EX-10.14 8 v301976_ex10-14.htm AMEGY BANK Dallas, Texas 75201 December 4, 2009 INFINITY ENERGY RESOURCES, INC. Denver, Colorado 80202 Re: Fourth Forbearance Agreement Ladies and Gentlemen:
Exhibit 10.14
AMEGY BANK
0000 Xxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxx 00000
December 4, 2009
INFINITY ENERGY RESOURCES, INC.
000 Xxxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxx 00000
Re: Fourth Forbearance Agreement
Ladies and Gentlemen:
This letter (this “Agreement”) sets forth the fourth forbearance agreement among INFINITY ENERGY RESOURCES, INC. (“Borrower”), a Delaware corporation; INFINITY OIL AND GAS OF TEXAS, INC., a Delaware corporation, and INFINITY OIL & GAS OF WYOMING, INC., a Wyoming corporation (collectively “Guarantors”); and AMEGY BANK NATIONAL ASSOCIATION (“Lender”). Borrower, Guarantors, and Lender previously entered into a Forbearance Agreement (the “First Forbearance Agreement”) dated August 31, 2007, a Second Forbearance Agreement (the “Second Forbearance Agreement”) dated March 26, 2008, and a Third Forbearance Agreement (the “Third Forbearance Agreement”) dated October 16, 2008. Capitalized terms below have the meanings assigned in the Loan Agreement dated January 9, 2007, among Borrower, Guarantors, and Lender, as amended (the “Loan Agreement”).
2. Revolving Loan. (a) The “Termination Date” as defined in the Loan Agreement is hereby extended until 11:00 a.m. (Dallas, Texas time) on January 31, 2010. Borrower agrees to sign and deliver a Second Amendment of the Revolving Note to reflect this extension.
(b) Notwithstanding any provision in the Loan Agreement or the Revolving Note to the contrary, Borrower may not request any further advances on the Revolving Loan without the prior written consent of Lender.
(a) The Existing Defaults set forth in the First Forbearance Agreement, the Second Forbearance Agreement, and the Third Forbearance Agreement;
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(b) Borrower and Guarantors breached the financial covenants set forth in Subsection (a) - (h) of Section 8 of the Loan Agreement for the periods ended September 30, 2008, December 31, 2008, March 31, 2009, June 30, 2009, and September 30, 2009; and
(c) Borrower and Guarantors breached the covenants set forth in Subsections (g), (i), and (m) of Section 7 of the Loan Agreement during the periods ended September 30, 2008, December 31, 2008, March 31, 2009, June 30, 2009, and September 30, 2009; provided, however, that the breach of Subsection (i) of Section 7 of the Loan Agreement was solely attributable to involuntary mineral lien claims made under Chapter 56 of the Texas Property Code or similar applicable law.
(b) As of the date of this Agreement, the Borrowing Base results in a Borrowing Base deficiency in the amount of $8,003,468.00 (the “Deficiency”). On or before the end of the Forbearance Period, Borrower and Guarantors agree to pay the Revolving Loan and all other fees and obligations under this Agreement and the Loan Agreement, in full and cure the Deficiency by selling assets, refinancing of the Revolving Loan, or raising capital on terms acceptable to Lender.
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(b) So long as the Deficiency remains uncured or there is any outstanding Event of Default, Borrower and Guarantors agree that:
(i) They shall not sell, assign, transfer, or otherwise dispose of all or any interest in the Nicaragua Concessions, without the prior written consent of Lender, except for (1) the sale of hydrocarbons in the ordinary course of business, (2) the sale or transfer of equipment or inventory in the ordinary course of business or that is no longer necessary for the business of Borrower or that is obsolete or replaced by equipment of at least comparable value and use, (3) the assignment or transfer required under Section 10.02 of Borrower’s insurance policies issued by the Overseas Private Investment Corporation (“OPIC”) related to the Nicaragua Concessions (the “OPIC Policies”), after payment of compensation for a claim made by Borrower under the OPIC Policies, (4) in connection with the consulting arrangements identified on Schedule B attached, the conveyance of the overriding royalty interest in the Nicaragua Concessions identified thereon, and (5) such conveyances of one or more overriding royalty interests in the Nicaragua Concessions as approved by Lender in writing; and
(ii) They shall not mortgage, assign, hypothecate, pledge, or encumber, and not create, incur, or assume any lien or security interest on or in, the Nicaragua Concessions (or any interest in the Nicaragua Concessions), without the prior written consent of Lender, except for any security interest in favor of Lender and the Permitted Encumbrances.
