September 2018 Purchase Agreement
|9 Months Ended|
Sep. 30, 2018
|Notes to Financial Statements|
|Note 9 - September 2018 Purchase Agreement||
On September 2, 2018, the Company entered into a Purchase and Sale Agreement (the “September 2018 Acquisition Agreement”) to acquire oil and gas leases and related assets in Texas and Louisiana for an estimated purchase price of approximately $100,000,000. The agreement originally contemplated a closing deadline of October 31, 2018, and the Company escrowed a $3,500,000 deposit to be applied towards the purchase price at closing.
On November 1, 2018, the parties to the September 2018 Acquisition Agreement amended it to (i) extend the closing deadline to the earlier of: (a) 10 days from the date on which the sellers obtain consents from applicable landowners authorizing the transfer to the Company of the oil and gas leases representing 80% of the total PDP (PV10) value of the purchased assets; or (b) December 31, 2018 (the “Closing Date”); (ii) provide for a portion of the purchase price for the purchased assets in respect of which post-closing consent to transfer is required from the State of Louisiana or State of Texas, to be paid into escrow at closing to provide the sellers up to 180 days thereafter to secure the requisite post-closing governmental agency approvals; (iii) upon the sellers obtaining third-party consents to assign a portion of the oil and gas leases representing at least 80% of the PDP (PV10) value of the purchased assets, require the parties to close on the Closing Date, on the purchase of those assets (provided that no single purchased asset represents more than 15% of the total PDP (PV10) value of the assets purchased at the closing); (iv) provide the sellers from the date of the first closing until March 21, 2019, to obtain any remaining third-party consents required to transfer any of the purchased assets not otherwise transferred to the Company on the first closing; and (v) to make other changes.