CONFIDENTIAL PRIVATE PLACEMENT MEMORANDUM EXHIBIT F SOFI BLACK BEAR Creek County Oklahoma NEWEST STEP OUT SKINNER WATERFLOOD OPPORTUNITY
1 EXECUTIVE SUMMARY ALFREDO M GONZALEZ President CEO Sof Exploration Alfredo M Gonzalez is the President and CEO of Sofi Exploration Mr Gonzalez is a sought after influential leader For the last 10 years his forte is offering proficient Good Practice Guidance aligning high production Asset Development opportunities in the Oil and Gas sectors with sophisticated investors who are in the market to expand their Cash Flow and Tax Advantage positions His corporate Vision for Sofi Exploration is to be the energy company most admired for its people partners and performance His corporate mission is to build successful partnerships based on 7 established pillars High Performance Integrity Transparency Trust Verification and Protecting Partners and the Environment His immense knowledge and innovative counsel regarding asset development programs in the industry confirms the confidence of vigorous partnerships and superior offerings from the industry s leading and selective Operators Drilling Corporations and Completion Companies Mr Gonzalez continues to develop an extensive vetting process compelling industry leaders to perform at the highest levels for investor participation and production achievement The corporate goals are capital development drilling completion production success and continuous liquidity development for his associates and partners Alan Girardot President CEO Rush Creek Resources Alan Girardot 37 president and CEO of Rush Creek Resources is an independent Texas and Oklahoma energy entrepreneur who established Rush Creek Resources in 2014 during the initial shockwave of the most recent oil crash Prior to establishing Rush Creek Mr Girardot served as a senior executive in both private equity venture management and operations management within the upstream oil and gas sector He founded Rush Creek to capitalize on the bear energy market that he believed would facilitate the largest transfer of mineral wealth Americans have seen in a generation Since 2014 Rush Creek has expanded from an idea to 4 000 mineral acres 125 wellbores and a vertically integrated low cost operating company during an elongated period of basement oil prices Additionally Mr Girardot graduated from Texas Tech University with a B A in political science while simultaneously serving as a United States Marine during Operation Iraqi Freedom Kim D rew Geologist Kim Drew has worked mainly in vertical drilling and improving secondary recovery projects but have also developed several horizontal ideas in new target formations Additional responsibilities include managing regulatory filings such as permitting operations spacing and pooling expert testimony hearings and disposal well applications Tristan W McKinney Chief Operating Officer Alfredo M Gonzalez President C E O Olivia M Gonzalez Executive Director
2 GEOLOGICAL SUMMARY Kim Drew Geological Opinion The Black Bear Prospect is a step out play to find another Skinner sand field in a similar depositional and structural position as Emerald Oil Companies Coyote Leap field in Section 15 of T14N ROSE The primary lease consists of eighty acres described as the east half of the northwest quarter of section 25 in Township 14 North Range 8 East Creek County Oklahoma The Black Bear Prospect is basically extending production by moving up dip from some good Skinner wells and incorporating new completion techniques in virgin areas to drastically increase the producible reserves of Skinner sandstone reservoirs This prospect is looking to extend Skinner production up dip onto a lease that covers over 80 acres that has never had a well drilled on it and so it should have virgin pressures and oil reserves Rough estimates on the oil reserves across the eighty acre lease if the sand thickness and porosities are as we believe could be as high as 105 000 barrels of producible oil per twenty acre drill site The West 1 well in the SE 4 of Section 20 has produced over 105 000 barrels of oil from the Skinner sand since 1956 The first year and a half of sales from wells in the Coyote Leap Prospect saw production in the first well the Griffith 1 of 14 688 Barrels of oil and 10 151 MMFC gas sold from 2 13 to 11 14 The next