Exhibit 10.2
Execution Version
SECURITIES PURCHASE AGREEMENT
     SECURITIES PURCHASE AGREEMENT (the “Agreement”), dated as of March 23,
2009, by and among Infinity Energy Resources, Inc., a Delaware corporation, with
headquarters located at 11900 College Blvd., Suite 204, Overland Park, Kansas
66210 (the “Company”) and Off-Shore Finance, LLC, a Nevada limited liability
company (the “Buyer”), 11900 College Blvd., Suite 310, Overland Park, Kansas
66210.
     WHEREAS:
     A. The Company and Buyer are executing and delivering this Agreement in
reliance upon the exemption from securities registration afforded by
Section 4(2) of the Securities Act of 1933, as amended (the “1933 Act”), and
Rule 506 of Regulation D (“Regulation D”) thereunder, as promulgated by the
United States Securities and Exchange Commission (the “SEC”) under the 1933 Act.
     B. The Company has authorized the issuance of (i) a subordinated secured
promissory note in the aggregate principal amount of $1,275,000 due March 23,
2012 (the “Note”), and (ii) a one percent (1%) revenue sharing interest with
respect to the Company’s Nicaragua concessions in the Tyra and Perlas Blocks,
offshore Nicaragua (the “Concessions”) (the “Revenue Sharing Interest”).
     C. The Buyer wishes to purchase, and the Company wishes to sell, upon the
terms and conditions stated in this Agreement, (i) the Note, in substantially
the form attached hereto as Exhibit A, and (ii) the Revenue Sharing Interest.
     D. The Note and the Revenue Sharing Interest are collectively referred to
herein as the “Securities.”
     NOW, THEREFORE, the Company and Buyer hereby agree as follows:
     1. PURCHASE AND SALE OF NOTE AND REVENUE SHARING INTEREST.
          (a) Amount. Upon the terms and conditions set forth herein, the
Company hereby agrees to issue and sell to Buyer, and Buyer hereby agrees to
purchase from the Company at the Closing (as defined below), the Securities.
          (b) Closing. The closing (the “Closing”) of the purchase and sale of
the Securities will occur at the offices of Davis Graham & Stubbs LLP, 1550 17th
Street, Denver Colorado, 80202 at 10:00 a.m., Denver Time, on the date hereof
(“Closing Date”). At the Closing, the parties shall take the actions and make
such deliveries as are provided in Article 5 below.
          (c) Purchase Price. The purchase price (the “Purchase Price”) of the
Securities is $1,275,000. The Buyer agrees, on the terms and conditions set
forth herein and in the Note, to make loans to the Company upon the Company’s
request from time to time, provided that in no event shall the aggregate
principal amount of such loans at any time exceed $1,275,000. On the Closing
Date, (i) Buyer shall deposit the Purchase Price into an escrow account (the
“Off-Shore Escrow Account”) at Amegy Bank National Association (“Amegy”) which
is the subject of the escrow agreement

 

--------------------------------------------------------------------------------

 

