|3 Months Ended|
Mar. 31, 2023
Note 16. Subsequent Events
On April 28, 2023, the Company issued 588,235 common shares pursuant to the assignment and conversion of $200,000 of the convertible promissory note owed by the Company and its subsidiary, Mid-Con Petroleum, LLC, to Cornerstone Bank (Note 11).
On May 1, 2023, the Company issued 3,849,306 common shares upon the exercise of warrants with an exercise price of between $0.001 and $0.009.
Effective as of May 5, 2023, the Company entered into a securities purchase agreement with FK Venture LLC, a Delaware limited liability company (the “Investor”), pursuant to which (i) the Investor agreed to purchase, by the fifth calendar day of each month for six months commencing May 5, 2023, and the Company agreed to issue to the Investor, convertible promissory notes (each such note a “Note”), with each Note having a minimum principal amount of $800,000 (for aggregate minimum funding to the Company of $4,800,000); and (ii) the Investor would have the right to purchase up to an aggregate of $9,600,000 in principal amount of Notes provided the Investor has purchased each Note monthly as required.
The initial Note purchased by the Investor was funded by the Investor on May 5, 2023, and on such date, the Company received the purchase price of $800,000 and issued a Note in the principal amount of $800,000 to the Investor. Each Note issued to the Investor will (i) mature on the earlier of earlier of July 1, 2025, or 90 days following the date that the Company completes a direct up-listing of its common stock to a national securities exchange (not including any merger or combination of the Company and Camber Energy, Inc. (such combination the “Camber Merger”)); (ii) accrue interest at 12% per annum (provided that if a Note is prepaid within 12 months of the issuance date, a full 12 months of interest shall be paid); and (iii) be convertible into shares of the Company’s (or its successor’s) common stock at a fixed conversion price equal to the lesser of (a) $0.75 (subject to proportional adjustment for stock splits), or (b) if the Camber Merger closes, 50% multiplied by the volume-weighted average price of Camber Energy, Inc.’s common stock on the trading day immediately prior to the closing of the Camber Merger (subject to proportional adjustment for stock splits).
The entire disclosure for significant events or transactions that occurred after the balance sheet date through the date the financial statements were issued or the date the financial statements were available to be issued. Examples include: the sale of a capital stock issue, purchase of a business, settlement of litigation, catastrophic loss, significant foreign exchange rate changes, loans to insiders or affiliates, and transactions not in the ordinary course of business.
Reference 1: http://www.xbrl.org/2003/role/disclosureRef