Exhibit 10.1

 

SETTLEMENT AGREEMENT AND MUTUAL RELEASE

 

This Settlement Agreement and Mutual Release (“Settlement Agreement” or
“Agreement”) is entered into by and between TAUREN EXPLORATION, INC. (“Tauren”)
and CUBIC ENERGY, INC. (“Cubic”), on the one hand (Tauren and Cubic are
sometimes herein together called “Plaintiffs”)” and EXCO OPERATING COMPANY, LP
(“EXCO”) and BG US PRODUCTION COMPANY, LLC (“BG”), on the other hand (EXCO and
BG are sometimes herein together called “Defendants”).  The Plaintiffs and the
Defendants are collectively referred to herein as the “Parties.”

 

RECITALS

 

WHEREAS, by that Purchase and Sale Agreement dated as of October 30, 2009, by
and between Tauren, as seller, and EXCO, as buyer, Tauren agreed to sell to EXCO
and EXCO agreed to purchase from Tauren certain oil and gas interests pertaining
to lands in Caddo and DeSoto Parishes, Louisiana (such Purchase and Sale
Agreement, as amended, being referred to herein as the “PSA”).

 

WHEREAS, subsequent to closing under the PSA, a dispute arose between Plaintiffs
and Defendants concerning their respective rights and obligations under the PSA.

 

WHEREAS, such disputes included, among other things, a claim asserted by
Plaintiffs seeking payment and compensation under the PSA and a claim by
Defendants seeking offsets and deductions against Plaintiffs’ claim for payment
and compensation under the PSA.

 

WHEREAS, Tauren and Cubic filed a lawsuit seeking an order compelling
arbitration of such dispute, the lawsuit being filed in the 298th Judicial
District Court of Dallas County, Texas under Cause No. DC-11-12425, and styled
Tauren Exploration, Inc. and Cubic Energy, Inc. v. EXCO Operating Company, LP
and BG US Production Company LLC (the “Lawsuit”).

 

WHEREAS, the 298th District Court ordered that the dispute be referred to
arbitration and the Parties thereafter participated in an arbitration hearing
pursuant to the Court’s order (the “Arbitration”), to which proceeding EXCO and
BG objected, and on March 9, 2012 a majority of the arbitration panel issued a
“Report and Award of Arbitration Panel” in favor of Tauren and Cubic.

 

WHEREAS, EXCO and BG thereafter filed a motion in the Lawsuit to vacate that
award and Tauren and Cubic thereafter filed a motion in the Lawsuit to confirm
that award.

 

WHEREAS, on June 13, 2012, the 298th District Court issued an “Order Confirming
Arbitration Award” in the Lawsuit.

 

WHEREAS, on July 3, 2012, EXCO and BG filed a Notice of Appeal in the Lawsuit.

 

1

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WHEREAS, on July 27, 2012, a majority of the arbitration panel issued an “Award
of Attorneys’ Fees and Costs by Arbitration Panel” in favor of Tauren and Cubic.

 

WHEREAS, on July 27, 2012, Tauren and Cubic filed a “Second Amended Motion to
Confirm Arbitration Award and for Entry of Judgment” in the Lawsuit, which
motion was opposed by EXCO and BG.

 

WHEREAS, on September 12, 2012, a Final Judgment was signed by the
298th District Court in the Lawsuit.

 

WHEREAS, disputes and controversies exist between the Parties and the Parties
desire to fully and finally compromise and settle all of the claims, matters,
disputes and causes of action described below and to enter into certain
agreements between them as set out below.

 

WHEREAS, in order to avoid the cost, uncertainty and inconvenience of further
litigation, and to compromise and settle disputed claims, the Plaintiffs and the
Defendants have agreed to resolve the Lawsuit and the matters described herein
pursuant to the terms of this Agreement.

 

AGREEMENT

 

1.                                      Definitions

 

1.1                               In this Agreement, the phrase “Deferred
Purchase Price” shall have the same meaning as in the PSA.

