Item 1.01Item 1.01 - Entry into Material Agreement
Item 1.01 Entry into a Material Definitive Agreement
Purchase and Sale Agreements
On
July 1, 2026 (the “Closing Date”), Presidio Production Company (the “Company”) completed the transactions contemplated
by those certain purchase and sale agreements (the “Purchase and Sale Agreements”), dated as of May 7, 2026, by and between
the Company and each of Canyon Creek Energy - Arkoma, LLC (“Canyon Creek”), Alchemist Energy LeaseCo, LP (“Alchemist”),
Pivotal Arkoma Basin II, LLC (“Pivotal”), East Dennis Oil Company, LLC (“East Dennis”), Harvard Petroleum Company,
LLC (“Harvard”), FBF Energy, LLC (“FBF” and, collectively, the “Seller Parties”), whereby the Company
acquired the properties and assets from the Seller Parties set forth in the Purchase and Sale Agreements. The Purchase and Sale Agreements
with Canyon Creek, Alchemist and Pivotal (respectively, the “Canyon Creek PSA”, the “Alchemist PSA” and the “Pivotal
PSA”) represented approximately 98% of the aggregate consideration value of the Purchase and Sale Agreements.
Pursuant to each Purchase and Sale Agreement,
the Company purchased oil and gas leases, oil, gas, and mineral leases and subleases, carried interests, operating rights, record title
interests, overriding royalty interests and other interests to the crude oil, gas, casinghead gas, condensate, natural gas liquids, and
other gaseous or liquid hydrocarbons (including ethane, propane, iso-butane, nor-butane, gasoline, and scrubber liquids) of any type and
chemical composition in, on, under, and that may be produced from or are otherwise attributable to certain properties in Oklahoma (the
“Properties”).
On
the Closing Date, the Company (i) paid to the Seller Parties aggregate cash consideration of approximately $52.5 million and (ii) issued
to the Seller Parties an aggregate of 1,930,156 shares (the “Stock Consideration”) of the Company’s Class A common
stock, par value $0.0001 per share (“Common Stock”).
The foregoing descriptions of the Canyon Creek
PSA, the Alchemist PSA and the Pivotal PSA are qualified in their entirety by reference to the full text of each of such Purchase and
Sale Agreements, copies of which are attached as Exhibits 10.1, 10.2 and 10.3 to this Current Report on Form 8-K and are incorporated
herein by reference.
Registration Rights Agreement
On the Closing Date, the Company entered into
a registration rights agreement (the “Registration Rights Agreement”) by and between the Company and the Seller Parties, excluding
Pivotal, which received solely cash consideration in the transactions, pursuant to which, among other things, the Company granted such
Seller Parties customary rights to require the Company to file and maintain the effectiveness of a shelf registration statement with respect
to the resale of the Stock Consideration received by such Seller Parties, along with customary piggyback registration rights.
The foregoing description of the Registration
Rights Agreement is qualified in its entirety by reference to the full text of the Registration Rights Agreement, a copy of which is attached
as Exhibit 10.4 to this Current Report on Form 8-K and is incorporated herein by reference.
Loan Agreement and Limited Guarantee
On the Closing Date, (a) Presidio Acquisitions
LLC, as borrower (the “Borrower”), and Presidio Intermediate Holding Company II LLC, as a guarantor (“PIHC II”),
each a wholly owned indirect subsidiary of the Company, entered into a Loan and Security Agreement (the “Loan Agreement”)
with Goldman Sachs Bank USA (“GS”), as administrative agent and collateral agent, Goldman Sachs Bank USA and Citizens Bank,
N.A., as joint lead arrangers, the lenders party thereto from time to time and the other loan parties party thereto and (b) in connection
with the Loan Agreement, the Company entered into a Non-Recourse Carve-Out Guarantee (the “Limited Guarantee”) in favor of
GS, as collateral agent for the benefit of the secured parties.
The Loan Agreement provides for a senior secured
warehouse credit facility with aggregate commitments of up to $1.0 billion, consisting of (i) an initial $55.0 million Closing Date loan
commitment and (ii) $945.0 million of delayed draw loan commitments, which may be funded during a two-year delayed draw loan availability
period to finance the acquisition of additional qualifying oil and gas assets. The drawing of delayed draw loans is subject to lender
approval and satisfaction of specified conditions, including (i) the consent of each of the lenders if the aggregate principal amount
of loans outstanding under the Loan Agreement would exceed $500.0 million and (ii) the consent of GS if the aggregate principal amount
of loans owed to GS and its affiliates would exceed $300.0 million. Loans made on the Closing Date that are repaid may be reborrowed only
as delayed draw loans, subject to the terms of the Loan Agreement. On the Closing Date of the Loan Agreement, the Borrower drew the full
$55.0 million Closing Date loan commitment in loans.
The loans made on the Closing Date mature on the
third anniversary of the Closing Date, and each delayed draw loan matures on the third anniversary of its funding date; provided that
all delayed draw loans mature no later than the fifth anniversary of the Closing Date.
Borrowings under the Loan Agreement may bear interest,
at the Borrower’s election, at either (i) a base rate or (ii) Term SOFR plus an applicable margin. The applicable margin initially
is 3.00% for Term SOFR loans and 2.00% for base rate loans and increases to (i) 4.00% for Term SOFR loans and 3.00% for base rate loans
during months 13 through 24 following the funding date of such loan to the extent such loan is still outstanding and (ii) 5.00% for Term
SOFR loans and 4.00% for base rate loans for any period thereafter to the extent such loan is outstanding. The Borrower may voluntarily
prepay borrowings without premium or penalty, subject to customary breakage costs for certain SOFR loans. The Loan Agreement documents
also provide for certain upfront, administrative and duration fees payable by the Borrower.