between the Buyer, Amegy and Amegy Bank National Association as escrow agent, of
even date herewith (the “Off-Shore Escrow Agreement”), by wire transfer of
immediately available funds, and (ii) the Company shall deliver to Buyer the
Note and the Revenue Sharing Agreement.
          (d) Fees. In consideration of efforts made by the Buyer in advance of
the date of this Agreement, and for other valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the Company agrees to pay
Buyer a loan origination fee of $17,912.50 (the “Loan Origination Fee”). The
Company further agrees to pay a commitment fee on unborrowed amounts under the
Note at a rate of 6.0% per annum, to be computed on the basis of a 360-day year
and actual days elapsed, commencing on the Closing Date, until such funds are
borrowed under the Note, with such amounts to be assessed against the Company on
the last day of each fiscal quarter (the “Commitment Fee”, together with the
Loan Origination Fee, the “Fees”). The Fees shall be deemed accrued interest
under the Note; provided, however, that any Commitment Fees shall be offset by
any interest earned on funds held in the Off-Shore Escrow Account. The Loan
Origination Fee is non-refundable and earned by Buyer upon execution of the
Note; the Commitment Fee when assessed against the Company each quarter is
thereby non-refundable and deemed earned by Buyer.
          (e) Subordinated Secured Promissory Note. Payment of the Note will be
secured by (i) two second-lien Deeds of Trust and Security Agreements, each
dated March 23, 2009 (collectively, the “Security Agreement”), by and between
Infinity Texas and Infinity Wyoming, respectively, and the Buyer, covering
certain collateral as more particularly described therein and (ii) a Commercial
Guaranty by each of Infinity Oil and Gas of Texas, Inc. (“Infinity Texas”) and
Infinity Oil & Gas of Wyoming, Inc. (“Infinity Wyoming”) in favor of Buyer (the
“Commercial Guaranties”), and the Note is further subject to a Subordination and
Intercreditor Agreement dated March 23, 2009 (the “Subordination Agreement”), by
and among the Buyer, the Company and Amegy.
          (f) Revenue Sharing Interest. The Revenue Sharing Interest shall be
reflected in the Revenue Sharing Agreement, in substantially the form attached
hereto as Exhibit B. In the event that Buyer breaches its funding obligations
under the Note, the Revenue Sharing Interest shall terminate and be of no
further force and effect.
          (g) Transaction Documents. The Note, the Security Agreement, the
Commercial Guaranties, the Off-Shore Escrow Agreement, the Subordination
Agreement, the Revenue Sharing Agreement and the other agreements entered into
or to be entered into by the parties hereto in connection with the transactions
contemplated by this Agreement shall constitute the “Transaction Documents”.
     2. BUYER’S REPRESENTATIONS AND WARRANTIES. Buyer represents and warrants to
the Company that the following representations and warranties are true and
correct in all material respects as of the date hereof:
          (a) Organization and Good Standing. Buyer is duly organized, validly
existing, and in good standing under the laws of the State of Nevada. The Buyer
has all requisite limited liability company power and authority to own and
operate its assets and to carry on its business as presently conducted.

-2-

--------------------------------------------------------------------------------

 

          (b) Validity; Enforcement. The Buyer has the requisite power and
authority to enter into and perform its obligations under this Agreement and the
other Transaction Documents to which it is or may be a party. The execution and
delivery of such Transaction Documents by the Buyer and the consummation by the
Buyer of the transactions contemplated hereby and thereby, including, without
limitation, the receipt of the Note and the Revenue Sharing Interest with
respect thereto, have been duly authorized by the Buyer’s Managing Member and
Members. This Agreement and the other Transaction Documents of even date
herewith to which it is a party have been duly executed and delivered by the
Buyer, and constitute the legal, valid and binding obligations of the Buyer,
enforceable against the Buyer in accordance with their respective terms, except
as (i) such enforceability may be limited by general principles of equity or
applicable bankruptcy, insolvency, reorganization, moratorium, liquidation or
similar laws relating to, or (ii) general principles of equity that restrict the
enforcement and availability of applicable creditors’ rights and remedies.
          (c) No Conflicts. The execution, delivery and performance by Buyer of
this Agreement and the other Transaction Documents to which it is or may be a
party and the consummation by Buyer of the transactions contemplated hereby and
thereby will not (i) result in a violation of the organizational documents of
Buyer, or (ii) conflict with, or constitute a default (or an event which with
notice or lapse of time or both would become a default) under, or give to others
any rights of termination, amendment, acceleration or cancellation of, any
agreement, indenture or instrument to which Buyer is a party, or (iii) result in
a violation of any law, rule, regulation, order, judgment or decree (including
federal and state securities laws) applicable to Buyer, except in the case of
clauses (ii) and (iii) above, for such conflicts, defaults, rights or violations
which would not, have a material adverse effect on the ability of Buyer to
perform its obligations hereunder.
          (d) No Public Sale or Distribution. Buyer is acquiring the Securities
for its own account and for investment purposes only and not with a view
towards, or for resale in connection with, the public sale or distribution
thereof in a manner that would violate the 1933 Act, except pursuant to sales
registered or exempted under the 1933 Act. Buyer does not presently have any
agreement or understanding, directly or indirectly, with any person to
distribute any of the Securities.
          (e) Access to Information. Buyer and its advisors, if any, have been
furnished with all materials relating to the business, finances and operations
of the Company and materials relating to the offer and sale of the Securities
that have been requested by Buyer. Buyer and its advisors, if any, have been
afforded the opportunity to ask questions of the Company and receive answers
concerning the business and affairs of the Company and the terms and conditions
of the sale of the Securities as contemplated by this Agreement, and to obtain
any additional information as may be necessary to verify the accuracy of
information furnished to Buyer. Buyer further acknowledges that it was
encouraged by the Company to request all additional information that might be
material or important in order for Buyer to make an informed investment decision
with respect to the purchase of the Securities and has carefully read this
Agreement and the other Transaction Documents and all other information
furnished to Buyer by the Company in connection with this Agreement.
          (f) Acknowledgement of Risk. Buyer acknowledges and warrants that, in
making this investment decision, it has made its own independent assessment of
the merits and risks of an investment in the Securities based on its examination
and evaluation of Company, its business,

