10.104 Request For Interest Purchase
Agreement by and between Surge Global Energy, Inc. and Padgett/Danco 2013-A Joint Venture dated July 26, 2013 (finalized on
August 1, 2013).
REQUEST FOR INTEREST
THIS REQUEST FOR INTEREST
PURCHASE AGREEMENT is entered into this 26th day of July 2013 by and between Surge Global Energy, whose address is
75-153 Merle Drive Suite B, Palm Desert CA 92211, herein (“Surge”) and Padgett Energy, LLC as operator
(“Padgett/Danco 2013-A Joint Venture”), whose address is 5866 Rice land Drive, New burgh, IN 47630, here in
collectively and inter changeably (“Padgett”) and both parties here in collectively “the Parties”
with the intent to be legally bound agree as follows:
Surge is acquiring a 33% Working Interest
(“WI”) in the 85% Net Revenue Interest being offered by Padgett/Danco 2013 - A Joint Venture, the Initial Payment
established is $201,300 and shall comprise a 33% WI in 2 pre-existing producing wells, the Drilling and
Testing (“D/T”) of 3 new wells, and the Completion and Equipping (“C/E”) cost of one well (wells
Padgett will assign title
at closing of the Working Interest subscribed for above on its Robison lease on which the five wells have been, or are going
to be drilled, as further described in the attached Exhibit A – Robison Lease, and as located in attached Exhibit B,
Location Map of Subject Wells. The title opinion is attached as Exhibit E.
Surge agrees that the location of the first two new wells #3 and #4 shall
be fixed by this agreement, however Padgett reserves the right to decide, at its sole discretion, the proposed drilling location
of the #5 well, but only in the event analysis from wells #3 and #4 indicate a geologically superior location has been identified.
Padgett will share any such analysis with Surge prior to drilling and also agrees to offer Surge a first right of refusal in the
event the current 3rd new location (well#5) is then drilled at a later date.
Surge agrees in the
to two additional completions are required for the new wells drilled, Buyer will be invoiced and Padgett paid $911. 56 for
each 1% WI held by Buyer for each completion. Any increase or reduction in Surge’s WI shall be adjusted on a prior at
basis at a price of $911.56 per 1% WI for each completion ($29,169.92 for 32% WI). The cost to Surge for the initial phase
calculated at $6,100.00 per 1% of each of 2 existing wells, the drilling of 3 new wells, and the completion costs of one new
well (well #3). Surge shall have the right not to pay the completion costs if it deems, at its sole discretion, that either
or both of wells #4 and/or #5 will not be commercial, and in that event, its non-consent election shall be governed by the
terms of the Operating Agreement.
Padgett agrees all five wells are being offered on a turn key basis and
should the lease hold cost and the cost to Drill, Test and/or to Complete and Equip the wells exceed the agreed prices that any
such excess cost shall be born solely by Padgett.
Padgett agrees that on receipt of the Initial Payment that Padgett will
immediately revise the division order to include Surge for the next scheduled monthly Working Interest payment paid subsequent
to the date above without requiring prorate adjustment.
Padgett and Surge agree the wells will be operated by Padgett subject to
Padgett’s model form Operating Agreement. See attached Exhibit C. Padgett’s monthly operating fee shall be $150 for each
well that is producing from the date of completion of the well in addition to the normal expenses incurred. See Exhibit D –Estimated
Project Operating Expenses.
Surge acknowledges Padgett is being carried for 25% Working Interest free
of drilling or completion expense, the total cost associated with that carried interest is included in the purchase price and completion
costs set forth in Paragraphs 1 and 3.
In the event of any disputes requiring litigation the Parties agree the venue
shall lie in the Muhlenberg Circuit Court or the United States District Court for the Western District of Kentucky
The Parties agree this Request For Interest is being offered subject to
first money in, and should Padgett have received funds prior to those tendered with this Agreement, said funds shall immediately
be returned in full.
Surge learned of this opportunity thru Blair Merriam and has agreed to compensate
him outside the terms of this Agreement but simultaneously with execution of this Agreement and agrees to hold Padgett harmless
in the event of any dispute between Merriam and Surge.
Padgett will cause the assignment to Surge to be recorded and sent to Regal
so that a new Division Order may be issued and Surge will be paid directly by crude buyer. The Parties acknowledge the oil production
is being sold to Regal, a Sunoco Refining subsidiary located in Tennessee and the price is based on West Texas Intermediate minus
$2.50bbl. transportation. Padgett will use its best efforts to reduce this charge or tie the wells to a pipeline once all five
wells are producing.
Surge will execute a wire transfer of the funds subject to this Agreement
for further distribution by Padgett’s attorney, Harry L Mathison, Jr. at the law firm of King, Deep & Branaman – 127
N Main Street–P O BOX43 – Henderson, Kentucky 42419-0043 who will prepare the assignments and distribute the funds
according to the closing instructions, page 3 of this agreement.
Agreed as of the date first entered above or the date of distribution of payment which shall be
August 1, 2013, whichever is later:
Charles Neeley, CEO,
“Padgett” Padgett Energy,
LLC – Operator
Padgett/Danco 2013-A Joint Venture
5866 Riceland Drive Newburgh, IN 47630