 

2.                                      Application of Drilling Credits and
Deferred Purchase Price.

 

2.1                               Within five (5) business days after the full
execution of this Agreement by all Parties, EXCO and BG shall:

 

a.                                      Apply drilling credits in favor of Cubic
in accordance with Schedule I attached hereto and made a part hereof (sometimes
referred to herein as the “Drilling Credits”) and place Cubic in consent status
with regard to the Rye and McDonnell wells retroactively and through September
15, 2012;

 

b.                                      Pay to Tauren the total amount of
$2,871,255.00 (same being the total monetary payment to be received by Tauren
from EXCO and BG collectively under this Agreement);

 

2

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c.                                       Pay to RBC Capital Markets Corporation
the total amount of $400,000.00 (being the total monetary payment to be paid to
RBC Capital Markets Corporation by EXCO and BG);

 

d.                                      Pay to Cubic the total amount of
$12,179,853.40 (same being the total monetary payment to be received by Cubic
from EXCO and BG collectively under this Agreement), of which amount
$9,134,890.05 shall be paid direct to Wells Fargo Energy Capital, Inc. (“Wells
Fargo”) and $3,044,963.35 shall be paid direct to Cubic.

 

2.2                               The payments of the amounts described above to
Tauren, RBC Capital Markets Corporation, Cubic and Wells Fargo (collectively
referred to herein as the “Settlement Payments”) shall be made by check or wire
transfer in accordance with wiring instructions to be furnished by Cubic and
Tauren.  If payment is made by check, the check(s) to Cubic and Wells Fargo
shall be delivered to the office of Cubic’s counsel and the other checks shall
be delivered to the offices of Tauren’s counsel within five (5) business days
after the full execution of this Agreement by all Parties.

 

2.3                               Tauren and Cubic hereby agree that upon
application of the above-described Drilling Credits and their receipt of their
respective Settlement Payments: (i) Tauren and Cubic will have received full
payment of the Deferred Purchase Price under the PSA and there will be no
remaining unpaid balance of the Deferred Purchase Price or remaining Drilling
Credits under the PSA; (ii) there will be no remaining or further amount of
money owed to Tauren or Cubic under the PSA; (iii) Tauren and Cubic waive any
claim for any additional consideration, compensation, damages or payment under
the PSA; (iv) Cubic will have received full payment of all net proceeds
allocable through September 15, 2012 to Cubic with respect to the Rye 34-1 well
and the O McDonnell 8-1 well; and (v) the Releases given in Section 4 below will
become effective.  Defendants hereby represent and warrant that the Settlement
Payment to Cubic set forth in Section 2.1(d) includes the full amount of net
proceeds allocable through September 15, 2012 to Cubic with respect to the Rye
34-1 well and the O McDonnell 8-1 well that is attributable to Cubic’s interest
through that date and was calculated in the same manner as and proportionate to
proceeds paid through that date to all other working interest owners.

 

3.                                      Release of the Judgment and Dismissal of
the Appeal

 

Defendants hereby authorize their counsel to sign the Appellants’ Unopposed
Motion to Dismiss Appeal, a copy of which is attached hereto and incorporated
herein as Exhibit A. Defendants’ counsel shall submit said Motion to Dismiss
Appeal to the Dallas Court of Appeals for action thereon no later than five (5)
business days after the above-described Drilling Credits have been applied; the
above-described Settlement Payments have been delivered to Tauren and Cubic; and
a fully signed copy of the above-referenced Settlement Agreement has been
received by Defendants’ counsel. Plaintiffs shall sign the Release and
Satisfaction of Judgment, a copy of which is attached hereto as Exhibit B and
shall deliver a fully signed original of Exhibit B to Defendants’ counsel at or
before the time that Plaintiffs sign this Agreement. Defendants and

 

3

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their counsel may file the Release and Satisfaction of Judgment at any time
after the above-referenced Motion to Dismiss Appeal has been filed with the
Dallas Court of Appeals. Plaintiffs hereby represent and warrant that no
abstract of the Final Judgment in the Lawsuit has been filed or recorded in any
jurisdiction and that no actions or procedures have been initiated to collect or
enforce that Final Judgment.

