PROP Prairie Operating Company

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

 

Date of Report (date of earliest event reported): November 15, 2024

 

 

Prairie Operating Co.

(Exact name of registrant as specified in its charter)

 

 

Delaware		001-41895		98-0357690
(State or other jurisdiction of incorporation or organization)		(Commission File Number)		(I.R.S. Employer Identification Number)

 

55 Waugh Drive

Suite 400

Houston, TX 77007

(Address of principal executive offices and zip code)

 

(713) 424-4247

(Registrant’s telephone number, including area code)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, $0.01 Par Value		PROP		The Nasdaq Stock Market LLC

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17CFR § 230.405) or 12b-2 of the Exchange Act of 1934 (17 CFR § 240.12b-2).

 

Emerging growth company ☐

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

 

 

Item 1.02 Termination of a Material Definitive Agreement.

 

As previously disclosed, Prairie Operating Co. (the “Company”), Bristol Capital Advisors, LLC (“Bristol Capital”), an affiliate of Paul L. Kessler, a former member of the board of directors of the Company (the “Board”), Mr. Kessler, Gary C. Hanna, President of the Company, and Edward Kovalik, Chairman of the Board and Chief Executive Officer of the Company, entered into that certain Stockholders Agreement, dated as of May 3, 2023 (the “Stockholders Agreement”), pursuant to which the parties agreed to use reasonable best efforts, including taking certain necessary actions, to cause the Board to elect certain nominees to serve as a director on the Board, subject to certain conditions.

 

On November 15, 2024, the parties agreed to terminate the Stockholders Agreement pursuant to that certain Termination of Stockholders Agreement (the “Termination Agreement”) in connection with the previously disclosed resignation of Mr. Kessler as a member of the Board.

 

The foregoing description of the Termination Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Termination Agreement, which is attached hereto as Exhibit 10.1 to this Current Report on Form 8-K.

 

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

 

On November 21, 2024, the Board elected Richard N. Frommer as a member of the Board, filling the vacancy remaining due to the previously disclosed resignation of Mr. Kessler. Prior to his election to the Board, Mr. Frommer served as a member of the Company’s Advisory Board.

 

As compensation for his service on the Board, Mr. Frommer will receive the Company’s standard compensation for non-employee directors as disclosed in the Company’s proxy statement filed with the Securities and Exchange Commission (“SEC”) on April 24, 2024, which disclosure is incorporated by reference into this Item 5.02.

 

The Company and Mr. Frommer will enter into the Company’s standard form of indemnification agreement for directors, a copy of which was previously filed as Exhibit 10.8 to the Company’s Current Report on Form 8-K filed with the SEC on May 9, 2023.

 

Item 7.01 Regulation FD Disclosure.

 

Election of Richard Frommer Press Release

 

On November 21, 2024, the Company issued a press release announcing that the Board had elected Mr. Frommer as a member of the Board.

 

The full text of the press release is included as Exhibit 99.1 and is incorporated herein by reference into this Item 7.01.

 

Item 9.01 Financial Statements and Exhibits.

 

(d) Exhibits

EXHIBIT INDEX

 

Exhibit Number		Description
10.1		Termination of Stockholders Agreement, dated November 15, 2024, by and among Prairie Operating Co., Bristol Capital Advisors, LLC, Paul L. Kessler, Gary C. Hanna and Edward Kovalik.
99.1		Press Release, dated November 21, 2024.
104		Cover Page Interactive Data File (embedded within the Inline XBRL document).

 

 

SIGNATURE

 

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

	PRAIRIE OPERATING CO.
Date: November 21, 2024	By:	/s/ Daniel T. Sweeney
	Name:	Daniel T. Sweeney
	Title:	Executive Vice President, General Counsel and Corporate Secretary

 

 

 

 

Exhibit 10.1

 

Termination of STOCKHOLDERS AGREEMENT

 

This Termination of STOCKHOLDERS AGREEMENT (this “Termination”), dated as of November 15, 2024 (the “Effective Date”), is entered into by and among Prairie Operating Co., a Delaware corporation (the “Company”), Bristol Capital Advisors, LLC, a Delaware limited liability company (“Bristol”), Paul L. Kessler, an individual residing in the State of Utah (“Kessler”), Edward Kovalik, an individual residing in the State of Texas (“Kovalik”), and Gary Hanna, an individual residing in the State of Oklahoma (“Hanna” and together with Kovalik, the “Prairie Members”).