8. Subordinate Loans. Borrower has entered into one or more subordinate loans in an aggregate amount not less than $1,250,000.00, which are subordinated to the Loans (the “Subordinate Loans”). The Subordinate Loans are secured by security documents on a fully-subordinated basis. Unless otherwise agreed by Lender in writing, the proceeds from the Subordinate Loans may be used by Borrower for general and administrative expenses in excess of the monthly limit set forth below or for development of the Nicaragua Concessions.
9. Cash Flow. Borrower agrees that it will use its commercially reasonable best efforts to cause the contribution of cash to Borrower to the extent necessary so that Borrower’s consolidated cash flow is a minimum of break even, after payment of interest expense on the Revolving Loan, to prevent any additional accounts payable from becoming past due, and to prevent any mineral liens under Chapter 56 of the Texas Property Code or similar applicable law from being filed against the Properties.
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(a) Borrower and Guarantors will direct all production proceeds attributable to their oil and gas properties to be paid to a lockbox account to be set up and maintained with Lender for the purpose of collection of production proceeds (the “Lockbox Account”).
(b) All production proceeds received in the Lockbox Account by Lender with respect to production, severance, ad valorem, or other taxes on production proceeds (excluding income taxes) or that are attributable to another person’s or entities’ royalty or other interest in the oil and gas properties shall be released immediately to Borrower upon Borrower’s request and verification of those amounts. Borrower and Guarantors shall provide evidence of the timely payment of production, severance, ad valorem, or other taxes on production proceeds (excluding income taxes) and of the royalty and overriding royalty owners; provided, however, that no royalties and overriding royalty interests owned by Borrower, Guarantors, or any affiliates of Borrower or Guarantors within the meaning of Securities and Exchange Commission Rule 144, shall be paid from the Lockbox Account proceeds.
(c) Borrower will provide Lender with a proposed budget of recurring operating expenses, non-recurring operating expenses, general and administrative expenses, and any capital expenditures for the oil and gas properties expected to be paid during the Forbearance Period and supporting documentation for those expenses and expenditures.
(d) At Borrower’s request, production proceeds in the Lockbox Account may be used to pay operating expenses, general and administrative expenses (subject to the limits in Section 15 below), and capital expenditures, all as approved by Lender (which approval shall not be unreasonably withheld, delayed, or denied). Borrower and Guarantors shall not pay in any month operating expenses, general and administrative expenses, or capital expenditures exceeding the aggregate budgeted expenses for each such category for that month, unless Lender has approved such payments. Borrower shall, not later than two (2) business days prior to the date on which Borrower proposes to pay such operating expenses, general and administrative expenses, or capital expenditures and as a condition precedent to requesting such approval, deliver to Lender in usual and customary form reasonably acceptable to Lender reasonable detail of all expenses and expenditures proposed to be paid in respect of such month. Any excess production proceeds in the Lockbox Account may be used only for such other purposes as approved by Lender, in its discretion.
(e) All production proceeds remaining in the Lockbox Account after payment of the taxes and royalties as provided above and the operating expenses and discretionary amounts as provided above will be applied by Lender on the last day of each month to the principal and interest on the Revolving Note and all other fees and obligations under this Agreement and the Loan Agreement as set forth in Section 3.2 of the Deed of Trust. If the production proceeds received in the Lockbox during any month are not sufficient to make the scheduled monthly interest payment on the Revolving Loan, Borrower will pay Lender the deficiency within ten (10) days of notice from Lender of such shortfall.
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(f) Borrower and Guarantors agree that the insurance proceeds in the approximate amount of $100,000.00, from the 2008 saltwater disposal tank fire, shall be promptly deposited upon receipt, into the Lockbox Account and used for the purposes set forth above.
