Cubic Energy, Inc. (fka CBNRQ)

[sekt]

Ugly 8k posted on the 28th August

Item 8.01 Other Events.

As previously disclosed by Cubic Energy, Inc. (the “Company”), a lawsuit was filed on or about June 15, 2010, against the Company and other named defendants (collectively, the “Defendants”) in the 1st Judicial District Court, Caddo Parish, Louisiana, Case No. 541-768-A. This lawsuit alleged that all or part of the mineral lease granted by Gloria’s Ranch, L.L.C. (“Plaintiff”) on September 17, 2004 has lapsed, and sought a finding that the mineral lease has lapsed, damages, attorney fees, and other equitable relief. A trial was held in March 2015.

On August 24, 2015, the court ruled in favor of Plaintiff, against the Defendants, solidarily, declaring that the oil, gas and mineral lease granted by Plaintiff expired and is cancelled. In addition, judgment was rendered in favor of Plaintiff against the Defendants, solidarily, awarding to Plaintiff the following amounts:

1. $22,806,000.00 for lost leasing opportunity, with legal interest thereon from March 5, 2010;

2. $242,029.26 for unpaid royalty from the Chesapeake HA RA SAO; Soaring Ridge 15-15-15 Well, with legal interest from the date of production;

3. $484,058.52 as penalty for failure to pay royalty from the Chesapeake HA RA SAO; Soaring Ridge 15-15-15 Well, with legal interest thereon from the date of the judgment;

4. $925,603.00 for Plaintiff’s pre-trial attorney’s fees and expert costs with legal interest thereon from the date of the judgment; and

5. $11,200.00 for attorney’s fees incurred by Plaintiff during trial with legal interest thereon from the date of the judgment.

In addition, all court costs were assessed against Defendants, in solido.

The Company is assessing its alternatives with respect to the judgment including seeking relief through possible appeals based on fact and procedural issues. The Company has not made a decision regarding its alternatives.