-3-

--------------------------------------------------------------------------------

 

operations, financial condition, future prospects and the skills and
qualifications of its officers, directors and employees. Buyer has sought such
accounting, legal and tax advice as it has considered necessary to make an
informed investment decision with respect to its acquisition of the Securities
and has not relied on Company or its respective agents or representatives. Buyer
understands that its investment in the Securities involves a high degree of risk
and understands that the Company is currently experiencing substantial liquidity
problems. Buyer acknowledges the risks, including, without limitation, the risks
set forth in the “Risk Factors” attached hereto as Exhibit C relating to the
Company and an investment in the Securities, and in particular, the risks
related to the Company’s risk of default under the loan agreement with Amegy,
dated January 9, 2007, as amended and supplemented by the First, Second and
Third Forbearance Agreements. Buyer further represents it: (i) is able to bear
the loss of Buyer’s entire investment without any material adverse effect on
Buyer’s economic condition or stability and (ii) has, alone or together with its
advisors, such knowledge and experience in financial and business matters as to
be capable of evaluating the merits and risks of the investment to be made by
Buyer pursuant to this Agreement.
          (g) Investor Status. Buyer understands that the Securities are being
offered and sold only to “accredited investors” (as that term is defined under
Rule 501(a) of Regulation D), and Buyer represents that Buyer is an accredited
investor by virtue of the fact that it is an entity in which all of the equity
owners are accredited investors. Buyer understands that the Company is relying
on Buyer with respect to the accuracy of this representation. Buyer and each of
its equity investors has completed and returned a copy of the investor
questionnaire, and Buyer represents that the statements made therein are
complete and accurate.
          (h) General Solicitation. Buyer is not purchasing the Securities as a
result of any advertisement, article, notice or other communication regarding
the Securities published in any newspaper, magazine or similar media or
broadcast over television or radio or presented at any seminar or any other
general solicitation or general advertisement.
          (i) Additional Information. Buyer represents and warrants that, except
as set forth in this Agreement and in the Transaction Documents, no
representations or warranties have been made to Buyer, by the Company or any
agent, employee, representative or affiliate of the Company and that, in
entering into this transaction for the Securities, Buyer is not relying on any
information other than that contained in this Agreement, the other Transaction
Documents, and other written information obtained from the Company in the course
of the independent investigation by Buyer, and has been based solely on the
independent evaluation by the Buyer and its representatives.
          (j) Reliance on Exemptions. Buyer understands that the Securities are
being offered and sold to it in reliance on specific exemptions from the
registration requirements of United States federal and state securities laws and
that the Company is relying in part upon the truth and accuracy of, and Buyer’s
compliance with, the representations, warranties, agreements, acknowledgments
and understandings of Buyer set forth herein in order to determine the
availability of such exemptions and the eligibility of Buyer to acquire the
Securities. Buyer understands that the Securities have not been registered under
the Securities Act or any state securities laws by reason of their contemplated
issuance in transactions exempt from the registration requirements of the
Securities Act and applicable state securities laws, and that the reliance of
Company and others upon these exemptions is predicated in part upon the
representations by Buyer in this Agreement.

