Surge Global Energy, Inc.

The regulator barred Peter Messineo from practising before it, which retrospectively voided Surge's 2013 and 2014 audits and left the company unable to rely on two years of its own accounts. Not Surge's own error this time, but the consequence of a decade of choosing the cheapest available auditor. It is the last substantive thing Surge filed; its registration was revoked in 2019.

financial restatement

Surge issued 500,000 shares at $0.50 plus warrants - $250,000 of stock - to acquire investment units in Fitzgerald Energy II and III, and states in the same filing that those units are worth under $20,000. Value moving out of the company towards its controlling family's vehicles, disclosed plainly and worth reading twice.

asset acquisition disposition

Control of Surge changed hands for $350,000: the Fitzgerald family and Clark Morton bought 140 million new shares, taking about 77% between them, with the Fitzgeralds taking officer roles. Surge's one remaining asset of substance - about 2.9 million Andora shares - was ring-fenced in a subsidiary that could not be sold before 2014, which is the clearest sign of what the buyers were actually acquiring: a listed shell with a protected legacy holding.

director officer appointment

Surge went back to Asher for another 8% convertible note, $60,000 for $57,000 net, with a 22% default rate - the same lender and the same terms it had just escaped four months earlier.

director officer appointment

Surge borrowed $45,000 from Asher Enterprises on an 8% note convertible at a 40% discount to the lowest recent trading prices - the classic toxic convertible, whose conversion price falls as the shares fall. A company that once raised $1.8 million at $1.50 was now funding itself in $45,000 instalments on those terms.

director officer appointment

The SEC-Compliance purchase was unwound three months after it closed, effective 31 December 2010: founder David McGuire resigned from the board, returned his 5,000,000 shares for cancellation and took the business and its liabilities back. Surge paid him a further $10,000 and said it expected to recover the roughly $95,000 already paid out of shares in another company due to it under the rescission.

asset acquisition disposition

Surge, an oil company, agreed to buy SEC-Compliance Inc - a two-month-old business that formats other companies' regulatory filings - for 5 million shares and $100,000, and hired its founder. This is not a pivot within the industry; it is abandoning it, and it would be unwound within four months.

director officer appointment

Surge sold 450,000 of its 11 Good Energy shares to Berndt for $450,000, booking a $346,500 gain, and in the same filing wrote down its Nevada prospect on revised production results. Selling the good investment to cover the failing one.

material agreement

Surge settled its litigation with former director Daniel Schreiber and his company Granite Financial, closing out a run of disputes that also included a claim by former chief executive David Perez over indemnity for his legal costs, settled earlier in 2009. The board that ran Surge through the oil sands years had ended up suing it.

material agreement

Surge tried to become an operator again on a much smaller scale, paying about $500,000 to Tetuan Resources for 2,500 acres of Nevada oil leases with an obligation to drill a test well by August 2009 and a $1.5 million cap on spending per well. From 86,400 acres of oil sands to a single wildcat in Nevada.

material agreement

Surge sold what was left of Peace Oil - the shell of it, after Red Earth had gone - for C$13.1 million, mostly the cancellation of intercompany debt, against a cost base of C$14.5 million. A small loss, and the end of Surge's Canadian operating structure.

asset acquisition disposition

E. Jamie Schloss came back as both chief executive and finance chief on a guaranteed contract to April 2010, half his salary deferred into stock - one man running a company whose assets were now shares in Andora and North Peace. Surge also bought out a minority holder of Cold Flow preferred using North Peace shares as currency.

material agreement

Surge sold its 17.52% of Cynthia Holdings back to the same related parties it bought from - Oromin, Irie Isle and director Chet Idziszek - for $600,000 cash and the return of a million Surge shares. The Argentine interest the 2002 reverse merger was built around was gone, six years on, without ever producing anything.

material agreement

Surge's second restatement in under eighteen months, and this one costs real money: after taking KPMG's advice it found Canadian tax on the Peace Oil transactions was $3.6-5 million higher than the $1 million it had booked, forcing every 2007 quarter and the Red Earth pro formas to be redone. Much of the profit on Red Earth was never really there.

financial restatement

The Signet-Andora merger completed and Surge's 11.55 million Signet shares became 3.43 million Andora shares - about 5.78% of a company controlled by Pan Orient Energy. The Sawn Lake project Surge originated in 2005 was now something it owned a twentieth of, with much of even that in escrow.

asset acquisition disposition

Gemini declared Surge in default on the $1.15 million note and demanded immediate redemption, because Surge again failed to register the underlying shares or pay the penalties for not doing so. The money had to be put into escrow. Surge had just banked C$20 million from Red Earth and was still being forced to repay a lender early over paperwork.

debt default or forbearance

The Red Earth sale closed. Surge had owned the leases for less than four months and turned about C$16.35 million into about C$20 million - but it was now, once again, a company holding shares in other people's oil companies rather than an operator.

asset acquisition disposition

Three months after buying Peace Oil, Surge agreed to sell its core Red Earth oil sands leases to North Peace Energy for about C$20 million in cash and shares - a quick markup on the C$16.35 million paid, but it leaves Surge without the operating asset it had just acquired.

