Attached files
file | filename |
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EX-2.2 - EX-2.2 - SUN RIVER ENERGY, INC | d79543exv2w2.htm |
EX-10.2 - EX-10.2 - SUN RIVER ENERGY, INC | d79543exv10w2.htm |
EX-99.1 - EX-99.1 - SUN RIVER ENERGY, INC | d79543exv99w1.htm |
EX-10.1 - EX-10.1 - SUN RIVER ENERGY, INC | d79543exv10w1.htm |
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): February 7, 2011
SUN RIVER ENERGY, INC.
(Exact name of registrant as specified in its charter)
Colorado | 000-27485 | 84-1491159 | ||
(State or other jurisdiction | (Commission | (IRS Employer | ||
of incorporation) | File Number) | Identification Number) |
5950 Berkshire Lane, Suite 1650, Dallas, Texas 75225
(Address of Principal Executive Offices) (Zip Code)
(Address of Principal Executive Offices) (Zip Code)
(214) 369-7300
Registrants telephone number, including area code
Not applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy
the filing obligation of the registrant under any of the following provisions:
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 1.01 Entry into a Material Definitive Agreement.
On February 7, 2011, Sun River Energy, Inc. (the Company) closed the acquisition from Katy
Resources ETX, LLC, a Delaware limited liability company (Katy), of (a) certain oil and gas
leases and leasehold interests in Angelina, Cherokee, Houston and Panola Counties in East Texas;
(b) four wellbores consisting of three producing wells each holding one of the three gas units
being acquired and one shut-in well; (c) any contracts or agreements related to the foregoing
lands, leases and wells; (d) any equipment located on the land or used in the operation of the
foregoing land, leases or wells; and (e) any hydrocarbons produced from or attributable to the
foregoing land, the leases and the wells and other related assets for an aggregate purchase price
of $8.5 million, subject to purchase price adjustments (the Acquisition). The Acquisition
includes total acreage held by production of 2,486 gross acres (1,361 net acres), as well as 9,706
gross acres (7,549 net acres) under primary terms on numerous leases. The producing wells and
surrounding acreage on the acquired property have been unitized under Texas Railroad Commission
rules.
The Acquisition was consummated pursuant to a Purchase and Sale Agreement (the Original
Purchase Agreement) entered into with Katy on October 19, 2010. Under the terms of the Original
Purchase Agreement, the purchase price was to be paid in the form of (i) $5 million in cash, and
(ii) shares of the Companys common stock, par value $0.0001 per share (the Common Stock), with
an aggregate value of $3.5 million based on the volume weighted average price of the Companys
Common Stock for the 30 trading days prior to the earlier of (x) December 18, 2010 and (y) five
days prior to the closing.
The Original Purchase Agreement was amended on February 7, 2011 pursuant to a First Amendment
to Purchase and Sale Agreement (the Amended Purchase Agreement) to reflect (i) that the purchase
price for the Acquisition would be revised to consist of (A) $1 million in cash, (B) a promissory
note from the Company in the amount of $4 million due 180 days from the date of closing (the
Note), and (C) 1,583,710 shares of the Companys Common Stock, based upon the formula set forth
in the Original Purchase Agreement; (ii) the execution by the Company of a Deed of Trust, Mortgage,
Security Agreement, Financing Statement and Assignment of Production and Revenues (the Deed of
Trust), granting Katy a lien and security interest in and to, and assigning certain rights with
respect to, the assets acquired from Katy and related properties and interests, to secure the
Companys obligations under the Note; and (iii) the grant to Katy of piggyback registration rights,
which provide Katy with, subject to certain limitations, the right to participate in certain
registered offerings that the Company may conduct in the future.
At the closing of the Acquisition, the Company delivered to Katy cash in the sum of $962,967,
the Note, the Deed of Trust and 1,333,710 shares of the Companys Common Stock, which represents
the balance of the cash owed to Katy after credits and offsets and the balance of shares owed to
Katy after deducting the 250,000 shares previously delivered to Katy as a deposit. Effective
immediately after the closing of the Acquisition, the Companys wholly owned operating company, Sun
River Operating, Inc., has assumed operations under existing joint operating agreements on all
units and prospects with respect to the properties acquired.
