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Forbearance Agreement - GALAXY ENERGY CORP - 3-15-2007

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					                        EXHIBIT 10.54

FORBEARANCE AGREEMENT BETWEEN GALAXY ENERGY CORPORATION AND
     BRUNER FAMILY TRUST UTD MARCH 28, 2005 DATED EFFECTIVE
                       DECEMBER 1, 2006
                                      FORBEARANCE AGREEMENT

This Forbearance Agreement (this "Agreement") is dated to be effective as of December 1, 2006, and is entered
into by and between Galaxy Energy Corporation, a Colorado corporation ("Borrower") and Bruner Family Trust
UTD March 28, 2005 ("Note Holder").

                                                  RECITALS:

WHEREAS, Borrower and Note Holder are parties to that certain Promissory Note in the principal amount of
$2,600,000, dated January 14, 2004, as amended by that certain Note Modification Agreement, dated April 1,
2006 (the Promissory Note and the Note Modification Agreement are collectively referred to herein as the
"Note");

WHEREAS, Borrower has failed to make the mandatory payment of the principal and interest owing as required
under Section 1 of the Note (the "Primary Payment"); and
WHEREAS, Note Holder is willing to forbear from enforcing its rights that arise as a result of the failure by
Borrower to make the Primary Payment for a limited period of time, provided that Borrower complies with the
terms of this Agreement.

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:

                                               I. AGREEMENT

Note Holder hereby agrees to refrain through 5:00 p.m. Mountain
Standard Time on June 30, 2007 (the "Termination Date") from exercising any of its rights and remedies under
the Note that may exist by virtue of the failure by Borrower to make the Primary Payment and hereby waives any
such rights until the Termination Date.

1. Except as expressly provided herein, the execution and delivery of this Agreement shall not: (a) constitute an
extension or modification of any aspect of the Note; (b) extend the terms of the Note or the due date of any of
the obligations set forth in the Note; (c) give rise to any obligation on the part of the Note Holder to extend,
modify or waive any term or condition of the Note; (d) give rise to any defenses or counterclaims to the right of
Note Holder to otherwise enforce its rights and remedies under the Note; or (e) establish a custom or course of
dealing.

2. From and after the Termination Date, Note Holder shall be entitled to enforce the Note according to the
original terms thereof.

II. REPRESENTATIONS AND WARRANTIES

In consideration of the limited agreement of Note Holder to forbear from the exercise of its rights and remedies
as set forth above, Borrower hereby represents and warrants to Note Holder as of the date hereof as follows:
1. The execution, delivery and performance of this Agreement by Borrower are within Borrower's corporate
power and have been duly authorized by all necessary corporate action.

2. This Agreement constitutes a valid and legally binding Agreement enforceable against Borrower in accordance
with its terms subject to the effects of bankruptcy, insolvency, fraudulent conveyance and other laws affecting
creditors' rights generally and to general equitable principles.

3. The Note constitutes a valid and legally binding obligation of Borrower, enforceable against Borrower in
accordance with the terms thereof subject to the effects of bankruptcy, insolvency, fraudulent conveyance and
other laws affecting creditors' rights generally and to general equitable principles.

III. MISCELLANEOUS

1. HEADINGS. Section headings in this Agreement are included herein for convenience of reference only and
shall not constitute a part of this Agreement for any other purpose.

2. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND SHALL BE
CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
WYOMING WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES.

3. COUNTERPARTS. This Agreement may be executed in any number of counterparts, and by different parties
hereto in separate counterparts, each of which when so executed and delivered shall be deemed an original, but
all such counterparts together shall constitute but one and the same instrument.

4. CONTINUED EFFECTIVENESS. Except as expressly set forth in this Agreement, the terms of the Note
remain unchanged, and shall remain in full force and effect and are hereby confirmed and ratified.

5. NO NOVATION. This Agreement shall not be deemed or construed to be a satisfaction, reinstatement,
novation or release of the Note or, except as expressly provided herein, a waiver by Note Holder of any of its
rights and remedies under the Note, or at law or in equity.

6. REAFFIRMATION. Borrower hereby reaffirms each and every covenant, condition, obligation and provision
set forth in the Note, as modified hereby.

7. CONSTRUCTION. Borrower acknowledges that it has been represented by its own legal counsel in
connection with its execution of this Agreement and the Note, that it has exercised independent judgment with
respect to this Agreement and the Note, and that it has not
relied on Note Holder or Note Holder's counsel for any advice with respect to this Agreement or the Note.

8. INTEGRATION; WAIVERS. This Agreement, the Note and the other written agreements, instruments and
documents entered into in connection therewith (collectively, the "Borrower/Note Holder Documents") set forth
in full the terms of agreement between the parties with respect to the subject matter thereof and are intended as
the full, complete and exclusive contract governing the relationship between the parties with respect thereto,
superseding all other discussions, promises, representations, warranties, agreements and understandings between
the parties with respect thereto. Any waiver of any condition in, or breach of, any of the foregoing in a particular
instance shall not operate as a waiver of other or subsequent conditions or breaches of the same or a different
kind.