material agreement

On an investor call Surge relayed Signet and Andora's figures for the proposed merger: recoverable reserves rising from about 32 million barrels to about 276 million. The headline is nearly nine times bigger; Surge's share of it would be a fraction of what it once held.

business combination

Surge and chairman David Perez committed to vote their Signet shares in favour of merging Signet with Andora Energy - the minority holder locking itself in to a deal that would turn its Signet stake into a much smaller slice of a bigger company.

material agreement

Surge failed to register Gemini's shares for resale as promised, and restructured its way out: Gemini handed back the stock and put in another $250,000 in exchange for a $1.15 million zero-interest note convertible at $0.37, waiving the penalties it was owed. A financing turned into a debt because the company could not meet a paperwork obligation.

capital raising announcement

Surge completed the Peace Oil acquisition for C$16.35 million - part cash, part exchangeable preferred shares in Cold Flow - giving it a direct 30% working interest in 86,400 acres of Red Earth oil sands leases. This is Surge's only wholly controlled asset since Signet slipped away, and it would hold it for less than four months.

asset acquisition disposition

Surge raised $1.35 million at $0.45 from hedge fund Gemini Master Fund and existing holder Mark Fritz - a third of the March price - and simultaneously agreed to buy Peace Oil Corp through a new Canadian subsidiary, Cold Flow Energy. Having been diluted out of Sawn Lake, Surge was buying its way back into Alberta oil sands with money raised on much worse terms.

capital raising announcement

Stephen Sharpe resigned after three months and Surge replaced him with three genuinely senior independents - former San Diego Gas & Electric chief Thomas Page, Sempra director Richard Collato, and John Stiska. Their options were struck at $0.50, a third of the price paid in March's placement, which says more about the stock than the press release does.

director officer appointment

Surge told investors not to rely on its June 2006 quarterly accounts after it and its auditors found transactions misclassified across the balance sheet, income statement, equity and cash flow statements. The restatement lands in the same quarter Surge lost control of Signet - complex accounting a small company was not equipped for.

financial restatement

The dilution predicted by December's subsidiary financing arrived: Signet sold $18.7 million of its own stock, none of which Surge received, and Surge dropped below 50%. Sawn Lake - the only project Surge had ever operated - stopped being consolidated into its accounts, leaving Surge a minority shareholder in the company that holds its asset.

asset acquisition disposition

Surge raised $1.8 million selling 1.2 million shares at $1.50 to a dozen private buyers with matching warrants - its best-priced raise, done while Sawn Lake still looked like a growing asset.

director officer appointment

Surge stopped funding Sawn Lake itself and let its subsidiary Signet Energy raise C$5.7 million directly from Canadian investors in flow-through shares and 7% convertible debentures. Money for the project, but raised at the subsidiary - the first step in Surge's stake being diluted away.

capital raising announcement

Two things at once: Surge spudded its first well at Sawn Lake in late September and won approval to drill a horizontal producer - and then Deep Well and Northern, its own farm-out partners, sued it in the Alberta courts over that same agreement. The asset and the lawsuit over the asset arrived in the same month.

drilling progress report

Surge raised just $300,000 at $1.00 a share, and every buyer was an existing investor or a director - Fritz, Idziszek, Vandergrift, Gersh and Plaksin. More significantly, holders of $1.71 million of convertible notes agreed to convert on the same terms, clearing the debt taken on to fund Sawn Lake.

capital raising announcement

Surge borrowed $1.575 million from investor Mark Fritz on a convertible note with warrants to fund the Sawn Lake drilling commitment - debt rather than equity, because the well had to be drilled on a deadline.

capital raising announcement

Surge got its first real operating asset: a farm-out with Deep Well Oil & Gas and Northern Alberta Oil at Sawn Lake in Alberta, where drilling a test well within 150 days at its own cost would earn it half their working interest, building towards 40% of 63 sections. Ambitious for a company with almost no cash - and the drilling deadline is the risk.

capital raising announcement

Surge shed the last of its past, selling the entire tobacco and smoking-accessories business back to former chief executive William Miller's own companies. The Havana Group was now gone in substance as well as in name.

material agreement

Surge finally took delivery of the Argentine interest the 2002 reverse merger had promised, acquiring 17.52% of Cynthia Holdings, which holds oil and gas rights in Argentina's Cuyana Basin. It is a related-party deal - Surge director Chet Idziszek chairs the counterparty's parent, Oromin Explorations - and Schloss became acting finance chief the same day.

asset acquisition disposition

Now trading as Surge Global Energy, the company bought a five-year first look at all of Calgary-based Dynamo Energy's prospects - one of which Dynamo claimed held 10 billion barrels - and sold 300,000 shares at $0.65 to pay bills. E. Jamie Schloss joined the board; he would still be running the company a decade later.

director officer appointment

The Havana Group handed control to strangers to get into oil: it issued 10.9 million shares for Bible Resources, a Nevada company with no assets beyond an agreement to buy half of the Santa Rosa property in Argentina, and Bible's principals Frederick Berndt and Steven Heard walked away with 65% of the enlarged company. The claimed 197 million barrels rested on seismic and one geologist's reports, and the deal needed $2.5 million the company did not have.

asset acquisition disposition