UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): August 1, 2013
BLACK RIDGE OIL & GAS, INC.
(Exact name of registrant as specified in its charter)
Delaware
(State or other jurisdiction of incorporation)
000-53952 | 27-2345075 | |
(Commission File Number) | (I.R.S. Employer Identification No.) | |
10275 Wayzata Boulevard, Suite 310, Minnetonka, Minnesota |
55305 |
|
(Address of principal executive offices) | (Zip Code) | |
(952) 426-1241 | ||
(Registrant’s telephone number, including area code) | ||
(Former name, former address and former fiscal year, 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.
£ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 240.14d-2(b)) | |
£ | Soliciting material pursuant to Rule 14a-12 under Exchange Act (17 CFR 240.14a-12) | |
£ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
£ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 5.02. | Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers |
(c) Effective August 1, 2013, Black Ridge Oil & Gas, Inc. (the “Company”) appointed Mr. Michael Eisele, 30, to the position of Chief Operating Officer. Mr. Eisele has served since August 2012 as the Company’s Vice President of Land, overseeing the Company’s acreage portfolio and managing acquisitions and divestitures. Mr. Eisele brings over five years of oil and gas lease experience in the Williston Basin and greater Rocky Mountain region. Prior to joining the Company, Mr. Eisele was the co-owner and landman of High West Resources, Ltd. from 2011 to 2012, the owner of Eisele Resources LLC from 2009 to 2012, and a self-employed landman from 2007 to 2009. Mr. Eisele is a graduate of Luther College (B.A.).
In connection with Mr. Eisele’s promotion to Chief Operating Officer, his annual salary will increase from $105,000 to $130,000 and, pursuant to the Company’s 2012 Amended and Restated Stock Incentive Plan and a Stock Option Agreement, Mr. Eisele was granted options to purchase 165,000 shares. These options will vest in five equal installments, commencing one year from the date of grant on August 1, 2013, and continuing for the next four anniversaries thereof until fully vested. The Company and Mr. Eisele also entered into the Company’s standard Director and Officer Indemnification Agreement, pursuant to which the Company will indemnify Mr. Eisele against certain liabilities which may arise by reason of his status as an officer, as well as a Change of Control Agreement, which provides, among other things, for twelve months of severance pay in the event of termination as a result of a change in control of the Company.
The foregoing descriptions of stock options granted to Mr. Eisele, the Director and Officer Indemnification Agreement, and the Change of Control Agreement are qualified in their entirety by reference to the full text of the Stock Option Agreement, Director and Officer Indemnification Agreement and Change of Control Agreement, copies of which are attached hereto and incorporated by reference herein.
There are no family relationships between Mr. Eisele and any other director or executive officer of the Company and no transactions in which Mr. Eisele has an interest requiring disclosure under Item 404(a) of Regulation S-K.
A press release related to Mr. Eisele’s appointment is attached as Exhibit 99.1 to this Current Report on Form 8-K.
Item 9.01. | Financial Statements and Exhibits. |
(d) Exhibits
10.1 | Stock Option Agreement between Black Ridge Oil & Gas, Inc. and Michael Eisele, dated August 1, 2013 | |
10.2 | Director and Officer Indemnification Agreement between Black Ridge Oil & Gas, Inc. and Michael Eisele, dated August 1, 2013 | |
10.3 | Change of Control Agreement between Black Ridge Oil & Gas, Inc. and Michael Eisele, dated August 1, 2103 | |
99.1 | Press Release issued on August 1, 2013 |
2 |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
BLACK RIDGE OIL & GAS, INC.
(Registrant)
Date: August 1, 2013
/s/ Ken DeCubellis, Chief Executive Officer
Ken DeCubellis, Chief Executive Officer
3 |
Exhibit 10.1
Black Ridge Oil & Gas, Inc.
STOCK OPTION AGREEMENT
(2012 Amended and Restated Stock Incentive Plan)
Black Ridge Oil & Gas, Inc. (the "Company"), pursuant to the 2012 Amended and Restated Stock Incentive Plan (as such plan may be amended and/or restated, the "Plan"), hereby grants to Optionee listed below ("Optionee"), an option to purchase the number of shares of the Company's Common Stock ("Shares") set forth below, subject to the terms and conditions of the Plan and this Stock Option Agreement. Unless otherwise defined herein, the terms defined in the Plan shall have the same defined meanings in this Stock Option Agreement.
BACKGROUND
A. Employee is serving as an associate for the Company and the Company desires to award Employee for his or her services to the Company; and
B. The Company has adopted the 2012 Amended and Restated Stock Incentive Plan (the “Plan”) pursuant to which shares of common stock, $0.001 par value, of the Company have been reserved for issuance under the Plan.
I. | NOTICE OF STOCK OPTION GRANT |
Optionee: | Michael Eisele | |||
Date of Stock Option Agreement: | August 1, 2013 | |||
Date of Grant: | August 1, 2013 | |||
Vesting Commencement Date: | August 1, 2013 | |||
Exercise Price per Share: | $.64 | |||
Total Number of Shares Granted: | 165,000 Shares | |||
Total Exercise Price: | $105,600 | |||
Term/Expiration Date: | July 31, 2023 | |||
Type of Option: | x | Incentive Stock Option | Non-Qualified Stock Option | |
Vesting Schedule: This Option shall vest and become exercisable only to the extent that all, or any portion thereof, has vested. Except as otherwise provided herein, the Option shall vest in five (5) annual installments, commencing one year from the Date of Grant, as noted above, and continuing on the next four (4) anniversaries thereof (hereinafter referred to singularly as a “Vesting Date” and collectively as “Vesting Dates”), until the Option is fully vested, as set forth in the following schedule:
No. of Shares to be Vested | Vesting Date | |
33,000 | August 1, 2014 | |
33,000 | August 1, 2015 | |
33,000 | August 1, 2016 | |
33,000 | August 1, 2017 | |
33,000 | August 1, 2018 |
1 |
II. | AGREEMENT |
1. Grant of Option. The Company hereby irrevocably grants from the Plan to Optionee an Option to purchase the number of Shares set forth in the Notice of Grant, at the exercise price per Share set forth in the Notice of Grant (the "Exercise Price"). Notwithstanding anything to the contrary anywhere else in this Stock Option Agreement, the Option is subject to the terms, definitions and provisions of the Plan adopted by the Company, which is incorporated herein by reference.
If designated in the Notice of Grant as an Incentive Stock Option, this Option is intended to qualify as an Incentive Stock Option as defined in Section 422 of the Code; provided, however, that to the extent that the aggregate Fair Market Value of stock with respect to which Incentive Stock Options (within the meaning of Code Section 422, but without regard to Code Section 422(d)), including the Option, are exercisable for the first time by Optionee during any calendar year, exceeds $100,000, such options shall be treated as not qualifying under Code Section 422, but rather shall be treated as Non-Qualified Stock Options to the extent required by Code Section 422. The rule set forth in the preceding sentence shall be applied by taking options into account in the order in which they were granted. For purposes of these rules, the Fair Market Value of stock shall be determined as of the time the option with respect to such stock is granted.
2. Exercise of Option. This Option is exercisable as follows:
(a) Right to Exercise.
(i) This Option shall be exercisable cumulatively according to the Vesting Schedule set forth in the Notice of Grant. For purposes of this Stock Option Agreement, Shares subject to this Option shall vest as provided in the Vesting Schedule set forth in the Notice of Grant.
(ii) This Option may not be exercised for a fraction of a Share.
(iii) In the event of Optionee's death, disability or other termination of Optionee's status as an employee, officer or Board Member, the exercisability of the Option is governed by Section 7 below and the Termination Provisions set forth in the Notice of Grant.
(iv) In no event may this Option be exercised after the date of expiration of the term of this Option as set forth in the Notice of Grant.
(b) Method of Exercise. This Option shall be exercisable by written Notice (substantially in the form attached as Exhibit A). The Notice must state the number of Shares for which the Option is being exercised, and such other representations and agreements with respect to such Shares as may be required by the Company pursuant to the provisions of the Plan. The Notice must be signed by Optionee and shall be delivered in person or by certified mail to the Secretary of the Company. The Notice must be accompanied by payment of the Exercise Price plus payment of any applicable withholding tax. This Option shall be deemed to be exercised upon receipt by the Company of such written Notice accompanied by the Exercise Price and payment of any applicable withholding tax. No Shares shall be issued pursuant to the exercise of an Option unless such issuance and such exercise comply with all relevant provisions of law and the requirements of any stock exchange upon which the Shares may then be listed. Assuming such compliance, for income tax purposes the Shares shall be considered transferred to Optionee on the date on which the Option is exercised with respect to such Shares.
