Item 1.01Item 1.01 - Entry into Material Agreement
Item 1.01 Entry into a Material Definitive Agreement.
Third Amendment to Amended & Restated Credit Agreement
On August 14, 2026, Prairie Operating Co. (the “Company”) entered into a Third Amendment to Amended and Restated Credit Agreement
(the “Amendment”), effective as of June 30, 2026, with Citibank, N.A., as administrative agent, and the other financial institutions party thereto, which amends the Amended and Restated Credit Agreement, dated as of March 26, 2025 (as amended by
that certain First Amendment to Amended and Restated Credit Agreement, dated as of June 6, 2025, and that certain Second Amendment to Amended and Restated Credit Agreement, dated as of June 10, 2026, the “A&R Credit Agreement”), by and among
the Company, Citibank, N.A., as administrative agent, and the other financial institutions party thereto.
Among other things, the Amendment (i) reduces the Current Ratio (as defined in the A&R Credit Agreement) the Company is
required to maintain under the A&R Credit Agreement from 1.00 to 1.00 to (a) for the Company’s fiscal quarter ending June 30, 2026, 0.50 to 1.00, (b) for the Company’s fiscal quarter ending September 30, 2026, 0.40 to 1.00 and (c) for the
Company’s fiscal quarter ending December 31, 2026, 0.60 to 1.00, and (ii) introduces a new covenant requiring the Company meet or exceed certain minimum hydrocarbon production thresholds. The new minimum hydrocarbon production covenant is
measured over rolling three-month periods at the end of each calendar month and is first tested on August 31, 2026 for the three month period then ending.
Other than in respect of the A&R Credit Agreement and related documents or as previously disclosed by the Company in its
filings with the Securities and Exchange Commission (the “SEC”), neither the Company nor any of its affiliates have any material relationship with any of the other parties to the A&R Credit Agreement and related documents, other than that
each of the lenders may have performed, and may in the future perform, various commercial banking, investment banking, underwriting, trust and other financial advisory services for the Company and/or its affiliates, for which it may have
received, and may in the future receive, customary fees and expenses.
The foregoing description of the Amendment is not complete and is qualified in its entirety by reference to the full text of the
Amendment, which is filed as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated herein by reference.
Series F Convertible Preferred Stock - Letter Agreement
On August 14, 2026, the Company entered into a letter agreement (the “Letter Agreement”) with Hudson Bay PH XIX LLC (“High Trail”), pursuant to
which the parties agreed, among other things, to (i) amend Section 4(w) of the Securities Purchase Agreement, dated as of March 24, 2025, between the Company and High Trail, as amended (the “Purchase Agreement”), to change the “Anniversary
Warrant Issuance Date” from August 14, 2026 to August 31, 2026, and (ii) amend certain footnotes in the Form of Anniversary Warrant attached as Exhibit B to the Purchase Agreement, as amended, to replace certain references to August 14, 2026 with
references to August 31, 2026.
The Letter Agreement also (i) amends a previous letter agreement between the Company and High Trail to extend the issuance date of a warrant
issuable to High Trail to purchase 3,000,000 shares of the Company’s common stock at an exercise price of $0.01 per share (subject to adjustment pursuant to the terms therein) (the “Second Penny Warrant”) from August 14, 2026 to August 31, 2026,
so that if on August 31, 2026 (rather than August 14, 2026 as provided by the previous letter agreement), for any reason, the Anniversary Warrants (as defined in the Company’s Certificate of Designation of Preferences, Rights and Limitations of
Series F Convertible Preferred Stock (the “Certificate of Designation”)) are not issued to High Trail, the Company will issue the Second Penny Warrant to High Trail and (ii) waives the Company’s obligation under Section 8(A)(ii) of the
Certificate of Designation to maintain the Current Ratio (as defined in the Certificate of Designation) until 11:59 p.m. (New York City time) on December 31, 2026 (the “Limited Waiver”). The effectiveness of the Limited Waiver is expressly
conditioned upon the Company not permitting, as of the last day of any fiscal quarter commencing with the fiscal quarter ending June 30, 2026, the Current Ratio as of such date to be less than (i) 0.50 to 1.00, for the fiscal quarter ending June
30, 2026, (ii) 0.40 to 1.00, for the fiscal quarter ending September 30, 2026 and (iii) 0.60 to 1.00, for the fiscal quarter ending December 31, 2026.