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UNITED
STATES
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SECURITIES AND EXCHANGE
COMMISSION
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Washington, D.C.
20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
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Date of Report (Date of earliest event reported)
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December 31, 2020
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Laredo Oil, Inc.
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(Exact Name of Registrant as Specified in Charter)
Delaware
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(State or Other Jurisdiction of Incorporation)
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333-153168
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26-2435874
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(Commission File Number)
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(IRS Employer Identification No.)
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2021 Guadalupe Street, Ste. 260
Austin, Texas
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78705
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(Address of Principal Executive Offices)
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(Zip Code)
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Registrant’s telephone number, including area
code
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(512) 337-1199
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110 N. Rubey Drive, Suite 120, Golden, Colorado
80403
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(Former Name or Former Address, if Changed Since Last
Report.)
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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 (see General Instruction A.2.
below):
☐ 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))
Indicate by check mark whether
the registrant is an emerging growth company as defined in Rule 405
of the Securities Act of 1933 (§230.405 of this chapter) or
Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2
of this chapter).
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.
☐
1
Item 1.01 Entry into a Material Definitive Agreement
The
information set forth in Item 2.01 is incorporated by reference
into this Item 1.01.
Item 2.01 Completion of Acquisition or Disposition of
Assets
Pursuant
to a Securities Purchase Agreement dated December 31, 2020 (the
“Purchase Agreement”), by and among Laredo Oil, Inc.
(“Laredo”), Stranded Oil Resources Corporation
(“SORC”), Alleghany Corporation, SORC’s sole
stockholder (“Seller”), and SORC Holdings LLC, a
wholly-owned subsidiary of Laredo (“Buyer”), Buyer
purchased all of the issued and outstanding shares of SORC stock
(the “SORC Shares”). The transaction closed on December
31, 2020.
As
consideration for the SORC Shares, Buyer paid to Seller $55,000 and
Laredo agreed to pay to Seller a revenue royalty of 5.0% of
Laredo’s future revenues and net profits relating to oil,
gas, gas liquids and all other hydrocarbons, subject to certain
adjustments, for a period of seven years after the closing. The
Purchase Agreement provides for customary adjustments to the
purchase price based on the effective date of December 31, 2020.
SORC owns the enhancements to UGD 3.0, an improved version of
Laredo’s enhanced oil recovery technique utilized to produce
oil from horizontally developed or mature pressure-depleted oil
fields. With this acquisition of SORC, Laredo now has exclusive
rights to utilize and license that technology worldwide, and has
acquired oilfield assets and equipment.
In
connection with the transaction, the two senior promissory notes of
Laredo held by Seller were consolidated into a single Consolidated,
Amended and Restated Senior Promissory Note in the amount of
$631,434.00 (which includes all principal and accrued interest
through December 31, 2020) (the “Consolidated Note”),
which Consolidated Note has a maturity date of June 30, 2022. The
Consolidated Note is now secured by a grant to Seller of a security
interest in certain oilfield equipment assets of SORC pursuant to a
Security Agreement executed at the closing.
Further,
pursuant to the Purchase Agreement, Laredo and Seller entered into
a Consulting Agreement dated as of December 31, 2020 (the
“Consulting Agreement”), pursuant to which Seller
agreed to pay an aggregate of approximately $1.245 million during
2021 in consideration of Laredo causing certain individuals,
including Mark See, Laredo’s Chief Executive Officer and
Chairman, and Chris Lindsey, Laredo’s General Counsel and
Secretary, to provide consulting services to Seller (for a period
of three years for Mr. See and one year for Mr.
Lindsey).
Item 7.01 Regulation FD Disclosure
On
January 5, 2021, Laredo issued a press release, attached as Exhibit
99.1, announcing the closing of the purchase of the SORC Shares. A
copy of the press release is furnished as Exhibit 99.1 hereto and
is incorporated by reference.
This
information set forth in Exhibit 99.1 shall not be deemed to be
“filed” for purposes of Section 18 of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”),
or otherwise subject to the liabilities of that Section, and is not
incorporated by reference into a filing under the Securities Act of
1933, as amended, or the Exchange Act, except as expressly set
forth by specific reference in such filing. Additionally, the
submission of this report on Form 8-K in is not deemed an admission
as to the materiality of any information in this report that is
required to be disclosed solely by Regulation FD.
Item 9.01 Financial Statements and Exhibits
(a)
Financial Statements of
Business Acquired
Pursuant
to Item 9.01(a)(4) of Form 8-K, the Company intends to file all
financial statements required by this item, if any, by an amendment
to this Current Report of Form 8-K to be filed within 71 calendar
days after the date this Current Report on Form 8-K must be
filed.
(b)
Pro Forma Financial
Information
Pursuant
to Item 9.01(b)(2) of Form 8-K, the Company intends to file all pro
forma financial information required by this item, if any, by an
amendment to this Current Report of Form 8-K to be filed within 71
calendar days after the date this Current Report on Form 8-K must
be filed.
(d)
Exhibit
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SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
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LAREDO OIL, INC.
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Date: January 7, 2021
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By:
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/s/ Bradley E. Sparks
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Bradley E. Sparks
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Chief Financial Officer and Treasurer
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EXHIBIT INDEX
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Exhibit No.
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Description
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3