3. Optionee's Representations. If the Shares purchasable pursuant to the exercise of this Option have not been registered under the Securities Act or any applicable state laws at the time this Option is exercised, Optionee shall, if required by the Company, concurrently with the exercise of all or any portion of this Option, deliver to the Company his or her Investment Representation Statement in the form attached hereto as Exhibit B and shall make such other written representations as are deemed necessary or appropriate by the Company and/or its counsel.
2 |
4. Lock-Up Period. Optionee hereby agrees that, if so requested by the Company or any representative of the underwriters (the "Managing Underwriter") in connection with any registration of the offering of any securities of the Company under the Securities Act or any applicable state laws, Optionee shall not sell or otherwise transfer any Shares or other securities of the Company during the 180-day period (or such longer period as may be requested in writing by the Managing Underwriter and agreed to in writing by the Company) (the "Market Standoff Period") following the effective date of a registration statement of the Company filed under the Securities Act; provided, however, that such restriction shall apply only to the first registration statement of the Company to become effective under the Securities Act that includes securities to be sold on behalf of the Company to the public in an underwritten public offering under the Securities Act. The Company may impose stop-transfer instructions with respect to securities subject to the foregoing restrictions until the end of such Market Standoff Period and these restrictions shall be binding on any transferee of such Shares.
5. Method of Payment. Payment of the Exercise Price shall be payable in US dollars by any of the following, or a combination thereof, at the election of Optionee:
(a) cash;
(b) uncertified or certified check, bank draft; or
(c) with the consent of the Board,
(i) by delivery of shares of Common Stock in payment of all or any part of the option price, which shares shall be valued for this purpose at the Fair Market Value (as such term is defined in the Plan) on the date such option is exercised; or;
(ii) by instructing the Company to withhold from the shares of Common Stock issuable upon exercise of the stock option shares of Common Stock in payment of all or any part of the exercise price and/or any related withholding tax obligations, which shares shall be valued for this purpose at the Fair Market Value or in such other manner as may be authorized from time to time by the Board (Cashless Exercise);
All shares that shall be purchased upon the exercise of the Option as provided herein shall be fully paid and non-assessable.
6. Restrictions on Exercise. If the issuance of Shares upon such exercise or if the method of payment for such shares would constitute a violation of any applicable federal or state securities or other law or regulation, then the Option may not be exercised. The Company may require Optionee to make any representation and warranty to the Company as may be required by any applicable law or regulation before allowing the Option to be exercised.
7. Termination of Relationship. If Optionee ceases to be a Board Member, Officer or Employee for any reason other than death, disability or termination for cause, Optionee shall have the right to exercise the Option at any time within twelve (12) months after the date Optionee ceased to be a Non-Employee Director or Employee to the extent of the full number of shares exercisable by Optionee on the date he or she ceased to be a Non-Employee Director or Employee, and the unvested portion shall not vest and all of Optionee’s rights to such unvested parts of the Option shall terminate. Upon the expiration of such twelve (12) month period, or, if earlier, upon the expiration date of the Options as set forth above, the Options shall terminate and become null and void.
8. Non-Transferability of Option. This Option may not be transferred in any manner except by will or by the laws of descent or distribution. It may be exercised during the lifetime of Optionee only by Optionee. The terms of this Option shall be binding upon the executors, administrators, heirs, successors and assigns of Optionee.
9. Term of Option. This Option may be exercised only within the term set forth in the Notice of Grant.
3 |
10. Restrictions on Shares. Optionee hereby agrees that Shares purchased upon the exercise of the Option shall be subject to such terms and conditions as the Administrator shall determine in its sole discretion, including, without limitation, restrictions on the transferability of Shares, the right of the Company to repurchase Shares, the right of the Company to require that Shares be transferred in the event of certain transactions, a right of first refusal in favor of the Company with respect to permitted transfers of Shares, tag-along rights and take-along rights. Such terms and conditions may, in the Administrator's sole discretion, be contained in the Exercise Notice with respect to the Option or in such other agreement as the Administrator shall determine and which Optionee hereby agrees to enter into at the request of the Company.
11. No Right to Employment. Nothing in the Plan or in this Stock Option Agreement shall confer upon Optionee any right to serve or continue as an Employee, Director or Consultant of the Company or any Parent or Subsidiary, or shall interfere with or restrict in any way the rights of the Company or any Parent or Subsidiary, which are hereby expressly reserved, to discharge Optionee at any time for any reason whatsoever, with or without Cause, except to the extent expressly provided otherwise in a written employment agreement between Optionee and the Company or any Parent or Subsidiary.
This Stock Option Agreement may be executed in two or more counterparts, each of which shall be deemed an original and all of which shall constitute one document.
Black Ridge Oil & Gas, Inc. | ||
| ||
By: | /s/ Kenneth DeCubellis | |
Name: | Kenneth DeCubellis | |
Title: | Chief Executive Officer |
OPTIONEE ACKNOWLEDGES AND AGREES THAT THE VESTING OF SHARES PURSUANT TO THE OPTION HEREOF IS EARNED ONLY BY CONTINUING AS A BOARD MEMBER OR EXECUTIVE OFFICER AT THE WILL OF THE COMPANY (NOT THROUGH THE ACT OF BEING HIRED, BEING GRANTED THIS OPTION OR ACQUIRING SHARES HEREUNDER). OPTIONEE FURTHER ACKNOWLEDGES AND AGREES THAT NOTHING IN THIS STOCK OPTION AGREEMENT, NOR IN THE COMPANY'S 2012 AMENDED AND RESTATED STOCK INCENTIVE PLAN WHICH IS INCORPORATED HEREIN BY REFERENCE, SHALL CONFER UPON OPTIONEE ANY RIGHT WITH RESPECT TO CONTINUATION AS A BOARD MEMBER OR EXECUTIVE OFFICER OF THE COMPANY OR ANY PARENT OR SUBSIDIARY, NOR SHALL IT INTERFERE IN ANY WAY WITH OPTIONEE'S RIGHT OR THE COMPANY'S RIGHT TO TERMINATE OPTIONEE'S BOARD MEMBER OR EXECUTIVE OFFICER RELATIONSHIP AT ANY TIME, WITH OR WITHOUT CAUSE AND WITH OR WITHOUT PRIOR NOTICE.
Optionee acknowledges receipt of a copy of the Plan and represents that he or she is familiar with the terms and provisions thereof. Optionee hereby accepts this Option subject to all of the terms and provisions hereof. Optionee has reviewed the Plan and this Option in their entirety, has had an opportunity to obtain the advice of counsel prior to executing this Option and fully understands all provisions of the Option. Optionee hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Administrator upon any questions arising under the Plan or this Option. Optionee further agrees to notify the Company upon any change in the residence address indicated below.
Dated: | August 1, 2013 | By: | /s/ Michael Eisele | ||
Name: | Michael Eisele | ||||
Address: | |||||
10275 Wayzata Blvd., Suite 310 Minnetonka, MN 55305 |
4 |
EXHIBIT A
Black Ridge Oil & Gas, Inc.
2012 Amended and Restated Stock Incentive Plan
EXERCISE NOTICE
Black Ridge Oil & Gas, Inc. Attention: Chief Financial Officer
1. Exercise of Option. Effective as of today, Michael Eisele, the undersigned ("Optionee"), hereby elects to exercise Optionee's option to purchase _________ shares of the Common Stock (the "Shares") of Black Ridge Oil & Gas, Inc. (the "Company") under and pursuant to the 2012 Amended and Restated Stock Incentive Plan (as such plan may be amended and/or restated, the "Plan") and the Stock Option Agreement dated August 1, 2013 (the "Option Agreement"). Capitalized terms used herein without definition shall have the meanings given in the Option Agreement.
Date of Grant: | August 1, 2013 | ||||||
Number of Shares as to which Option is Exercised: | _________ | ||||||
Exercise Price per Share: | $.64 | ||||||
Total Exercise Price: | __________ | ||||||
Certificate to be issued in name of: | |||||||
Cash Payment delivered herewith: | $ | ||||||
Type of Option: | [x] Incentive Stock Option | [ ] Non-Qualified Stock Option | |||||
2 Representations of Optionee. Optionee acknowledges that Optionee has received, read and understood the Plan and the Option Agreement. Optionee agrees to abide by and be bound by their terms and conditions.
3. Rights as Stockholder. Until the stock certificate evidencing such Shares is issued (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company), no right to vote or receive dividends or any other rights as a stockholder shall exist with respect to Shares subject to the Option, notwithstanding the exercise of the Option. The Company shall issue (or cause to be issued) such stock certificate promptly after the Option is exercised.
