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While the ultimate outcome of the pending proceedings, disputes or claims, and any resulting impact on us, cannot be predicted with certainty, we believe that none of these matters, if ultimately decided adversely, will have a material adverse effect on our financial condition, cash flows or results of operations.
−Removed: The Company was named as a defendant in an adversary proceeding (the "Adversary Proceeding") commenced on October 25, 2021 in the United States Bankruptcy Court for the Northern District of Texas, Dallas Division (the "Bankruptcy Court"), by the Trustee of the Chapter 7 bankruptcy of the Hoactzin Partners, L.P.
−Removed: ("Hoactzin").
−Removed: The complaint in the Adversary Proceeding alleges that in October of 2018, one year prior to the Hoactzin bankruptcy filing in October of 2019, Peter Salas ("Salas"), Chairman of the Board of Tengasco during the period of the purported fraudulent transfers, caused Hoactzin to transfer its working interests in certain wells on its Kansas acreage (the “Kansas Working Interests”) to the Company for an amount the complaint alleges was purportedly less than the reasonable equivalent value of such Kansas Working Interests.
−Removed: The complaint includes avoidance actions and other causes of action in connection with the transfer of the Kansas Working Interests, as well as other causes of action alleged related to certain transactions to which the Company was not a party.
−Removed: On October 13, 2022, the Company entered into a Compromise Settlement Agreement and Mutual General Release (the “Settlement Agreement”) with the Trustee for the bankruptcy estate for Hoactzin to resolve certain claims against the Company in the Adversary Proceeding.
−Removed: Under the terms of the Settlement Agreement, the Company agreed to pay $80 thousand to the Trustee in full settlement and satisfaction of (a) all claims, causes of action, and damages that have been asserted against the Company or could be asserted against the Company in the Adversary Proceeding;
−Removed: and (b) all claims which might arise from or relate to any actions taken by the Company while acting in connection with Debtor.
−Removed: In November 2022, the Bankruptcy Court approved the Settlement Agreement, and the Company made the settlement payment to the Trustee in accordance with the Settlement Agreement.
−Removed: Subsequently, the Bankruptcy Court entered an Order Granting the Joint Motion to Dismiss resulting in the dismissal of the Adversary Proceeding with prejudice (the "Dismissal Order"), as contemplated by the Settlement Agreement.
−Removed: Neither the Settlement Agreement nor the Dismissal Order has any effect on the Trustee’s claims against any of the other defendants in the Adversary Proceeding, including without limitation, those claims against Peter Salas, our former Chief Executive Officer.
−Removed: For additional information regarding contingencies, see Note 14 - Commitments and Contingencies included in notes to the consolidated financial statements included elsewhere in this Annual Report.
+Added: See Note 13 - Commitments and Contingencies in the Company's consolidated financial statements in "Item 15.
+Added: Exhibits and Financial Statement Schedules" for a discussion of our commitments and contingencies.
Mine Safety Disclosures
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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.