 

4.                                      Mutual Releases

 

4.1                               Plaintiffs’ Release of Defendants

 

PLAINTIFFS FULLY RELEASE AND FOREVER DISCHARGE WITH PREJUDICE DEFENDANTS (AND
ALL OF THEIR PREDECESSORS, SUCCESSORS, PARENT CORPORATIONS, SUBSIDIARIES,
AFFILIATES, ASSIGNS, OFFICERS, DIRECTORS, SHAREHOLDERS, PARTNERS, MEMBERS,
MANAGERS, EMPLOYEES, AGENTS, ATTORNEYS AND INSURERS AND ANY OTHER PERSON OR
ENTITY WHO OR WHICH MAY BE LIABLE THROUGH EITHER OF THEM) FROM ANY AND ALL
CLAIMS, ACTIONS, CAUSES OF ACTION, APPEALS, SUITS, RIGHTS, OBLIGATIONS, DAMAGES,
LOSSES, CHARGES, DEBTS, LIABILITIES, AND DEMANDS WHATSOEVER, WHETHER FORESEEN OR
UNFORESEEN, KNOWN OR UNKNOWN, DISCLOSED OR UNDISCLOSED, MATURED OR UNMATURED, IN
LAW, EQUITY OR OTHERWISE, DIRECTLY OR INDIRECTLY BASED ON, RELATED TO, CAUSED BY
OR ARISING FROM ANY OF THE MATTERS, RELATIONSHIPS, TRANSACTIONS, FACTS,
OCCURRENCES, CIRCUMSTANCES, REPRESENTATIONS, ACTS, OMISSIONS AND EVENTS GIVING
RISE TO THE ARBITRATION INCLUDING, WITHOUT LIMITATION: (i) ANY CLAIMS THAT WERE
OR COULD HAVE BEEN ASSERTED, PRESENTED OR SUBMITTED IN THE ARBITRATION; (ii) ANY
CLAIMS THAT WERE WITHDRAWN FROM THE ARBITRATION (INCLUDING TORT CLAIMS OF TAUREN
AND/OR CUBIC AGAINST EXCO AND/OR BG); (iii) ANY CLAIMS THAT WERE ADDRESSED IN,
DETERMINED IN OR DECIDED IN THE MARCH 9, 2012 REPORT AND AWARD OF ARBITRATION
PANEL; AND (iv) ANY CLAIMS THAT WERE ADDRESSED IN, DETERMINED IN OR DECIDED IN
THE JULY 27, 2012 AWARD OF ATTORNEYS’ FEES AND COSTS BY ARBITRATION PANEL.
NOTWITHSTANDING THE PROVISIONS IN THIS PARAGRAPH, THE PARTIES UNDERSTAND AND
AGREE THAT THE RELEASES GIVEN IN THIS PARAGRAPH DO NOT INCLUDE OR COVER ANY
LIABILITIES ARISING FROM CLAIMS ASSERTED BY MINERAL LESSORS OWNING PROPERTY
WITHIN ANY OF THE UNITS FOR THE WELLS MADE THE BASIS OF THAT LAWSUIT NOW PENDING
IN THE 1ST JUDICIAL DISTRICT COURT OF CADDO PARISH, LOUISIANA UNDER CAUSE NO.
541-768:A AND STYLED “GLORIA’S RANCH, LLC V. TAUREN EXPLORATION, INC. ET AL”
(EXCEPT THAT THE RELEASES GIVEN IN THIS PARAGRAPH DO INCLUDE AND COVER THOSE
CLAIMS AND RIGHTS ADJUDICATED IN THE ARBITRATION).