The obligations under the Loan Agreement are (i)
guaranteed by PIHC II and certain present and future subsidiaries of the Borrower and (ii) secured by first-priority security interests
in substantially all assets of the Borrower, PIHC II and certain present and future subsidiaries of the Borrower that become loan parties
under the Loan Agreement from time to time (including substantially all oil and gas properties and related assets of such parties) subject
to customary excluded property and permitted lien exceptions.
Pursuant to the Limited Guarantee, the Company
guarantees certain specified losses arising from customary non-recourse carve-out events, including, among other things, fraud, theft,
willful misconduct, misapplication of collateral proceeds and certain unauthorized distributions. In addition, the Limited Guarantee provides
for springing full recourse liability upon the occurrence of certain customary events, including specified voluntary bankruptcy or insolvency
actions, substantive consolidation of the Borrower with another entity in certain circumstances, certain bad-faith challenges to the loan
documents or collateral, certain prohibited changes of control and other customary recourse carve-out events, in each case as more fully
described in the Limited Guarantee.
The Loan Agreement contains customary affirmative
and negative covenants for facilities of this type, including restrictions on the ability of the loan parties to incur additional indebtedness,
create liens, make investments, dispose of assets, engage in mergers or other fundamental transactions, make restricted payments, enter
into transactions with affiliates, amend material contracts and organizational documents, and enter into certain hedging arrangements,
in each case subject to customary exceptions and baskets. The Loan Agreement also requires the Borrower to maintain specified commodity
and interest rate hedging arrangements and a debt service reserve account. In addition, the Loan Agreement contains customary reporting
obligations and reserve reporting requirements with respect to the Borrower’s oil and gas assets.
The Loan Agreement includes financial maintenance
covenants with respect to the Closing Date loans, including (i) a minimum debt service coverage ratio of not less than 1.10 to 1.00 and
(ii) a maximum LTV Ratio (as defined in the Loan Agreement) of not greater than 70% (which decreases to 65% after the fifth full fiscal
quarter following the Closing Date). In the case of any funding of delayed draw loans, the Borrower and the applicable Lenders will establish
separate thresholds for such financial covenants at the time such Delayed Draw Loans are funded.
The Loan Agreement contains customary events of
default, including payment defaults, breaches of covenants, inaccuracies of representations and warranties, cross-defaults to specified
indebtedness, bankruptcy and insolvency events, invalidity of loan documents or collateral security, certain ERISA events, certain events
relating to the management and operating agreements, change of control and specified judgments (each subject to thresholds and/or grace
periods described in the Loan Agreement). Upon the occurrence and continuation of an event of default, the administrative agent may, and
at the direction of the requisite lenders shall, terminate the lenders’ commitments and declare all outstanding obligations immediately
due and payable, and exercise remedies against the collateral.
The foregoing descriptions of the Loan Agreement
and the Limited Guarantee do not purport to be complete and are qualified in their entirety by reference to the full text of the Loan
Agreement and the Limited Guarantee, copies of which are filed as Exhibits 10.5 and 10.6, respectively, to this Current Report on Form
8-K and are incorporated herein by reference.
Item 2.01
Completion of Acquisition or Disposition of Assets
The
information regarding the Purchase and Sale Agreements set forth in Item 1.01 of this Current Report on Form 8-K is incorporated into
this Item 2.01 by reference.
Item 2.03 Creation of a
Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant
The
information regarding the Loan Agreement and Limited Guarantee set forth in Item 1.01 of this Current Report on Form 8-K is incorporated
into this Item 2.03 by reference.
Item 7.01Item 7.01 - Regulation FD Disclosure
Item 7.01 Regulation FD Disclosure
On July 2, 2026, the Company issued a press release
announcing the completion of the transactions contemplated by the Purchase and Sale Agreements and the Loan Agreement and the Limited
Guarantee. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference. In accordance with
General Instruction B.2 of Form 8-K, the information in this Item 7.01, including Exhibit 99.1, shall not be deemed “filed”
for the 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, nor shall such information, including Exhibit 99.1, be deemed incorporated by reference in any filing
under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such
filing.
Cautionary Note Regarding Forward-Looking Statements
Statements in this Current Report on Form 8-K
and in our other filings with the SEC, as well as other statements we may make from time to time, other than statements of historical
fact, constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995.
In some cases, you can identify forward-looking statements by words such as “may,” “will,” “should,”
“expects,” “intends,” “plans,” “anticipates,” “believes,” “estimates,”
“guidance,” “outlook,” “predicts,” “potential,” “continue,” and similar words
or phrases or the negative of these words or phrases. These statements relate to future events or the Company’s future financial
performance and involve known and unknown risks, uncertainties, and other factors that may cause the Company’s actual results, performance,
or achievements to be materially different from any future results, performance or achievements expressed or implied by these forward-looking
statements. Although the Company believes the expectations reflected in the forward-looking statements are reasonable when made, the Company
cannot guarantee future results, levels of activity, performance, or achievements. See the Company’s final prospectus and definitive
proxy statement filed with the SEC, dated January 30, 2026 in the section entitled “Risk Factors” and the Company’s
other filings with the SEC for a discussion of risks and uncertainties. The Company disclaims any obligation to update or revise any forward-looking
statements, whether as a result of new information, future events or otherwise.