NEWCASTLE ENERGY CORP. ("NGY")
BULLETIN TYPE: Property-Asset or Share Disposition Agreement
BULLETIN DATE: May 5, 2014
TSX Venture Tier 2 Company
Property-Asset or Share Disposition Agreement:
Pursuant to Newcastle Energy Corp. (the "Company") receiving shareholder approval for the transaction at the Special General Meeting of Shareholders held on March 31, 2014, and disclosure in the Company's information circular dated February 24, 2014, TSX Venture Exchange has accepted for filing:
A. LAK Ranch Sale and Purchase Agreement ("SPA") dated February 1, 2014 between the Company's subsidiary Derek Resources (U.S.A.) Inc. ("Derek") and Maha Energy (US) Inc. ("Maha"), whereby Derek will sell to Maha its working interest in the LAK Ranch holding, which includes:
* 38.8235% working interest in the Federal leases;
* 38.8235% working interest in the New LAK Ranch Lease;
* 38.8235% working interest in the Joint operating agreement ("JOA") between Derek and Maha;
* 38.8235% working interest in assets held under the joint account under the original LAK Ranch Joint Acquisition Agreement ("JAA") between Derek and Maha; and
* 38.8235% working interest in all other assets, comprising the LAK Ranch area, Wyoming.
The total consideration for the transferred interest under the SPA is:
* a $635,000 cash payment;
* forgiveness of all Joint Venture debt (estimated to be about US$400,000); and
* the issuance to the Company of 3,750,000 shares of Maha Energy Inc., the Canadian-based parent of Maha Energy (US) Inc.
B. Letter Agreement between the Company's Subsidiary Derek Resources (U.S.A.) Inc. ("Derek") and Charles A. Haegelin dated February 10, 2014, which provides the terms of the settlement of the security interest held by Mr. Haegelin over the LAK Ranch Leases.
* Under the terms, the Company will repay loan note debt of $1,705,800 by making cash payment of $170,580 and transferring 539,807 Maha shares from the 3,750,000 issued to the Company to the debtor.
Further information on the transaction is available in the Company's information circular dated February 24, 2014, and news releases dated January 14, 2014, February 21, 2014, March 20, 2014, April 1, 2014 and May 5, 2014 all on SEDAR.
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