Victory Energy Corporation to Cut Down the Further Extension of Credit to Lucas Energy, Inc. on Termination of Agreements
May 15 15
Lucas Energy, Inc. announced that on May 11, 2015, the non-binding letter of intent (the "Letter of Intent") previously entered into between Victory Energy Corporation ("Victory") and Lucas was terminated. The Letter of Intent provided that either party could terminate the agreement by written notification to the other party for any reason. As previously disclosed, the Letter of Intent contemplated the combination of the businesses of the Company and Victory by way of a merger (the "Proposed Business Combination"). In conjunction with the termination and pursuant to the Pre-Merger Loan and Funding Agreement between the Company and Victory dated February 26, 2015 (the "Loan Agreement"), Victory will not extend further credit to Lucas. Lucas and Victory are currently in the process of negotiating a mutually agreeable unwinding of the steps previously taken in anticipation of the Proposed Business Combination.
NYSE MKT Grants Extension To Lucas Energy, Inc. To Regain Compliance
Apr 6 15
Lucas Energy, Inc. announced that the NYSE MKT (Exchange) has notified the company that it has been granted an extension with a targeted completion date of August 28, 2015 to regain compliance with the NYSE MKT continued listing standards. On February 28, 2014, Lucas received notice that the company was below certain of the NYSE MKT continued listing standards, as set forth in Section 1003(a)(iii) of the NYSE MKT Company Guide, due to its financial condition. Based on information provided by the company through March 31, 2015, the Exchange has determined that Lucas Energy has made a reasonable demonstration of its ability to regain compliance by the end of the revised period which has been extended to August 28, 2015. By the conclusion of this extension, the company must be in compliance with the Exchange's continued listing
standards. August 28, 2015 represents the maximum allowable eighteen-month period within which to regain compliance as outlined in Section 1009(b) of the Company Guide. Failure to demonstrate adequate progress within that timeframe will result in the Exchange Staff initiating delisting proceedings pursuant to Section 1009 of the Company Guide.
Lucas Energy, Inc. Amends Terms of Loan Agreement
Feb 24 15
On February 23, 2015, Lucas Energy, Inc. entered into a letter agreement with Louise H. Rogers, the company's senior lender pursuant to that certain Letter Loan Agreement and Promissory Note, as amended by the Amended Letter Loan Agreement and Amended and Restated Promissory Note effective April 29, 2014, and the Second Amended Letter Loan Agreement and Second Amended and Restated Promissory Note effective November 13, 2014. Pursuant to the Letter Agreement, the parties agreed that the interest payments due under the promissory note for January, February and March 2015 (which January and February 2015 interest payments were not previously made by the company) would be added to the principal amount of the promissory note and be due at maturity; and that interest only payments on the promissory note at the rate of 12% per annum (compared to 15% per annum pursuant to the Second Amended and Restated Promissory Note, and 18% per annum as a result of various events of default which occurred under the loan documents prior to the parties' entry into the Letter Agreement) would be due between April 2015 and August 2015 compared to the terms of the Second Amended and Restated Promissory Note, which required amortizing principal payments every month between December 2014 and August 2015 (which amortizing payments the company failed to pay from December to February 2015). The Letter Agreement also provides the company the right to extend the maturity date of the promissory note to September 13, 2015, by paying an extension fee of 2% of the remaining balance of the note on or before the current maturity date (August 13, 2015), and to thereafter further extend the maturity date of the promissory note to October 13, 2015, by paying an additional extension fee of 2% of the then remaining balance of the note on or before the September 13, 2015 extended maturity date. The company also agreed to pay the lender all current and past due credit administration and legal fees, a $50,000 loan amendment fee upon final repayment of the promissory note, and to require that the newly formed entity (Newco) which the company plans to form with Victory Energy Corporation (in connection with its planned merger, and prior to the consummation of such merger, its planned arrangement whereby Victory will fund various of the company's wells), to provide the lender a promissory note in the amount of $250,000, payable within 90 days following the termination of its proposed merger transaction with Victory, provided that if the planned merger transaction with Victory is consummated, such promissory note will be cancelled, provided further that it will still owe the lender all amounts due under its Letter Loan Agreement and promissory note, each as amended, with the Lender.