DELAWARE
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001-16653
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73-1238709
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(State or Other Jurisdiction
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(Commission
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(I.R.S. Employer
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of Incorporation or Organization)
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File Number)
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Identification No.)
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Large accelerated filer
☐
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Accelerated filer
☐
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Non-accelerated filer
☐
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Smaller reporting company
☑
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Emerging growth company
☐
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(Do not check if a smaller reporting company)
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ITEM NUMBER AND CAPTION
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PAGE NO.
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PART I
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PART II
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PART III
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PART IV
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Quarter
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High
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Low
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||
03/31/16
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$0.10
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$0.07
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||
06/30/16
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$0.12
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$0.05
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09/30/16
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$0.12
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$0.09
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12/31/16
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$0.25
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$0.07
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Quarter
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High
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Low
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||
03/31/17
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$0.51
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$0.15
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06/30/17
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$0.17
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$0.06
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09/30/17
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$0.25
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$0.04
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12/31/17
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$0.25
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$0.10
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·
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the need for additional capital,
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·
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the costs expected to be incurred in exploration and development,
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·
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unforeseen engineering, mechanical or technological difficulties in drilling wells,
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·
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uncertainty of exploration results,
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·
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operating hazards,
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·
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competition from other natural resource companies,
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·
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the fluctuations of prices for oil and gas,
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·
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the effects of governmental and environmental regulation, and
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·
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general economic conditions and other risks described in the Company's filings with the Securities and Exchange Commission (the "SEC").
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Name
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Age
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Position
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Thomas Pritchard
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56
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Chief Executive Officer
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Michael R. Morrisett
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54
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Director and President
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Anthony N. Kamin
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57
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Director
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(a)
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(b)
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(c)
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|||
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Number of securities
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|||
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remaining available
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|||
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for future
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|||
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Number of securities
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issuance under
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|||
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to be issued upon
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Weighted-average
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equity compensation
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|||
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exercise of
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exercise price of
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plans (excluding
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|||
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outstanding options
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outstanding options
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securities reflected
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Plan Category
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and rights
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and rights
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in column (a)
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|||
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Equity compensation plans
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|||
approved by security
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holders
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1,154,167
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$0.21
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0
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|||
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|||
Equity compensation plans
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not approved by security
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holders
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N/A
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N/A
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N/A
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TOTAL
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1,154,167
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0
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Amount and nature of
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Name and address of beneficial owner
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beneficial ownership
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Percent of class (1)
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J. C. Whorton, Jr.
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1,673,128 (2)
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14.9%
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6657 S. High Drive
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Morrison, CO 80465
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Michael R. Morrisett
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2,173,128 (2)(3)
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18.5%
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Director and President
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2651 E. 21
st
Street, Suite 310
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Tulsa, Oklahoma 74114
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Empire Petroleum Holdings, LL
C
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3,718,064 (4)
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33.1%
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2651 E. 21
st
Street, Suite 310
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Tulsa, OK 74114
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Anthony Kamin
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4,424,304 (5)
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29.4%
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Director
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4870 S Lewis Ave. Suite 250
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Tulsa, Oklahoma 74105
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Gary Adams
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2,000,000 (6)
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17.8%
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1437 South Boulder Ave, Suite 930
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Tulsa, OK 74119
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Thomas Pritchard
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500,000 (7)
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4.3%
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15798 Spyglass Hill Loop
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Gainesville, VA 20155
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All current directors, executive officers and beneficial owners as a group (5 persons)
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10,770,560 (4)
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67.1%
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Fee Category
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Fiscal 2017 Fees
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Fiscal 2016 Fees
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Audit Fees (1)
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$30,250
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$30,250
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Audit - Related Fees (2)
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0
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0
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Tax Fees
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0
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0
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All Other Fees (3)
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0
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0
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Total Fees
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$30,250
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$30,250
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Exhibit No.
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Description
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2.1
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Subscription and Contribution Agreement dated as of December 22, 2016, by and between Masterson West, LLC and Empire Petroleum Corporation (incorporated herein by reference to Exhibit 2.1 of the Company's Form 8-K dated December 22, 2016 filed on December 28, 2016).
