Form 8-K - Current report

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

_________________

 

FORM 8-K

_________________

Current Report

Pursuant To Section 13 or 15 (d) of the Securities Exchange Act of 1934

 

 

Date of Report (date of earliest event reported):

 

 

NOVEMBER 18, 2024

_______________________________

EMPIRE PETROLEUM CORPORATION

(Exact name of registrant as specified in its charter)

_______________________________

 

Delaware	001-16653	73-1238709
(State or Other Jurisdiction	(Commission	(I.R.S. Employer
of Incorporation)	File Number)	Identification No.)

 

2200 S. Utica Place, Suite 150, Tulsa, Oklahoma   74114

(Address of Principal Executive Offices)       (Zip Code)

 

Registrant’s telephone number, including area code:   [phone]

 

 

(Former name or former address, if changed since last report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

  

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock $0.001 par value	EP	NYSE American

  

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

 

Item 1.01.

Entry into a Material Definitive Agreement.

As previously reported on the Current Report on Form 8-K of Empire Petroleum Corporation (the “Company”) filed on January 5, 2024, Empire North Dakota LLC, a Delaware limited liability company (“Empire North Dakota”) and wholly owned subsidiary of the Company, and Empire ND Acquisition LLC, a Delaware limited liability company and wholly owned subsidiary of the Company (“Empire ND Acquisition” and, collectively with Empire North Dakota, the “Borrowers”), entered into that certain Revolver Loan Agreement dated as of December 29, 2023 with Equity Bank, as lender (the “Loan Agreement”).

On November 18, 2024, the Borrowers and Equity Bank entered into that certain first amendment to the Loan Agreement (the “First Amendment”). The First Amendment amended the Loan Agreement to, among other things: (a) amend certain definitions; (b) increase the revolver commitment amount to $20,000,000 from an initial revolver commitment amount of $10,000,000; and (c) increase the monthly commitment reduction amount from $150,000 to $250,000, commencing on December 31, 2024, and occurring on the last day of each calendar month thereafter. The Loan Agreement continues to mature on December 29, 2026 and be guaranteed by the Company.

The foregoing summary of the First Amendment is qualified in its entirety by reference to the full terms and conditions of the First Amendment, a copy of which is filed as Exhibit 10 to this Current Report on Form 8-K and is incorporated by reference into this Item 1.01.

 

Item 2.03.

Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

The information set forth under Item 1.01 of this Current Report on Form 8-K is incorporated by reference into this Item 2.03.

 

Item 7.01.

Regulation FD Disclosure.

On November 22, 2024, the Company issued a press release announcing the First Amendment. A copy of the press release is furnished as Exhibit 99 to this Current Report on Form 8-K.

This information is being furnished pursuant to Item 7.01 of Form 8-K and shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

 

Item 9.01.

Financial Statements and Exhibits.

(d)		Exhibits.
The following exhibits are filed or furnished herewith.

Exhibit Number	Description
10	First Amendment to Revolver Loan Agreement dated as of November 18, 2024, by and between Empire North Dakota LLC and Empire ND Acquisition LLC, as borrowers, and Equity Bank, as lender.
99	Press Release of Empire Petroleum Corporation dated November 22, 2024.
104	Cover Page Interactive Data File (embedded within the Inline XBRL document).

 

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

 

 

	EMPIRE PETROLEUM CORPORATION
Date:    November 22, 2024	By:	/s/ Michael R. Morrisett
		Michael R. Morrisett President and Chief Executive Officer

 

 

 

 

 

 

 

 

 

 

 

 

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EXHIBIT 10

 

FIRST AMENDMENT TO REVOLVER LOAN AGREEMENT

THIS FIRST AMENDMENT TO REVOLVER LOAN AGREEMENT (this "First Amendment") is entered into effective as of November 18, 2024, between EMPIRE NORTH DAKOTA LLC, a Delaware limited liability company ("END"), and EMPIRE ND ACQUISITION LLC, a Delaware limited liability company ("Acquisition", and, together with END, collectively, "Borrowers"), and EQUITY BANK, a Kansas banking corporation (the "Bank"). END and Acquisition are sometimes collectively referred to herein as a "Borrower" and collectively as the "Borrowers".