 

4

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4.2                               Defendants’ Release of Plaintiffs

 

DEFENDANTS FULLY RELEASE AND FOREVER DISCHARGE WITH PREJUDICE PLAINTIFFS (AND
ALL OF THEIR PREDECESSORS, SUCCESSORS, PARENT CORPORATIONS, SUBSIDIARIES,
AFFILIATES, ASSIGNS, OFFICERS, DIRECTORS, SHAREHOLDERS, PARTNERS, MEMBERS,
MANAGERS, EMPLOYEES, AGENTS, ATTORNEYS AND INSURERS AND ANY OTHER PERSON OR
ENTITY WHO OR WHICH MAY BE LIABLE THROUGH EITHER OF THEM) FROM ANY AND ALL
CLAIMS, ACTIONS, CAUSES OF ACTION, APPEALS, SUITS, RIGHTS, OBLIGATIONS, DAMAGES,
LOSSES, CHARGES, DEBTS, LIABILITIES, AND DEMANDS WHATSOEVER, WHETHER FORESEEN OR
UNFORESEEN, KNOWN OR UNKNOWN, DISCLOSED OR UNDISCLOSED, MATURED OR UNMATURED, IN
LAW, EQUITY OR OTHERWISE, DIRECTLY OR INDIRECTLY BASED ON, RELATED TO, CAUSED BY
OR ARISING FROM ANY OF THE MATTERS, RELATIONSHIPS, TRANSACTIONS, FACTS,
OCCURRENCES, CIRCUMSTANCES, REPRESENTATIONS, ACTS, OMISSIONS AND EVENTS GIVING
RISE TO THE ARBITRATION INCLUDING, WITHOUT LIMITATION: (i) ANY CLAIMS THAT WERE
OR COULD HAVE BEEN ASSERTED, PRESENTED OR SUBMITTED IN THE ARBITRATION; (ii) ANY
CLAIMS THAT WERE WITHDRAWN FROM THE ARBITRATION (INCLUDING TORT CLAIMS OF TAUREN
AND/OR CUBIC AGAINST EXCO AND/OR BG); (iii) ANY CLAIMS THAT WERE ADDRESSED IN,
DETERMINED IN OR DECIDED IN THE MARCH 9, 2012 REPORT AND AWARD OF ARBITRATION
PANEL; AND (iv) ANY CLAIMS THAT WERE ADDRESSED IN, DETERMINED IN OR DECIDED IN
THE JULY 27, 2012 AWARD OF ATTORNEYS’ FEES AND COSTS BY ARBITRATION PANEL.
NOTWITHSTANDING THE PROVISIONS IN THIS PARAGRAPH, THE PARTIES UNDERSTAND AND
AGREE THAT THE RELEASES GIVEN IN THIS PARAGRAPH DO NOT INCLUDE OR COVER ANY
LIABILITIES ARISING FROM CLAIMS ASSERTED BY MINERAL LESSORS OWNING PROPERTY
WITHIN ANY OF THE UNITS FOR THE WELLS MADE THE BASIS OF THAT LAWSUIT NOW PENDING
IN THE 1ST JUDICIAL DISTRICT COURT OF CADDO PARISH, LOUISIANA UNDER CAUSE NO.
541-768:A AND STYLED “GLORIA’S RANCH, LLC V. TAUREN EXPLORATION, INC. ET AL”
(EXCEPT THAT THE RELEASES GIVEN IN THIS PARAGRAPH DO INCLUDE AND COVER THOSE
CLAIMS AND RIGHTS ADJUDICATED IN THE ARBITRATION).

 

4.3                               Covenants Not to Sue

 

Each Party agrees and covenants not to sue any person or entity that it has
released in this Agreement on any claim that it has released in this Agreement.

 

5.                                      Limitation on Disclosure

 

Except to the extent otherwise required by applicable law, regulation or rule,
the Parties shall not disclose the specific terms of this Agreement to, or file
a copy of this Agreement with, any person or entity.  The Parties shall not
otherwise comment on or discuss the terms of this

 

5

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Agreement with any person or entity (including, but not limited to, the general
public via mailings, postings, publications on the internet or otherwise, the
media, financial analysts, auditors, investors, consultants, suppliers, vendors,
business associates, or agents and/or representatives of any of the foregoing)
except that the Parties may comment on or discuss the terms of this Agreement:
(1) with their own officers, directors and employees; (2) with their
accountants, auditors, financial advisors and legal advisors to the extent
necessary to render tax, accounting, financial or legal advice; (3) in response
to a court order; or (4) to the extent necessary to enforce this Agreement by
legal process or in order to comply with this Agreement.  The Parties agree that
this paragraph is a material and substantial term of this Agreement.

