Laredo Oil, Inc.

Laredo's auditor, BF Borgers, was suspended from practicing before the SEC after the agency charged the firm with massive audit fraud -- Laredo had to scramble to find a new, qualified auditor.

auditor change

Laredo's Hell Creek Crude subsidiary raised $2.034 million from accredited investors to drill a development well and buy leases in Montana's Midfork Field; some investors rolled $575,000 of existing convertible debt into the new investment instead of taking cash.

material agreement

Laredo set up a note-purchase facility for up to $7.5 million, secured by its wholly owned subsidiary Hell Creek Crude, and drew an initial $50,000 -- a large facility size relative to the company, though only a small fraction was drawn at first.

debt financing

Laredo bought SORC back from Alleghany for $55,000 cash plus a 5% royalty on Laredo's future oil and gas revenue for seven years, reversing the 2011 arrangement and giving Laredo exclusive worldwide rights again to its enhanced-oil-recovery technology plus SORC's oilfield equipment. The two old Alleghany loans were rolled into one $631,434 note secured by that equipment, and Alleghany agreed to pay roughly $1.245 million in 2021 for continued consulting from CEO Mark See and General Counsel Chris Lindsey.

asset acquisition disposition

Laredo formed Cat Creek Holdings, a joint venture with Lipson Investments and Viper Oil & Gas (Laredo 50%, each partner 25%), to buy oil and gas properties in Montana's Cat Creek Field from Carrell Oil Company for $400,000 -- Laredo's first direct operating stake since becoming primarily a technology licensor to SORC in 2011.

material agreement

Laredo licensed its "Underground Gravity Drainage" enhanced-oil-recovery technology and the services of CEO Mark See to a new Alleghany-backed vehicle, Stranded Oil Resources Corporation (SORC), in exchange for a 17.25%-19.99% royalty on SORC's net profits plus management fees. Alleghany committed up to $16 million to fund SORC. The deal turned cash-strapped Laredo into essentially a technology-licensing and management-services company rather than a direct oil operator.

material agreement