(a) Borrower, INFINITY OIL & GAS OF WYOMING, INC. (“IOGWy”), and INFINITY OIL AND GAS OF TEXAS, INC. (“IOGTx”) shall proceed with the sale and marketing of the interest retained in the oil and gas properties of IOGWy (the “Rockies Properties”) and the Texas oil and gas properties of IOGTx (the “Texas Properties”). Borrower and Guarantors shall devote their substantial efforts, time, talents, and expertise to the sale and marketing of the Rockies Properties and the Texas Properties, will take all lawful actions as will result in the prompt payment of the Deficiency, and will thereafter accept any commercially reasonable offer to buy the Rockies Properties and the Texas Properties, or any of them; provided no oil and gas property or leasehold interest which is mortgaged to Lender shall be sold except on terms and price acceptable to Lender and with the prior written approval of Lender. Borrower and Guarantors shall use their best efforts to (i) promptly open a data room on the properties to be sold, (ii) to promptly obtain firm proposals for the sale of the properties, (iii) to execute a definitive agreement or agreements, subject to stockholder approval if required, for the sale of properties with proceeds sufficient to repay the Deficiency, and (iv) seek stockholder approval, if required, and consummate the sale of the properties as soon as practicable thereafter.
(b) Borrower and Guarantors have entered into an agreement with an oil and gas divestiture firm acceptable to Lender, to assist with sales of the Rockies Properties and the Texas Properties under this Section. Borrower and Guarantors shall promptly provide Lender with a copy of the agreement or engagement letter with any oil and gas divestiture firm retained to assist with sales under this Section; and thereafter Borrower and Guarantors shall provide a monthly report on the first (1st) day of each month, to be prepared by the oil and gas divestiture firm engaged by Borrower and Guarantors to facilitate the sale of the oil and gas properties and leasehold interests, that includes any and all information pertaining to property bids, the current status of any bids or sale discussions, and all marketing efforts employed to sell the Rockies Properties and the Texas Properties. Notwithstanding any provision to the contrary, at least two business days prior to the date on which Borrower proposes to pay such, Borrower shall deliver to Lender in usual and customary form reasonably acceptable to Lender, reasonable detail of all broker fees and other transaction costs related to the sale of the properties proposed to be paid from proceeds in the Lockbox Accounts, and thereafter Borrower may pay such fees and costs as are approved by Lender (which approval shall not be unreasonably withheld, delayed, or denied).
(c) No sale of any of the Rockies Properties and the Texas Properties, or any of them, will be permitted to an affiliate of Borrower or Guarantors, unless Lender consents in writing.
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(d) Except as set forth below, Borrower and Guarantors will direct all of the net sale proceeds from the sale of any of the Rockies Properties and the Texas Properties to be paid to Lender to be applied to the Revolving Note and all other fees and obligations under this Agreement and the Loan Agreement, and to cash securing all outstanding Letters of Credit, including the Nicaragua Letters of Credit, in such order as determined by Lender and shall take all lawful actions to ensure that the proceeds of any such sales are contemporaneously with the closing thereof applied to the Revolving Note and all other fees and obligations under this Agreement and the Loan Agreement, and cash security for all outstanding Letters of Credit, including the Nicaragua Letters of Credit, as herein provided. Lender hereby agrees that, so long as there is no Default at the time of the sale of the Rockies Properties, Borrower and IOGWy may retain twenty percent (20%) of the net sale proceeds from the sale and use those net sale proceeds solely for working capital and development of the Nicaragua Concessions.
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(a) Within ten (10) days of the end of each month, a report showing Borrower’s consolidated actual cash flow for the month and for the period from the beginning of the fiscal year through the end of the month and consolidated projected cash flow for the next six months.
(b) Within ten (10) days of the end of each month, an accounts payable listing and aging, along with copies of all additional liens or claims made by any account creditors.
(c) As received and available, Borrower and Guarantors shall promptly provide to Lender all information related in any way to their ability to raise additional capital.
(d) As received and available, Borrower and Guarantors shall promptly provide to Lender copies of any agreement or engagement letter with an oil and gas divestiture firm, all written purchase bids, purchase agreements, and farm-in proposals related in any way to the prospective sale of any of the Rockies Properties and the Texas Properties and shall promptly inform Lender of any unwritten offers or bids.
(e) As received and available, Borrower and Guarantors shall promptly provide to Lender copies of any term sheets or financing proposals received that would result in the Deficiency being cured or a refinance of the entire outstanding amount owed on the Revolving Note.
