Armada Oil, Inc.

On August 28, 2015 Armada and its subsidiaries ceased operations and filed for Chapter 7 bankruptcy in the Eastern District of Texas, Sherman Division. A trustee will take control and liquidate the assets. The filing defaulted the Prosperity Bank term note, with about $3,486,664 now due, and the CFO and COO have left. The filing does not state what shareholders will receive; that Chapter 7 liquidation could leave equity with little or nothing is an inference, not stated.

bankruptcy or receivership

On March 5, 2015 Armada and Prosperity Bank converted the matured credit line into a $3,472,693 term loan with no further advances. Interest is paid monthly, principal of $50,000 a month starts October 5, 2015, and everything is due March 5, 2016. The rate is prime plus 1% with a 5.75% floor, secured by the Kansas leases. The bank removed the financial covenants and waived earlier violations, which resolves the default thread; Armada paid an $8,681.73 fee.

debt financing

Armada ended the $16,350,000 Tabbs Bay purchase on December 11, 2014, citing the sharp fall in oil prices, the high operating cost of the properties, and WTI closing below $76.74; the $100,000 deposit is to be returned. The year-end release says the related financing also fell away, Bear Creek #1 remains uncompleted, and Armada is seeking a working-interest sale or joint venture for it. It is also seeking a lender extension and says it received an offer for all or part of the Kansas property at or above the payoff. It plans to cut expenses. This resolves the Tabbs Bay thread.

material agreement termination

Armada sold its remaining 27.124% of TNR Holdings to Gulfstar on November 26, 2014 for $5,012,473, so it no longer has any interest in the South Louisiana fields. This completes the exit from the Louisiana assets that came from the Mesa deal. The bank credit facility matured November 22, 2014 and Armada failed to repay it; $4,600,000 of principal was paid from the sale proceeds, leaving $3,472,693 owed, secured by the Kansas leases. Armada is working to refinance, with no assurance it will succeed, and says the bank could enforce its rights if not.

asset acquisition disposition

On October 16, 2014 Armada agreed to buy eight leases (about 576 acres, Harris County, Texas, about 190 net barrels a day) from Tabbs Bay Energy for $16,350,000 cash, with the price adjusted by the WTI oil price at closing. It paid a $100,000 non-refundable deposit, and closing was due by November 14, 2014 (extendable to December 12 with another $100,000). Funding was to come from a new bank facility and equity or debt sales, but no firm commitment existed, and without financing Armada would forfeit the deposit.

material agreement

Armada says it breached a general-and-administrative-expense-to-revenue covenant on its Prosperity Bank (formerly F&M) credit facility for the quarters ended March 31 and June 30, 2014 (140.89% against a 27% limit), which is an event of default. About $8,111,375 was outstanding at June 30, 2014, the bank could demand immediate repayment, and Armada has asked for a waiver but has no answer yet. Armada attributes the breach to the Gulfstar asset reallocation and the move to midcontinent and Rocky Mountain operations.

debt financing

A press release says Armada began drilling the Bear Creek #1 well in Carbon County, Wyoming (100% working interest, target depth about 8,457 feet, roughly 15 days of drilling expected). Starting the well means it met its drilling obligation under the Anadarko farmout and keeps the rest of the farmout acreage, resolving that open thread. The release also says Armada sold its remaining Oklahoma acreage to focus on Kansas and Wyoming; no price or buyer is given.

drilling progress report

On April 10, 2014 Armada closed Gulfstar's second purchase (Tranche B, $6,700,053 for 25.925% of TNR Holdings), taking Gulfstar to 60.3% and control, so Armada will stop consolidating TNR Holdings and will account for its stake under the equity method. Armada also closed the Kansas purchase from Piqua Petro (six leases, about 1,040 acres, Woodson County), paying the $6,400,000 balance after the $100,000 deposit, subject to an operating-cost adjustment; current production is about 80 barrels a day. The F&M/Prosperity loan was amended: $4,603,125 of letters of credit moved off Armada's borrowings, the borrowing base was reset to $8,200,000, and the Kansas leases were pledged to the bank. This resolves the pending Tranche B and Piqua threads.

asset acquisition disposition

On March 14, 2014 Armada agreed to buy six oil and gas leases from Piqua Petro covering about 1,040 acres in Woodson County, Kansas, producing about 80 barrels a day, for $6,500,000 in cash. It paid a $100,000 non-refundable deposit, targets closing by April 3, 2014, and the deal is subject to due diligence conditions. Armada plans to pay by drawing the Tranche B Gulfstar funding ($6,700,053), which would raise Gulfstar's stake in TNR Holdings to 60.3%. This continues the Gulfstar thread and adds Kansas as a new area.