No adjustment will be made for a dividend or other right for which the record date is prior to the date the stock certificate is issued, except as provided in Section 14 of the Plan. Optionee shall enjoy rights as a stockholder until such time as Optionee disposes of the Shares or the Company and/or its assignee(s) exercises the Right of First Refusal or the Take-Along Right hereunder (each as defined below). Upon such exercise, Optionee shall have no further rights as a holder of the Shares so purchased except the right to receive payment for the Shares so purchased in accordance with the provisions of this Exercise Notice, and Optionee shall forthwith cause the certificate(s) evidencing the Shares so purchased to be surrendered to the Company for transfer or cancellation.
4. Company's Right of First Refusal. Before any Shares held by Optionee (including, for purposes of Sections 4 and 5 hereof, any permitted transferee holding Shares) may be sold, pledged, assigned, hypothecated, transferred, or otherwise disposed of (including transfer by gift or operation of law) (collectively, "Transfer" or "Transferred"), the Company or its assignee(s) shall have a right of first refusal to purchase the Shares on the terms and conditions set forth in this Section 4 (the "Right of First Refusal").
A-1 |
(a) Notice of Proposed Transfer. Optionee shall deliver to the Company a written notice (the "Notice") stating: (i) Optionee's bona fide intention to sell or otherwise Transfer such Shares; (ii) the name of each proposed purchaser or other transferee ("Proposed Transferee"); (iii) the number of Shares to be Transferred to each Proposed Transferee; and (iv) the bona fide cash price or other consideration for which Optionee proposes to Transfer the Shares (the "Offered Price"), and Optionee shall offer the Shares at the Offered Price to the Company or its assignee(s).
(b) Exercise of Right of First Refusal. Within thirty (30) days after receipt of the Notice, the Company and/or its assignee(s) may elect in writing to purchase all, but not less than all, of the Shares proposed to be transferred to any one or more of the Proposed Transferees. The purchase price will be determined in accordance with subsection (c) below.
(c) Purchase Price. The purchase price (the "ROFR Purchase Price") for the Shares repurchased under this Section shall be the Offered Price. If the Offered Price includes consideration other than cash, the cash equivalent value of the non-cash consideration shall be determined by the Board in good faith.
(d) Payment. Payment of the ROFR Purchase Price shall be made, at the option of the Company or its assignee(s), in cash (by check), by cancellation of all or a portion of any outstanding indebtedness of Optionee to the Company (or, in the case of repurchase by an assignee, to the assignee), or by any combination thereof within thirty (30) days after receipt of the Notice or in the manner and at the times set forth in the Notice.
(e) Optionee's Right to Transfer. If all of the Shares proposed in the Notice to be transferred to a given Proposed Transferee are not purchased by the Company and/or its assignee(s) as provided in this Section, then Optionee may sell or otherwise Transfer such Shares to that Proposed Transferee at the Offered Price or at a higher price, provided that such sale or other Transfer is consummated within one hundred twenty (120) days after the date of the Notice and provided further that any such sale or other Transfer is effected in accordance with any applicable securities laws and the Proposed Transferee agrees in writing that (i) the provisions hereof, including without limitation the provisions of Sections 4 and 5 shall continue to apply to the Shares in the hands of such Proposed Transferee and (ii) that such Proposed Transferee will not transfer the Shares any other purchaser or transferee unless such future purchase or transferee agrees in writing to be bound by the provisions hereof, including without limitation the provisions of Sections 4 and 5 hereof. If the Shares described in the Notice are not Transferred to the Proposed Transferee within such period, a new Notice shall be given to the Company, and the Company and/or its assignees shall again be offered the Right of First Refusal as provided herein before any Shares held by the Holder may be sold or otherwise Transferred.
(f) Exception for Certain Family Transfers. Anything to the contrary contained in this Section 4 notwithstanding, the Transfer of any or all of the Shares during Optionee's lifetime or on Optionee's death by will or intestacy to Optionee's Immediate Family or a trust for the benefit of Optionee's Immediate Family shall be exempt from the Right of First Refusal. As used herein, "Immediate Family" shall mean spouse, lineal descendant or antecedent, father, mother, brother or sister or stepchild (whether or not adopted). In such case, the transferee or other recipient shall receive and hold the Shares so Transferred subject to the provisions hereof, including without limitation the provisions of Sections 4 and 5 hereof, and there shall be no further Transfer of such Shares except in accordance with the terms hereof.
(g) Termination of Right of First Refusal. The Right of First Refusal shall terminate as to the Shares upon the Public Trading Date of the Shares. For the purposes of the Stock Option Agreement and this Exercise Notice, the “Public Trading Date” of the Shares is the date on which the Shares first become freely tradeable under the Securities Act of 1933, as amended (the “Act”), either pursuant to Rule 144 or another provision of the Act. The holder of the Shares may apply to have all restrictive transfer legends removed from the certificates evidencing the Shares without delivering a notice to the Company pursuant to Section 4(a) of this Exercise Notice, provided that the request for legend removal is made at such times and in such manner that removal is accomplished in compliance with the Act and the rules and regulations promulgated under the Act.
A-2 |
5. Company Take-Along Right.
(a) Approved Sale. If the Board shall deliver a notice to Optionee (a "Sale Event Notice") stating that the Board has approved a sale of all or a portion of the Company (an "Approved Sale") and specifying the name and address of the proposed parties to such transaction and the consideration payable in connection therewith, Optionee shall (i) consent to and raise no objections against the Approved Sale or the process pursuant to which the Approved Sale was arranged, (ii) waive any dissenter's rights and other similar rights, and (iii) if the Approved Sale is structured as a sale of securities, agree to sell Optionee's Shares on the terms and conditions of the Approved Sale which terms and conditions shall treat all stockholders of the Company equally (on a pro rata basis), except that shares having a liquidation preference may receive an amount of consideration equal to such liquidation preference in addition to the consideration being paid to the holders of shares not having a liquidation preference. Notwithstanding the foregoing, the sale of the Shares in an Approved Sale shall be further subject to the terms of the Plan.
Optionee will take all necessary and desirable lawful actions as directed by the Board and the stockholders of the Company approving the Approved Sale in connection with the consummation of any Approved Sale, including without limitation, the execution of such agreements and such instruments and other actions reasonably necessary to (A) provide the representations, warranties, indemnities, covenants, conditions, non-compete agreements, escrow agreements and other provisions and agreements relating to such Approved Sale and, (B) effectuate the allocation and distribution of the aggregate consideration upon the Approved Sale, provided, that this Section 5 shall not require Optionee to indemnify the purchaser in any Approved Sale for breaches of the representations, warranties or covenants of the Company or any other stockholder, except to the extent (x) Optionee is not required to incur more than its pro rata share of such indemnity obligation (based on the total consideration to be received by all stockholders that are similarly situated and hold the same class or series of capital stock) and (y) such indemnity obligation is provided for and limited to a post-closing escrow or holdback arrangement of cash or stock paid in connection with the Approved Sale.
(b) Costs. Optionee will bear Optionee's pro rata share (based upon the amount of consideration to be received) of the reasonable costs of any sale of Shares pursuant to an Approved Sale to the extent such costs are incurred for the benefit of all selling stockholders of the Company and are not otherwise paid by the Company or the acquiring party. Costs incurred by Optionee on Optionee's own behalf will not be considered costs of the transaction hereunder.
(c) Share Delivery. At the consummation of the Approved Sale, Optionee shall, if applicable, deliver certificates representing the Shares to be transferred, duly endorsed for transfer and accompanied by all requisite stock transfer taxes, if any, and the Shares to be transferred shall be free and clear of any liens, claims or encumbrances (other than restrictions imposed by this Agreement) and Optionee shall so represent and warrant.
(d) Termination of Company Take-Along Right. The Take-Along Right shall terminate as to the Shares upon the Public Trading Date of the Shares, as defined in Section 4(g) of this Exercise Notice.
6. Tax Consultation. Optionee understands that Optionee may suffer adverse tax consequences as a result of Optionee's purchase or disposition of the Shares. Optionee represents that Optionee has consulted with any tax consultants Optionee deems advisable in connection with the purchase or disposition of the Shares and that Optionee is not relying on the Company for any tax advice.
