Each one in plain English, with the numbers worked through for a shareholder.
12 June 2014capital raising announcement● NeutralMajor
On June 6, 2014 Stratex sold $3,032,860 of 12% Series B senior secured convertible notes due June 6, 2016, convertible at $0.30 per share, with warrants for 2,021,957 shares at $0.30. The placement agent got a $250,786 fee and warrants for 835,954 shares. The notes share an equal first lien with the Series A notes; this follows the February-March Series A raise and adds debt and potential dilution. The filing does not state the use of proceeds.
On May 6, 2014 Stratex agreed to acquire Richfield Oil & Gas Company by merging a Stratex subsidiary into it; Richfield holders would get Stratex shares (1.009 Stratex shares per Richfield share on the May 6 share count, subject to downward adjustment if more Richfield shares are issued). Stratex also agreed to lend Richfield up to $3,000,000 at 6% (due by the earlier of Nov 30, 2014, ten business days after closing, or a superior offer). Closing needs Richfield holder approval, an effective Form S-4, and exchange of Stratex's Series A Preferred for 7,000,000 common shares; Richfield needs Stratex to have $5,000,000 cash. Fees of $3,000,000 (Richfield) or $1,000,000 (Stratex) apply in certain terminations, and holders of about 46% of Richfield have agreed to vote for the deal. Richfield's former chairman is Alan Gaines, the same person who has the Stratex consulting deal. This is a major new thread and would dilute existing Stratex holders.
17 Mar 2014capital raising announcement● NeutralMajor
From February 11 to March 13, 2014 the company raised $6,842,650 selling 12% senior secured convertible notes due February 11, 2016, secured by a first lien on substantially all assets and convertible at $0.30 per share. Investors also got warrants for 4,561,728 shares at $0.30, and the placement agent received a $382,765 fee plus warrants for 1,275,900 shares. This is the company's first identified debt facility and adds both debt and potential dilution; the filing does not state the use of proceeds.
On January 24, 2014 the Eagleford joint development agreement was amended: the company received an immediate 50% working interest and operating rights over the whole lease, now stated as about 2,629 acres, in return for committing to frac the Matthews #1H or spud a new well by March 31, 2014. If it doesn't, the lease and its interest become void. The press release says Baker Hughes was contracted to start the frac on February 16, 2014, cites a Ryder Scott best estimate of 6.9 million recoverable barrels of contingent resources (8/8ths basis), and announces a new Houston office.
This revises the October 2013 Alan Gaines consulting deal: his earlier 8% option and five preferred shares are cancelled and replaced with an option for 7,500,000 shares at $0.15, with 4,500,000 exercisable now and 3,000,000 vesting when he becomes a director or on December 31, 2014 if D&O insurance over $5 million has not been obtained. The company also issued warrants for 6,100,000 shares at $0.15 to three consultants on December 10, 2013. The fixed option and new warrants add to potential dilution.
On December 3, 2013 the company signed a joint development agreement with Eagleford Energy and its subsidiary for about 2,549 leasehold acres in Zavala County, Texas. It must frac the Matthews #1H well by March 31, 2014 and pay all related costs (press release estimates up to $2.0 million), earning a 66.67% working interest in that well (50% after payout) and a 50% interest in the whole acreage once the work begins. It agreed to pay $300,000, of which $200,000 was paid by December 4 and $100,000 is due by December 31, 2013, funded from cash on hand.
3 Dec 2013asset acquisition disposition● NeutralMajor
The company's subsidiary bought a 64% working interest (48.64% net revenue interest) in an approximately 60-acre oil property in Callahan County, Texas from Mesa Resources, paying cash and 150,000 company shares; the purchase closed November 26, 2013 and was paid from existing cash. The filing text gives the cash as $300,800 while the attached press release says $308,800. Mesa gets a 12.5% back-in interest after payout. The press release says the area could become a new core focus area, which is the company's own view; this is its first Texas asset in the history seen so far.
On October 15, 2013 the company signed a one-year consulting agreement with Alan Gaines to review acquisition, merger and leasehold opportunities and help secure financing. He is to be paid $15,000 a month, plus five preferred shares and an option for up to 8% of fully diluted common shares at $0.15 each, exercisable for five years. This option could dilute existing shareholders; the size depends on shares outstanding at exercise.
A third amendment to the report on the July 6, 2012 merger of the old Poway Muffler and Brake shell with Stratex Oil & Gas, Inc. The visible text is labelled both Amendment No. 3 (cover) and Amendment No. 2 (explanatory note), says it responds to SEC comment letters of August 10 and August 24, 2012, and reflects no events after July 6, 2012. The merger terms shown (2-for-1 conversion, about 33,372,550 shares issued to former Stratex holders, 6,110,000 retained by pre-merger holders) match earlier filings; the specific revisions are not visible in the text provided.
Second amendment to the July 2012 merger report, filed to reflect revisions responding to SEC comment letters dated August 10 and August 24, 2012. It states it reflects no events after July 6, 2012; the merger terms shown are unchanged from the original, and the specific revisions are not visible in the text provided.
On August 28, 2012 the company announced an offer to buy Magellan Petroleum (NASDAQ: MPET) at $2.30 per share in cash and stock, about $124 million in total, which it describes as a 137% premium to Magellan's prior closing price of $.97. The company says it has committed financing for the cash portion; the offer was made by letter and no formal tender offer has started, and Magellan's response is not stated. This is a first, ambitious step beyond the just-completed merger, and the company's own risk language notes it may not pursue a transaction.