material agreement

On December 20, 2013 Armada agreed with Gulfstar Resources to sell interests in a new subsidiary, TNR Holdings, which holds the Louisiana oil properties that came from Mesa. Gulfstar bought a 34.375% stake for $6,250,000 and is obliged to buy another 25.925% for $6,700,053 within 90 days of the first closing. It has an option on a further 9.7% for $4,549,968, which would bring it to 70% if all are funded. Gulfstar gets 8% cumulative priority on distributions, approval rights over major decisions, and royalty interests in future Wyoming and Oklahoma wells drilled with the proceeds. Armada agrees to keep F&M Bank borrowings under $8,222,693 and letters of credit under $4,603,125. This is new funding but gives up part of the ownership of the Louisiana assets.

material agreement

The Mesa acquisition closed on March 28, 2013: Armada bought 100% of Mesa Energy, Inc., which holds substantially all of Mesa's assets, and Mesa will distribute 0.40 Armada share per Mesa share to its holders before dissolving. After the distribution, former Mesa and Armada holders will own about 62.4% and 37.6% of Armada. Three old directors (Bhogal, Matthews, Moss) resigned and Griffin, Unruh, Schlumberger and Zaziski joined the board. The F&M Bank & Trust lender consented and released Mesa as guarantor of Mesa Energy, Inc.'s loan, with Armada giving a replacement guaranty. This resolves the pending-deal thread from the S-4 filings. The S-4 was declared effective March 15, 2013.

business combination

On February 19, 2013 Armada, Mesa and Mesa Energy, Inc. signed Amendment No. 1 to the November 2012 acquisition agreement. It pushes the deadline for Mesa holder consent from February 18 to April 20, 2013 and the closing deadline from February 28 to April 30, 2013. It also revises the planned post-closing leadership: board of Griffin (Chairman), Cerna, Eric Wold, Unruh, Hern, Zaziski and Marceau Schlumberger; management of Griffin as CEO, Cerna as President, David Freeman as COO and Rachel Dillard as CFO. Freeman was earlier listed as EVP Gulf Coast and Unruh as COO. The filing does not state why the dates were extended (that the deal had not closed by the original dates is an inference).

material agreement

On January 10, 2013 Armada amended its Wyoming purchase and option agreement with TR Energy for the second time, acknowledging it has exercised an option to pay $736,000 for an additional 320 acres. Payment is split into $250,000 by February 28, 2013, $243,000 by April 30, 2013 and $243,000 by May 1, 2013. This is a new cash commitment tied to the Overland Trail project, and the filing does not say how it will be funded.

material agreement

Armada filed the S-4 registration statement to register up to 33,732,191 shares to be issued to Mesa holders in the Mesa acquisition; it also serves as Mesa's consent solicitation. It repeats the 0.40 ratio and about 62.4% Mesa / 37.6% Armada ownership after closing. The filing is not yet effective, and the document is still a draft with blanks, such as the mailing date. This is the registration step flagged as open in the context.

business combination

On November 14, 2012 Armada signed a binding asset purchase agreement with Mesa Energy Holdings and its subsidiary Mesa Energy, Inc. (MEI), turning the October non-binding letter of intent into a definitive deal. Armada would buy all of MEI (substantially all of Mesa's assets) for 0.40 Armada share per Mesa share (about 34 million shares, fixed ratio); Mesa would then dissolve, and Mesa holders would own about 62% and current Armada holders about 38%, versus the 57%/43% in the LOI. Armada shareholders do not vote on it. Closing needs Mesa holder consent (majority), an effective S-4 and other conditions. Armada would be based in Dallas, with Mesa's Griffin as CEO and Cerna as President.

material agreement

On November 2, 2012 (effective October 22) Armada Oil signed a Seismic and Farmout Option Contract with Anadarko, giving it a permit until May 1, 2013 to run a 3D survey on Anadarko-owned land. The company committed to drill a test well on that acreage by August 1, 2013 and to give Anadarko the survey data. If it drills and completes a producing test well, it earns a three-year lease on the drillsite section with a 20% royalty. The contract ends automatically if the survey is not finished by May 1, 2013.

material agreement

On October 3, 2012 Armada Oil announced a non-binding letter of intent to combine with Mesa Energy Holdings, Inc., issuing 0.325 Armada shares per Mesa share (stated as about a 134% premium to Mesa's $0.168 close). Mesa holders would own about 57% and current Armada holders about 43%. The combined company would keep the Armada Oil name, be based in Dallas and be run by Mesa's Randy Griffin as CEO, with James Cerna Jr. as President. A reverse split to support a national exchange listing is contemplated. Closing needs due diligence, definitive agreements and approvals, the aim is year-end, and the company itself cautions that expectations of completion are speculative. For existing holders, this would mean dilution to a minority stake if completed.

