STOCKHOLDERS' EQUITY (DEFICIT)

12 Months Ended

Dec. 31, 2016

Notes to Financial Statements

STOCKHOLDERS' EQUITY (DEFICIT)

Note 10 – Stockholders’ Deficit

The Company is authorized to issue 100,000,000 shares of its $0.001 par value common stock.

In March of 2015, the Company approved the issuance of 1,400,000 common stock shares for the conversion of a $100,000 promissory note, plus accrued interest of $2,164 and an additional capital investment of $107,836, all at fair value of $0.15 per share.

In March of 2015, the Company issued 25,000 shares of common stock to settle the stock payable of $2,250 recorded as of December 31, 2014.

In July of 2015, the Company issued 6,000,000 shares of common stock at fair value and paid $1,900,000 in cash for the Kern Bluff Oil Field. The Company had paid a $100,000 deposit on the property in May of 2015, upon execution of a letter of intent (LOI) on the field.

In March of 2016, the Company approved the sale of up to 250,000 shares of Series A Convertible Participating Preferred Stock. The Company sold 175,000 shares of Series A Convertible Participating Preferred Stock to convert its $3,500,000 related party note payable to preferred stock. In addition, the Company has sold 21,250 shares of Series A Convertible Participating Preferred Stock for cash in the amount of $425,000 through March 31, 2016.

In June of 2016, the Company sold 50,000 shares of Series A Convertible Participating Preferred Stock for cash in the amount of $1,000,000.

In September of 2016, the Company sold 26,500 shares of Series A Convertible Participating Preferred Stock for cash in the amount of $530,000. The Company issued 500,000 shares of common stock for cash in the amount of $100,000.

In October of 2016, the Company sold 10,350 shares of Series A Convertible Participating Preferred Stock for cash in the amount of $207,000.

In November of 2016, the Company sold 29,330 shares of Series A Convertible Participating Preferred Stock for cash in the amount of $586,600.

In December of 2016, the Company sold 13,300 shares of Series A Convertible Participating Preferred Stock for cash in the amount of $266,000.

In December of 2016, the Company was notified by its transfer agent, that prior to issuing its Series A Preferred stock, the Company was required to file a 14c with the Securities and Exchange Commission to authorize the issuance of previously sold Series A Preferred Stock. This delay in issuance of Series A Preferred required the Company to classify the Series A Preferred as a liability until the Series A Preferred is issued, which is expected in the first quarter of 2017. This will also require the Company to restate prior periods of their form 10Q, in which Series A Preferred Shares were sold, but not issued deeming them a liability.