ENERJEX RESOURCES, INC.
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Overland
Park, Kansas 66210
April 1,
2010
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West
Coast Opportunity Fund, LLC
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▇▇▇▇
Living Trust
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Montecito,
CA 93108
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Stuart,
FL 34997
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Enable
Growth Partners LP
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Enable
Opportunity Partners LP
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C/o
Enable Capital Management
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C/o
Enable Capital Management
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One
Ferry Building, Suite 225
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▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
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San
Francisco, CA 94111
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San
Francisco,
CA 94111
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RE:
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Amendment to
Debentures and Transaction Documents (this “Letter
Agreement”)
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Dear
Buyers:
Reference
is made to the June 21, 2007 Senior Secured Debentures, as amended (the “Debentures”), the
Securities Purchase Agreement, as amended (the “Purchase Agreement”),
and the Pledge and Security Agreement, as amended (the “Security Agreement”)
and other agreements and documents associated therewith, as amended through the
date hereof (collectively, the “Transaction
Documents”), all originally dated as of April 11, 2007, by and among
EnerJex Kansas, Inc.
(the “Company”), EnerJex Resources, Inc.
(“Parent”),
West Coast Opportunity Fund,
LLC (“West
Coast”), ▇▇▇▇ Living
Trust (“▇▇▇▇”), Enable
Growth Partners LP (“Enable Growth”) and Enable Opportunity Partners LP
(“Enable Opportunity”) (collectively, West Coast, ▇▇▇▇, Enable Growth and Enable
Opportunity may be referred to as the “Buyers”). Capitalized
terms used but not otherwise defined herein have the meanings ascribed to such
terms in the Debentures, Purchase Agreement, the Security Agreement and/or the
Transaction Documents.
WHEREAS:
A. The
Company wishes to extend the Maturity Date of the Debentures to December 31,
2010.
B. The
Company and the Buyers desire to amend the Debentures to remove the Section
allowing for the Buyers to convert the Debentures into shares of Parent’s common
stock.
C. The
Company and the Buyers wish to amend certain Sections of the Debentures and the
Transaction Documents as set forth herein.
▇. ▇▇▇▇▇▇▇
of the Transaction Documents provide that amendments may be made by written
consent of the Company and holders of at least sixty-five percent of the
aggregate number of Registrable Securities issued under the Securities Purchase
Agreement, and the undersigned Buyers constitute such requisite
holders.
1
NOW THEREFORE, in
consideration of the premises and mutual promises herein contained, the Company
and the Buyers hereby agree as follows:
1. Defined Terms.
Capitalized terms used in this Letter Agreement which are not defined herein
shall have the meaning ascribed to them in the Transaction
Documents.
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2.
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Amendments to
Debentures. The Company and the Buyers hereby agree
that:
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a.
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Section (1)
of each of the Debentures is modified to state the “Maturity Date” shall
be December 31, 2010.
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b.
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Section
(3) “CONVERSION”
shall be deleted in its entirety.
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c.
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Sections
(4) through (24) shall be renumbered Sections (3) through (23),
respectively to account for the deletion of Section (3) as set forth
above.
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3.
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Conditional
Waiver.
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a.
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The
Buyers hereby waive any existing Event of Default under the Transaction
Documents that does not, directly or indirectly, have a material negative
impact on the Buyers’ security interest in the collateral or other
properties of the Company in which it has a security interest, or have a
material negative impact in the Buyers’ priority of payment under the
Debentures.
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b.
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The
Company hereby represents and warrants to the Buyers that it has no
knowledge of any material Defaults or Events of Default under the
Transaction Documents.
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c.
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The
waivers granted by the Buyers in favor of the Company that are contained
in this Agreement shall be null and void in the event the Company has
breached its representation in
Section 4(b).
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4.
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Governing
Law. This Letter Agreement shall be construed and
enforced in accordance with, and all questions concerning the
construction, validity, interpretation and performance of this Letter
Agreement and all disputes arising hereunder shall be governed by, the
laws of the State of New York, without giving effect to any choice of law
or conflict of law provision or rule (whether of the State of New York or
any other jurisdiction) that would cause the application of the laws of
any jurisdiction other than the State of New
York.
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5.
