ARET Arete Industries Inc (CE)

Item 8.01. Other events.

On September 28, 2018, through negotiations with Arête, Citywide Banks of Denver Colorado granted a two-year extension to Arête reducing the line of credit to the existing outstanding advance amount of $523,000 and releasing all of the collateral except the certificate of deposit already being held by the bank. The new maturity date was extended to September 28, 2020.

On October 11, 2018, the Company entered into a Sale and Purchase Agreement with Burlingame Equity Investors Master Fund, LP and Burlingame Equity Investors II, LP (“Lenders”) to acquire from Lenders two promissory notes with outstanding balances of $165,251 and $17,749 respectively. The total purchase price for these notes is $82,625.50 and $8874.50 respectively or 50% of the outstanding balances (the “Purchase Price”). The Purchase Price is due in three equal monthly payments totaling $30,500 each commencing on October 20, 2018 with the final payment due on or before December 20, 2018. The closing date on the purchase is to take place between two and five business days after the final payment due on December 20, 2018. The first payment has been made in a timely fashion. Part of the proceeds from the sale of the Company’s working interests described in Item 2.01 above has been dedicated to the completion of this Sale and Purchase Agreement.

On or about February 4, 2019, DNR Oil and Gas Inc., one of our operators, entered into a confidential settlement agreement on our behalf with one of our pipeline operators who had apparently not properly mapped the pipeline in question which caused the pipeline operator to have to settle various liability issues including ours. Without admitting or denying liability, the pipeline operator agreed to pay us $105,200 in full settlement of any and all claims known or unknown. The payment was received by DNR in a timely fashion.