two wells the Pickett 1 2 sold 20 952 barrels of oil and 27 410 MMCF gas from 7 13 to 11 14 This is the type of production we are looking for in the Black Bear Prospect The Black Bear Prospect could eventually support the drilling of four to six Skinner producers Additional acreage is available and currently unleased that could expand tltis starting 80 acre unit into surrounding leases with the potential to expand to over 200 acres of developmental drilling The Coyote Leap Prospect started out as an 80 acre lease prospect and has expanded to over 400 acres with 14 producing wells and plans to drill at least two more wells This document was issued by Rush Creek Resources
3 PRODUCTION MAP Creek County Oklahoma Operations Decades of County Specific Expertise Proven Track Record Conventional Vertical Oil Proven Geological Areas Favorable Regulatory Environment Low Mechanical and Engineering Risks Renewed Interest and Activity in the Area Excellent Potential Reserves to Depth Ratios This document was issued by Rush Creek Resources
4 SURROUNDING PRODUCTION AREA Sofi Black Bear Joint Venture Proposed Drill Site s This document was issued by Rush Creek Resources
5 WILCOX STRUCTURE MAP This document was issued by Rush Creek Resources
6 SKINNER SAND ISOPACH SKINNER STRUCTURE MAP Sofi Black Bear Joint Venture Proposed Drill Site s This document was issued by Rush Creek Resources
7 PURE SAND ISOPACH PRUE STRUCTURE MAP Sofi Black Bear Joint Venture Proposed Drill Site s This document was issued by Rush Creek Resources
8 SURROUNDING PRODUCTION This document was issued by Rush Creek Resources
9 STAKED LOCATION Sofi Black Bear Joint Venture Staked Location This photo was taken by Sofi Exploration
10 DRILLING PERMIT This document was issued by Rush Creek Resources
11 A F E This document was issued by Rush Creek Resources AFE is subject to change depending upon market conditions
12 ESTIMATED PARTNERSHIP ECONOMICS WORKING INTEREST PARTICIPATION Working Interest Net Revenue Interest W I N R I 10 Units 10 Units 37 5 28 50 76 N R I PARTICIPATION Unit W I 1 3 75 N R I 2 85 1 2 1 875 1 4 0 9375 1 425 0 7125 Drill Test 1 Unit 1 2 Unit 1 4 Unit 10 Units Total Price 33 000 16 500 8 250 Completion Upon Aproval 1 Unit 1 2 Unit 1 4 Unit Price 9 000 4 500 2 250 TOTAL CAPITALIZATION 420 000
13 POTENTIAL REVENUE PROJECTIONS Oil Production Estimates 6 68 BPD X 534 40 IPD X 16 245 76 IPM X 80 30 4 Days 2 85 N R I 534 40 IPD 16 245 76 IPM 463 00 463 00 Gross Oil Proceeds Per Month estimated Oil Income 75 80 85 6 68 Monthly Income Gross Does Not Include L O E 434 66 463 00 491 94 25 Monthly Income Gross Does Not Include L O E Monthly Income Gross 50 Does Not Include L O E 1 624 50 1 732 80 1 841 10 3 249 00 3 465 60 3 682 20 100 Monthly Income Gross Does Not Include L O E 6 498 00 6 931 20 7 364 40 Annual return 0 50 Potential Oil Production Payout 24 month payment These are estimated figures only upon production BPD BARRELS PER DAY MCF MILLION METRIC CUBIC FEET IPD INCOME PER DAY IPM INCOME PER MONTH IPU INCOME PER UNIT L O E LEASE OPERATING EXPENSES these numbers were formulated based on first annual rate of return without expenses and depletion rates These calculations are estimates only and do not reflect any guarantees
14 COMPANY PORTFOLIO OKLAHOMA OPERATOR NUMBER OKLAHOMA 734825 TEXAS 23895 Sofi Newby III Joint Venture 2023 Coming Soon Sofi Newby II Joint Venture 2023 Funding Sofi Newby Joint Venture 2023 Finalized Funded Producing A P I Waiting On Permit Operator Rush Creek Resources A P I Waiting On Permit Operator Rush Creek Resources A P I 037 29503 Operator Rush Creek Resources State Oklahoma State Oklahoma State Oklahoma
15 COMPANY PORTFOLIO OKLAHOMA OPERATOR NUMBER OKLAHOMA 734825 TEXAS 23895 Sofi Three Hills Joint Venture 2023 Funded Waiting on spud date Sofi Carr III Joint Venture 2023 Funded waiting on spud date Sofi Fox Joint Venture 2022 Finalized Funded Producing Sofi Carr Joint Venture 2022 Finalized Funded Producing Sofi Drake Joint Venture 2022 Finalized Funded Producing Sofi Michigan Joint Venture 2022 Funded Non Commercial Transfer A P I Waiting On Permit Operator Rush Creek Resources A P I Waiting On Permit Operator Rush Creek Resources A P I 3503704467 3503704466 Operator Rush Creek Resources A P I 3503704457 Operator Rush Creek Resources A P I 3503704457 Operator Rush Creek Resources A P I 35037291380000 Operator Rush Creek Resouces State Oklahoma State Oklahoma State Oklahoma State Oklahoma State Oklahoma State Oklahoma