 

RECITALS

 

WHEREAS, in connection with, and effective upon, the merger of the Company, Prairie Operating Co., LLC, a Delaware limited liability company, and Creek Road Merger Sub, LLC, a Delaware limited liability company (the “Merger”), the Company, Bristol, Kessler, and the Prairie Members entered into the certain Stockholders Agreement, effective May 3, 2023 (the “Agreement”).

 

WHEREAS, Bristol is the investment advisor to Bristol Investment Fund, Ltd., an exempted company incorporated with limited liability under the Laws of the Cayman Islands, and certain other investment funds (collectively, together with Kessler and Bristol, the “Bristol Parties”).

 

WHEREAS, the Company, the Prairie Members, and the Bristol Parties (collectively, the “Parties” and individually a “Party”) desire to terminate the Agreement, subject to the terms set forth herein, as of the Effective Date.

 

AGREEMENT

 

NOW, THEREFORE, in consideration of the mutual covenants contained herein and for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, each of the parties, intending to be legally bound, agrees as follows:

 

ARTICLE I

TERMINATION

 

1.1 Termination. The Company, the Prairie Members, and the Bristol Parties desire to mutually terminate the Agreement effective as of the Effective Date, and each of the Company, the Prairie Members, and the Bristol Parties release one another from any and all obligations created by the Agreement, and extinguish all rights created by the Agreement from and after the Effective Date.

 

ARTICLE II

Miscellaneous

 

2.1 Amendment. This Termination may not be amended, supplemented, or otherwise modified except in a written document signed by the Parties.

 

 

2.2 Entire Agreement. This Termination constitutes the entire agreement among the Parties and supersedes any prior or contemporaneous understandings, agreements, or representations by or among the Parties, or any of them, written or oral, with respect to the subject matter hereof and thereof.

 

2.3 Assignment and Successors and No Third-Party Rights. This Termination binds and benefits the Parties and their respective heirs, executors, administrators, successors, and assigns.

 

2.4 Interpretation. In the negotiation of this Termination, each Party has received advice from its own attorney. The language used in this Termination is the language chosen by the Parties to express their mutual intent, and no provision of this Termination will be interpreted for or against any Party because that Party or its attorney drafted the provision.

 

2.5 Governing Law. The internal laws of the State of Delaware (without giving effect to any choice or conflict of law provision or rule (whether of the State of Delaware or any other jurisdiction) that would cause the application of laws of any other jurisdiction) govern all matters arising out of or relating to this Termination, including its validity, interpretation, construction, performance and enforcement and any disputes or controversies arising therefrom or related thereto. Any legal suit, action, proceeding or dispute arising out of or relating to this Release or the transactions contemplated hereby or thereby may be instituted in the federal courts of the United States of America or the courts of the State of New York in the City of New York, Borough of Manhattan, and each party irrevocably submits to the exclusive jurisdiction of such courts in any such suit, action, proceeding or dispute. Each party waives the right to a trial by jury in any such dispute. The prevailing party in any legal proceeding or action arising out of or relating to this Release shall be entitled to recover from the non-prevailing party all reasonable legal fees and costs incurred as a result of such action

 

2.6 Counterparts. This Termination may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. This Termination may be executed by electronic means (including .portable document format (.pdf) or DocuSign) with the same binding effect as the original.

 

[Signature pages follow.]

 

 

IN WITNESS WHEREOF, the Parties have executed this Termination as of the date first written above.

 

	COMPANY:
	PRAIRIE OPERATING CO.
	By:	/s/ Craig Owen
	Name:	Craig Owen
	Title:	Executive Vice President, Chief Financial Officer

 

Signature Page to

Termination of Stockholders Agreement

 

 

	BRISTOL:
	BRISTOL CAPITAL ADVISORS, LLC
	By:	/s/ Paul L. Kessler
	Name:	Paul L. Kessler
	Title:	Chief Executive Officer
	PAUL KESSLER:
	By:	/s/ Paul L. Kessler
	Name:	Paul L. Kessler

 

Signature Page to

Termination of Stockholders Agreement

 

 

	PRAIRIE MEMBERS:
	EDWARD KOVALIK
	By:	/s/ Edward Kovalik
	Name:	Edward Kovalik
	GARY HANNA
	By:	/s/ Gary C. Hanna
	Name:	Gary C. Hanna

 

Signature Page to

Termination of Stockholders Agreement

 

 

 

 

Exhibit 99.1

 

Prairie Operating Co. Welcomes Energy Industry Veteran Richard N. Frommer to Its Board of Directors

 

HOUSTON, Texas, November 21, 2024 (GLOBE NEWSWIRE) -- Prairie Operating Co. (Nasdaq: PROP) (the “Company” or “Prairie”) today announced that Richard N. Frommer, former Chief Executive Officer of Great Western Petroleum, esteemed energy industry veteran, and current Prairie Advisory Board member, has joined its Board of Directors as an independent director.

