(Amendment No. 2)
| CUSIP NO. 292034 20 4 | 13D | Page 2 of 6 pages |
| 1 | NAMES OF REPORTING PERSONS | ||||
Energy Evolution Master Fund, Ltd. | |||||
| 2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP | (a) | ☐ | ||
| (b) | ☐ | ||||
| 3 | SEC USE ONLY | ||||
| 4 | SOURCE OF FUNDS (SEE INSTRUCTIONS) | ||||
| WC | |||||
| 5 | CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(D) OR 2(E) | ☐ | |||
| 6 | CITIZENSHIP OR PLACE OF ORGANIZATION | ||||
Cayman Islands | |||||
| NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH | 7 | SOLE VOTING POWER | |||
21,866,551* | |||||
| 8 | SHARED VOTING POWER | ||||
| 0 | |||||
| 9 | SOLE DISPOSITIVE POWER | ||||
| 21,866,551* | |||||
| 10 | SHARED DISPOSITIVE POWER | ||||
| 0 | |||||
| 11 | AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON | ||||
| 21,866,551* | |||||
| 12 | CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) | ☐ | |||
| 13 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) | ||||
| 27.02%* | |||||
| 14 | TYPE OF REPORTING PERSON (SEE INSTRUCTIONS) | ||||
| OO | |||||
| CUSIP NO. 292034 20 4 | 13D | Page 3 of 6 pages |
This Schedule 13D (Amendment No. 2) amends and restates in its entirety the Schedule 13D, which was filed on June 24, 2021 and the Amendment No 1 thereto filed on October 12, 2021.
The securities to which this Schedule 13D relate are shares of common stock, par value $0.001 per share (“Common Stock”), of Empire Petroleum Corporation (the “Company”).
The address of the Company’s principal executive office is 2200 S. Utica Place, Suite 150 Tulsa, OK 74114.
The business address of Energy Evolution Master Fund, Ltd. is 25025 I-45 North, Suite 420, The Woodlands, Texas 77380.
Energy Evolution Master Fund, Ltd. (such fund and its affiliates, “EEF”) is an investment fund organized in the Cayman Islands that focuses on investing in oil and gas assets as well as companies transitioning to a low-carbon and alternative energy economy.
EEF has not, during the last five years, been convicted in a criminal proceeding (excluding traffic violations and similar misdemeanors).
EEF has not, during the last five years, been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such a proceeding, been subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws.
On August 6, 2020, Petroleum Independent & Exploration LLC, a Nevada limited liability company (“PIE”), partially assigned to EEF warrants so EEF had the right to purchase (a) up to 100,000 shares of Common Stock at an exercise price of $0.10 per share (the “Assigned PIE-3 Warrant”), and (b) 255,000 shares of Common Stock at an exercise price of $0.141 per share (the “Assigned PIE-4 Warrant”). On March 11, 2021, EEF exercised the Assigned PIE-3 Warrant and the Assigned PIE-4 Warrant in full for an aggregate exercise price of $45,955. Such exercise prices were funded using EEF’s working capital.
On or about March 30, 2021, the Company closed an offering of shares of its Common Stock along with warrants to purchase shares of its Common Stock. In connection with such offering, on or about March 24, 2021, EEF purchased 300,000 shares of Common Stock and a warrant to purchase up to 300,000 shares of Common Stock at an exercise price of $0.50 per share (the “EEF Warrant-1”) for an aggregate purchase price of $105,000. The purchase price was funded using EEF’s working capital. On or about March 30, 2021, Phil E. Mulacek assigned a warrant to EEF to purchase up to 600,000 shares of Common Stock at an exercise price of $0.50 per share (the “EEF Warrant-2”). On or about May 14, 2021, EEF exercised the EEF Warrant-1 and EEF Warrant-2 in full for an aggregate exercise price of $450,000. Such exercise prices were funded using EEF’s working capital.
On May 14, 2021, Empire New Mexico LLC, a Delaware limited liability company and wholly owned subsidiary the Company d/b/a Green Tree New Mexico (“Green Tree New Mexico”), issued that certain Senior Secured Convertible Note due December 31, 2021 in the aggregate principal amount of
| CUSIP NO. 292034 20 4 | 13D | Page 4 of 6 pages |
$16,250,000 (the “Secured Convertible Note”) to EEF. The Secured Convertible Note was purchased using EEF’s working capital. Under the Secured Convertible Note, 40% of the principal amount outstanding together with accrued interest thereon (the “Maximum Convertible Amount”) may be converted at a conversion price of $1.25 per share (the “Conversion Price”) into Common Stock, or an aggregate of 5,200,000 shares of Common Stock (without giving effect to any interest that may be converted). The Conversion Price is subject to customary downward adjustments. As partial consideration for the issuance of the Secured Convertible Note, the Company issued (a) 1,500,000 shares of Common Stock along with (b) a warrant certificate (the “Note Warrant”) to purchase up to 3,000,000 shares of Common Stock (the “Note Warrant Shares”) at an exercise price of $1.00 per Note Warrant Share. Under the Note Warrant, the exercise price is subject to customary downward adjustments, including in the event that the Company conducts capital raises at a valuation less than $1.00 per share of Common Stock. Effective as of June 15, 2021, EEF partially exercised the Note Warrant by acquiring 1,500,000 shares of Common Stock for an aggregate exercise price of $1,500,000. Effective as of June 16, 2021, EEF exercised the remaining portion of the Note Warrant by acquiring 1,500,000 shares of Common Stock for an aggregate exercise price of $1,500,000. Such exercise prices were funded using EEF’s working capital.