(f) Notwithstanding the provisions of Subsection (h) of Section 9 of the Loan Agreement, within fifty (50) days of the end of each month, a production report, on a lease-bylease or unit basis, showing the gross proceeds from the sale of oil, gas, and associated hydrocarbons produced from the Properties, the quantity of oil, gas, and associated hydrocarbons sold, the severance, gross production, occupation, or gathering taxes deducted from or paid out of the proceeds, settlements of any Hedge Transactions, the cash lease operating expenses, including non-recurring cash operating expenses, intangible drilling costs, and capital expenditures, general and administrative expenses, the number of xxxxx operated, drilled, or abandoned, the name, address, telephone number, and contact of the first purchaser of production for all of the Properties, and such other information as Lender may reasonably request;
(g) such other information respecting the condition and the operations, financial or otherwise, of Borrower, Guarantors, and the Properties as Lender may from time to time reasonably request.
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(b) Lender has suspended the interest payments due on May 1, 2009, and June 1, 2009, and that accrued interest shall be due and payable on the Deferral Date. Accrued, unpaid interest on the Revolving Note shall be due and payable monthly, commencing on July 1, 2009, and continuing on the first (1st) day of each month thereafter during the Forbearance Period. Interest payments shall be made from the funds available from the Lockbox Account, or from additional cash equity contributions to Borrower deposited into the Lockbox Account, or from a combination of both. If any cash equity contribution to Borrower is deposited into the Lockbox Account for the purpose of paying the monthly interest payments due under this Forbearance Agreement, then Borrower shall be entitled to the credit against the Forbearance/Waiver Fee as set forth in Section 21(c) below.
(i) Forbearance/Waiver Fee under the First Forbearance Agreement in the amount of $553,666.67; plus
(ii) Forbearance/Waiver Fee under the Second Forbearance Agreement in the amount of $723,666.33; plus
(iii) Forbearance/Waiver Fee under the Third Forbearance Agreement in the amount of $1,189,259.24; plus
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(iv) A Forbearance/Waiver Fee shall be due for each month from June 1, 2009 through the end of the Forbearance Period, inclusive, calculated as one percent (1.0%) of the average daily outstanding principal balance on the Revolving Note for the month as of the last day of each of those months (or as of the Deferral Date if such occurs during any month).
Except as set forth below, the Forbearance/Waiver Fees and all other fees are non-refundable and earned by Lender upon execution of this Agreement.
(b) If on or before January 31, 2010, the Revolving Note and all other fees and obligations under this Agreement and the Loan Agreement are paid in full, and all outstanding Letters of Credit, including the Nicaragua Letters of Credit, are terminated or cash secured to Lender’s satisfaction, then Lender hereby agrees to waive one-half of the Forbearance/Waiver Fees accrued, but unpaid, under Subsection (a) above.
(c) If any cash equity contribution to Borrower is deposited into the Lockbox Account for the purpose of paying the monthly interest payments due under this Forbearance Agreement, then Borrower shall receive a credit to the Forbearance/Waiver Fees accrued, but unpaid, under Subsection (a) above, equal to three hundred percent (300%) of the amount of the equity contribution used for the purpose of paying the monthly interest payments due under this Forbearance Agreement, up to the full amount of the Forbearance/Waiver Fees accrued, but unpaid, under Subsection (a) above.
(d) Borrower may make a written proposal to Lender regarding the payment of the Forbearance/Waiver Fees due under this Section by (i) delivery of stock in Borrower to Lender or its nominee, or (ii) assignment of an overriding royalty interest in the Nicaragua Concessions to Lender or its nominee. The proposal will be subject to Lender’s credit approval and must be upon terms and pricing acceptable to Lender, in its sole discretion. Lender does not yet have credit approval for payment of the Forbearance/Waiver Fees by delivery of stock or assignment of royalty.
(a) Except for the Deficiency and the Existing Defaults, all representations and warranties set forth in Section 6 of the Loan Agreement must be true as of the date of this Agreement, except for Subsection (d) of Section 6, which is qualified by the lawsuits set forth in Schedule A attached, and Subsection (i) of Section 6, which is no longer applicable.