-4-

--------------------------------------------------------------------------------

 

          (k) Acknowledgment Regarding Buyer’s Purchase of Securities. The Buyer
acknowledges and agrees that Buyer and any person acting as an affiliate of
Buyer is acting solely in the capacity of an arm’s length purchaser with respect
to the Securities and the negotiation of the Transaction Documents and that
Buyer is not: (i) an officer or director of the Company, (ii) acting as a
financial advisor or fiduciary of the Company (or in any similar capacity) with
respect to the purchase and sale of the Securities and the negotiation of the
Transaction Documents.
          (l) No Governmental Review. Buyer understands that no United States
federal or state agency or any other government or governmental agency has
passed on or made any recommendation or endorsement of the Securities or the
fairness or suitability of the investment in the Securities nor have such
authorities passed upon or endorsed the merits of the offering of the
Securities.
          (m) Transfer or Resale Legends. Buyer understands that because the
Securities have not been and are not being registered under the 1933 Act or any
state securities laws, such securities may not be offered for sale, sold,
assigned or transferred, and the legend set forth below shall not be removed and
the Company shall not issue a certificate without such legend to the holder of
the securities upon which it is stamped, unless (i) such securities are
registered under the 1933 Act, or (ii) in connection with a sale, assignment or
other transfer, such holder provides the Company with an opinion of counsel, in
a generally acceptable form, to the effect that such sale, assignment or
transfer of the securities may be made without registration under the applicable
requirements of the 1933 Act. Buyer understands that the certificates or other
instruments representing the Note and the Revenue Sharing Interest shall bear a
legend as required by the securities laws of any state and a restrictive legend
in substantially the following form:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”). THE SECURITIES MAY NOT BE
OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN
EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE ACT, OR (B) AN
OPINION OF COUNSEL, IN A GENERALLY ACCEPTABLE FORM, THAT SUCH REGISTRATION SHALL
NO LONGER BE REQUIRED.
          (n) Brokers. Buyer has not employed, engaged or retained or otherwise
incurred any liability to, any person as a broker, finder, agent or other
intermediary in connection with the transactions contemplated herein.
          (o) Domicile. Buyer has its principal place of business in the
jurisdiction set forth below Buyer’s name in the notice provisions of this
Agreement.
     3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company hereby
represents and warrants to the Buyer that the following representations and
warranties are true and correct in all material respects as of the date hereof:
          (a) Organization and Good Standing. The Company and its subsidiaries
are duly organized, validly existing, and in good standing under the laws of the
jurisdiction in which they are formed. The Company and it subsidiaries have all
requisite power and authority to own and operate their properties and assets and
to carry on their business as presently conducted.

-5-

--------------------------------------------------------------------------------

 

