in its entirety as
follows:
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5. Notwithstanding
anything to the contrary herein or elsewhere, EnerJex will have until March 31,
2010 (the “Additional Capital Deadline”) to contribute additional capital
towards the development of Black Oaks, and within a reasonable length of time
thereafter, secure and contribute additional funding so as not to cause more
than thirty (30) days delay of project activities due to lack of funding to
complete the project. In the event EnerJex is not successful in obtaining
additional funding, or all funding, to complete the Black Oaks development
described in Section 6, MorMeg may cancel and declare the JEA of no force and
effect from the point of cancellation forward. In the event of cancellation of
the JEA by MorMeg, the following procedure and formula will be used to
distribute the ownership and pay the debts of the project.
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A.
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The
project revenues from whatever source will be used to repay all debt
associated with the project, including without limitation any loan or debt
incurred by EnerJex to obtain funding for the Black Oaks
Project.
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1
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B.
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When
the project debt is paid, the working interest of the individual leases
within the Black Oaks block will be assigned to EnerJex in the undivided
interest that the total EnerJex investment bears to the total of that
investment plus the pre-project commencement value stated in paragraph 2
of the Recitals, with the remaining undivided interest (which shall not be
a carried interest) being assigned to MorMeg. The parties agree to
reassign working interest if necessary to redistribute the working
interest according to the above
formula.
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1.
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In
the event of a conflict between this Fifth Amendment and the JEA and any
amendments thereto, this Fifth Amendment shall prevail to the extent of
such conflict.
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2.
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This
Fifth Amendment shall be of no force and effect upon a material default by
EnerJex under the Credit
Facility.
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3.
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Other
than as specifically provided in this Fifth Amendment, all other
provisions of the JEA shall remain in full force and
effect. This Fifth Amendment constituting the sole and entire
agreement between the parties as to the matters contained herein, and
supersedes any and all conversations, letters and other communications
which may have been disseminated by the parties relating to the subject
matter hereof, all of which are void and of no
effect.
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4.
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Any
capitalized terms not defined herein have the meaning set forth in the
JEA.
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5.
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This
Fifth Amendment may be executed in any number of counterparts, all of
which taken together shall constitute one and the same instrument, and the
parties hereto may execute this Fifth Amendment by signing any such
counterpart.
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6.
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The
parties hereby agree to take or cause to be taken such action, and to do
and perform all such other acts and things as are necessary, advisable or
appropriate to carry out the intent and terms of this Fifth
Amendment
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IN
WITNESS WHEREOF, the parties have executed this Fifth Amendment as of the 31st
day of December, 2009.
MorMeg:
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MORMEG,
LLC, a Kansas limited liability company
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By:
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/s/ ▇▇▇▇ ▇▇▇▇
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Name:
▇▇▇▇ ▇▇▇▇
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Title:
Managing Member
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2
EnerJex:
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EnerJex
Resources, Inc., a Nevada corporation
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By:
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Name:
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
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Title:
Chief Executive Officer
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