EXCLUSIVE OPTION TO PURCHASE
EXHIBIT
10.1
This
Exclusive Option to Purchase is made and entered into by and between Ameriwest
Energy Corp., (“Ameriwest”), and Alpha Development Corporation and JK Minerals,
Inc. (collectively, "Seller"), on
the
15th
day of
April,
2008,
(hereinafter "Execution Date"). For good and valuable consideration, the
parties
agree to the following definitions, terms and conditions:
Section
1. Definitions
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1.1
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“Assets”
are defined as all of Seller's right, title and interest in and
to
hydrocarbon substances, the
tangibles and the miscellaneous interests insofar as and to the
extent
they pertain to the ▇▇▇▇ Creek
Unit and Adjacent Leases (Exhibit A), located in Natrona and Converse
Counties, Wyoming,
including:
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(a)
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any
and all ▇▇▇▇▇, well bores, and
casing;
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(b)
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any
and all teases, leaseholds, contracts and agreements; any
and all hydrocarbon substances produced after the
Closing;
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(d)
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any
and all records, hooks, documents, licenses, reports and data;
and
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(e)
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any
and all tangible depreciable property and assets, including pumping
units,
pumps,
buildings, lines, tanks, treaters, and all other equipment used
in the
production of hydrocarbon
substances at the ▇▇▇▇ Creek
Unit.
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As
part
of the Assets to be conveyed to Ameriwest at Closing, Seller shall convey
its
Working Interest
in and to all formations that are Below the Base of the ▇▇▇▇▇▇▇ Formation,
which
in most cases
is
35%, at
the
Net Revenue Interest that exists as of the Execution Date in all leases and
▇▇▇▇▇. Seller shall also convey its interest in and to all depths and formations
from the surface to the
base
of the ▇▇▇▇▇▇▇ Formation. These interests were purchased from Mon Oil Corp.
at a
77%
Net
Revenue Interest and comprise a Working Interest of approximately 68.475%
in and
to the
"▇▇▇▇▇▇▇" leasehold purchased from Mon Oil Corp. as described on Exhibit
"B".
“Assets”
shall exclude, and Ameriwest shall not be purchasing or assuming, any
liabilities of Seller
whether related to the Assets or otherwise.
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1.2
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“Option
Fee” is defined as $400,000.00, payable in two $200,000.00 installment
payments. Failure to make any installment payment - timely and
in full -
shall automatically cause this Agreement to terminate. The Option
Fee and
all other payments for extended option fees shall not be nonrefundable.
The Option Fee and all other payments for extended option fees
shall not
be credited against the Purchase Price, if closing
occurs.
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“First
Option Period” is defined as that period of time commencing at 5:00 p.m. MST on
Tuesday,
April 15, 2008 and ending at 5:00 p.m. MST on Monday, June 16, 2008. The
first
installment
payment of the Option Fee shall be paid by Ameriwest to Seller by wire, cash
or
cash equivalent,
or cashier's check on or before 5:00 p.m. MST on Tuesday, April 15,
2008.
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1.4
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“Second
Option Period” is defined as that period of time commencing at 5:00 p.m.
MST on Monday, June 16, 2008 and ending at 5:00 p.m. MST on Monday,
August
18, 2008. The second installment payment of the Option Fee shall
be paid
by Ameriwest to Seller by wire, cash or cash equivalent, or cashier's
check on or before 5:00 p.m. MST on Monday, June 16,
2008.
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1.5
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“Option
Extension Period” is defined as that period of time commencing at 5:00
p.m. MST on Monday, August 18, 2008, ending at 5:00 p.m. MST on
Wednesday,
September 17, 2008. Ameriwest may elect to postpone closing until
5:00
p.m. MST on Wednesday, September 17, 2008, provided Ameriwest makes
a
third payment in the amount of $200,000.00 to Seller on or before
5:00
p.m. MST on Monday, August 18, 2008 by wire, cash or cash equivalent,
or
cashier's check. Once this payment has been made and the Option
Period has
been extended to 5:00 p.m. MST, Wednesday, September 17, there
shall be no
further extensions or option time and no change in any of the provisions
of this Agreement, except as the parties may otherwise agree in
writing.
In the event that Ameriwest establishes good cause for the need
of an
extension of the closing date or in the event of an occurrence
no fault of
Ameriwest, the parties will negotiate in good faith to reach agreement
that provides Ameriwest with additional time within which to close
the
transaction. Ameriwest and Seller agree that no damages of any
kind shall
be asserted if the option granted herein is not exercised, except
that all
of the Option Fees and other amounts paid hereunder shall be forfeited
by
Ameriwest and retained by
Seller.
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1.6
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"Closing”
is defined as Ameriwest's purchase of the Assets and payment
of the
Purchase Price which shall occur in a timely manner, and in no
event later
than 5:00 p.m. MST on Monday, August 18, 2008, unless otherwise
properly
extended pursuant to Section 1.5, and then, in no event later
than
September 17, 2008. Failure to pay the Purchase Price fully and
promptly
at Closing shall automatically cause this Agreement to terminate
and of no
further force and effect. On or before Closing, Seller shall
prepare such
assignments, transfers, sale documents and title documents as
may be
reasonably requested or required to convey the Assets. Such documents,
fully executed by Seller, shall be delivered to Ameriwest upon
payment of
the Purchase Price at Closing. Failure to pay the Purchase Price
at
Closing shall cause this Agreement to
terminate.
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1.7
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“Purchase
Price” is defined as the sum of $10,000,000.00 (USD) paid by wire, cash
or
cash equivalent, or cashier's check or such other method agreed
to by
Ameriwest and Sellers.