          (b) Validity; Enforcement. The Company has the requisite power and
authority to enter into and perform its obligations under this Agreement, the
Note and the other Transaction Documents to which it is or may be a party. The
execution and delivery by the Company of such Transaction Documents and the
consummation by the Company of the transactions contemplated hereby and thereby,
including, without limitation, the issuance of the Note and the Revenue Sharing
Interest, have been duly authorized by the Company’s Board of Directors. This
Agreement and the other Transaction Documents of even date herewith to which the
Company is a party have been duly executed and delivered by the Company, and
constitute the legal, valid and binding obligations of the Company, enforceable
against the Company in accordance with their respective terms, except as
(i) such enforceability may be limited by general principles of equity or
applicable bankruptcy, insolvency, reorganization, moratorium, liquidation or
similar laws relating to, or (ii) general principles of equity that restrict the
enforcement and availability of applicable creditors’ rights and remedies.
          (c) No Conflicts. The execution, delivery and performance by the
Company of this Agreement and the other Transaction Documents to which it is or
may be a party and the consummation by the Company of the transactions
contemplated hereby and thereby will not (i) result in a violation of the
organizational documents of the Company, or (ii) conflict with, or constitute a
default (or an event which with notice or lapse of time or both would become a
default) under, or give to others any rights of termination, amendment,
acceleration or cancellation of, any agreement, indenture or instrument to which
Company is a party, or (iii) result in a violation of any law, rule, regulation,
order, judgment or decree (including federal and state securities laws)
applicable to Company, except in the case of clauses (ii) and (iii) above, for
such conflicts, defaults, rights or violations which would not have a material
adverse effect on the Company or its ability to perform its obligations
hereunder.
          (d) Consents. The Company is not required to obtain any consent,
authorization or order of, or make any filing or registration with, any court,
governmental agency or any regulatory or self-regulatory agency in order for it
to execute, deliver or perform any of its obligations under or contemplated by
the Transaction Documents, in each case in accordance with the terms hereof or
thereof, other than (x) the filing of the Security Agreement in applicable real
estate records, (y) the filing with the SEC of a Form D, and (z) filings with
state securities authorities as required thereby.
          (e) Compliance with Law; Permits. The Company and its subsidiaries are
in compliance with all applicable statutes and regulations of the United States
and of all states and applicable agencies and foreign jurisdictions or bodies in
respect of the conduct of their business and operations, except as would not
have a material adverse effect. The Company and its subsidiaries have all
permits, licenses, and similar authority necessary for the conduct of their
business as now being conducted by them, except as would not have a material
adverse effect.
          (f) SEC Documents; Financial Statements. During the two (2) years
prior to the date hereof, the Company has filed all reports, schedules, forms,
statements and other documents required to be filed by it with the SEC pursuant
to the reporting requirements of the Securities Exchange Act of 1934, as amended
(the “1934 Act”) (the “SEC Documents”). As of their respective

-6-

--------------------------------------------------------------------------------

 

dates, the SEC Documents complied in all material respects with the requirements
of the 1934 Act and the rules and regulations of the SEC promulgated thereunder
applicable to the SEC Documents, and none of the SEC Documents, at the time they
were filed with the SEC, contained any untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading, other than as may have been subsequently
restated or amended in an amended or subsequent report. As of their respective
dates, the financial statements of the Company included in the SEC Documents
complied as to form in all material respects with applicable accounting
requirements and the published rules and regulations of the SEC with respect
thereto. The financial statements of the Company were prepared in accordance
with generally accepted accounting principles in the United States and fairly
and accurately present in all material respects the financial position, results
of operations and cash flows of the Company as of the dates, and for the
periods, indicated therein.
          (g) Ranking of Notes. Except with respect to the “Senior Debt” (as
defined in the Note), which is senior to the Note in all respects, no
indebtedness of the Company ranks senior to or pari passu with the Note in right
of payment, whether with respect of payment of principal, interest, damages or
upon liquidation or dissolution or otherwise.
          (h) No Additional Agreements. The Company does not have any agreement
or understanding with Buyer with respect to the transactions contemplated by the
Transaction Documents other than as specified in the Transaction Documents.
     4. COVENANTS.
          (a) Form D and Blue Sky. The Company agrees to file a Form D with
respect to the Securities as required under Regulation D. The Company shall, on
or before the Closing Date, take such action as the Company shall reasonably
determine is necessary in order to obtain an exemption for or to qualify the
Securities, for sale to the Buyer at the Closing pursuant to this Agreement
under applicable securities laws of the states of the United States (or to
obtain an exemption from such qualification). The Company shall make all filings
and reports relating to the offer and sale of the Securities required under
applicable securities or “Blue Sky” laws of the states of the United States
following the Closing Date.
          (b) Use of Proceeds. The Company hereby agrees, as further set forth
in the Off-Shore Escrow Agreement, that the proceeds from the sale of the
Securities shall be used solely for the development of the Nicaragua
Concessions, for general and administrative expenses, and the settlement of any
claims, actions or proceedings against the Company or any of its subsidiaries
involving the Nicaragua Concessions.
          (c) Conduct of Business. The business of the Company and its
subsidiaries shall not be conducted in violation of any law, ordinance or
regulation of any governmental entity, except where such violations would not
result, either individually or in the aggregate, in a material adverse effect.
          (d) Release of Assets. The Buyer acknowledges that the Company is
currently obligated to proceed with the sale of certain assets, and at the
request of Amegy may be required to