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Amendment. It
is the intention of the parties that this Letter Agreement modifies and
amends the Transaction Documents to the extent set forth herein or as
otherwise necessary to effectuate the intentions of the parties as set
forth herein.
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2
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6.
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No
Waiver. The execution of this Letter Agreement is not,
and shall not be deemed to constitute, a waiver, cure, or forbearance of
any default arising prior or subsequent to the date of this Letter
Agreement, nor shall it constitute a reinstatement of the terms described
in the Transaction Documents, except as set forth herein. The
Company agrees that no delay on the part of any of the Buyers in
exercising any power or right shall operate as a waiver of any such power
or right or preclude the further exercise of any other power or
right. Any remedies contained herein are cumulative and not
exclusive of any remedies provided by law. Notice to or demand
in circumstances under which the terms of this Letter Agreement do not
require such notice or demand shall not entitle the Company to further
notice or demand nor constitute a waiver of the rights of the Buyers to
take any other or further action without notice or
demand.
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7.
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Continuing Validity of
Transaction Documents. Except as expressly provided for
in this Letter Agreement, the other Transaction Documents and all other
documents executed in connection therewith shall continue unchanged in
full force and effect, in accordance with their respective terms, and the
parties hereby expressly confirm and reaffirm all of their respective
liabilities, obligations, duties and responsibilities under and pursuant
to the other Transaction Documents.
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8.
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Transaction
Document. This Letter Agreement shall be deemed and constitute a
“Transaction Document” under the Securities Purchase
Agreement.
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9.
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Recitals. The
recitals set forth above are true and correct and are hereby incorporated
into this Letter Agreement as if set forth at length
herein.
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10.
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Counterparts. This
Letter Agreement may be executed in two or more identical counterparts,
all of which shall be considered one and the same agreement and shall
become effective when counterparts have been signed by each party and
delivered to each other party; provided that a facsimile signature shall
be considered due execution and shall be binding upon the signatory
thereto with the same force and effect as if the signature were an
original, not a facsimile
signature.
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11.
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Headings. The
headings of this Letter Agreement are for convenience of reference and
shall not form part of, or affect the interpretation of, this Letter
Agreement.
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12.
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Severability. If
any provision of this Letter Agreement shall be invalid or unenforceable
in any jurisdiction, such invalidity or unenforceability shall not affect
the validity or enforceability of the remainder of this Letter Agreement
in that jurisdiction or the validity or enforceability of any provision of
this Letter Agreement in any other
jurisdiction.
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13.
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Further
Assurances. Each party shall do and perform, or cause to
be done and performed, all such further acts and things, and shall execute
and deliver all such other agreements, certificates, instruments and
documents, as any other party may reasonably request in order to carry out
the terms of this Letter Agreement and the consummation of the
transactions contemplated hereby.
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3
Kindly
confirm your agreement with the foregoing by signing the copy of this letter
where indicated below.
IN
WITNESS WHEREOF, the parties hereto have executed or caused this Letter
Agreement to be duly executed by an authorized officer as of the date first
above written.
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Very
Truly Yours,
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Company:
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ENERJEX
KANSAS, INC.
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By:
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/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
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Name:
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
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Title:
Chief Executive Officer
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Parent:
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By:
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/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
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Name:
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
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Title:
Chief Executive Officer
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4
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WEST
COAST OPPORTUNITY FUND,
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LLC
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By:
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/s/ ▇▇▇▇▇▇▇ ▇▇▇▇
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Name:
▇▇▇▇▇▇▇ ▇▇▇▇
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Title:
Chief Investment Officer
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5
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ENABLE
GROWTH PARTNERS LP
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By:
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/s/ ▇▇▇▇▇ ▇▇▇▇▇▇
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Name:
▇▇▇▇▇ ▇▇▇▇▇▇
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Title:
CEO
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6
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ENABLE
OPPORTUNITY PARTNERS LP
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By:
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/s/ ▇▇▇▇▇ ▇▇▇▇▇▇
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Name:
▇▇▇▇▇ ▇▇▇▇▇▇
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Title:
CEO
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7
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▇▇▇▇
LIVING TRUST
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By:
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/s/ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇.
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Name:
▇▇▇▇▇▇ ▇▇▇▇ ▇▇.
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Title:
Trustee
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