7. Lock-Up Period. Optionee hereby agrees that if so requested by the Company or any representative of the underwriters (the "Managing Underwriter") in connection with any registration of the offering of any securities of the Company under the Securities Act or any applicable state laws, Optionee shall not sell or otherwise transfer any Shares or other securities of the Company during the 180-day period (or such longer period as may be requested in writing by the Managing Underwriter and agreed to in writing by the Company) (the "Market Standoff Period") following the effective date of a registration statement of the Company filed under the Securities Act; provided, that such restriction shall apply only to the first registration statement of the Company to become effective under the Securities Act that includes securities to be sold on behalf of the Company to the public in an underwritten public offering under the Securities Act. The Company may impose stop-transfer instructions with respect to securities subject to the foregoing restrictions until the end of such Market Standoff Period.
A-3 |
8. Restrictive Legends and Stop-Transfer Orders.
(a) Legends. Optionee understands and agrees that the Company shall cause the legends set forth below or legends substantially equivalent thereto, to be placed upon any certificate(s) evidencing ownership of the Shares together with any other legends that may be required by state or federal securities laws:
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE "ACT") OR ANY APPLICABLE STATE SECURITIES LAWS AND MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER THE ACT AND SUCH LAWS OR, IN THE OPINION OF COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER OF THESE SECURITIES, SUCH OFFER, SALE OR TRANSFER, PLEDGE OR HYPOTHECATION IS IN COMPLIANCE THEREWITH.
THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RESTRICTIONS ON TRANSFER AND RIGHT OF FIRST REFUSAL OPTIONS HELD BY THE ISSUER OR ITS ASSIGNEE(S) AS SET FORTH IN THE EXERCISE NOTICE BETWEEN THE ISSUER AND THE ORIGINAL HOLDER OF THESE SHARES, A COPY OF WHICH MAY BE OBTAINED AT THE PRINCIPAL OFFICE OF THE ISSUER. SUCH TRANSFER RESTRICTIONS AND RIGHT OF FIRST REFUSAL ARE BINDING ON TRANSFEREES OF THESE SHARES UNTIL THE SHARES FIRST BECOME FREELY TRADEABLE IN OPEN MARKET TRANSACTIONS IN A PUBLIC TRADING MARKET UNDER THE ACT.
(b) Stop-Transfer Notices. Optionee agrees that, in order to ensure compliance with the restrictions referred to herein, the Company may issue appropriate "stop transfer" instructions to its transfer agent, if any, and that, if the Company transfers its own securities, it may make appropriate notations to the same effect in its own records.
(c) Refusal to Transfer. The Company shall not be required (i) to transfer on its books any Shares that have been sold or otherwise transferred in violation of any of the provisions of this Agreement or (ii) to treat as owner of such Shares or to accord the right to vote or pay dividends to any purchaser or other transferee to whom such Shares shall have been so transferred.
9. Successors and Assigns. The Company may assign any of its rights under this Agreement to single or multiple assignees, and this Agreement shall inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer herein set forth, this Agreement shall be binding upon Optionee and his or her heirs, executors, administrators, successors and assigns.
10. Interpretation. Any dispute regarding the interpretation of this Agreement shall be submitted by Optionee or by the Company forthwith to the Administrator, which shall review such dispute at its next regular meeting. The resolution of such a dispute by the Administrator shall be final and binding on the Company and on Optionee.
11. Governing Law; Severability. This Agreement shall be governed by and construed in accordance with the laws of the State of Nevada excluding that body of law pertaining to conflicts of law. Should any provision of this Agreement be determined by a court of law to be illegal or unenforceable, the other provisions shall nevertheless remain effective and shall remain enforceable.
A-4 |
12. Notices. Any notice required or permitted hereunder shall be given in writing and shall be deemed effectively given upon personal delivery or upon deposit in the United States mail by certified mail, with postage and fees prepaid, addressed to the other party at its address as shown below beneath its signature, or to such other address as such party may designate in writing from time to time to the other party.
13. Further Instruments. The parties agree to execute such further instruments and to take such further action as may be reasonably necessary to carry out the purposes and intent of this Agreement.
14. Delivery of Payment. Optionee herewith delivers to the Company the full Exercise Price for the Shares, as well as any applicable withholding tax.
15. Entire Agreement. The Plan and Option Agreement are incorporated herein by reference. This Agreement, the Plan, the Option Agreement and the Investment Representation Statement constitute the entire agreement of the parties and supersede in their entirety all prior undertakings and agreements of the Company and Optionee with respect to the subject matter hereof.
Accepted by: | Submitted by: | |||
BLACK RIDGE OIL & GAS, INC. | OPTIONEE | |||
By: | By: | |||
Michael Eisele | ||||
Address: 10275 Wayzata Boulevard, Suite 310 Minnetonka, MN 55305 |
Address: 10275 Wayzata Boulevard, Suite 310 Minnetonka, MN 55305 |
A-5 |
EXHIBIT B
INVESTMENT REPRESENTATION STATEMENT
OPTIONEE | : | Michael Eisele |
COMPANY | : | Black Ridge Oil & Gas, Inc. |
SECURITY | : | Options to purchase Common Stock |
AMOUNT | : | _________ shares |
DATE | : |
In connection with the purchase of the above-listed shares of Common Stock (the "Securities") of Black Ridge Oil & Gas, Inc. (the "Company"), the undersigned (the "Optionee") represents to the Company the following:
(a) Optionee is aware of the Company's business affairs and financial condition and has acquired sufficient information about the Company to reach an informed and knowledgeable decision to acquire the Securities. Optionee is acquiring these Securities for investment for Optionee's own account only and not with a view to, or for resale in connection with, any "distribution" thereof within the meaning of the Securities Act of 1933, as amended (the "Securities Act").
(b) Optionee acknowledges and understands that the Securities constitute "restricted securities" under the Securities Act and have not been registered under the Securities Act in reliance upon a specific exemption therefrom, which exemption depends upon, among other things, the bona fide nature of Optionee's investment intent as expressed herein. Optionee understands that the Securities must be held indefinitely unless they are subsequently registered under the Securities Act or an exemption from such registration is available. Optionee further acknowledges and understands that the Company is under no obligation to register the Securities. Optionee understands that the certificate evidencing the Securities will be imprinted with a legend which prohibits the transfer of the Securities unless they are registered or such registration is not required in the opinion of counsel satisfactory to the Company and any other legend required under applicable state securities laws.
(c) Optionee is familiar with the provisions of Rule 701 and Rule 144, each promulgated under the Securities Act, which, in substance, permit limited public resale of "restricted securities" acquired, directly or indirectly from the issuer thereof, in a non-public offering subject to the satisfaction of certain conditions. Rule 701 provides that if the issuer qualifies under Rule 701 at the time of the grant of the Option to Optionee, the exercise will be exempt from registration under the Securities Act.
In the event the Company becomes subject to the reporting requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, ninety (90) days thereafter (or such longer period as any market stand-off agreement may require) the Securities exempt under Rule 701 may be resold, subject to the satisfaction of certain of the conditions specified by Rule 144, including, in the case of an affiliate, (i) the resale being made through a broker in an unsolicited "broker's transaction" or in transactions directly with a market maker (as said term is defined under the Securities Exchange Act of 1934), (ii) the availability of certain public information about the Company, (iii) the amount of Securities being sold during any three (3) month period not exceeding the limitations specified in Rule 144(e), and (iv) the timely filing of a Form 144, if applicable.
In the event that the Company does not qualify under Rule 701 at the time of grant of the Option, then the Securities may be resold beginning ninety (90) days after the Company becomes subject to the reporting requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934 in certain limited circumstances subject to the provisions of Rule 144, which requires the resale to occur not less than six months after the later of the date the Securities were sold by the Company or the date the Securities were sold by an affiliate of the Company, within the meaning of Rule 144 and the availability of certain public information about the Company (subject to certain exceptions); and, in the case of a sale of the Securities by an affiliate, the satisfaction of the conditions set forth in sections (i), (ii), (iii) and (iv) of the paragraph immediately above.
B-1 |
(d) Optionee further understands that in the event all of the applicable requirements of Rule 701 or 144 are not satisfied, registration under the Securities Act, compliance with Regulation A, or some other registration exemption will be required; and that, notwithstanding the fact that Rules 144 and 701 are not exclusive, the Staff of the Securities and Exchange Commission has expressed its opinion that persons proposing to sell private placement securities other than in a registered offering and otherwise than pursuant to Rules 144 or 701 will have a substantial burden of proof in establishing that an exemption from registration is available for such offers or sales, and that such persons and their respective brokers who participate in such transactions do so at their own risk. Optionee understands that no assurances can be given that any such other registration exemption will be available in such event.
(e) Optionee understands and acknowledges that the Company will rely upon the accuracy and truth of the foregoing representations and Optionee hereby consents to such reliance.