-7-

--------------------------------------------------------------------------------

 

proceed with the sale of additional assets, under the Company’s Third
Forbearance Agreement with Amegy dated October 16, 2008 (collectively, the
“Permitted Dispositions”). Upon the request of the Company in connection with a
Permitted Disposition, the Buyer agrees to take all such actions as shall be
required to release the collateral being sold in such Permitted Disposition, to
the extent necessary to permit the consummation of such Permitted Disposition
and agrees not take any action that would hinder or delay a Permitted
Disposition. The Company agrees to deliver to the Buyer at least ten (10) days
prior to the date of the proposed release (or such shorter period agreed to by
the Buyer), a written request for release identifying the relevant collateral
being sold in such Permitted Disposition, together with a certification by the
Company stating that such transaction is in compliance with this Section 4(d).
Buyer agrees to execute all necessary releases in recordable form within ten
(10) days of the Company’s written request.
          (e) Indemnification of Buyer by the Company. The Company hereby agrees
to indemnify and hold harmless each of Buyer, its affiliates, their investment
advisors and each of their respective officers, managers, members and employees
(collectively, the “Buyer Indemnitees”), from and against any and all losses,
claims, damages, judgments, penalties, liabilities and deficiencies (including
the reasonable fees and expenses (including the reasonable fees and expenses of
legal counsel) (collectively, “Losses”), to the extent arising out of or in
connection with: (i) any material misrepresentation, omission of fact or breach
of any of the Company’s representations or warranties contained in this
Agreement or the other Transaction Documents to which it is a party; or (ii) any
failure by the Company to perform any of its covenants, agreements, undertakings
or obligations set forth in this Agreement or the other Transaction Documents to
which it is a party.
          (f) Indemnification of the Company by Buyer. Buyer hereby agrees to
indemnify and hold harmless the Company and its officers, directors and
employees (collectively, the “Company Indemnitees”), from and against any and
all Losses to the extent arising out of or in connection with any material
misrepresentation, omission of fact or breach of any of Buyer’s representations,
warranties or covenants contained in this Agreement or the other Transaction
Documents to which it is a party and any failure by Buyer to perform any of its
covenants, agreements, undertakings or obligations set forth in this Agreement
or the other Transaction Documents to which it is a party.
          (g) Confidentiality. Buyer acknowledges that after the Closing Date it
may receive non-public information regarding the Company in connection with the
Note and the Off-Shore Escrow Agreement. Buyer agrees that any such non-public
information shall be maintained in confidence and shall not be used or divulged
by Buyer or its affiliates to any party unless and until it shall become
generally known.
     5. CLOSING. The parties will take the following actions at Closing:
          (a) Execution and Delivery of Transaction Documents. Each of Buyer and
the Company shall execute each of the Transaction Documents to which it is a
party and any and all ancillary documents thereto, and deliver the same to the
other party. In addition, the Company shall execute and deliver to Buyer the
Security Agreements and the Commercial Guaranties, executed by Infinity Texas
and Infinity Wyoming and the Subordination Agreement, executed by Amegy. Buyer
shall deliver to the Company the Off-Shore Escrow Agreement executed by Amegy,
Amegy Bank National Association and deposit the Purchase Price into the
Off-Shore Escrow Account by