(b) the negotiation, execution, and delivery of Loan Documents in Proper Form, including, but not limited to, the following:
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(i) this Agreement;
(ii) Second Amendment to Revolving Note;
(iii) Restated Security Agreement signed by Borrower and acknowledged by the Overseas Private Investment Corporation; and
(iv) Borrower and Guarantors Resolutions.
(c) other than as contemplated in this Agreement, there shall not have occurred a material adverse change in the business, assets, liabilities (actual and contingent), operations, or financial condition of Borrower or in the facts and information regarding such entities as represented to date.
(d) Lender’s receipt and satisfactory review of a 180-day operating/cash flow forecast for Borrower and Guarantors.
(e) Lender’s receipt and satisfactory review of a proposed budget from Borrower of recurring operating expenses, non-recurring operating expenses, general and administrative expenses, and any capital expenditures for the oil and gas properties expected to be paid during the Forbearance Period and supporting documentation for those expenses and expenditures.
(f) Lender’s receipt of satisfactory written evidence that Borrower was provided with an additional commitment on the Subordinate Loan in May, 2009, in an amount not less than $250,000.00, for the payment of trade payables with respect to the Rockies Properties and the Texas Properties, and that as of the date of this Agreement, Borrower has funded not less than $100,000.00 from this additional commitment and used the funds for payment of trade payables with respect to the Rockies Properties and the Texas Properties.
(b) Upon a Default, Lender may terminate the Forbearance Period and the maturity of the Revolving Note shall automatically be accelerated as of the date of the termination of the Forbearance Period, without presentment, demand for payment, notice of intent to accelerate, other notice of acceleration or dishonor, protest, or notice of protest of any kind, all of which are expressly waived by Borrower. Thereafter Lender may exercise any and all rights and remedies available to it, including, without limitation, those under the Loan Agreement, the Revolving Note, the Security Documents, the Guaranties, the Loan Documents, this Agreement, and any other instrument or agreement relating hereto, or any one or more of them. All rights and remedies of Lender shall be cumulative and concurrent and, after a Default, may be pursued separately, successively, or together as often as occasion therefore shall arise, at the sole discretion of the Lender.
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22. Other Representations. Borrower and Guarantors hereby represent to Lender as follows:
(a) The execution, delivery, and performance of this Agreement by Borrower and Guarantors have been duly authorized by Borrower’s and Guarantors’ respective boards of directors and this Agreement constitutes their legal, valid, and binding obligations, enforceable in accordance with their respective terms; and
(b) Except as set forth on Schedule A hereto, there are no actions, suits, or proceedings pending or threatened against or affecting Borrower, Guarantors, or the Properties, before any court or governmental department, commission, or board, which, if determined adversely, would have a material adverse effect on any of the Properties or the operations or financial condition of any of Borrower or Guarantors.
(c) Borrower has fully performed all of its obligations under the Farmout and Acquisition Agreement (the “Farmout Agreement”) dated December 26, 2007, between IOGTx, as farmor, and Forest, as farmee; and the Farmout Agreement has terminated under its terms.
Principal | $ | 10,010,493.64 | |||
Interest | $ | 420,703.59 | |||
Total | $ | 10,431,197.23 |
Borrower and Guarantors agree that there is no set off or defense to payment of the Revolving Note.
(b) As security for the Notes, Borrower and Guarantors previously executed the Security Documents, including the Security Agreement. Borrower and Guarantors ratify and confirm the Security Documents, acknowledge that they are valid, subsisting, and binding, and agree that the Security Documents secure payment of the Notes (including the Revolving Note) and the Loans (including the Revolving Loan).
(c) In connection with the Revolving Note, Guarantors executed the Guaranties. Guarantors ratify and confirm the Guaranties, acknowledge that the Guaranties are valid, subsisting, and binding upon Guarantors, and agree that the Guaranties guarantee payment of the Revolving Note. Guarantors agree that there is no defense to payment under the Guaranties.
(d) Borrower and Guarantors hereby represent to Lender that all representations and warranties set forth in Section 6 of the Loan Agreement are true and correct as of the date of execution of this Agreement, except for Subsection (d) of Section 6, which is qualified by the lawsuits set forth in Schedule A attached, and Subsection (i) of Section 6, which is no longer applicable; and that, except for the Existing Defaults, Borrower and Guarantors are in compliance as of the date of execution of this Agreement with all covenants set forth in Section 7 of the Loan Agreement, all financial covenants set forth in Section 8 of the Loan Agreement, and all reporting requirements set forth in Section 9 of the Loan Agreement.