Signature of Optionee: | |
Date: _________________ | |
Michael Eisele | |
B-2 |
Exhibit 10.2
BLACK RIDGE OIL & GAS, INC.
INDEMNIFICATION AGREEMENT
This Indemnification Agreement (“Agreement”) is made as of August 1, 2013 by and between Black Ridge Oil & Gas, Inc., a Nevada corporation (the “Company”), and Michael Eisele, an individual (“Indemnitee”).
RECITALS
A. The Company and Indemnitee recognize the significant cost of directors’ and officers’ liability insurance and the general limitations in the coverage of such insurance.
B. The Company and Indemnitee further recognize the risk of corporate litigation in general, potentially subjecting officers and directors to litigation at the same time as the coverage of liability insurance is limited.
C. The Company desires to attract and retain the services of highly qualified individuals, such as Indemnitee, to serve as officers and directors of the Company and to indemnify its officers and directors so as to provide them with the maximum protection permitted by law.
NOW, THEREFORE, in consideration for Indemnitee’s services as an officer or director of the Company, the Company and Indemnitee hereby agree as follows:
1. Indemnification.
(a) Third Party Proceedings. The Company shall indemnify Indemnitee if Indemnitee is or was a party or is threatened to be made a party to any threatened, pending or completed action, suit, proceeding or any alternative dispute resolution mechanism, whether civil, criminal, administrative or investigative (other than an action by or in the right of the Company) by reason of the fact that Indemnitee is or was a director, officer, employee or agent of the Company, or any subsidiary of the Company, or by reason of the fact that Indemnitee is or was serving at the request of the Company as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement (if such settlement is approved in advance by the Company, which approval shall not be unreasonably withheld) actually and reasonably incurred by Indemnitee in connection with such action, suit or proceeding if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in or not opposed to the best interests of the Company, and, with respect to any criminal action or proceeding, had no reasonable cause to believe Indemnitee’s conduct was unlawful. The termination of any action, suit or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that Indemnitee did not act in good faith and in a manner which Indemnitee reasonably believed to be in or not opposed to the best interests of the Company, and, with respect to any criminal action or proceeding, had reasonable cause to believe that Indemnitee’s conduct was unlawful.
1 |
(b) Proceedings By or in the Right of the Company. The Company shall indemnify Indemnitee if Indemnitee was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the Company or any subsidiary of the Company to procure a judgment in its favor by reason of the fact that Indemnitee is or was a director, officer, employee or agent of the Company, or any subsidiary of the Company, or by reason of the fact that Indemnitee is or was serving at the request of the Company as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys’ fees) and, to the fullest extent permitted by law, amounts paid in settlement actually and reasonably incurred by Indemnitee in connection with the defense or settlement of such action or suit if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in or not opposed to the best interests of the Company, except that no indemnification shall be made in respect of any claim, issue or matter as to which Indemnitee shall have been adjudged to be liable to the Company unless and only to the extent that any court in which such action or suit was brought or another court of competent jurisdiction shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, Indemnitee is fairly and reasonably entitled to indemnity for such expenses as such court shall deem proper.
(c) Mandatory Payment of Expenses. To the extent that Indemnitee has been successful on the merits or otherwise in defense of any action, suit or proceeding referred to in Subsections (a) and (b) of this Section 1, or in defense of any claim, issue or matter therein, Indemnitee shall be indemnified against expenses (including attorneys’ fees) actually and reasonably incurred by Indemnitee in connection therewith.
2. Advancement of Expenses. All reasonable Expenses (as hereinafter defined) incurred by or on behalf of Indemnitee (including costs of enforcement of this Agreement) shall be advanced from time to time by the Company to Indemnitee within thirty (30) days after the receipt by the Company of a written request for an advance of Expenses, whether prior to or after final disposition of a Proceeding (as hereinafter defined) (except to the extent that there has been a final adverse determination that Indemnitee is not entitled to be indemnified for such Expenses), including without limitation any Proceeding brought by or in the right of the Company. The written request for an advancement of any and all Expenses under this paragraph shall contain reasonable detail of the Expenses incurred by Indemnitee. By execution of this Agreement, Indemnitee shall be deemed to have made whatever undertaking as may be required by law at the time of any advancement of Expenses with respect to repayment to the Company of such Expenses. In the event that the Company shall breach its obligation to advance Expenses under this Section 2, the parties hereto agree that Indemnitee’s remedies available at law would not be adequate and that Indemnitee would be entitled to specific performance.
3. Presumptions and Effect of Certain Proceedings. Upon making a request for indemnification, Indemnitee shall be presumed to be entitled to indemnification under this Agreement and the Company shall have the burden of proof to overcome that presumption in reaching any contrary determination. The termination of any Proceeding by judgment, order, settlement, arbitration award or conviction, or upon a plea of nolo contendere or its equivalent shall not affect this presumption or, except as determined by a judgment or other final adjudication adverse to Indemnitee, establish a presumption with regard to any factual matter relevant to determining Indemnitee’s rights to indemnification hereunder. If the person or persons so empowered to make a determination pursuant to Section 4 hereof shall have failed to make the requested determination within sixty (60) days after any judgment, order, settlement, dismissal, arbitration award, conviction, acceptance of a plea of nolo contendere or its equivalent, or other disposition or partial disposition of any Proceeding or any other event that could enable the Company to determine Indemnitee’s entitlement to indemnification, the requisite determination that Indemnitee is entitled to indemnification shall be deemed to have been made.
2 |
4. Procedure for Determination of Entitlement to Indemnification.
(a) Notice/Cooperation by Indemnitee. Indemnitee shall, as a condition precedent to his right to be indemnified under this Agreement, give the Company notice in writing as soon as practicable of any claim made against Indemnitee for which indemnification will or could be sought under this Agreement. Notice to the Company shall be directed to the Chief Executive Officer of the Company at the address shown on the signature page of this Agreement (or such other address as the Company shall designate in writing to Indemnitee). Notice shall be deemed received as provided in Section 15 of this Agreement. In addition, Indemnitee shall give the Company such information, documentation and cooperation as it may reasonably require and as shall reasonably be accessible to Indemnitee.
(b) Procedure. Any indemnification and advances provided for in Section 1 and Section 2 shall be made no later than thirty (30) days after receipt of the written request of Indemnitee; provided, in the case of any request for indemnification, the Company has determined that Indemnitee is entitled to indemnification under this Agreement. If a claim under this Agreement, under any statute, or under any provision of the Company’s Articles of Incorporation or Bylaws providing for indemnification, is not paid in full by the Company within thirty (30) days after a written request for payment thereof has first been received by the Company, Indemnitee may, but need not, at any time thereafter bring an action against the Company to recover the unpaid amount of the claim and, subject to Section 14 of this Agreement, Indemnitee shall also be entitled to be paid for the expenses (including attorneys’ fees) of bringing such action. It shall be a defense to any such action (other than an action brought to enforce a claim for expenses incurred in connection with any action, suit or proceeding in advance of its final disposition) that Indemnitee has not met the standards of conduct which make it permissible under applicable law for the Company to indemnify Indemnitee for the amount claimed. Nevertheless, the Indemnitee shall be entitled to receive interim payments of expenses pursuant to Section 2 of this Agreement unless and until such defense may be finally adjudicated by court order or judgment from which no further right of appeal exists. It is the parties’ intention that if the Company contests Indemnitee’s right to indemnification, the question of Indemnitee’s right to indemnification shall be for the court to decide, and neither the failure of the Company (including its Board of Directors, any committee or subgroup of the Board of Directors, independent legal counsel, or its stockholders) to have made a determination that indemnification of Indemnitee is proper in the circumstances because Indemnitee has met the applicable standard of conduct required by applicable law, nor an actual determination by the Company (including its Board of Directors, any committee or subgroup of the Board of Directors, independent legal counsel, or its stockholders) that Indemnitee has not met such applicable standard of conduct, shall create a presumption that Indemnitee has or has not met the applicable standard of conduct.
3 |
(c) Notice to Insurers. If, at the time of the receipt of a notice of a claim pursuant to Section 4(a) hereof, the Company has director and officer liability insurance in effect, the Company shall give prompt notice of the commencement of such proceeding to the insurers in accordance with the procedures set forth in the respective policies. The Company shall thereafter take all necessary or desirable action to cause such insurers to pay, on behalf of the Indemnitee, all amounts payable as a result of such proceeding in accordance with the terms of such policies.