9. Note Holder's exercise or failure to exercise any rights under any of the foregoing in a particular instance shall
not operate as a waiver of its right to exercise the same or different rights in other instances. Except as expressly
provided to the contrary in this Agreement, all the terms, conditions and provisions of the Borrower/Note Holder
Documents shall continue in full force and effect.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date first set
forth above, by their respective duly authorized officers.

          BORROWER                                           NOTE HOLDER

          GALAXY ENERGY CORPORATION                          BRUNER FAMILY TRUST UTD MARCH 28, 2005


          By:                                                By: /s/ MARC E. BRUNER
               ---------------------------                      -----------------------------------
          Name:                                              Name: MARC E. BRUNER, TRUSTEE
               ---------------------------
          Title:
                 -------------------------
                                                             By:
                                                                -----------------------------------
                                                             Name: CYNTHIA L. GAUSVIK, TRUSTEE
                       EXHIBIT 23.1

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM,
         HEIN & ASSOCIATES LLP DATED MARCH 14, 2007
           CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We consent to the incorporation by reference in Registration Statements No. 333-120275, 333-126310, and
333-130391 on Form S-3 of Galaxy Energy Corporation ("Galaxy") of our report dated March 14, 2007
relating to our audit of the consolidated financial statements, included in and incorporated by reference in the
Annual Report on Form 10-K of Galaxy for the year ended November 30, 2006.

                                          /s/ HEIN & ASSOCIATES LLP

                                          Denver, Colorado
                                          March 14, 2007
EXHIBIT 31.1

                                       RULE 13A-14(a) CERTIFICATION

I, Marc E. Bruner, certify that:

1. I have reviewed this annual report on Form 10-K of Galaxy Energy Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements and other financial information included in this report, fairly
present in all material respects the financial condition, results of operations, and cash flows of the registrant as of,
and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure
controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over
financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be
designed under our supervision, to ensure that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in
which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting
to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external purposes in accordance with generally accepted
accounting principles;

c) evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report
our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period
covered by this report based on such evaluation; and

d) disclosed in this report any change in the registrant's internal control over financial reporting that occurred
during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual
report) that has materially affected, or is reasonably likely to materially affect, registrant's internal control over
financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal
control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of
directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial
reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and
report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in
the registrant's internal control over financial reporting.

          Date:       March 15, 2007                          /s/ MARC E. BRUNER
                                                              ---------------------------------------
                                                              Marc E. Bruner,
                                                              President (Principal Executive Officer)
EXHIBIT 31.2

                                       RULE 13A-14(a) CERTIFICATION

I, Christopher S. Hardesty, certify that:

1. I have reviewed this annual report on Form 10-K of Galaxy Energy Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements and other financial information included in this report, fairly
present in all material respects the financial condition, results of operations, and cash flows of the registrant as of,
and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure
controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over
financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be
designed under our supervision, to ensure that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in
which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting
to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external purposes in accordance with generally accepted
accounting principles;

c) evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report
our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period
covered by this report based on such evaluation; and

d) disclosed in this report any change in the registrant's internal control over financial reporting that occurred
during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual
report) that has materially affected, or is reasonably likely to materially affect, registrant's internal control over
financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal
control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of
directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial
reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and
report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in
the registrant's internal control over financial reporting.

          Date:       March 15, 2007                            /s/ CHRISTOPHER S. HARDESTY
                                                                -------------------------------------
                                                                Christopher S. Hardesty
                                                                Chief Financial Officer
                                                  EXHIBIT 32.1

                      CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,
                                 AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of Galaxy Energy Corporation (the "Company") on Form 10-K for the
period ending November 30, 2006, as filed with the Securities and Exchange Commission on the date hereof (the
"Report"), I, Marc E. Bruner, President (Chief Executive Officer) of the Company, certify, pursuant to 18 U.S.C.
Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of
1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and
results of operations of the Company.

                                /s/ MARC E. BRUNER
                                --------------------------------------------
                                Marc E. Bruner
                                President (Chief Executive Officer)
                                                  EXHIBIT 32.2

                      CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,
                                 AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of Galaxy Energy Corporation (the "Company") on Form 10-K for the
period ending November 30, 2006, as filed with the Securities and Exchange Commission on the date hereof (the
"Report"), I, Christopher S. Hardesty, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C.
Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of
1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and
results of operations of the Company.

                                    /s/ CHRISTOPHER S. HARDESTY
                                    --------------------------------------
                                    Christopher S. Hardesty
                                    Chief Financial Officer