W I T N E S S E T H:

WHEREAS, Borrowers and Bank are parties to that certain Revolver Loan Agreement dated as of December 29, 2023 (the "Existing Loan Agreement"), pursuant to which Bank established a revolving line of credit facility in the maximum principal amount of $15,000,000.00 for the benefit of Borrowers (the "Existing Commitment") until the maturity date of December 29, 2026 (the "Existing Maturity Date").

WHEREAS, Borrowers have requested, and Bank has agreed to (i) increase the Revolver Commitment in the increased maximum principal amount of $20,000,000.00 (subject to the Revolver Commitment Amount and the Collateral Borrowing Base limitations), (ii) increase the MCR from $150,000.00 to $250,000.00 and (iii) make certain other modifications to the existing Loan Agreement by amending the Existing Loan Agreement, all upon the terms and conditions herein set forth.

NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein, and other good and valuable consideration, receipt of which is acknowledged by the parties hereto, the parties agree as follows:

1.

Definitions. Capitalized terms used herein and not otherwise defined shall have the meaning given in the Existing Loan Agreement.

a.

The definition of "Letters of Credit" shall be amended as follows:

"Letters of Credit" shall mean any and all letters of credit issued by Bank pursuant to the request of Borrowers in accordance with the provisions of Sections 2.1 and 2.7 hereof which at any time remain outstanding and subject to draw by the beneficiary, whether in whole or in part.

b.

The definition of "MCR" shall be amended as follows:

"MCR" shall have the meaning assigned thereto in Section 2.12.

c.

The definition of "Revolver Commitment Amount" shall be amended as follows:

"Revolver Commitment Amount" shall be the maximum outstanding principal amount plus Letter of Credit Exposures the Bank agrees from time to time to make available under the Revolver Commitment (initially stipulated to be equal to $20,000,000.00).

2.

Revolver Commitment. The Revolver Commitment is hereby renewed and increased in the increased maximum principal amount of $20,000,000.00 until the existing Revolver Final Maturity Date.

3.

Replacement Revolver Note. All of the Indebtedness created pursuant thereto shall be evidenced by that certain Promissory Note (Revolver Note) dates as of even date herewith, from the Borrowers payable to the order of Bank in the existing maximum principal amount of $20,000,000.00 (the "Replacement Revolver Note"), in form, scope and substance acceptable to the Bank. The Replacement Revolver Note shall bear interest on unpaid balances of principal from time to time outstanding at a variable rate equal from day to day to the Base Rate plus one hundred and fifty basis points (1.50%), and in no event lower than 8.50%. The Replacement Revolver Note shall be payable as set forth therein and in Section 2.2 of the Existing Loan Agreement. All references to the Revolver Note in the Existing Loan Agreement and other Loan Documents shall hereafter refer to the Replacement Revolver Note.

4.

Monthly Commitment Reductions. Section 2.12 of the Existing Loan Agreement shall be amended as follows:

2.12. Monthly Commitment Reductions. Commencing on December 31, 2024, and occurring on the last day of each calendar month thereafter, the Revolver Commitment Amount shall be automatically reduced by $250,000.00 (the "MCR"). From time to time thereafter, the MCR will be subject to adjustment by the Bank in its discretion at each semi-annual Collateral Borrowing Base redetermination. To the extent the outstanding principal balance of the Revolver Note (including Letter of Credit Exposure) is in excess of the adjusted amount of the Revolver Commitment Amount, Borrowers shall make a mandatory principal prepayment on the Revolver Note in such amount as is necessary to reduce the outstanding principal balance of the Revolver Note (including Letter of Credit Exposure) to an amount less than or equal to the adjusted Revolver Commitment Amount, which such mandatory principal prepayment shall be made within five (5) days of the applicable MCR principal payment. Any such payments shall be in addition to the regularly scheduled interest payment.