 

6.                                      Authority and Requisite Approvals

 

Each of the Parties represents and warrants with respect only to itself that (1)
its authorized representative(s) has read and fully understands this Agreement,
(2) all corporate, partner, member or other approvals necessary to authorize it
to enter into this Agreement have been obtained, (3) it is fully authorized to
make this Agreement and, if applicable, to bind to the terms and conditions
contained in this Agreement those persons and entities on whose behalf it
purports to act, (4) the representative signing this Agreement on its behalf is
duly authorized to execute this Agreement on its behalf in the capacity
identified below, and (5) this Agreement is its binding and enforceable
obligation.

 

7.                                      Notices

 

All notices and other communications pursuant to this Agreement shall be in
writing and shall be deemed given if (a) delivered personally, (b) sent by
nationally recognized, overnight courier, (c) mailed by certified mail (return
receipt requested), with postage prepaid, or (d) sent by facsimile (followed by
a copy sent by courier or certified mail) to the Parties at the following
addresses:

 

To

Tauren Exploration, Inc.

 

9870 Plano Road

 

Dallas, TX 75232

 

Attn: Calvin A. Wallen, III

 

(972) 681-9687 — FAX

 

 

 

With a copy to:

 

 

 

Barry F. Cannaday

 

SNR DENTON

 

2000 McKinney Avenue, Suite 1900

 

Dallas, TX 75201-1858

 

(214) 259-1855 — Telephone

 

(214) 259-0910 — FAX

 

barry.cannaday@snrdenton.com

 

6

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To

Cubic Energy, Inc.

 

9870 Plano Road

 

Dallas, TX 75238

 

Attn: Calvin A. Wallen, III

 

(972) 681-9687 — FAX

 

 

 

With a copy to:

 

 

 

Mary L. O’Connor

 

Michelle Ann Brown Reed

 

AKIN GUMP STRAUSS HAUER & FELD LLP

 

1700 Pacific Avenue, Suite 4100

 

Dallas, TX 75201-4675

 

(214) 969-2800 — Telephone

 

(214) 969-4343 — FAX

 

moconnor@akingump.com

 

mreed@akingump.com

 

 

 

 

To

EXCO Operating Company, LP

 

Attn: William L. “Lanny” Boeing

 

12377 Merit Drive

 

Suite 1700, LB 82

 

Dallas, TX 75251

 

(214) 368-2087 — FAX

 

 

 

With a copy to:

 

 

 

James S. Robertson, III

 

GLAST, PHILLIPS & MURRAY, P.C.

 

14801 Quorum Drive, Suite 500

 

Dallas, TX 75254-1449

 

972/419-7136

 

972/419-8329 — Telecopier

 

jrobertson@gpm-law.com

 

 

 

 

To:

BG US Production Company, LLC

 

Attn: Christopher W. Migura

 

BG Group Place

 

811 Main Street, Suite 3400

 

Houston, TX 77002

 

7

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With a copy to:

 

 

 

James S. Robertson, III

 

GLAST, PHILLIPS & MURRAY, P.C.

 

14801 Quorum Drive, Suite 500

 

Dallas, TX 75254-1449

 

972/419-7136

 

972/419-8329 — Telecopier

 

jrobertson@gpm-law.com

 

8.                                      Counterparts

 

This Agreement may be signed in any number of counterparts or copies or on
separate signature pages or by facsimile transmission, which when taken together
shall be deemed to be an original for all purposes.