 

For the past year, Mr. Frommer has been a key contributor as a member of the Company’s Advisory Board. His deep expertise with Colorado’s regulatory environment, as well as his comprehensive knowledge of the Denver-Julesburg (DJ) Basin and strong familiarity with Prairie’s assets make his transition to the Board of Directors a natural progression.

 

Mr. Frommer brings more than 40 years of experience in the oil and gas industry to his new role. He has led and collaborated with boards and management teams across a variety of regions, from Canada to the Gulf Coast. Throughout his career, he has demonstrated a proven ability to build and monetize multiple billion-dollar oil and gas companies. As Chairman of the Trade Association for the Colorado Oil and Gas Association, Mr. Frommer played a pivotal role in shaping Colorado’s regulatory framework, championing innovation and the production of the “cleanest molecule.”

 

“We are excited to welcome Rich to our Board of Directors,” said Edward Kovalik, Chairman and Chief Executive Officer of the Company. “Rich’s exceptional leadership track record, combined with his unique understanding of the DJ Basin, the Colorado regulatory environment and expertise in driving billion-dollar enterprises, makes him an invaluable addition. His insights and strategic vision will help position Prairie for sustainable growth and long-term success.”

 

“I am honored to join Prairie Operating Co.’s Board of Directors,” said Mr. Frommer. “Prairie is uniquely positioned to capitalize on opportunities in the energy sector, and I look forward to collaborating with the Board and management team to drive value and advance Prairie’s position as a leader in the industry.”

 

Mr. Frommer’s appointment as an independent director reflects Prairie’s ongoing commitment to strengthening its leadership team and enhancing its position in the industry.

 

About Prairie Operating Co.

 

Prairie Operating Co. is a Houston-based publicly traded independent energy company engaged in the development and acquisition of oil and natural gas resources in the United States. The Company’s assets and operations are concentrated in the oil and liquids-rich regions of the Denver-Julesburg (DJ) Basin, with a primary focus on the Niobrara and Codell formations. The Company is committed to the responsible development of its oil and natural gas resources and is focused on maximizing returns through consistent growth, capital discipline, and sustainable cash flow generation. More information about the Company can be found at www.prairieopco.com.

 

 

Forward-Looking Statement

 

The information included herein and in any oral statements made in connection herewith include “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of present or historical fact included herein, are forward-looking statements. When used herein, including any oral statements made in connection herewith, the words “could,” “should,” “will,” “may,” “believe,” “anticipate,” “intend,” “estimate,” “expect,” “project,” the negative of such terms and other similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. These forward-looking statements are based on the Company’s current expectations and assumptions about future events and are based on currently available information as to the outcome and timing of future events. Except as otherwise required by applicable law, the Company disclaims any duty to update any forward-looking statements, all of which are expressly qualified by the statements in this section, to reflect events or circumstances after the date hereof. The Company cautions you that these forward-looking statements are subject to risks and uncertainties, most of which are difficult to predict and many of which are beyond the control of the Company. There may be additional risks not currently known by the Company or that the Company currently believes are immaterial that could cause actual results to differ from those contained in the forward-looking statements. Additional information concerning these and other factors that may impact the Company’s expectations can be found in the Company’s periodic filings with the Securities and Exchange Commission (the “SEC”), including the Company’s Annual Report on Form 10-K/A filed with the SEC on March 20, 2024, and any subsequently filed Quarterly Report and Current Report on Form 8-K. The Company’s SEC filings are available publicly on the SEC’s website at www.sec.gov.

 

Investor Relations Contact:

 

Wobbe Ploegsma

info@prairieopco.com

832.274.3449

 

 

v3.24.3

Cover	Nov. 15, 2024
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Nov. 15, 2024
Entity File Number	001-41895
Entity Registrant Name	Prairie Operating Co.
Entity Central Index Key	0001162896
Entity Tax Identification Number	98-0357690
Entity Incorporation, State or Country Code	DE
Entity Address, Address Line One	55 Waugh Drive
Entity Address, Address Line Two	Suite 400
Entity Address, City or Town	Houston
Entity Address, State or Province	TX
Entity Address, Postal Zip Code	77007
City Area Code	(713)
Local Phone Number	424-4247
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common Stock, $0.01 Par Value
Trading Symbol	PROP
Security Exchange Name	NASDAQ
Entity Emerging Growth Company	false

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