5.

Loan Origination Fee. Section 2.4 of the Existing Loan Agreement shall be amended as follows:

2.4   Loan Origination Fee. Borrowers shall pay to the Bank a fully earned and non-refundable loan origination fee equal to $69,000.00.

6.

Guaranty Ratification. Borrowers shall cause the Guarantor to execute and deliver to the Bank the Guarantor Acknowledgment and Ratification attached hereto (the "Guarantor Ratification").

 

 

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7.

Conditions Precedent. Borrowers shall execute and deliver, or cause to be executed and delivered to the Bank, each of the following as express conditions precedent to the effectiveness of the amendments and modifications contemplated by this First Amendment:

a.

This First Amendment;

b.

Replacement Revolver Note;

c.

The Guarantor Ratification;

d.

Closing certificates from Borrowers and Guarantor in form, scope and substance acceptable to the Bank; and

e.

Such updated financial statements and information on Borrowers and the Guarantor as the Bank shall request.

8.

Ratification and Continuation. The remaining terms, provisions and conditions set forth in the Existing Loan Agreement shall remain in full force and effect as long as any Indebtedness of the Borrowers is owing to the Bank and/or the Commitment remains in effect. The Borrowers restate, confirm and ratify the warranties, covenants and representations set forth in the Existing Loan Agreement (except the representations and warranties that specify a specific date or period of time) and further represents to the Bank that, as of the date hereof, no Default or Event of Default exists under the Loan Agreement (including this First Amendment). All references to the "Loan Agreement" appearing in any of the Loan Documents shall hereafter be deemed references to the Existing Loan Agreement as amended, modified and supplemented by this First Amendment. In the event of any inconsistency between the terms of this First Amendment and the terms of the Existing Loan Agreement, the terms of this First Amendment shall control and govern, and the agreements shall be interpreted so as to carry out and give full effect to the intent of this First Amendment. Each of the Borrowers and the Bank hereby adopt, ratify and confirm the Loan Agreement, as amended hereby, and acknowledge and agree that the Loan Agreement and all other Loan Documents, are and remain in full force and effect. Borrowers acknowledge and agree that its liabilities and obligations under the Loan Agreement and all other Loan Documents, including the Security Instruments, are not impaired in any respect by this First Amendment. Borrowers further ratify, confirm, and continue the mortgage liens and security interests granted thereby pursuant to the Existing Loan Agreement and Loan Documents and hereby grants and regrants such mortgage liens and security interests in favor of the Bank.

9.

Fees and Expenses. The Borrowers agree to pay to the Bank on demand all costs, fees and expenses (including without limitation reasonable attorneys' fees and legal expenses) incurred or accrued by the Bank in connection with the preparation, negotiation, execution, closing, delivery, and administration of the Loan Agreement (including this First Amendment) and the other Loan Documents (including Security Instruments), or any amendment, waiver, consent or modification thereto or thereof, or any enforcement thereof.

 

 

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10.

SUBMISSION TO JURISDICTION. BORROWERS AND THE BANK HEREBY CONSENT TO THE JURISDICTION OF ANY OF THE LOCAL, STATE, AND FEDERAL COURTS LOCATED WITHIN TULSA COUNTY, OKLAHOMA AND WAIVE ANY OBJECTION BASED ON IMPROPER VENUE OR FORUM NON CONVENIENS TO THE CONDUCT OF ANY PROCEEDING IN ANY SUCH COURT.

11.