 

9.                                      No Duty

 

None of the Parties are relying upon a legal duty, even if one might allegedly
exist, on the part of any other Party (or such other Party’s employees, agents,
representatives, or attorneys) to disclose any information in connection with
the execution of this Agreement or its preparation; it is expressly understood
and agreed that any lack of information on the part of any Party is not a ground
for challenging this Agreement.

 

10.                               Basis For Parties’ Understanding of The
Agreement

 

10.1                        Each Party Relying on Own Judgment

 

It is understood and agreed that the Parties hereto have carefully reviewed this
Agreement, that they fully understand its terms, that they sought and obtained
independent legal advice with respect to the negotiation and preparation of this
Agreement, that this Agreement has been negotiated and prepared by the joint
efforts of the respective attorneys for each of the Parties, and that the
Parties have relied wholly upon their own judgment and knowledge (and the advice
of their respective attorneys) in entering into this Agreement.

 

10.2                        No Reliance on Representations or Assumed Facts

 

THE PARTIES ALSO ACKNOWLEDGE THE CONTESTED AND ADVERSARIAL NATURE OF THE
LAWSUIT, THE ARBITRATION AND THE UNDERLYING DISPUTES IN THOSE PROCEEDINGS, AND
STIPULATE THAT IN EXECUTING THIS AGREEMENT THEY ARE NOT RELYING ON ANY
REPRESENTATION BY ANY OTHER PARTY OR ITS AGENTS, REPRESENTATIVES OR ATTORNEYS,
WITH REGARD TO (1) FACTS UNDERLYING THE LAWSUIT OR FACTS UNDERLYING THE
ARBITRATION, (2) THE SUBJECT MATTER OR EFFECT OF THIS AGREEMENT AND (3) ANY
OTHER FACTS

 

8

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OR ISSUES WHICH MIGHT BE DEEMED MATERIAL TO THE DECISION TO ENTER INTO THIS
AGREEMENT, OTHER THAN THOSE TERMS AND PROVISIONS SPECIFICALLY SET FORTH IN THIS
AGREEMENT.

 

11.                               Section Numbers and Headings

 

Section numbers and section titles have been set forth herein for convenience
only, and they shall not be construed to limit or extend the meaning or
interpretation of any part of this Agreement.

 

12.                               Governing Law

 

This Agreement shall be governed by and interpreted in accordance with the
substantive laws of the State of Texas without regard to its conflict of law
principles.

 

13.                               No Admission of Fault

 

This Agreement, the monies paid and other consideration given by any Party under
this Agreement shall NOT constitute an admission of fault, wrongdoing or
liability.

 

14.                               Prevailing Party

 

In the event of any dispute that results in a proceeding to construe or enforce
any provision of this Agreement or that results in a proceeding arising out of
any alleged breach of this Agreement, the prevailing Party may recover from the
non-prevailing party reasonable attorneys’ fees and other costs incurred (in
addition to all other amounts and relief to which such party may be entitled to
recover).

 

15.                               No Strict Construction

 

The language used in this Agreement is chosen jointly by the Parties to express
their mutual intent and no rule of construction will be applied against any
Party, including any rule of draftsmanship.  The Parties hereby expressly agree
that any uncertainty or ambiguity existing herein shall not be interpreted
against any of them.  Except as expressly limited by this paragraph, all of the
applicable rules of interpretation of contracts shall govern the interpretation
of any uncertainty or ambiguity.  The term “including” as used in this Agreement
is used to list items by way of example and shall not be deemed to constitute a
limitation of any term or provision contained herein.

 

16.                               Attorneys’ Fees, Expenses and Court Costs

 

Each party to this Agreement shall bear its own attorneys’ fees, costs and
expenses with regard to and in connection with the Arbitration and the Lawsuit,
and each party to this

 

9

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Agreement waives any claims for attorneys’ fees, costs, expenses and interest
with regard to the Arbitration and the Lawsuit.

