Annual report pursuant to Section 13 and 15(d)

Share Exchange Agreement

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Share Exchange Agreement
12 Months Ended
Dec. 31, 2017
ProvedDevelopedAndUndevelopedReserveProductionEnergyProvedUndeveloped  
Share Exchange Agreement

Note 2 – Share Exchange Agreement

 

During the year ended December 31, 2016, (the “Company”):

 

(1) acquired over 14.1 million pre-split (56.4 million post-split) shares of Key Link’s common stock from five persons constituting approximately 96% of our issued and outstanding shares (the “FPI Acquired Shares”). In conjunction with this purchase we incurred a charge of $316,035 for the purchase of these shares.
   
(2) effected a 4:1 forward split of our shares of common stock.
   
(3) entered into a Share Exchange Agreement (“Share Exchange Agreement”) with the shareholders of FPI, whereby the Company acquired all of the outstanding shares of FPI for an aggregate of 6,003,759 shares of common stock of which 4,500,000 shares of common stock were issued to Wilshire Energy Partners, LLC, (“Wilshire”) and 1,503,759 of shares of common stock were issuable to Alternus Capital Holdings Ltd., a British Virgin Islands company (“Alternus”) (the “Share Exchange”) for automatic conversion of debt. As a result of the Share Exchange, FPI became the Company’s wholly owned subsidiary and the FPI Acquired Shares were subsequently returned to treasury, deemed canceled and no longer outstanding.
   
(4) exchanged warrants to purchase 700,000 shares of FPI’s common stock that were issued to Wilshire for a like amount of warrants to purchase shares of Key Link’s common stock (the “Wilshire Warrants”). The Wilshire Warrants which:

 

  have a term of five years;
     
  are exercisable at $1.25 per share as to 100,000 shares;

  

  are exercisable at $2.00 per share as to 200,000 shares;
     
  are exercisable at $3.00 per share as to 400,000 shares;
     
  do not have a cashless exercise feature; and
     
  are not exercisable for one year from the date of issuance.

 

Following the closing of the Share Exchange transaction the Company had approximately 8,363,759 shares of common stock outstanding (excluding the FPI Acquired Shares, which are deemed canceled following the Share Exchange), of which Wilshire and Alternus own in the aggregate 6,003,759 shares, or approximately 52% of the outstanding common stock.