WAIVER OF JURY TRIAL. BORROWERS AND THE BANK FULLY, VOLUNTARILY AND EXPRESSLY WAIVE ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS UNDER THE LOAN AGREEMENT (INCLUDING THIS FIRST AMENDMENT) OR UNDER ANY AMENDMENT, INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED (OR WHICH MAY IN THE FUTURE BE DELIVERED) IN CONNECTION THEREWITH OR ARISING FROM ANY BANKING RELATIONSHIP EXISTING IN CONNECTION WITH THE EXISTING LOAN AGREEMENT, THE SECURITY INSTRUMENTS AND/OR ANY OTHER LOAN DOCUMENT. BORROWERS AND THE BANK AGREE THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY.

12.

Counterparts. This First Amendment may be executed in multiple counterparts, each of which, when so executed, shall constitute an original copy. Transmission by facsimile or electronic transmission (e.g., pdf format) of an executed counterpart of this First Amendment by any party shall be deemed to constitute due and sufficient delivery of such counterpart and such facsimile or electronic transmission shall be deemed to be an original counterpart of this First Amendment.

13.

Governing Law. This First Amendment shall be deemed to be a contract made under and shall be governed by and construed in accordance with the laws of the State of Oklahoma.

14.

Release. In consideration of the amendments contained herein, Borrowers hereby waive and release the Bank from any and all claims and defenses, known or unknown, as of the effective date of this First Amendment, with respect to the Loan Agreement (including this First Amendment) and the Loan Documents and the transactions contemplated thereby.

[Signature page follows.]

 

 

 

 

 

 

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IN WITNESS WHEREOF, the parties hereto have caused this First Amendment to Revolver Loan Agreement to be duly executed and delivered by the respective duly authorized representatives of Borrowers to the Bank in Tulsa, Oklahoma, effective as of the day and year first above written.

 

BORROWERS:	EMPIRE NORTH DAKOTA LLC, a Delaware limited liability company     By: /s/ Michael R. Morrisett        Name: Michael R. Morrisett        Title: Chief Executive Officer
	EMPIRE ND ACQUISITION LLC, a Delaware limited liability company     By: /s/ Michael R. Morrisett       Name: Michael R. Morrisett         Title: Chief Executive Officer

 

 

 

 

 

 

 

Loan Agreement Signature Page

 

BANK:	EQUITY BANK, a Kansas banking corporation     By: /s/ Terry Blain                       Terry Blain, Senior Vice  President/Energy

 

 

 

 

 

 

 

 

 

 

Loan Agreement Signature Page 

 

GUARANTOR ACKNOWLEDGMENT AND RATIFICATION

The undersigned guarantor (the "Guarantor") hereby acknowledges, ratifies, confirms, restates and continues in full force and effect in favor of EQUITY BANK (the "Bank") the continuing validity, effectiveness and enforceability of that certain Guaranty Agreement from Guarantor, dated as of December 29, 2023 (the "Guaranty Agreement"), issued by Guarantor to the Bank pursuant to that certain Revolver Loan Agreement dated as of December 29, 2023 (the "Existing Loan Agreement"), between EMPIRE NORTH DAKOTA LLC, a Delaware limited liability company ("END"), by and between EMPIRE ND ACQUISITION LLC, a Delaware limited liability company ("Acquisition", and together with END, collectively, the "Borrowers"), as borrowers, and the Bank, as lender, as therein described and defined, including as amended and modified by virtue of the First Amendment to Revolver Loan Agreement between Borrowers and the Bank dated effective as of November 18, 2024 (the "First Amendment", and together with the Existing Loan Agreement, collectively, the "Loan Agreement"), all as more particularly described and defined in the First Amendment, with the same force and effect as if such Guaranty Agreements were fully restated herein.

The undersigned Guarantor acknowledges, approves and consents to the terms and provisions of the First Amendment.

A facsimile signature page may be delivered to the Bank with the same force and effect as a manually executed signature page and delivery of such facsimile signature page shall constitute a covenant of Guarantor that a manually executed signature page will be promptly and timely delivered to the Bank.