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Section
2. Grant
of Option- Assignment; Due Diligence- Termination.
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2.1.
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Subject
to the terms of this Agreement, Seller hereby grants to Ameriwest
during
the First Option Period and Second Option Period, and during
any Option
Extension Period, the sole and exclusive option to purchase the
Assets for
payment of the Purchase Price. Ameriwest may assign all of any
part of its
right, title and interest hereunder to a third party, or parties,
and will
provide Seller prior written notice of the name, address, telephone
number
and email address of each assignee.
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2.2
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Ameriwest
will conduct its due diligence and other requirements on every
matter
related to this purchase during the First Option Period and Second
Option
Period, and during any Option Extension Period. Seller represents
they are
not aware of any title defect associated with any of the assets
or
properties listed above and do not believe there are any environmental
defects with respect to the assets of the subject property (outside
of
those customarily associated with normal oilfield activities).
All of
these have been previously disclosed to Ameriwest and are represented
by
Seller to be nonmaterial and
minor.
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| 2.3 |
Ameriwest
may terminate this Agreement at any time, but must, except
in the event of
a breach by
Sellers, pay Sellers the second installment payment of the
Option Fee,
regardless of whether termination
occurs prior to 5:00 p.m. MST on Monday, June 16,
2008.
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Section
3. Exercise
of Option.
| 3.1 |
If
Ameriwest elects to exercise its option to purchase the Assets,
Ameriwest
shall provide written notice
of its intent to Seller prior to the expiration of the Option Period
or
any Option Extension.
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Section
4. Maintenance
of Assets and Prohibition on Seller Transfers.
| 4.1 |
Seller
agrees, during the Option Period and until Closing: (a)
to maintain and preserve the Assets in
at least as good condition as exists as of the Execution Date;
(b) to
fully comply with all requirements and demands of regulatory agencies
pertaining to the Assets; (c) to promptly inform Ameriwest
of any regulatory action, notices or demands affecting the Assets;
(d) to
keep the Unit properly bonded; (e) to keep all leases affecting
any of the
Assets in good standing; and (f) not to transfer
any interest in any well, well bore, casing, lease, leasehold,
mineral
interest, royalty, contract,
or other agreement related to the Assets without the written approval
of
Ameriwest.
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Section
5. Condition
of Title at Closing.
| 5.1 |
At
Closing, Seller agrees: (a) to provide good and merchantable
title, free
and clear of any and all voluntary
or involuntary liens or encumbrances related to or affecting
the Assets;
(b) to provide a ▇▇▇▇
of sale for the personal property associated with, or used
in the
production of, the Assets; and (c)
to provide recordable assignments for the leasehold and to
execute any
such documents deemed
necessary by Ameriwest to convey good and merchantable title
to Ameriwest
or its Assignee.
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Section
6. Miscellaneous.
| 6.1 |
Seller
and Ameriwest agree to keep this Agreement confidential and
not disclose
the terms of this Agreement
to any third party, except to the extent necessary for Ameriwest
to comply
with any of its
disclose requirements.
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| 6.2 |
Seller
and Ameriwest have discussed the current re-development program
proposed
by ▇▇▇▇▇▇▇
Exploration, operator of the formations below the ▇▇▇▇▇▇▇. Ameriwest
is
fully aware of the new ▇▇▇▇▇
proposed by ▇▇▇▇▇▇▇ which are planned to be drilled in the summer
of 2008.
Notwithstanding
anything to the contrary herein, until Closing, Seller reserves
the
absolute right to
negotiate, enter binding agreements and otherwise deal with these
proposed
▇▇▇▇▇ and any other
matters related to any ▇▇▇▇▇▇▇ operations, and at Closing, Ameriwest
will
take the Assets subject
to agreements negotiated by Seller, if any. Ameriwest hereby agrees
to
ratify any farmout agreement negotiated by Seller. During the terms
of the
Option Period or any Option Extension, Seller
will disclose new agreements with ▇▇▇▇▇▇▇ to Ameriwest in a timely
manner
and will generally
inform Ameriwest in a timely manner of material developments pertaining
to
▇▇▇▇▇▇▇ operations
or proposals.
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| 6.3 |
Any
notices to be given hereunder shall be sent to the
following:
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Seller:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, President
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AND
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▇▇▇
▇. ▇▇▇▇▇▇▇▇▇▇, President
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Alpha
Development Company
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JK
Minerals, Inc.
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P.
0. ▇▇▇ ▇▇▇▇
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P.
0. ▇▇▇ ▇▇▇▇
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▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
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▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
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Ameriwest:
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▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇, President
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▇▇▇
▇▇▇▇ ▇▇▇
▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
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| 6.4 |
This
Agreement and its terms shall not be modified or terminated except
by a
written agreement duly
executed by the parties.
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| 6.5 |
This
Agreement shall he governed by and construed under the laws of
the State
of Wyoming.
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| 6.6 |
The
parties acknowledge that ▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇ holds an ownership interest
related to the Assets and
hereby state that full disclosure of said interest has been made
to the
parties.
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DATED
AND
EFFECTIVE ON THE DATE FIRST SHOWN ABOVE.
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ALPHA
DEVELOPMENT CORPORATION:
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By
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By
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▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇, President
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▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇, President/CEO
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By
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▇▇▇▇▇
▇. ▇▇▇▇▇, Secretary
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JK
MINERALS, INC.
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By
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▇▇▇.
▇. ▇▇▇▇▇▇▇▇▇▇, President
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