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2.2
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Limited Liability Company Agreement of Masterson West II, LLC dated as of December 22, 2016(incorporated herein by reference to Exhibit 2.1 of the Company's Form 8-K dated December 22, 2016 filed on December 28, 2016).
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3.1
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Articles of Incorporation of the Company, as amended (incorporated herein by reference to Exhibit 3.1 of the Company's Form 10-QSB for the period ended September 30, 1995, which was filed November 6, 1995).
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3.2
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Certificate of Amendment to Certificate of Incorporation (incorporated herein by reference to Exhibit 3.1 to the Company's Form 8-K dated May 31, 2012, which was filed on June 1, 2012).
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3.3
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Bylaws of the Company (incorporated herein by reference to Exhibit 3.2 of the Company's Form 10-QSB for the period ended March 31, 1998, which was filed May 15, 1998).
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4.1
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Form of Securities Purchase Agreement entered into between Empire Petroleum Corporation and five accredited investors (incorporated herein by reference to Exhibit 2.1 of the Company's Form 8-K dated December 22, 2016 filed on December 28, 2016).
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10.1
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1995 Stock Option Plan (incorporated herein by reference to Appendix A of the Company's Form DEFS 14A dated June 13, 1995, which was filed June 14, 1995).
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10.2
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Form of Stock Option Agreement (incorporated herein by reference to Exhibit 10(g) of the Company's Form 10-KSB for the year ended December 31, 1995, which was filed March 29, 1996).
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10.3
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2006 Stock Incentive Plan (incorporated herein by reference to Exhibit A to the Company's 2006 Proxy Statement on Schedule 14A dated May 10, 2006).
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10.4
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Form of Non-qualified Stock Option Agreement (incorporated herein by reference to Exhibit 10.2 to the Company's Form 8-K dated June 5, 2006, which was filed on June 9, 2006).
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10.5
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Form of Non-qualified Stock Option Agreement for Non-employee Directors (incorporated herein by reference to Exhibit 10.3 to the Company's Form 8-K dated June 5, 2006, which was filed on June 9, 2006).
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10.6
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Form of Restricted Stock Award Agreement (incorporated herein by reference to Exhibit 10.4 to the Company's Form 8-K dated June 5, 2006, which was filed on June 9, 2006).
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31.1
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Rule 13a – 14(a)/15d – 14(a) Certification of Thomas Pritchard, Chief Executive Officer (submitted herewith).
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31.2
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Rule 13a – 14(a)/15d – 14(a) Certification of Michael R. Morrisett, principal financial officer (submitted herewith).
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32.1
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Section 1350 Certification of Thomas Pritchard, Chief Executive Officer (submitted herewith).
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32.2
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Section 1350 Certification of Michael R. Morrisett, principal financial officer (submitted herewith).
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101
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Financial Statements for XBRL format (submitted herewith).
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Empire Petroleum Corporation
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Date: April 2, 2017
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By:
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/s/ Michael R. Morrisett
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Name: Michael R. Morrisett
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Title: President
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Signature
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Title
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Date
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/s/ Thomas Pritchard
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Director and Chief Executive Officer
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April 2, 2017
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THOMAS PRITCHARD
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||||
/s/ Michael R. Morrisett
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Director, and President
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April 2, 2017
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MICHAEL R. MORRISETT
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(principal financial officer)
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/s/ Anthony J. Kamin
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Director
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April 2, 2017
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ANTHONY J. KAMIN
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NO.
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2.1
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2.2
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3.1
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Articles of Incorporation of the Company, as amended (incorporated herein by reference to Exhibit 3.1 of the Company's Form 10-QSB for the period ended September 30, 1995, which was filed November 6, 1995).
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3.2
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3.3
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4.1
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10.1
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1995 Stock Option Plan (incorporated herein by reference to Appendix A of the Company's Form DEFS 14A dated June 13, 1995, which was filed June 14, 1995).
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10.2
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Form of Stock Option Agreement (incorporated herein by reference to Exhibit 10(g) of the Company's Form 10-KSB for the year ended December 31, 1995, which was filed March 29, 1996).