 

[Signature Page Follows]

 

 

 

 

 

 

 

 

 

 

 

 

Guarantor Acknowledgment - 1

 

 

IN WITNESS WHEREOF, Guarantor has caused this Guaranty to be executed and delivered to Bank in Tulsa, Oklahoma, effective as of the date first above written.

 

EMPIRE PETROLEUM CORPORATION,

a Delaware corporation

 

 

By: /s/ Michael R. Morrisett                                  

        Michael R. Morrisett, President

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Guarantor Acknowledgment - 2

 

 

EXHIBIT 99

 

  

 

Empire Petroleum Increases Revolver Loan Facility with Equity Bank to

$20 Million in Support of Strategic Growth Initiatives

 

•

Amended current revolver commitment from $10 Million to $20 Million

•

Initially provides additional financial capacity of over $11 Million

 

TULSA, OK – (November 22, 2024) – Empire Petroleum Corporation (NYSE American: EP) (“Empire” or the “Company”) today announced that it has entered into an amendment to its Revolver Loan Agreement with Equity Bank (Equity Bancshares, Inc. NYSE: EQBK), increasing the total principal commitment to $20.0 million, up from an initial $10.0 million through December 29, 2026. Currently, Empire has approximately $8.4 million borrowed on the $20.0 million facility.

 

The loan is secured by assets from two of the Company’s subsidiaries, Empire North Dakota, LLC, and Empire ND Acquisition, LLC. The increase highlights Empire’s strong operational and financial progress, supported by ongoing strategic initiatives, including the successful completion of an oversubscribed $10.0 million rights offering earlier this year.

 

“I would like to express my appreciation to Equity Bank’s energy team for their continued support,” said Mike Morrisett, President and CEO. “This revolver increase provides us with additional financial resources to further execute our North Dakota development, drive growth, and deliver value to our shareholders.”

  

 

ABOUT EMPIRE PETROLEUM

Empire Petroleum Corporation is a publicly traded, Tulsa-based oil and gas company with current producing assets in New Mexico, North Dakota, Montana, Texas, and Louisiana. Management is focused on organic growth and targeted acquisitions of proved developed assets with synergies with its existing portfolio of wells. More information about Empire can be found at www.empirepetroleumcorp.com.

 

SAFE HARBOR STATEMENT

This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements involve a wide variety of risks and uncertainties, and include, without limitations, statements with respect to the Company’s estimates, strategy, and prospects. Such statements are subject to certain risks and uncertainties which are disclosed in the Company’s reports filed with the SEC, including its Form 10-K for the fiscal year ended December 31, 2023, and its other filings with the SEC. Readers and investors are cautioned that the Company’s actual results may differ materially from those described in the forward-looking statements due to a number of factors, including, but not limited to, the Company’s ability to acquire productive oil and/or gas properties or to successfully drill and complete oil and/or gas wells on such properties, general economic conditions both domestically and abroad, uncertainties associated with legal and regulatory matters, and other risks and uncertainties related to the conduct of business by the Company. Other than as required by applicable securities laws, the Company does not assume a duty to update these forward-looking statements, whether as a result of new information, subsequent events or circumstances, changes in expectations, or otherwise.

 

 

CONTACTS

 

Empire Petroleum Corporation

Mike Morrisett

President & CEO

539-444-8002

[e-mail]

 

Kali Carter

Communications & Investor Relations Manager

918-995-5046

[e-mail]

 

 

 

Cover	Nov. 18, 2024
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Nov. 18, 2024
Entity File Number	001-16653
Entity Registrant Name	EMPIRE PETROLEUM CORPORATION
Entity Central Index Key	0000887396
Entity Tax Identification Number	73-1238709
Entity Incorporation, State or Country Code	DE
Entity Address, Address Line One	2200 S. Utica Place
Entity Address, Address Line Two	Suite 150
Entity Address, City or Town	Tulsa,
Entity Address, State or Province	OK
Entity Address, Postal Zip Code	74114
City Area Code	539
Local Phone Number	444-8002
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Entity Emerging Growth Company	false

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