 

17.                               Bankruptcy

 

The Parties agree and acknowledge that this Agreement shall be binding on the
Parties even if one or more of them shall become Debtors in a bankruptcy
proceeding.  To the extent permitted by applicable law, this Agreement shall
bind any trustee or representative appointed for a Debtor’s estate.  Such
binding effect is an integral part of this Agreement.

 

18.                               Forum Selection and Mandatory Venue

 

The Parties acknowledge and agree that any and all lawsuits arising from this
Agreement, or the obligations contained herein, shall be brought only in a
federal or state court in Dallas County, Texas.

 

19.                               Prior Agreements Superseded

 

It is understood and agreed that this Agreement contains the entire agreement
between the Parties regarding the subject matter of this Agreement and
supersedes any and all prior agreements, arrangements, or understandings between
the Parties regarding any of the subject matter of this Agreement. No oral
understandings, statements, promises or inducements contrary to the terms of
this Agreement exist.  For the avoidance of doubt, this Agreement does not
supersede any Joint Operating Agreement or other contract or agreement regarding
the ongoing operation of wells in which the Parties, or any of them,
participate.

 

20.                               Invalidity

 

If any term or provision of this Agreement shall be determined to be
unenforceable or invalid or illegal in any respect, the unenforceability,
invalidity or illegality shall not affect any other term or provision of this
Agreement, but this Agreement shall be construed as if such unenforceable,
invalid or illegal term or provision had never been contained herein.

 

21.                               Non-Assignment of Claims

 

Each Party hereby represents and warrants that it is the sole owner of all of
the claims and causes of action being released by such Party herein and that no
portion of any claim being released pursuant to this Agreement has been assigned
or conveyed to any other person, party or entity.  The Parties further agree
that the obligations imposed by this Agreement are not assignable.

 

10

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22.                               Taxes

 

The Parties understand and agree that none of the Parties or their attorneys
have made any representations or warranties regarding the taxability or
non-taxability of any of the consideration exchanged pursuant to this Agreement.

 

23.                               No Oral Modifications

 

This Agreement may not be modified, amended or terminated orally.  No
modification, amendment or termination, or any waiver of any of the provisions
of this Agreement, shall be binding unless same is in writing and signed by the
person against whom such modification, amendment, waiver or termination is
sought to be enforced.

 

24.                               No Waiver

 

The failure of any of the Parties to enforce at any time any provision of this
Agreement shall not be construed to be a waiver of such provision, nor in any
way affect the validity of this Agreement or any part thereof or any right of
any person thereafter to enforce each and every provision.  No waiver of any
breach of this Agreement shall be held to constitute a waiver of any other
breach.

 

25.                               Execution of Necessary Documents

 

The Parties further covenant and agree to execute any and all documents
reasonably necessary to effectuate the provisions of this Agreement.

 

[SIGNATURES ON FOLLOWING PAGES]

 

11

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AGREED AND ACCEPTED:

 

 

 

 

TAUREN EXPLORATION, INC.,

 

a Texas corporation

 

 

 

 

 

By:

/s/ Calvin A. Wallen, III

 

Calvin A. Wallen, III, President

 

 

 

 

STATE OF TEXAS

§

 

 

§

 

COUNTY OF DALLAS

§

 

 

This Agreement was acknowledged before me on Oct. 1, 2012, by Calvin A. Wallen,
III, President of TAUREN EXPLORATION, INC., a Texas corporation, on behalf of
said corporation.

 

 

 

/s/ Donna Luedtke

 

Notary Public, State of Texas

 

My Commission Expires:

1-26-2015

 

12

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AGREED AND ACCEPTED:

 

 

 

 

CUBIC ENERGY, INC.,

 

a Texas corporation

 

 

 

 

 

By:

/s/ Calvin A. Wallen, III

 

 

Calvin A. Wallen, III, President

 

 

 

 

STATE OF TEXAS

§

 

 

§

 

COUNTY OF DALLAS

§

 

 

This Agreement was acknowledged before me on Oct. 1, 2012, by Calvin A. Wallen,
III, President of CUBIC ENERGY, INC., a Texas corporation, on behalf of said
corporation.