(d) Selection of Counsel. In the event the Company shall be obligated under Section 2 hereof to pay the expenses of any proceeding against Indemnitee, the Company, if appropriate, shall be entitled to assume the defense of such proceeding, with counsel approved by Indemnitee, which approval shall not be unreasonably withheld, upon the delivery to Indemnitee of written notice of its election to do so. After delivery of such notice, approval of such counsel by Indemnitee and the retention of such counsel by the Company, the Company will not be liable to Indemnitee under this Agreement for any fees of counsel subsequently incurred by Indemnitee with respect to the same proceeding, provided that Indemnitee shall have the right to employ his counsel in any such proceeding at Indemnitee’s expense. Notwithstanding anything else herein to the contrary, if Indemnitee reasonably concludes that there may be a conflict of interest between the Company and Indemnitee in the conduct of any such defense, and the Company approves Indemnitee’s counsel which approval will not be unreasonably withheld, then the reasonable fees and expenses of Indemnitee’s counsel shall be at the expense of the Company.
5. Additional Indemnification Rights; Nonexclusivity.
(a) Scope. Notwithstanding any other provision of this Agreement, the Company hereby agrees to indemnify the Indemnitee to the fullest extent permitted by law, notwithstanding that such indemnification is not specifically authorized by the other provisions of this Agreement, the Company’s Articles of Incorporation, the Company’s Bylaws or by statute. In the event of any change, after the date of this Agreement, in any applicable law, statute, or rule which expands the right of a Nevada corporation to indemnify a member of its board of directors or an officer, such changes shall be, ipso facto, within the purview of Indemnitee’s rights and Company’s obligations, under this Agreement. In the event of any change in any applicable law, statute or rule which narrows the right of a Nevada corporation to indemnify a member of its board of directors or an officer, such changes, to the extent not otherwise required by such law, statute or rule to be applied to this Agreement shall have no effect on this Agreement or the parties’ rights and obligations hereunder.
(b) Nonexclusivity. The indemnification provided by this Agreement shall not be deemed exclusive of any rights to which Indemnitee may be entitled under the Company’s Articles of Incorporation, its Bylaws, any agreement, any vote of stockholders or disinterested Directors, the General Corporation Law of the State of Nevada, or otherwise, both as to action in Indemnitee’s official capacity and as to action in another capacity while holding such office. The indemnification provided under this Agreement shall continue as to Indemnitee for any action taken or not taken while serving in an indemnified capacity even though he may have ceased to serve in such capacity at the time of any action, suit or other covered proceeding (the “Indemnification Period”). To the extent that during the Indemnification Period the rights of the then existing directors and officers are more favorable to such directors or officers than the rights currently provided to Indemnitee thereunder or under this Agreement, Indemnitee shall be entitled to the full benefits of such more favorable rights.
4 |
6. Partial Indemnification. If Indemnitee is entitled under any provision of this Agreement to indemnification by the Company for some or a portion of the expenses, judgments, fines or penalties actually and reasonably incurred by him in the investigation, defense, appeal or settlement of any civil or criminal action, suit or proceeding, but not, however, for the total amount thereof, the Company shall nevertheless indemnify Indemnitee for the portion of such expenses, judgments, fines or penalties to which Indemnitee is entitled, which shall be reasonably determined in good faith by the Company’s Board of Directors.
7. Mutual Acknowledgement. Both the Company and Indemnitee acknowledge that in certain instances, Federal law or applicable public policy may prohibit the Company from indemnifying its directors and officers under this Agreement or otherwise. Indemnitee understands and acknowledges that the Company has undertaken or may be required in the future to undertake with the Securities and Exchange Commission to submit the question of indemnification to a court in certain circumstances for a determination of the Company’s right under public policy to indemnify Indemnitee.
8. Officer and Director Liability Insurance. The Company shall, from time to time, make the good faith determination whether or not it is practicable for the Company to obtain and maintain policies of insurance with reputable insurance companies providing the officers and directors of the Company with coverage for losses from wrongful acts, or to ensure the Company’s performance of its indemnification obligations under this Agreement. Among other considerations, the Company will weigh the costs of obtaining such insurance coverage against the protection afforded by such coverage. In all policies of director and officer liability insurance, Indemnitee shall be named as an insured in such a manner as to provide Indemnitee the same rights and benefits as are accorded to the most favorably insured of the Company’s directors, if Indemnitee is a director; or of the Company’s officers, if Indemnitee is not a director of the Company but is an officer. Notwithstanding the foregoing, the Company shall have no obligation to obtain or maintain such insurance if the Company determines in good faith that (a) such insurance is not reasonably available, (b) the premium costs for such insurance are too expensive for the Company to afford or are disproportionate to the amount of coverage provided, (c) the coverage provided by such insurance is limited by exclusions so as to provide an insufficient benefit, or (d) the Indemnitee is covered by similar insurance maintained by a subsidiary or parent of the Company.
9. Severability. Nothing in this Agreement is intended to require or shall be construed as requiring the Company to do or fail to do any act in violation of applicable law. The Company’s inability, pursuant to court order, to perform its obligations under this Agreement shall not constitute a breach of this Agreement. The provisions of this Agreement shall be severable as provided in this Section 9. If this Agreement or any portion hereof shall be invalidated on any ground by any court of competent jurisdiction, then the Company shall nevertheless indemnify Indemnitee to the full extent permitted by any applicable portion of this Agreement that shall not have been invalidated, and the balance of this Agreement not so invalidated shall be enforceable in accordance with its terms.
5 |
10. Exceptions. Any other provision herein to the contrary notwithstanding, the Company shall not be obligated pursuant to the terms of this Agreement:
(a) Claims Initiated by Indemnitee. To indemnify or advance expenses to Indemnitee with respect to proceedings or claims initiated or brought voluntarily by Indemnitee and not by way of defense, except with respect to proceedings brought to establish or enforce a right to indemnification under this Agreement or any other statute or law or otherwise as required under the Nevada General Corporation Law, but such indemnification or advancement of expenses may be provided by the Company in specific cases if the Board of Directors has approved the initiation or bringing of such suit; or
(b) Lack of Good Faith. To indemnify Indemnitee for any expenses incurred by the Indemnitee with respect to any proceeding instituted by Indemnitee to enforce or interpret this Agreement, if a court of competent jurisdiction determines that each of the material assertions made by the Indemnitee in such proceeding was not made in good faith or was frivolous; or
(c) Insured Claims. To indemnify Indemnitee for expenses or liabilities of any type whatsoever (including, but not limited to, judgments, fines, ERISA excise taxes or penalties, and amounts paid in settlement) which have been paid directly to or on behalf of Indemnitee by an insurance carrier under a policy of officers’ and directors’ liability insurance maintained by the Company; or
(d) Claims Under Section 16(b). To indemnify Indemnitee for expenses and the payment of profits arising from the purchase and sale by Indemnitee of securities in violation of Section 16(b) of the Securities Exchange Act of 1934, as amended, or any similar successor statute or
(e) Certain Matters. To indemnify Indemnitee on account of any proceeding with respect to (i) remuneration paid to Indemnitee if it is determined by final judgment or other final adjudication that such remuneration was in violation of law, (ii) which it is determined by final judgment or other final adjudication that the Imdemnitee’s conduct was knowingly fraudulent or dishonest or constituted willful misconduct, or (iii) which it is determined by final judgment or other final adjudication by a court having jurisdiction in the matter that such indemnification is not lawful.
11. Construction of Certain Phrases.
(a) For purposes of this Agreement, references to the “Company” shall include, in addition to the resulting corporation, any constituent corporation (including any constituent of a constituent) absorbed in a consolidation or merger which, if its separate existence had continued, would have had power and authority to indemnify its directors, officers, and employees or agents, so that if Indemnitee is or was a director, officer, employee or agent of such constituent corporation, or is or was serving at the request of such constituent corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, Indemnitee shall stand in the same position under the provisions of this Agreement with respect to the resulting or surviving corporation as Indemnitee would have with respect to such constituent corporation if its separate existence had continued.
6 |
(b) For purposes of this Agreement, the term “Expenses” shall include all reasonable attorneys’ fees, retainers, court costs, transcript costs, fees of experts, witness fees, travel expenses, duplicating costs, printing and binding costs, telephone charges, postage, delivery service fees and all other disbursements or expenses of the types customarily incurred in connection with prosecuting, defending, preparing to prosecute or defend, investigating, participating, or being or preparing to be a witness in a Proceeding. Expenses also shall include Expenses incurred in connection with any appeal resulting from any Proceeding, including without limitation the premium, security for, and other costs relating to any cost bond, supersede as bond, or other appeal bond or its equivalent. Expenses, however, shall not include amounts paid in settlement by Indemnitee or the amount of judgments or fines against Indemnitee.
