NOTE 19 — SUBSEQUENT EVENTS (UNAUDITED)

In December 2024, the Company entered into a purchase and sale agreement to sell a non-core interest in the Garden Banks Blocks 385 and 386. The effective date of the sale was December 1, 2024, and the transaction closed on January 8, 2025 for approximately $11.9 million following customary purchase price adjustments.

In January 2025, the Company received $58.5 million related to the settlement of claims related to the Mobile Bay plant turnaround in February 2023. During the turnaround, the MB 78-1 well was shut-in and did not return to production following completion of the planned maintenance. The Company filed a claim under its Energy Package Policy and in December 2024, the Company and the underwriters of the Energy Package Policy agreed to a settlement of claims.

On January 28, 2025, the Company issued and sold $350.0 million in aggregate principal amounts of its 10.75% Notes, which are governed under an indenture dated January 28, 2025 (the “2025 Indenture”). The 10.75% Notes mature on February 1, 2029 and interest is payable on each February 1 and August 1, commencing August 1, 2025. The 10.75% Notes are guaranteed by the Company’s direct and indirect wholly-owned subsidiaries (the “Guarantors”). The 10.75% Notes are secured by second priority liens (subject to permitted liens and certain other exceptions) on substantially all of the oil and natural gas properties of the Company and the Guarantors.

Prior to February 1, 2027, the Company may redeem all or any portion of the 10.75% Notes at a redemption price equal to 100% of the principal amount of the outstanding 10.75% Notes plus accrued and unpaid interest to the redemption date plus the applicable premium (as defined in the 2025 Indenture). In addition, prior to February 1, 2027, the Company may, at its option, on one or more occasions, redeem up to 35% of the aggregate original principal amount of the 10.75% Notes in an amount not greater than the net cash proceeds from certain equity offerings at a redemption price of 110.75% of the principal amount of the outstanding 10.75% Notes plus accrued and unpaid interest to the redemption date. From February 1, 2027 to (and including) January 31, 2028, the Company may redeem the 10.75% Notes in whole or in part, at redemption prices (expressed as percentages of the principal amount thereof) equal to 105.375% and 100.000% from February 1, 2028 and thereafter, plus accrued and unpaid interest, if any, to the redemption date.

An entity controlled by the Company’s CEO purchased $22.0 million in aggregate principal amount of the 10.75% Notes on the same terms as the other purchasers.

The net proceeds from the issuance of the 10.75% Notes along with cash on hand were used to (i) purchase for cash pursuant to the Tender Offer, such of the Company’s outstanding 11.75% Notes that were validly tendered (and not validly withdrawn) pursuant to the terms of the Tender Offer, (ii) on or after August 1, 2025, redeem in full any remaining 11.75% Notes not validly tendered and accepted for purchase in the Tender Offer and, pending such redemptions, satisfy and discharge the Indenture, (iii) repay outstanding amounts under the Term Loan, and (iv) pay premiums, fees and expenses relating to these transactions. As a result, the Company and the guarantors of the 11.750% Notes have been released from their remaining obligations under the Indenture.

On January 28, 2025, the Company terminated the Credit Agreement and entered into a new credit agreement (the “New Credit Agreement”) which provides the Company a revolving credit and letter of credit facility with initial bank lending commitments of $50.0 million with a letter of credit sublimit of $10.0 million. The New Credit Agreement matures on July 28, 2028.

The New Credit Agreement is guaranteed by the Guarantors and is secured by a first priority lien on substantially all the oil and natural gas properties and personal property assets of the Company and the Guarantors. Borrowings under the New Credit Agreement bear interest, at the Company’s option, at a rate per annum equal to either the adjusted Term SOFR rate (the “Adjusted Term SOFR”) plus the applicable margin or the base rate (the “Base Rate”) plus the applicable margin (all terms as defined in the New Credit Agreement). Interest is payable quarterly in arrears for Base Rate loans, at the end of the applicable interest period for Adjusted Term SOFR loans (but not less frequently than quarterly) and upon the prepayment or maturity of the underlying loans. Additionally, the Company is required to pay a letter of credit fee (as defined in the New Credit Agreement), a commitment fee (as defined in the New Credit Agreement) quarterly in arrears in respect of unused commitments under the New Credit Agreement and an annual administrative fee in the amount of $45,000 to be paid quarterly.

On March 3, 2025, the board of directors approved a first quarter dividend of $0.01 per share. The Company expects to pay the dividend on March 24, 2025, to stockholders of record as of the close of business on March 17, 2025.

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