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27. Governing Law and Venue. THIS AGREEMENT, THE LOAN AGREEMENT, THE REVOLVING NOTE, AND ALL LOAN DOCUMENTS SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS AND SHALL BE PERFORMED IN DALLAS COUNTY, TEXAS. BORROWER, GUARANTORS, AND LENDER IRREVOCABLY AGREE THAT VENUE FOR ANY ACTION OR CLAIM RELATED TO THIS AGREEMENT, THE LOAN AGREEMENT, THE REVOLVING NOTE, OR ANY LOAN DOCUMENTS SHALL BE IN DALLAS COUNTY, TEXAS.
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(b) It is the intention of Borrower, Guarantors, and Lender that this paragraph be incorporated by reference into each of the Loan Documents. Borrower, Guarantors, and Lender each warrant and represent that their entire agreement with respect to the Loans is contained within the Written Loan Agreement, and that no agreements or promises have been made by, or exist by or among, Borrower, Guarantors, and Lender that are not reflected in the Written Loan Agreement.
(c) THE LOAN AGREEMENT REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN AGREEMENTS BETWEEN THE PARTIES.
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If the foregoing correctly sets forth your understanding of our agreement, please sign and return one copy of this letter. Notwithstanding any provision to the contrary, this Agreement shall only be effective if Borrower and Guarantors sign and return to Lender by 3 p.m., Houston, Texas time, on Wednesday, December 9, 2009.
Yours very truly, AMEGY BANK NATIONAL ASSOCIATION | |||
By: | /s/ A. Xxxxxxx Xxxxxxx, | ||
A. Xxxxxxx Xxxxxxx, Senior Vice President/ Manager - Energy Group | |||
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December 4, 2009
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Accepted and agreed to
this 4 day of December, 2009:
BORROWER: INFINITY ENERGY RESOURCES, INC. | |||||
By: | /s/ Xxxxxxx X. Xxxx | ||||
Xxxxxxx X. Xxxx, President and Chief Executive Officer | |||||
GUARANTORS: INFINITY OIL AND GAS OF TEXAS, INC. | |||||
By: | /s/ Xxxxxxx X. Xxxx | ||||
Xxxxxxx X. Xxxx, President | |||||
INFINITY OIL & GAS OF WYOMING, INC. | |||||
By: | /s/ Xxxxxxx X. Xxxx | ||||
Xxxxxxx X. Xxxx, President | |||||
Exhibits and Schedules:
Schedule A - Lawsuits
Schedule B - Overriding Royalty conveyances
SCHEDULE A
Lawsuits
Southwest Aviation Specialist, LLC filed an action in the District Court in and for the County of Tulsa, State of Oklahoma, number CS200708783, on October 31, 2007, against Infinity Oil and Xxxx Xxxx.
SCHEDULE B
Overriding Royalty conveyances
1.Revenue Sharing Agreement, dated March 23, 2009, between Infinity Energy Resources, Inc. and Off-Shore Finance, LLC, with respect to 1% of the revenue derived from Infinity Energy Resources, Inc.'s share of the hydrocarbons produced at the wellhead from the Concessions (as therein defined).
2.Letter Agreement, dated September 8, 2009, between Xxxxxxxx & Xxxxxx Global Energy Services and Infinity Energy Resources, Inc., with respect to a 1% overriding royalty interest on all oil and gas produced.
3.Letter Agreement, dated September 16, 2009, between Infinity Energy Resources, Inc. and Xxxx Xxxxxxx, with respect to a 1% overriding royalty interest on all oil and gas produced.
4.Revenue Sharing Agreement, dated June 6, 2009, among Infinity Energy Resources, Inc. and Xxxxxxx X. Xxxx, Xxxxx X. Xxxxxx and Xxxxxx X. Xxxxxxxx, as tenants in common of 1% of the revenue derived from Infinity Energy Resources, Inc.'s share of the hydrocarbons produced at the wellhead from the Concessions (as therein defined).