Also on May 14, 2021, Green Tree New Mexico issued that certain Unsecured Convertible Note due May 9, 2022 in the aggregate principal amount of $1,500,000 (the “Unsecured Convertible Note”) to Phil E. Mulacek. The Unsecured Convertible Note was purchased using Mr. Mulacek’s personal funds. Under the Unsecured Convertible Note, 100% of the principal amount outstanding together with accrued interest thereon may be converted at a conversion price of $1.25 per share into Common Stock, or an aggregate of 1,200,000 shares of Common Stock (without giving effect to any interest that may be converted). Effective as of May 14, 2021, Mr. Mulacek converted the Unsecured Convertible Note in full by acquiring 1,200,000 shares of Common Stock, then contributed such 1,200,000 shares to EEF.
To incentivize Mr. Mulacek to purchase the Unsecured Convertible Note, executive officers of the Company entered into arrangements with Mr. Mulacek, pursuant to which Mr. Mulacek had the right to purchase up to 600,000 shares of Common Stock from such executive officers for $0.75 per share. Mr. Mulacek contributed such rights to EEF. On or about May 27, 2021, EEF exercised such rights in full. EEF used its working capital in connection with exercising such rights.
On or about June 1, 2021, third parties transferred 2,100,000 shares of Common Stock to EEF in exchange for an ownership interest in EEF on the basis of a valuation of $0.75 per share for each share of Common Stock.
On September 29, 2021, the Company and Green Tree New Mexico entered into a Loan Modification Agreement with EEF that made certain modifications to the Secured Convertible Note. In connection with the Loan Modification Agreement, among other things, (i) EEF converted $6,500,000 of principal under the Secured Convertible Note along with accrued interest into 5,305,208 shares of Common Stock on September 30, 2021, (ii) the maturity date of the Secured Convertible Note was extended from December 31, 2021 to June 30, 2023, (iii) the Company issued a Common Share Warrant Certificate dated as of September 30, 2021 pursuant to which EEF has the right to acquire 500,000 shares of Common Stock at an exercise price of $5.00 per share (assuming the effectiveness of the Company’s currently contemplated 1 for 4 reverse stock split, or an aggregate of 2,000,000 shares of Common Stock at $1.25 per share on a pre-reverse stock split basis) on or before December 31, 2023, (iv) each quarterly interest payment under the Secured Convertible Note shall be payable in shares of Common Stock converted at a conversion price of $5.00 per share (assuming the effectiveness of the Company’s currently contemplated 1 for 4 reverse stock split, or at $1.25 per share on a pre-reverse stock split basis) unless EEF otherwise elects to be paid in cash, and (v) upon maturity of the Secured Convertible Note, EEF has the option to convert the remaining principal balance along with accrued interest into common stock of the Company in lieu of cash payment. EEF used its working capital in connection with the conversion described in this paragraph.
On December 30, 2021, the Company, Green Tree New Mexico, and EEF amended the Secured Convertible Note so that EEF could covert 100% of the principal and accrued interest outstanding under the Senior Convertible Note, and EEF converted 100% of the principal ($5,715,353) and interest ($55,075) outstanding under the Secured Convertible Note into 4,616,343 shares of Common Stock. EEF used its working capital in connection with this conversion.
| CUSIP NO. 292034 20 4 | 13D | Page 5 of 6 pages |
EEF acquired and owns or owned the shares of Common Stock, convertible notes and warrants to purchase Common Stock, as described herein, for investment purposes.
| (a) | EEF is the beneficial owner of 21,866,551 shares of Common Stock, which includes 2,000,000 shares of Common Stock issuable upon exercise of a warrant, or 27.02% of the total issued and outstanding shares of Common Stock.
The ownership percentage included in this Schedule 13D for EEF is based on 78,940,107 outstanding shares of Common Stock, which figure was provided by the Company. The 2,000,000 shares of Common Stock that EEF is deemed to beneficially own by virtue of having a right to acquire upon exercise of a warrant are considered outstanding solely for purposes of calculating its percentage of ownership. |
| (b) | The responses of EEF to Items 7-11 of the cover page of this Schedule 13D are incorporated herein by reference. |
| (c) | The responses to Item 3 of this Schedule 13D are incorporated herein by reference. |
| (d) | Not applicable. |
| (e) | Not applicable. |
| CUSIP NO. 292034 20 4 | 13D | Page 6 of 6 pages |
Energy Evolution Master Fund, Ltd. | ||
| Date: January 10, 2022 | By: /s/ Sterling Mulacek | |
Name: Sterling Mulacek Title: Manager |
