Lucas Energy Amends Terms Of Loan Agreement
HOUSTON, Feb. 24, 2015 /PRNewswire/ -- Lucas Energy, Inc. (NYSE MKT: LEI) ("Lucas" or the "Company"), an independent oil and gas company with its operations in Texas, today announced that its lender has agreed to amend the terms of its Loan Agreement and further granted an optional extension through September 13, 2015 with a second extension option through October 13, 2015 in order to facilitate the Company's proposed business combination with Victory Energy Corporation (OTCQX: VYEY) ("Victory").
Under the terms of the amended agreement, Lucas will pay interest at a 12% rate beginning in April 2015, and interest for January, February and March will be added to the outstanding balance of the loan. If the Company elects to extend the maturity of the loan through September or October, a 2% extension fee will be added to the interest rate during the extension period. Lucas also agreed to pay all current and past due legal and administration fees and other costs associated with the amended terms.
The lender will also release a portion of the collateralized oil and gas properties securing the loan so that these properties can be transferred to an affiliate of Victory Energy and funded by Victory and its affiliates prior to the consummation of the business combination. If the business combination does not occur as contemplated, then the lender will have the right to receive a compensation payment from Victory.
"The amendment of our Loan Agreement was a gating item in our process toward establishing the funding intended to provide the capital necessary during the period prior to the consummation of our proposed business combination," said Anthony C. Schnur, Chief Executive Officer of Lucas Energy, who continued, "We are appreciative to have the opportunity to renegotiate the terms of our Loan Agreement in these turbulent market conditions, and we are encouraged to have taken a significant step toward completion of our transaction with Victory."
About Lucas Energy, Inc.
Lucas Energy (NYSE MKT: LEI) is engaged in the development of crude oil and natural gas in the Austin Chalk and Eagle Ford formations in South Texas. Based in Houston, Lucas Energy's management team is committed to building a platform for growth and the development of its five million barrels of proved Eagle Ford and other oil reserves while continuing its focus on operating efficiencies and cost control.
For more information, please visit the Lucas Energy web site at www.lucasenergy.com.
About Victory Energy Corporation
Victory Energy Corporation (OTCQX: VYEY), is a publicly-held, growth-oriented oil and gas exploration and production company based in Austin, Texas with additional resources located in Midland, Texas. The Company is focused on the acquisition and development of stacked multi-pay resource play opportunities in the Permian Basin that offer predictable outcomes and long-lived reserve characteristics. The Company presently utilizes low-risk vertical well development which offers repeatable and profitable outcomes. Its current assets include interest in proven formations such as the Spraberry, Wolfcamp, Wolfberry, Mississippian, Cline and Fusselman formations.
For additional information on the company, please visit www.vyey.com.
Safe Harbor Statement and Disclaimer
This news release includes "forward looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward looking statements give our current expectations, opinion, belief or forecasts of future events and performance. A statement identified by the use of forward looking words including "may," "expects," "projects," "anticipates," "plans," "believes," "estimate," "should," and certain of the other foregoing statements may be deemed forward-looking statements. Among these forward-looking statements are any statements regarding the expected completion of the proposed business combination between Lucas and Victory, benefits and synergies of the proposed business combination, Victory's ability to obtain funding for the Eagle Ford or other wells that are expected to be transferred to Victory, future opportunities of the combined company, and any other statements regarding Victory's or Lucas' beliefs, plans, objectives, financial conditions, assumptions or future events. Although Lucas believes that the expectations reflected in such forward-looking statements are reasonable, these statements involve risks and uncertainties that may cause actual future activities and results to be materially different from those suggested or described in this news release. These include risks that may affect the proposed business combination and related proposed development of the Eagle Ford wells, including the satisfactory completion of due diligence by the parties, the ability of the parties to negotiate and enter into a definitive merger agreement and, if such an agreement is entered into, the satisfaction of the conditions contained in the definitive merger agreement, any delay or inability to obtain necessary approvals or consents from third parties, the ability of the parties to obtain financing for funding obligations, the inability of Lucas to maintain its listing on the NYSE MKT, the ability of the parties to realize the anticipated benefits from the proposed business transaction. The forward looking statements are also subject to risks inherent in natural gas and oil drilling and production activities, including risks of fire, explosion, blowouts, pipe failure, casing collapse, unusual or unexpected formation pressures, environmental hazards, and other operating and production risks, which may temporarily or permanently reduce production or cause initial production or test results to not be indicative of future well performance or delay the timing of sales or completion of drilling operations; delays in receipt of drilling permits; risks with respect to natural gas and oil prices, a material decline which could cause Lucas to delay or suspend planned drilling operations or reduce production levels; risks relating to the availability of capital to fund drilling operations that can be adversely affected by adverse drilling results, production declines and declines in natural gas and oil prices; risks relating to unexpected adverse developments in the status of properties; risks relating to the absence or delay in receipt of government approvals or fourth party consents; and other risks described in Lucas's Annual Report on Form 10-Q, Form 10-K and other filings with the SEC, available at the SEC's website at www.sec.gov. Investors are cautioned that any forward-looking statements are not guarantees of future performance and actual results or developments may differ materially from those projected. The forward-looking statements in this press release are made as of the date hereof. The Company takes no obligation to update or correct its own forward-looking statements, except as required by law, or those prepared by third parties that are not paid for by the Company. The Company's SEC filings are available at http://www.sec.gov.
Investor and Media Contact:
Carol Coale, [email protected]
Ken Dennard, [email protected]
SOURCE Lucas Energy, Inc.
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