Exhibit 10.3
Execution Version
This
Revenue Sharing Agreement (the “Agreement”) dated March 23, 2009 is entered into by and
between
INFINITY ENERGY RESOURCES, INC. (
“Assignor”) and OFF-SHORE FINANCE, LLC, a Nevada limited
liability company (
“Assignee”). Assignor and Assignee are collectively referred to as the
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Parties.”
In consideration of the premises and mutual covenants and obligations below, the Parties agree
as follows:
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Assignor hereby assigns unto Assignee a monthly payment (the “RSP”) equal to the revenue
derived from one percent (1%) of 8/8ths of Assignor’s share of the hydrocarbons produced at
the wellhead from certain oil and gas concessions in the Tyra and Perlas Blocks, offshore
Nicaragua (the “Concessions”). The RSP shall bear its proportionate share of all costs
incurred to deliver the hydrocarbons to the point of sale to an unaffiliated purchaser,
including without limitation, its share of production, severance and similar taxes, as well as
its share of all costs of gathering, treating, compressing, dehydrating and processing
produced hydrocarbons (or otherwise rendering the same marketable) and transporting the same
to the point of sale. Assignor will employ the accounting procedures and standards in the
2005 XXXXX Accounting Procedure. |
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Assignor shall pay the RSP to Assignee by the last day of each month based on the revenue
received by Assignor from the purchaser of the production during the previous month from the
Concessions. The Parties expressly agree that this Agreement does not create any rights in
the Concessions. No obligation, express or implied, shall arise by reason of the RSP that
obligates Assignor to maintain or develop either of the Concessions. All operations under the
Concessions shall be solely at the discretion of Assignor. |
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Assignee, upon notice in writing to Assignor, shall have the right to audit Assignor’s
accounts and records relating to the RSP (“Audit Rights”), for any calendar year within the
twenty-four (24) month period following the end of such calendar year. Assignor shall bear no
portion of Assignee’ audit cost, and the audits shall not be conducted more than once each
year without prior approval of Assignor. |
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At any time within three (3) years from the date of this Agreement, Assignor shall have the
right to redeem the RSP by paying to Assignee an amount as follows: (i) if during the first
year of this Agreement, a sum equal to three (3) times the amount of investor funding by
Off-Shore Finance, LLC to Assignor as of December 31, 2009 (the “Funding Amount”); (ii) if
during the second year of this Agreement, a sum equal to five (5) times the Funding Amount; or
(iii) if during the third year of this Agreement, a sum equal to ten (10) times the Funding
Amount. Upon the redemption of the RSP by Assignor, this Agreement shall terminate and all
rights of Assignee under this Agreement shall immediately cease, provided Assignee shall be
entitled to payment of the RSP accruing up until the redemption of the RSP. |
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This Agreement may be executed in several counterparts, all of which are identical. All of
such counterparts together shall constitute one and the same instrument. |
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This Agreement shall inure to the benefit of and be binding upon the successors and permitted
assigns of the Parties. This Agreement shall not be assignable or transferable by Assignee
without the prior written consent of Assignor. |
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This Agreement contains the entire agreement between the Parties relating to the subject
matter of this Agreement at the date hereof to the exclusion of any terms implied by law which
may be excluded by contract and supersedes any previous written or oral agreement between the
Parties in relation to the matters dealt with in this Agreement. |
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This Agreement will be governed by, construed, interpreted and applied in accordance with the
laws of the State of Colorado, excluding any choice of law rules which would refer the matter
to the laws of another jurisdiction. All disputes arising out of or related to the
interpretation or enforcement of this Agreement shall be fully and finally resolved under
Commercial Arbitration Rules of the American Arbitration Association by a panel of three
arbitrators appointed in accordance with those rules. The arbitration proceeding shall take
place in Denver, Colorado, or any such other location as the Parties may mutually agree, and
shall be conducted in the English language. The arbitration award shall be final and binding
on the Parties. A Party may enter judgment upon the award in any court of appropriate
jurisdiction upon application thereto. |
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The Parties agree that this Agreement and its contents shall be considered confidential and
shall not be disclosed to any other person or entity without the prior written consent of
Assignor. |
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ASSIGNOR: |
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INFINITY ENERGY RESOURCES, INC. |
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Name:
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/s/ Xxxxxxx X. Xxxx
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By:
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Xxxxxxx X. Xxxx |
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Title: Chief Executive Officer |
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ASSIGNEE: |
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OFF-SHORE FINANCE, LLC |
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Name:
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/s/ Xxxxxx X. Xxxxx
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By:
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Xxxxxx X. Xxxxx |
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Title: Managing Member |
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