16 COMPANY PORTFOLIO TEXAS LOUSIANA OPERATOR NUMBER LOUSIANA N099 TEXAS 606055 Sofi Nacatoch III Joint Venture 2023 Funded A P I Coming Soon Sofi Nacatoch II Joint Venture 2023 Funded A P I 17015240850000 Sofi Nacatoch I Joint Venture 2023 Funded waiting on spud date Sofi Pressly Joint Venture 2023 Finalized Funded Completeing A P I 17015243860000 A P I 42 239 33965 Operator New Century Exploration Operator New Century Exploration Operator New Century Exploration Operator New Century Exploration State North Lousiana State North Lousiana State North Louisiana State East Texas
17 COMPANY PORTFOLIO TEXAS LOUSIANA OPERATOR NUMBER LOUSIANA N099 TEXAS 606055 Sofi Elite III Joint Venture 2022 Finalized Funded Producing Sofi Elite II Joint Venture 2022 Finalized Funded Producing Sofi 7 Joint Venture 2022 Funded Transfer Sofi Gold I II III Joint Ventures 2021 Finalized Funded Producing Sofi Blue Joint Venture 2021 Finalized Funded Producing Sofi Prime Joint Venture 2020 Funded Non Commercial Transfer A P I 42 203 35452 A P I 42 203 35452 A P I Not Applicable A P I 42 239 33959 A P I 42 239 33958 A P I 17 015 24570 Operator New Century Exploration Operator New Century Exploration Operator New Century Exploration Operator New Century Exploration Operator New Century Exploration Operator New Century Exploration State East Texas State East Texas State Texas State Texas State Texas State Lousiana
18 COMPANY PORTFOLIO TEXAS LOUSIANA OPERATOR NUMBER LOUSIANA N099 TEXAS 606055 Sofi Liv A P I Operator Joint Venture 2020 Funded Non Commercial Transfer 42 419 314220 New Century Exploration Sofi Phoenix Joint Venture 2019 Interest Released A P I 42 203 35385 Operator New Century Exploration Sofi Tyler Joint Venture 2019 Finalized Funded Producing Sofi Sands Joint Venture 2019 Interest Released A P I 42 457 30557 A P I 42 241 33187 Operator New Century Exploration Operator New Century Exploration Sofi Elite I Joint Venture 2018 Finalized Funded Producing A P I 42 203 35314 Sofi Victoria Marie Joint Venture 2018 Funded Non Commercial A P I 42 391 33187 Sofi Gold Coast Joint Venture 2017 Funded Non Commercial A P I 42 089 32747 Operator New Century Exploration Operator Millennium Exploration Operator Millennium Exploration State Texas State Texas State Texas State Texas State Texas State Texas State Texas
19 TAX BENEFITS EXAMPLE THE BASIC TAX CONSIDERATIONS INVOLVED IN AN OIL GAS INVESTMENT 1 INTANGIBLE DRILLING COSTS Up to 80 of the investment amount constitutes what is known as intangible Drilling Costs IDC and is deductible against active passive or portfolio income in the first year incurred This includes all labor related costs for the prospect well Including but not limited to drilling contractors professional services and others The total amount of IDC is reported to each participant at the end of the year Please consult with your tax advisor for further details 2 TANGIBLE DRILLING COSTS Approximately 20 of the amount of costs to drill the well constitutes Tangible Drilling Costs TDC This includes but is not limited to all well equipment piping storage tanks wellhead equipment lease expenses and others The exact amount will be determined after the well is drilled This portion of an investment is depreciated over a seven year period Please consult with your tax advisor for further details A 42 000 00 x 80 33 600 00 1 200 00 34 800 00 B 34 800 00 x 35 12 180 00 C 42 000 00 12 180 00 29 820 00 ESTIMATED TAX INVESTMENT EXAMPLE Investment Amount Intangible Drilling Costs estimate 1st year deductions of intangible drilling costs estimate 1st year depreciation deduction estimate 91 000 x 20 divided by 7 years TOTAL FIRST YEAR TAX DEDUCTIONS estimate Total Deduction estimate Maximum Income Tax Bracket TOTAL FIRST YEAR CASH VALUE OF DEDUCTIONS estimate Investment Amount Actual Cash Savings from Tax Deductions estimate AFTER TAX CASH INVESTMENT estimate 3 DEPLETION ALLOWANCE Currently the depletion allowance is 15 This means that fifteen cents of every dollar is tax free Please consult with your tax advisor for further details 4 STATE INCOME TAXES State income taxes could add substantial additional savings however they may vary from state to state Please consult with your tax advisor for further details