(c) For purposes of this Agreement, the term “Proceeding” shall include any threatened, pending or completed action, suit, arbitration, alternate dispute resolution mechanism, investigation, inquiry, administrative hearing or any other actual, threatened or completed proceeding, whether brought by or in the right of the Company or otherwise and whether civil, criminal, administrative or investigative, in which Indemnitee was, is or will be involved as a party or otherwise, by reason of the fact that Indemnitee is or was an officer or director of the Company, by reason of any action taken by him or of any inaction on his part while acting as an officer or director of the Company, or by reason of the fact that he is or was serving at the request of the Company as a director, officer, employee, agent or fiduciary of another corporation, partnership, joint venture, trust or other enterprise; in each case whether or not he is acting or serving in any such capacity at the time any liability or expense is incurred for which indemnification can be provided under this Agreement, including one pending on or before the date of this Agreement, but excluding one initiated by Indemnitee to enforce his rights under this Agreement.
(d) For purposes of this Agreement, references to “other enterprise” shall include employee benefit plans; references to “fines” shall include any excise taxes assessed on Indemnitee with respect to an employee benefit plan; and references to “serving at the request of the Company” shall include any service as a director, officer, employee or agent of the Company which imposes duties on, or involves services by, such director, officer, employee or agent with respect to an employee benefit plan, its participants, or beneficiaries; and if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan, Indemnitee shall be deemed to have acted in a manner “not opposed to the best interests of the Company” as referred to in this Agreement.
7 |
12. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall constitute an original.
13. Successors and Assigns. This Agreement shall be binding upon the Company and its successors and assigns, and shall inure to the benefit of Indemnitee and Indemnitee’s estate, heirs, legal representatives and permitted assigns.
14. Attorneys’ Fees. In the event that any action is instituted by Indemnitee under this Agreement to enforce or interpret any of the terms hereof, Indemnitee shall be entitled to be paid all court costs and expenses, including reasonable attorneys’ fees, incurred by Indemnitee with respect to such action, unless as a part of such action, the court of competent jurisdiction determines that each of the material assertions made by Indemnitee as a basis for such action were not made in good faith or were frivolous. In the event of an action instituted by or in the name of the Company under this Agreement or to enforce or interpret any of the terms of this Agreement, Indemnitee shall be entitled to be paid all court costs and expenses, including attorneys’ fees, incurred by Indemnitee in defense of such action (including with respect to Indemnitee’s counterclaims and cross-claims made in such action), unless as a part of such action the court determines that each of Indemnitee’s material defenses to such action were made in bad faith or were frivolous.
15. Notice. All notices, requests, demands and other communications under this Agreement shall be in writing and shall be deemed duly given (i) if delivered by hand and receipted for by the party addressee, or by email or by facsimile, on the date of such receipt, or (ii) if mailed by domestic certified or registered mail with postage prepaid, on the third business day after the date postmarked. Addresses for notice to either party are as shown on the signature page of this Agreement, or as subsequently modified by written notice.
16. Choice of Law. This Agreement shall be governed by and its provisions construed in accordance with the laws of the State of Nevada, without regard to the conflict of law principles thereof.
17. Period of Limitations. No legal action shall be brought and no cause of action shall be asserted by or in the right of the Company against Indemnitee, Indemnitee’s estate, spouse, heirs, executors or personal or legal representatives after the expiration of one year from the date of accrual of such cause of action, and any claim or cause of action of the Company shall be extinguished and deemed released unless asserted by the timely filing of a legal action within such one-year period; provided, however, that if any shorter period of limitations is otherwise applicable to any such cause of action, such shorter period shall govern.
18. Subrogation. In the event of payment under this Agreement, the Company shall be subrogated to the extent of such payment to all of the rights of recovery of Indemnitee, who shall execute all documents required and shall do all acts that may be necessary to secure such rights and to enable the Company effectively to bring suit to enforce such rights.
19. Amendment and Termination. No amendment, modification, termination or cancellation of this Agreement shall be effective unless it is in writing signed by both the parties hereto. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provisions hereof (whether or not similar) nor shall such waiver constitute a continuing waiver.
8 |
20. Integration and Entire Agreement. This Agreement sets forth the entire understanding between the parties hereto and supersedes and merges all previous written and oral negotiations, commitments, understandings and agreements relating to the subject matter hereof between the parties hereto.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written.
COMPANY: | INDEMNITEE: | |||
Black Ridge Oil & Gas, Inc., a Nevada corporation | Michael Eisele | |||
By: | /s/ Kenneth DeCubellis | /s/ Michael Eisele | ||
Kenneth DeCubellis, | Michael Eisele | |||
Chief Executive Officer | ||||
Address: | Address: | |||
10275 Wayzata Blvd., Suite 310 | 10275 Wayzata Blvd., Suite 310 | |||
Minnetonka, MN 55305 | Minnetonka, MN 55305 |
9 |
Exhibit 10.3
CHANGE OF CONTROL AGREEMENT
THIS CHANGE OF CONTROL AGREEMENT (the “Agreement”) dated as of August 1, 2013, between Black Ridge Oil & Gas, Inc., a Nevada corporation, having a place of business at 10275 Wayzata Boulevard Suite 310, Minnetonka MN 55305 (the "Company"), and Michael Eisele (the "Executive").
WITNESSETH
WHEREAS, the Executive has assumed duties of a responsible nature to the benefit of the Company and to the satisfaction of the Board of Directors (the "Board");
WHEREAS, the Board believes it to be in the best interests of the Company to enter into this Agreement to assure the Executive's continuing services to the Company including, but not limited to, under circumstances in which there is a possible, threatened or actual Change of Control (as defined below);
WHEREAS, the Board believes it is imperative to diminish the inevitable distraction of the Executive by virtue of the personal uncertainties and risks created by a pending or threatened Change of Control and to encourage the Executive's full attention and dedication to the Company currently and in the event of any threatened or pending Change of Control; and
WHEREAS, in order to accomplish all the above objectives, the Board has authorized the Company to enter into this Agreement;
NOW, THEREFORE, in consideration of the mutual promises herein contained, the Company and the Executive hereby agree as follows:
1. Certain Definitions.
"Cause" means termination of the Executive’s employment for (i) any conviction of the Executive, or plea of guilty or no contest by the Executive, to a felony, or (ii) any act or acts of dishonesty by the Executive intended to result in personal enrichment to the Executive at the expense of the Company; or (iii) failure to follow the lawful instructions of the Board.
“Change of Circumstance" means any event which would constitute (a) a demotion of the Executive or any assignment to material duties that are substantially inconsistent with the Executive’s position and title immediately prior to such assignment, (b) a reduction in the Executive’s base salary, other than reductions in salaries applied to executives generally, (c) without the Executive's express written consent, the requirement by the Company that the Executive's principal place of employment be relocated more than fifty (50) miles from his place of employment prior to the Change of Control, (d) a substantial reduction in benefits and perquisites provided to the Executive not applicable to executives generally, or (e) a material change in the terms and conditions of the Executive’s employment other than as permitted by (b) or (d) above; provided, however, none of the foregoing shall constitute a Change of Circumstance unless the Executive objects thereto by giving written notice to the Board within 30 days after the Executive becomes aware of such demotion, assignment, reduction, requirements or other change and the Company fails to correct the same within 30 days following receipt of such notice. Notwithstanding the foregoing, a Change of Control does not, standing alone, constitute a Change of Circumstance.
1 |
"Change of Control" or "Change in Control" shall mean:
(1) The acquisition by any person, entity or “group”, within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934 (the “Exchange Act”) (excluding, for this purpose, (A) the Company, (B) any employee benefit plan of the Company or its subsidiaries which acquires beneficial ownership of voting securities of the Company, or (C) Lyle Berman, Bradley Berman, Bradley Berman Irrevocable Trust, Julie Berman Irrevocable Trust, Jessie Lynn Berman Irrevocable Trust, Amy Berman Irrevocable Trust and Steven Lipscomb) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 33% or more of either the then outstanding shares of common stock or the combined voting power of the Company’s then outstanding voting securities entitled to vote generally in the election of directors, provided that the issuance by the Company as part of an equity offering of shares of 33% or more of either the then outstanding shares of common stock or the combined voting power of the Company’s then outstanding voting securities entitled to vote generally in the election of directors shall not constitute a Change in Control; or
(2) Individuals who, as of the date hereof, constitute the Board (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board, provided that any person becoming a director subsequent to the date hereof whose election, or nomination for election by the Company’s stockholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board (other than an election or nomination of an individual whose initial assumption of office is in connection with an actual or threatened election contest relating to the election of the Directors of the Company, as such terms are used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act) shall be, for purposes of this Agreement, considered as though such person were a member of the Incumbent Board; or
(3) Approval by the stockholders of the Company of (A) a reorganization, merger or consolidation, in each case, with respect to which persons who were the stockholders of the Company immediately prior to such reorganization, merger or consolidation do not, immediately thereafter, own more than 50% of the combined voting power of the reorganized, merged or consolidated company’s then outstanding voting securities entitled to vote generally in the election of directors of the reorganized, merged or consolidated company, or (B) a liquidation or dissolution of the Company or (C) the sale of all or substantially all of the assets of the Company.