A copy of the Original Purchase Agreement was filed as Exhibit 2.1 to the Companys Current
Report on Form 8-K filed with the Securities and Exchange Commission on October 19, 2010 and is
incorporated by reference as Exhibit 2.1 hereto. A copy of the Amended Purchase Agreement is filed
as Exhibit 2.2 to this Current Report on Form 8-K and is incorporated by reference herein. A copy
of the Note is filed as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated by
reference herein. A copy of the Deed of Trust is filed as Exhibit 10.2 to this Current Report on
Form 8-K and is incorporated by reference herein. The above description of the Original Purchase
Agreement, Amended Purchase Agreement, Note and Deed of Trust is a summary only and is qualified in
its entirety by reference to the complete text of such documents filed as Exhibits 2.1, 2.2, 10.1
and 10.2 respectively hereto.
Item 2.01 Completion of Acquisition or Disposition of Assets.
On February 7, 2011, the Company and Katy completed the Acquisition, as further described
under Item 1.01 above, which disclosures are incorporated into this Item 2.01 by reference.
The description of the Acquisition contained in this Item 2.01 does not purport to be complete
and is qualified in its entirety by reference to the Original Purchase Agreement, which was filed
as Exhibit 2.1 to the Companys Current Report on Form 8-K filed with the Securities and Exchange
Commission on October 19, 2010 and incorporated by reference as Exhibit 2.1 hereto, and to the
Amended Purchase Agreement, Note and Deed of Trust, which are filed as Exhibits 2.2, 10.1 and 10.2
respectively hereto.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet
Arrangement of a Registrant
Pursuant to the terms of the Amended Purchase Agreement, as partial consideration paid by the
Company in connection with the Acquisition, the Company issued the Note to Katy on February 7,
2001, as further described under Item 1.01 above, which disclosures are incorporated into this Item
2.03 by reference.
The Note accrues interest at a rate of 8% per annum and is due 180 days from the Acquisition
closing (the Scheduled Payment Date); provided, however, that if the Company issues any form of
equity or debt securities after the such closing but before the Scheduled Payment Date, but
excluding an Excluded Offering (as hereinafter defined), the Note shall accelerate and become due
on the date of such issuance of securities (the Accelerated Payment Date). An Excluded
Offering means one of the following types of issuances of debt or equity securities: (i) any
issuances of securities made pursuant to employment agreements, consulting agreements, employee
stock plans or similar instruments, (ii) one or more issuances of securities under a current
offering for an additional net proceeds of all such additional issuances that is equal to or less
than $2,500,000 in the aggregate, which proceeds shall be used for any business purposes (provided
that such $2,500,000 issuances shall be in addition to any issuance prior to the date of the Note
and in addition to any issuances described in subsection (iii) of this sentence), (iii) one or more
issuances of securities for which the total net proceeds of all such issuances are equal to or less
than $3,000,000 in the aggregate, which proceeds shall be used to fulfill the Companys obligations
under the continuous drilling clause under the farmout agreement between the Company and Devon
Energy Production Company, L.P. (the Farmout
Agreement), (iv) issuances made for the sole purpose of paying the Note and for which all net
proceeds of such issuances are applied to the Note. In the event the Note becomes due on the
Accelerated Payment Date, the outstanding balance of the Note shall be paid first in priority out
of the proceeds of the applicable issuance of securities, provided that if such proceeds are not
sufficient to cover the outstanding balance, the unpaid remainder of the outstanding balance shall
remain immediately due and payable. The Note may also be accelerated on default.
The description of the Note in this Item 2.03 herein does not purport to be complete and is
qualified in its entirety by reference to the complete text of the Note filed as Exhibit 10.1 to
this Current Report on Form 8-K and incorporated by reference herein.
Item 3.02. Unregistered Sales of Equity Securities.
