Item 8.01 Other Events.
We are
unable to meet the filing deadline for our Form 10-Q for the
quarter ended March 31, 2020 due to circumstances related to
COVID-19. Our operations and business have experienced disruption
due to the unprecedented conditions surrounding the COVID-19
pandemic, which has resulted in limited availability of key
personnel required to assist in the preparation of the Form 10-Q
due to suggested and mandated social quarantining and work from
home orders and the need to look after family members including
small children who are no longer in school and day care. We have
also had to modify our business practices, including employee work
locations and cancellation of physical participation in
meetings.
We are
relying on the Securities and Exchange Commission Release No.
34-88465 dated March 25, 2020 to delay the filing of our Form 10-Q
for the quarter ended March 31, 2020 for up to 45 days after the
original due date. We intend to work diligently to file the Form
10-Q as soon as practicable, and in no event later than the end of
the 45-day extension period on June 25, 2020.
We
are supplementing the risk factors previously disclosed in our
Annual Report on Form 10-K for the year ended December 31, 2019
with the following risk factors:
An occurrence of an uncontrollable event such as the COVID-19
pandemic is likely to negatively affect, and has to date negatively
affected, our operations.
The
occurrence of an uncontrollable event such as the COVID-19 pandemic
is likely to, and has already, negatively affect our operations. A
pandemic typically results in social distancing, travel bans and
quarantine, and the effects of, and response to, the COVID-19
pandemic has limited access to our facilities, properties,
management, support staff and professional advisors. These, in
turn, have not only negatively impacted our operations and
financial condition, but our overall ability to react timely to
mitigate the impact of this event. Further, the COVID-19 pandemic
has resulted in declines in the demand for, and the price of, oil
and gas, and it is unclear how long this decline will last. The
full effect on our business and operation is currently unknown. In
the event that the effects of COVID-19 continue in the future
and/or the economy continues to deteriorate, we may be forced to
curtail our operations and may be unable to pay our debt
obligations as they come due.
The coronavirus/COVID-19 pandemic has had a negative affect on oil
and gas prices, and depending on the severity and longevity of the
pandemic, it may result in a major economic recession which will
continue to depress oil and gas prices and cause our business and
results of operations to suffer.
The inability and/or
unwillingness of individuals to congregate in large groups, travel
and/or visit retail businesses or travel outside of their homes
will, and has to date, had a negative effect on the demand for, and
the current prices of, oil and gas. Additionally, the demand for
oil and gas is based partially on global economic conditions. If the COVID-19
pandemic results in a global economic recession,
there will be a continued negative effect on the demand for oil and
gas and this will have a negative effect on our operating results.
All of the above may be exacerbated in the future as the COVID-19
outbreak and the governmental responses thereto continue.
Concerns about global economic growth
have had a significant adverse impact on global financial markets
and commodity prices. If the economic climate in the United States
or abroad continues to deteriorate, demand for petroleum products
could further diminish, which will impact the price at which we can
sell our oil and gas, impact the value of our working interests and
other oil and gas assets, affect the ability of our vendors,
suppliers and customers to continue operations, affect our
operations and ultimately adversely impact our results of
operations, liquidity and financial condition.
NOTE ABOUT FORWARD-LOOKING STATEMENTS
This
Current Report on Form 8-K contains forward-looking statements
within the meaning of the Private Securities Litigation Reform Act
of 1995. These statements include, among other things, statements
regarding plans, objectives, goals, strategies, future events or
performance and underlying assumptions and other statements, which
are other than statements of historical facts. Forward-looking
statements generally can be identified by words such as
“anticipates,” “believes,”
“estimates,” “expects,”
“intends,” “plans,” “predicts,”
“projects,” “will be,” “will
continue,” “will likely result,” and similar
expressions. These forward-looking statements are based on current
expectations and assumptions that are subject to risks and
uncertainties, which could cause our actual results to differ
materially from those reflected in the forward-looking statements.
Factors that could cause or contribute to such differences include,
but are not limited to, those discussed in documents we file with
the Securities and Exchange Commission (“SEC”).
Important factors that in our view could cause material adverse
effects on our financial condition and results of operations
include, but are not limited to, risks associated with the
company’s ability to extend or restructure existing debt, to
obtain additional capital in the future to repay outstanding debt
and fund planned expansion, the demand for oil and natural gas
which demand could be materially affected by the economic impacts
of COVID-19 and anticipated increases in supply from Russia and
OPEC, general economic factors, competition in the industry, our
ability to regain and maintain compliance with the minimum bid
price requirement of the Nasdaq Stock Market, and other factors
that may cause actual results to be materially different from those
described herein as anticipated, believed, estimated or expected.
We undertake no obligation to revise or publicly release the
results of any revision to any forward-looking statements, except
as required by law. Given these risks and uncertainties, readers
are cautioned not to place undue reliance on such forward-looking
statements.
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