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Related Party Transactions
 9 Months Ended
Sep. 30, 2023
Related Party Transactions [Abstract]  
Related Party Transactions

Note 14 – Related Party Transactions

 

Energy Evolution is a related party of the Company as it beneficially owns approximately 24% of the Company’s outstanding shares of common stock as of September 30, 2023. Additionally, a board member of Energy Evolution was appointed to the Company’s board in October 2021. This board member separately beneficially owns approximately 16% of the Company’s outstanding shares of common stock as of September 30, 2023. The board member also is a majority owner of PIE. In October 2021 another Energy Evolution member was appointed to the Company’s board of directors.

 

In March 2021, the majority owner of PIE, through the exercise of warrants, became a significant shareholder of the Company’s outstanding shares of stock. The Company has a joint development agreement with PIE to perform recompletion or workover on specified mutually agreed upon wells in Texas. As of September 30, 2023, the Company has outstanding obligations of approximately $1.1 million as a part of the joint development agreement (See Note 8). In the third quarter of 2022, a $1.4 million long-term asset that had previously been recorded as an offset to the note payable was expensed to workovers within Lease Operating Expense on the Consolidated Statement of Operations.

 

The Company has also entered into a Shared Services Agreement with PIE effective August 1, 2023 that includes access to administrative, engineering and support services as well as building and insurance services. The agreement provides that the Company will reimburse PIE for the out-of-pocket or actual costs incurred by PIE in providing such services to the Company.

 

In July 2023, Energy Evolution exercised its remaining warrants for 500,000 shares of common stock for $5.00 per share. The Company received $2.5 million related to this transaction.

 

On September 19, 2023, each of Phil Mulacek and Energy Evolution made a bridge loan to Empire North Dakota each in the amount of $5.0 million. The Investors are each a related party of the Company. See Note 8 for a description of the Bridge Loans.