Debt

6 Months Ended

Jun. 30, 2022

Debt Disclosure [Abstract]

Debt

Note 8 - Debt

The following table represents the Company’s outstanding debt as of June 30, 2022:

Senior Revolver Loan Agreement	$	6,469,500
Term Loan – PIE, a related party		1,316,759
Equipment and vehicle notes, 0% to 6.99% interest rates, due in 2025  to 2027 with monthly payments ranging from $400 to $1,400 per month		275,762
Note Payable to Insurance Provider, bears 3.63% interest, matures November 2022, monthly payments of principal and interest of $50,083		150,103
Total Notes Payable		8,212,124
Less: Current Maturities		1,406,081
Total Long-Term Notes Payable	$	6,806,043

On July 7, 2021, the Company entered into the Fourth Amendment to its Senior Revolver Loan Agreement (the “Amended Agreement”) with CrossFirst Bank (“CrossFirst”). The maximum amount that can be advanced under the Agreement is $20,000,000 and the existing commitment amount at the current period-end is $7,080,000 which is reduced by $300,000 per calendar quarter and includes interest at Wall Street Journal Prime plus 150 basis points (6.25% as of June 30, 2022). The Amended Agreement matures on March 27, 2024. Collateral for the loan is a lien on all of the assets of Empire Louisiana and Empire North Dakota, both of which are wholly owned subsidiaries of the Company, and a first priority mortgage lien, pledge of and security interest in not less than 80% of Empire Louisiana’s and Empire North Dakota’s producing oil, gas and other leasehold and mineral interests. The Amended Agreement requires that the Company maintain commodity derivatives at certain thresholds based on projected production and to maintain certain covenants including an EBITDAX to interest expense of at least 4.5:1 and funded debt to EBITDAX of 4:1 on a trailing twelve-month basis. Current maturities of debt related to the Amended Agreement is $1,200,000. The Company was in compliance with its loan covenants at June 30, 2022. The Company paid $600,000 in principal during the six months ended June 30, 2022.

In August 2020, concurrent with the JDA with PIE, a related party, the Company entered into a term loan agreement dated August 1, 2020, whereby PIE will loan up to $2,000,000, at an interest rate of 6% per annum, maturing August 7, 2024 unless terminated earlier by PIE. The loan proceeds will be used for recompletion or workover of certain designated wells. Refer to Note 5 for additional information regarding this arrangement.