business combination

Effective July 2, 2012, Armada Oil signed an agreement with Geokinetics USA, Inc. to run a 3-D seismic survey over about 41.05 square miles (26,272 acres) of its Carbon County, Wyoming acreage. This moves the Overland Trail project from older 2D data toward new survey work. The filing does not state the survey's cost, and parts of the supplement are redacted.

material agreement

The Armada deal closed on March 30, 2012, on the terms announced on March 27. Armada is now a wholly owned subsidiary, and its former holders own about 43.7% of NDB. Armada's Wyoming project covers 25,000+ acres, of which it has acquired 1,280 acres plus data and 2D seismic, with an option on 23,700+ more acres. David Moss, Armada's founder and President since January 2012, joined the board. Director Derek Cooper, who led the company from 2005, resigned as a director with no stated disagreement. Existing shareholders are diluted to a minority position.

asset acquisition disposition

On March 21, 2012 NDB Energy agreed to buy all shares and warrants of Armada Oil, Inc., a separate private Nevada company with interests in Carbon County, Wyoming (the 'Overland Trail Project'). In return it would issue 8,870,000 shares, 2,520,000 Series B warrants ($2.00, 5 years) and 2,520,000 Series C warrants ($3.00, 7 years). Armada holders would own about 43.7% of NDB afterwards. The Series C warrants cannot be exercised until the Armada holders' total stake would be under 49.9%. Closing depends on due diligence and the agreement ends if not closed before March 31, 2012 unless extended. David Moss would join the board.

material agreement

On September 16, 2011 NDB Energy bought two leases on about 140 acres with twelve wells in Archer County, Texas from Baron Energy for $125,000. NDB gets an 80% non-operated working interest and a 60.8% net royalty interest, and Baron keeps 20% and operates the wells. Baron has a six-month option to buy back a 20% non-operated working interest and 15.2% net royalty interest on the same pro rata terms. This adds to the Texas properties bought in July and deepens the link with Baron.

asset acquisition disposition

This amendment repeats the July 2011 Texas acquisitions and adds a company history and risk factors. It says oil and gas exploration on Utah leases (Nov 2006 to Sept 2007) failed for lack of rigs and personnel, which led to the algae research. The company had been a shell company since late 2010 and now says it no longer is. The Young County property produces about 4 to 5 barrels of oil a day. It also restates the 2008 placement after a one-for-five reverse split effective June 27, 2011 (800,000 units at $3.00). Net losses were $183,666 for fiscal 2011 and $261,758 for fiscal 2010. The employment terms now say Cerna's stock options are subject to board approval.

asset acquisition disposition

Now named NDB Energy (renamed June 2011), the company bought its first oil and gas properties in the filings, effective July 29, 2011. It acquired a lease on about 300 undeveloped acres in Gonzales County, Texas for 1,800,000 shares (1,400,000 to James Cerna Jr. and 400,000 to Acqua Ventures). It also bought two leases on about 120 acres with fourteen wells in Young County, Texas for $128,500 in cash. Baron Energy operates the Young County wells and holds a 25% working interest there. Cerna became CEO at $180,000 a year and a director. Amit Dang stepped down as President and CEO but stays CFO and a director, and director Joanne Lustre resigned.

asset acquisition disposition

On April 17, 2008 International Energy completed a $2,400,000 private placement of 4,000,000 units at $0.60 to 10 accredited investors. Each unit was one share plus a two-year Series B warrant at $0.60. The proceeds are for working capital, and the company agreed to register the shares for resale. A broker dealer was paid 100,000 units as commission. This is the first equity raise in the filings, after the Rayat loans that funded the algae research.

capital raising announcement

On October 16, 2007 the company issued a $300,000 unsecured demand note to Harmel S. Rayat at 10.75% interest, to fund research and development, salaries, legal and accounting fees, investor relations and working capital. The board also extended 6,880,000 warrants (from a $250,000 October 2001 financing, 2,200,000 held by Rayat family members) from October 17, 2007 to October 17, 2008. Rayat is the company's Secretary and Treasurer.

debt financing

On September 17, 2007, International Energy, through its wholly owned subsidiary International Energy Corp., signed a research agreement with The Regents of the University of California in algal biochemistry and photosynthesis. The filing gives no cost or terms in its text; the agreement is attached as an exhibit.

material agreement

On June 10, 2005 the board approved 10-year stock options over 2,000,000 shares (1,250,000 to Ranjit Bhogal and 750,000 to Jeet Sidhu) at $0.515, out of 5,000,000 shares reserved under the 2002 plan. The same day a news release announced a reorganization with two new wholly owned operating subsidiaries, a name change and a four-for-one forward split; the filing gives no further detail on these.

material agreement