2 |
Notwithstanding the foregoing, in no event shall a Change of Control due to a breach of covenants under the Company’s indebtedness or a default on the Company’s indebtedness trigger any payments to Executive under this Agreement.
"Change of Control Date" shall mean the first date on which a Change of Control occurs. Anything in this Agreement to the contrary notwithstanding, (a) if a Change of Control occurs; (b) if prior to the date on which such Change of Control occurs, the Executive's employment with the Company is terminated or the Executive ceases to be the Chief Operating Officer (“COO”) of the Company; and (c) if it is reasonably demonstrated by the Executive that such termination of employment or cessation of status as COO (i) was at the request of a third party who has taken steps reasonably calculated to effect the Change of Control or (ii) otherwise arose in connection with or anticipation of the Change of Control, then for all purposes of this Agreement the "Change of Control Date" shall mean the date immediately prior to the date of such termination of employment or cessation of status as COO.
"Disability" means the inability of the Executive to perform the Executive’s duties as COO, or the Executive’s position and title at such time, by reason of illness or other physical or mental impairment or condition, if such inability continues for an uninterrupted period of 90 days or more. A period of Disability shall be “uninterrupted” unless and until the Executive returns to full-time work for a continuous period of at least 30 days. A Disability period shall be suspended during any period the Executive returns to full-time work for a continuous period of at least five days.
2. Obligations of the Company in Certain Circumstances. If, (a) while the Executive is employed by the Company, there is a Change of Control and (b) on or within 12 months after the Change of Control Date either (x) the Company terminates the Executive's employment other than for Cause, Disability, or death or (y) there is a Change in Circumstance (such date in the case of (x) or (y) the “Date of Termination”), then upon execution of a release, the Company shall pay as severance pay to the Executive an amount equal to the Base Salary that Executive would have received for a twelve (12) month period (the “Payment Period”) at an annualized rate equal to the higher of the rate in effect immediately prior to the Change in Control or the rate in effect on the Date of Termination. Such cash payment shall be payable in accordance with the Company’s regular pay period schedule over the Payment Period. The Executive shall have the right to purchase health and dental coverage under the Company’s group policies then in effect for the Payment Period, and during the Payment Period the Company shall make contributions on behalf of the Executive for the purchase of such health and dental coverage as it provides to its other executive employees as of the Date of Termination.
3. Successors.
(a) This Agreement is personal to the Executive and shall not be assignable by the Executive other than by will or the laws of descent and distribution. This Agreement shall inure to the benefit of and be enforceable by the Executive's legal representatives.
3 |
(b) This Agreement shall inure to the benefit of and be binding upon the Company and the Executive and their respective successors and assigns.
(c) The Company will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of its business and/or assets to assume expressly and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place. As used in this Agreement, the “Company" shall mean as hereinbefore defined and any successor to its business and/or assets as aforesaid which assumes and agrees to perform this Agreement by operation of law, or otherwise.
4. Miscellaneous.
(a) This Agreement shall be governed by and construed in accordance with the laws of the State of Minnesota, without reference to principles of conflict of laws. The captions of this Agreement are not part of the provisions hereof and shall have no force or effect. This Agreement may not be amended or modified otherwise than by a written agreement executed by the parties hereto or their respective successors and legal representatives.
(b) All notices and other communications hereunder shall be in writing and shall be given by hand delivery to the other party or by registered or certified mail, return receipt requested, postage prepaid, addressed as follows:
If to the Executive: | If to the Company: | ||
Michael Eisele | Black Ridge Oil & Gas, Inc. | ||
(Home address | 10275 Wayzata Boulevard | ||
separately given) | Suite 310 | ||
Minnetonka MN 55305 | |||
Attention: Board of Directors |
or to such other address as either party shall have furnished to the other in writing in accordance herewith. Notice and communications shall be effective when actually received by the addressees.
(c) The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement.
(d) The Company may withhold from any amounts payable under this Agreement such Federal, state or local taxes as shall be required to be withheld pursuant to any applicable law or regulation.
(e) The Executive's failure to insist upon strict compliance with any provision hereof shall not be deemed to be a waiver of such provision or any other provision thereof.
[Signatures On Next Page]
4 |
IN WITNESS WHEREOF, the Executive has hereunto set his hand and, pursuant to the authorization from the Board, the Company has authorized and directed the undersigned director to execute and deliver this Agreement in the Company’s name, all as of the day and year first above written.
EXECUTIVE | ||
/s/ Michael Eisele | ||
Michael Eisele | ||
BLACK RIDGE OIL & GAS, INC. | ||
By | /s/ Bradley Berman | |
Name: Bradley Berman | ||
Title: Chairman of the Board, Director |
5 |
Exhibit 99.1
Black Ridge Oil & Gas Appoints Michael Eisele to Chief Operating Officer
MINNETONKA, MN – August 1, 2013 – Black Ridge Oil & Gas, Inc. (the “Company”) (OTCQB: ANFC), an exploration and production (E&P) company focused on non-operated Bakken and Three Forks properties, today announced that the Company’s Board of Directors (the “Board”) approved the appointment of Mr. Michael Eisele, to the position of Chief Operating Officer, effective August 1, 2013.
Since August 2012, Mr. Eisele served as the Company’s Vice President of Land overseeing Black Ridge’s acreage portfolio and acquisitions. Prior to joining the Company, Mr. Eisele was the landman and co-owner of High West Resources, Ltd. from 2011 to 2012 and the owner of Eisele Resources LLC from 2009 to 2012. Mr. Eisele is a graduate of Luther College (B.A.).
Ken DeCubellis, Black Ridge's Chief Executive Officer, said, "We are very pleased to promote Michael to Chief Operating Officer. During his brief tenure with the Company, he has led the acquisition of high value leaseholds including the Stateline 14-3427H (8.3 WI%, 30 day IP of 26,299 BOE), the SCHA 33-34 3H (6.25% WI, 30 day IP of 21,749 BOE), and negotiated and executed the acreage swap with Samson. Under Michael’s operating leadership, we believe the Company is well positioned to continue to grow oil and gas production, revenue, and EBITDA in the Bakken / Three Forks play, and continue to execute our strategy of aggregating high value non operated leaseholds.”
About the Company
Black Ridge Oil & Gas is an oil and gas exploration and production company based in Minnetonka, Minnesota. Black Ridge's focus is exclusive to the Williston Basin Bakken and Three Forks trend in North Dakota and Montana. Black Ridge Oil & Gas controls approximately 12,000 net acres prospective for Bakken and/or Three Forks development. For additional information, visit the Company's website at www.blackridgeoil.com.
Make sure you are first to receive timely information on Black Ridge Oil & Gas when it hits the newswire. Sign up for Black Ridge's email news alert system today at http://ir.stockpr.com/blackridgeoil/email-alerts
Cautionary Statement as to Forward-Looking Statements
Certain statements contained herein, which are not historical, are forward-looking statements that are subject to risks and uncertainties not known or disclosed herein that could cause actual results to differ materially from those expressed herein. These statements may include projections and other "forward-looking statements" within the meaning of the federal securities laws. Any such projections or statements reflect Black Ridge Oil & Gas current views about future events and financial performance. No assurances can be given that such events or performance will occur as projected and actual results may differ materially from those projected. Important factors that could cause the actual results to differ materially from those projected include, without limitation, general economic or industry conditions nationally and/or in the communities in which our Company conducts business, quality and quantity of leaseholds available for sale, volatility in commodity prices for crude oil and natural gas, environmental risks, legislation or regulatory requirements, conditions of the securities markets, our ability to raise capital or have access to debt financing, changes in accounting principles, policies or guidelines, financial or political instability, acts of war or terrorism, increases in operator costs, other economic, competitive, governmental, regulatory and technical factors affecting our Company's operations, products, services and prices and other risks inherent in the Company's businesses that are detailed in the Company's Securities and Exchange Commission ("SEC") filings. Readers are encouraged to review these risks in the Company's SEC filings.
Contact
Black Ridge Oil & Gas, Inc.
Ken DeCubellis, Chief Executive Officer
952-426-1241
www.blackridgeoil.com