-8-

--------------------------------------------------------------------------------

 

wire transfer of immediately available funds. Each party shall execute and
deliver such other documents relating to the transactions contemplated by this
Agreement as the other party or its counsel may reasonably request.
     6. MISCELLANEOUS.
          (a) Governing Law; Jurisdiction; Jury Trial. All questions concerning
the construction, validity, enforcement and interpretation of this Agreement
shall be governed by the internal laws of the State of Colorado, without giving
effect to any choice of law or conflict of law provision or rule (whether of the
State of Colorado or any other jurisdictions) that would cause the application
of the laws of any jurisdictions other than the State of Colorado. Each party
hereby irrevocably submits to the exclusive jurisdiction of the state and
federal courts sitting in The City of Denver, Colorado, for the adjudication of
any dispute hereunder or in connection herewith or with any transaction
contemplated hereby or discussed herein, and hereby irrevocably waives, and
agrees not to assert in any suit, action or proceeding, any claim that it is not
personally subject to the jurisdiction of any such court, that such suit, action
or proceeding is brought in an inconvenient forum or that the venue of such
suit, action or proceeding is improper. Each party hereby irrevocably waives
personal service of process and consents to process being served in any such
suit, action or proceeding by mailing a copy thereof to such party at the
address for such notices to it under this Agreement and agrees that such service
shall constitute good and sufficient service of process and notice thereof.
Nothing contained herein shall be deemed to limit in any way any right to serve
process in any manner permitted by law. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY
RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION
OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT
OR ANY TRANSACTION CONTEMPLATED HEREBY.
          (b) Counterparts. This Agreement may be executed in two or more
identical counterparts, all of which shall be considered one and the same
agreement and shall become effective when counterparts have been signed by each
party and delivered to the other party; provided that a facsimile signature
shall be considered due execution and shall be binding upon the signatory
thereto with the same force and effect as if the signature were an original, not
a facsimile signature.
          (c) Headings. The headings of this Agreement are for convenience of
reference and shall not form part of, or affect the interpretation of, this
Agreement.
          (d) Severability. If any provision of this Agreement is prohibited by
law or otherwise determined to be invalid or unenforceable by a court of
competent jurisdiction, the provision that would otherwise be prohibited,
invalid or unenforceable shall be deemed amended to apply to the broadest extent
that it would be valid and enforceable, and the invalidity or unenforceability
of such provision shall not affect the validity of the remaining provisions of
this Agreement so long as this Agreement as so modified continues to express,
without material change, the original intentions of the parties as to the
subject matter hereof and the prohibited nature, invalidity or unenforceability
of the provision(s) in question does not substantially impair the respective
expectations or reciprocal obligations of the parties or the practical
realization of the benefits that would otherwise be conferred upon the parties.
The parties will endeavor in good faith

-9-

--------------------------------------------------------------------------------

 

negotiations to replace the prohibited, invalid or unenforceable provision(s)
with a valid provision(s), the effect of which comes as close as possible to
that of the prohibited, invalid or unenforceable provision(s).
          (e) Entire Agreement; Amendments. This Agreement and the other
Transaction Documents supersede all other prior oral or written agreements
between the Buyer, the Company, their affiliates and persons acting on their
behalf with respect to the matters discussed herein, and this Agreement, the
other Transaction Documents and the instruments referenced herein and therein
contain the entire understanding of the parties with respect to the matters
covered herein and therein and, except as specifically set forth herein or
therein, neither the Company nor Buyer makes any representation, warranty,
covenant or undertaking with respect to such matters. No provision of this
Agreement may be amended other than by an instrument in writing signed by the
Company and the holder of the Securities issued and issuable hereunder, and any
amendment to this Agreement made in conformity with the provisions of this
Section 6(e) shall be binding on Buyer. No provision hereof may be waived other
than by an instrument in writing signed by the party against whom enforcement is
sought.
          (f) Notices. Any notices, consents, waivers or other communications
required or permitted to be given under the terms of this Agreement must be in
writing and will be deemed to have been delivered: (i) upon receipt, when
delivered personally; (ii) upon receipt, when sent by facsimile (provided
confirmation of transmission is mechanically or electronically generated and
kept on file by the sending party); or (iii) one Business Day after deposit with
an overnight courier service, in each case properly addressed to the party to
receive the same. The addresses and facsimile numbers for such communications
shall be:
          If to the Company:
11900 College Blvd., Suite 204
Overland Park, Kansas 66210
Attn: Stanton E. Ross
          With a copy (for informational purposes only) to:
Davis Graham & Stubbs LLP
1550 17th Street, Suite 500
Denver, Colorado 80202
Michelle H. Shepston
Phone: (303) 892-7344
Fax: (303) 893-1379
Michelle.Shepston@dgslaw.com
          If to Buyer:
Off-Shore Finance, LLC
11900 College Boulevard., Suite 310
Overland Park, Kansas 66210
Daniel J. Haake
Phone: (913) 338-4455
Fax: (913) 338-4458
dan.haake@haakecpa.com