 

 

 

/s/ Donna Luedtke

 

Notary Public, State of Texas

 

My Commission Expires:

1-26-2015

 

13

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AGREED AND ACCEPTED:

 

 

 

 

EXCO OPERATING COMPANY, LP,

 

a Delaware limited partnership

 

 

 

By:

EXCO PARTNERS OLP GP, LLC,

 

 

a Delaware limited liability company

 

 

Its General Partner

 

 

 

 

 

 

 

 

By:

/s/ Stephen F. Smith

 

 

 

Printed Name:

Stephen F. Smith

 

 

 

Title:

President

 

 

 

 

STATE OF TEXAS

§

 

 

§

 

COUNTY OF DALLAS

§

 

 

This Agreement was acknowledged before me September 28, 2012, by Stephen F.
Smith, President of EXCO PARTNERS OLP GP, LLC, a Delaware limited liability
company and General Partner of EXCO OPERATING COMPANY, LP, a Delaware limited
partnership, on behalf of said limited liability company and limited
partnership.

 

 

 

/s/ Nancy DeVinney

 

Notary Public, State of Texas

 

My Commission Expires:

8-31-2006

 

14

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AGREED AND ACCEPTED:

 

 

 

 

BG US PRODUCTION COMPANY, LLC,

 

a Delaware limited liability company

 

 

 

 

 

By:

/s/ Ernst Den Hartigh

 

 

Printed Name:

Ernst Den Hartigh

 

 

Title:

Vice President

 

 

 

 

STATE OF TEXAS

§

 

 

§

 

COUNTY OF HARRIS

§

 

 

This Agreement was acknowledged before me October 2, 2012, by Ernst Den Hartigh,
Vice President of BG US PRODUCTION COMPANY, LLC, a Delaware limited liability
company, on behalf of said limited liability company.

 

 

 

/s/ Betriz Boyne

 

Notary Public, State of Texas

 

My Commission Expires:

June 2, 2013

 

15

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SCHEDULE I

 

 

 

Rye 34-1 Well

Capex

 

$

4,030,370.24

 

 

 

 

OPERATING COSTS

 

$

53,405.11

 

 

 

 

LHC

 

$

76,133.52

 

 

 

O McDonnell 8-1

Capex

 

$

3,335,745.88

 

 

 

 

OPERATING COSTS

 

$

33,615.02

 

(11-AR-2135)

 

Buffington UMI Lawsuit

 

$

1,070.65

 

(12-AR-2179)

 

Coleman 4-1

 

$

1,876.13

 

(12-AR-2179)

 

Buffington UMI Lawsuit

 

$

120.05

 

(01-AR-2582)

 

Buffington UMI Lawsuit

 

$

1,903.65

 

(03-AR-2638)

 

Buffington UMI Lawsuit

 

$

685.61

 

(03-AR-2638)

 

Billingsley V Exco Lawsuit

 

$

345.45

 

(04-AR-2813)

 

Billingsley V Exco Lawsuit

 

$

643.93

 

(04-AR-2813)

 

Remaining Outstanding Balance

 

$

65,071.31

 

(05-AR-2863)

 

Buffington UMI Lawsuit

 

$

552.73

 

(05-AR-2863)

 

Billingsley V Exco Lawsuit

 

$

848.68

 

(05-AR-2863)

 

Remaining Outstanding Balance

 

$

63,893.00

 

(06-AR-3065)

 

Billingsley V Exco Lawsuit

 

$

69.09

 

(06-AR-3065)

 

Remaining Outstanding Balance

 

$

41,713.59

 

(07-AR-3034)

 

Billingsley V Exco Lawsuit

 

$

117.80

 

(07-AR-3034)

 

Remaining Outstanding Balance

 

$

(16,032.84

)

(08-AR-2808)

 

Remaining Outstanding Balance

 

$

150.56

 

(08-AR-3122)

 

Remaining Outstanding Balance

 

$

161,086.35

 

Total Credits To Cubic

 

$

7,853,385.51

 

 

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