The issuance of 1,333,710 shares of the Companys Common Stock, on February 7, 2011, to Katy,
as partial consideration paid by the Company in connection with the Acquisition, was an
unregistered sale of equity securities made in reliance on an exemption from the registration
requirements of the Securities Act of 1933, as amended, pursuant to Section 4(2) thereof. The
issuance of such shares, the nature of the transaction related thereto, and the nature and amount
of consideration received by the Company for such shares, are further described under Item 1.01
above, which disclosures are incorporated into this Item 3.02 by reference.
In addition, pursuant to the terms of the Employment Agreement (the Employment Agreement)
with Tom Schaefer, the Companys Vice President-Engineering, which was filed as Exhibit 10.1 to the
Companys Current Report on Form 8-K filed with the Securities and Exchange Commission on October
21, 2010 and is incorporated by reference as Exhibit 10.3 hereto, upon the closing of the
Acquisition, the Company is obligated to issue to Mr. Schaefer in escrow 250,000 shares of its
Common Stock, which shall become earned and vest, in terms of ownership and voting rights,
1/12th per month thereafter during the term of the Employment Agreement and are subject
to a right of first refusal and repurchase described in the Employment Agreement. Such shares will
be issued in consideration for Mr. Schaefers assistance with respect to the Acquisition and his
services to the Company prior to his employment. Such issuance is an unregistered sale of equity
securities made in reliance on an exemption from the registration requirements of the Securities
Act of 1933, as amended, pursuant to Section 4(2) thereof.
Item 8.01. Other Events.
On
February 10, 2011, the Company issued a press release announcing that it had completed the
Acquisition. The full text of the press release is furnished as Exhibit 99.1 to this Current
Report on Form 8-K and is incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits.
(a) Financial statements of businesses acquired.
Financial statements relating to the Acquisition are not included in this Current Report on
Form 8-K, and to the extent required by this Item 9.01, will be filed by amendment to this Current
Report on Form 8-K within seventy-one (71) calendar days from the date that this Current Report on
Form 8-K must be filed.
(b) Pro forma financial information.
Pro forma financial information relating to the Acquisition are not included in this Current
Report on Form 8-K, and to the extent required by this Item 9.01, will be filed by amendment to
this Current Report on Form 8-K within seventy-one (71) calendar days from the date that this
Current Report on Form 8-K must be filed.
(d) Exhibits. The following is a complete list of exhibits filed as part of this
Report. Exhibit numbers correspond to the numbers in the exhibit table of Item 601 of Regulation
S-K.
Exhibit No. | Description | |
2.1
|
Purchase and Sale Agreement dated as of October 19, 2010 by and between Katy Resources ETX, LLC and Sun River Energy, Inc.(1)Incorporated by reference from the Current Report on Form 8-K as filed on October 19, 2010 | |
2.2
|
Amended Purchase and Sale Agreement dated as of February 7, 2011 by and between Katy Resources ETX, LLC and Sun River Energy, Inc. | |
10.1
|
Promissory Note dated as of February 7, 2011 by and between Katy Resources ETX, LLC and Sun River Energy, Inc |
Exhibit No. | Description | |
10.2
|
Deed of Trust, Mortgage, Security Agreement, Financing Statement and Assignment of Production and Revenues dated as of February 7, 2011 by and between Katy Resources ETX, LLC and Sun River Energy, Inc. | |
10.3
|
Employment Agreement as of September 1, 2010 by and between Sun River Energy, Inc and Tom Schaefer. .(1)Incorporated by reference from the Current Report on Form 8-K as filed on October 21, 2010 | |
99.1
|
Press Release dated February 10, 2011 |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly
caused this Report to be signed on its behalf by the undersigned, hereunto duly authorized.
SUN RIVER ENERGY, INC. |
||||
Date: February 10, 2011 | By: | /s/ Donal R. Schmidt, Jr. | ||
Name: | Donal R. Schmidt, Jr. | |||
Title: | President and CEO | |||