-10-

--------------------------------------------------------------------------------

 

          With a copy (for informational purposes only) to:
Richard W. Daily, LLC
621 17th Street, Suite 1535
Denver, Colorado 80293
Attn: Richard W. Daily
Phone: (720) 963-1121
Fax: (720) 897-2802
RDaily@DailyLLC.com
or to such other address and/or facsimile number and/or to the attention of such
other person as the recipient party has specified by written notice given to
each other party five (5) days prior to the effectiveness of such change.
Written confirmation of receipt (A) given by the recipient of such notice,
consent, waiver or other communication, (B) mechanically or electronically
generated by the sender’s facsimile machine containing the time, date, recipient
facsimile number and an image of the first page of such transmission or
(C) provided by an overnight courier service shall be rebuttable evidence of
personal service, receipt by facsimile or receipt from an overnight courier
service in accordance with clause (i), (ii) or (iii) above, respectively.
          (g) Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the parties and their respective successors and assigns,
including any purchasers of the Note or the Revenue Sharing Interest. The Buyer
shall not assign this Agreement or any rights or obligations hereunder without
the prior written consent of the Company.
          (h) No Third Party Beneficiaries. This Agreement is intended for the
benefit of the parties hereto and their respective permitted successors and
assigns, and is not for the benefit of, nor may any provision hereof be enforced
by, any other person.
          (i) Survival. The representations and warranties of the Company and
the Buyer contained in Sections 2 and 3 and the agreements, and covenants set
forth in Section 4 shall survive the Closing.
          (j) Further Assurances. Each party shall do and perform, or cause to
be done and performed, all such further acts and things, and shall execute and
deliver all such other agreements, certificates, instruments and documents, as
any other party may reasonably request in order to carry out the intent and
accomplish the purposes of this Agreement and the consummation of the
transactions contemplated hereby.
          (k) No Strict Construction. The language used in this Agreement will
be deemed to be the language chosen by the parties to express their mutual
intent, and no rules of strict construction will be applied against any party.
[Signature Page Follows]

-11-

--------------------------------------------------------------------------------

 

     IN WITNESS WHEREOF, each Buyer and the Company have caused their respective
signature page to this Securities Purchase Agreement to be duly executed as of
the date first written above.

                  COMPANY:    
 
                INFINITY ENERGY RESOURCES, INC.    
 
           
 
  By:   /s/ Stanton E. Ross    
 
  Name:  
 
Stanton E. Ross    
 
  Title:   Chief Executive Officer    
 
                BUYER:    
 
                OFF-SHORE FINANCE, LLC    
 
           
 
  By:   /s/ Daniel J. Haake    
 
  Name:  
 
Daniel J. Haake    
 
  Title:   Managing Member    

-12-

--------------------------------------------------------------------------------

 

EXHIBITS

     
Exhibit A
  Form of Note  
Exhibit B
  Form of Revenue Sharing Agreement  
Exhibit C
  Risk Factors

-13-