20 TAX INCENTIVES Congressional Incentives Encourage Domestic Petroleum Development Oil and Natural Gas from domestic reserves helps to make our country more energy self sufficient by reducing our dependence on foreign imports In light of this Congress has provided tax incentives to stimulate domestic natural gas and oil production financed by private sources Drilling projects offer many tax advantages and these benefits greatly enhance the economics The incentives are not Loop Holes they were placed in the Tax Code by Congress to make participation in oil and gas ventures one of the best tax advantaged investments Intangible Drilling Cost Tax Deduction The intangible expenditures of drilling labor chemicals mud grease etc are usually about 65 to 80 of the cost of a well These expenditures are considered Intangible Drilling Costs IDC which are 100 deductible during the first year For example a 100 000 investment could yield up to 80 000 in tax deductions during the first year of the venture These deductions are available in the year the money was invested even if the well does not start drilling until March 31 of the year following the contribution of capital See Section 263 of the Tax Code Tangible Drilling Cost Tax Deduction The total amount of the investment allocated to the equipment Tangible Drilling Costs TDC is 100 tax deductible In the example above the remaining tangible cost 25 000 may be deducted as depreciation over a seven year period See Section 263 of the Tax Code Active vs Passive Income The Tax Reform Act of 1986 introduced into the Tax Code the concepts of Passive income and Active income The Act prohibits the offsetting of losses from Passive activities against income from Active businesses The Tax Code specifically states that a Working Interest in an oil and gas well is NOT a Passive Activity therefore deductions can be offset against income from active stock trades business income salaries etc See Section 469 c 3 of the Tax Code Small Producers Tax Exemption The 1990 Tax Act provided some special tax advantages for small companies and individuals This tax incentive known as the Percentage Depletion Allowance is specifically intended to encourage participation in oil and gas drilling This tax benefit is not available to large oil companies retail petroleum marketers or refiners that process more than 50 000 barrels per day The Small Producers Exemption allows 15 of the Gross Income not Net Income from an oil and gas producing property to be tax free Lease Costs Lease costs purchase of leases minerals etc sales expenses legal expenses administrative accounting and Lease Operating Costs LOC are also 100 tax deductible through cost depletion Alternative Minimum Tax Prior to the 1992 Tax Act working interest participants in oil and gas ventures were subject to the normal Alternative MinimalTax to the extent that this tax exceeded their regular tax This Tax Act specifically exempted Intangible Drilling Cost as a Tax Preference item Alternative Minimum Taxable Income generally consists of adjusted gross income minus allowable Alternative Minimum Tax itemized deduction plus the sum of tax preference items and adjustments Tax preference items are preferences existing in the Code to greatly reduce or eliminate regular income taxation Included within this group are deductions for excess Intangible Drilling and Development Costs and the deduction for depletion allowable for a taxable year over the adjusted basis in the Drilling Acreage and the wells thereon
21 K 1 FORM EXAMPLE
22 CERTIFICATE OF INSURANCE This document was issued by Rush Creek Resources
23 INDUSTRY TERMS
24 INDUSTRY TERMS
25 INDUSTRY PARTNERS REFERENCES ALAN GIRADOT PRESIDENT CEO AGIRADOT RUSHCREEKRESOURCES COM D 214 329 5979 ALFREDO MANZUR GONZALEZ PRESIDENT CEO ALFREDO SOFIEXPLORATION COM O 469 802 0332 D 214 514 9022 REFERENCES KITTELSON LAW OFFICE DOUG KITTELSON DOUG KITTELSONLAW COM WWW KITTELSONLAW COM O 214 734 2700 C 214 704 5721 KAREY REBELLO KREBELLO HENSLEYCPAS US WWW HENSLEYCPAS US O 214 390 9071 MINDY GAYER BUSINESS DEVELOPMENT MANAGER MGAYER THEENTRUSTGROUP COM O 615 569 9122
Black Bear 1 1880 West Prosper Trail Prosper Texas 75078 469 802 0332 Alfredo sofiexploration com