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10.3
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10.4
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10.5
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10.6
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31.1
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31.2
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32.1
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32.2
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101
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Financial Statements for XBRL format (submitted herewith).
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Page No.
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Report of Independent Registered Public Accounting Firm
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21
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Balance Sheets as of December 31, 2017 and 2016
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22
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Statements of Operations for the years ended December 31, 2017 and 2016
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23
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Statements of Changes in Stockholders' Equity (Deficit) for the years ended December 31, 2017 and 2016
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24
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Statements of Cash Flows for the years ended December 31, 2017 and 2016
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25
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Notes to Financial Statements
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26
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2017
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2016
|
||||||
Revenue:
|
||||||||
Petroleum sales
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$
|
0
|
$
|
0
|
||||
|
||||||||
Costs and expenses:
|
||||||||
Lease option impairment
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0
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181,475
|
||||||
General and administrative
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757,069
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196,603
|
||||||
|
757,069
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378,078
|
||||||
Operating loss
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(757,069
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)
|
(378,078
|
)
|
||||
|
||||||||
Other income and (expense):
|
||||||||
Interest expense
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(72,998
|
)
|
(3,837
|
)
|
||||
Total other income and (expense)
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(72,998
|
)
|
(3,837
|
)
|
||||
|
||||||||
|
||||||||
Net loss
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$
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(830,067
|
)
|
$
|
(381,915
|
)
|
||
|
||||||||
Net loss per common
|
||||||||
share, basic and diluted
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$
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(0.08
|
)
|
$
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(0.04
|
)
|
||
Weighted average number of
|
||||||||
common shares outstanding
|
||||||||
basic and diluted
|
10,859,070
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8,727,047
|
|
||||||||||||||||||||||||||||
|
Common Stock
|
Common Stock
Subscribed, not
yet issued
|
Stock Subscription Receivable
|
Additional
Paid in
|
Accumulated
Deficit
|
Total
|
||||||||||||||||||||||
Shares
|
Par Value
|
|||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||
Balances December 31, 2015
|
8,710,609
|
$
|
8,710
|
$
|
0
|
$
|
0
|
$
|
15,081,928
|
$
|
(14,899,233
|
)
|
$
|
191,405
|
||||||||||||||
|
||||||||||||||||||||||||||||
Value of services contributed
|
0
|
0
|
0
|
0
|
50,000
|
0
|
50,000
|
|||||||||||||||||||||
|
||||||||||||||||||||||||||||
Net loss
|
0
|
0
|
0
|
0
|
0
|
(381,915
|
)
|
(381,915
|
)
|
|||||||||||||||||||
|
||||||||||||||||||||||||||||
Subscription of Stock
|
0
|
0
|
2,000
|
0
|
298,000
|
0
|
300,000
|
|||||||||||||||||||||
|
||||||||||||||||||||||||||||
Options, warrants and conversion features issued
|
0
|
0
|
0
|
0
|
141,891
|
0
|
141,891
|
|||||||||||||||||||||
|
||||||||||||||||||||||||||||
Balances December 31, 2016
|
8,710,609
|
8,710
|
2,000
|
0
|
15,571,819
|
(15,281,148
|
)
|
301,381
|
||||||||||||||||||||
Net loss
|
(830,067
|
)
|
(830,067
|
)
|
||||||||||||||||||||||||
|
||||||||||||||||||||||||||||
Shares, options, warrants and conversion features issued
|
93,333
|
93
|
1,225
|
(5,000
|
)
|
660,562
|
0
|
656,880
|
||||||||||||||||||||
Balances December 31, 2017
|
8,803,942
|
$
|
8,803
|
$
|
3,225
|
$
|
(5,000
|
)
|
$
|
16,232,381
|
$
|
(16,111,215
|
)
|
$
|
128,194
|
|
2017
|
2016
|
||||||
|
||||||||
Cash flows from operating activities:
|
||||||||
Net loss
|
$
|
(830,067
|
)
|
$
|
(381,915
|
)
|
||
Adjustments to reconcile net loss to net
|
||||||||
cash used in operating activities:
|
||||||||
Value of fair value of options and warrants granted
|
472,700
|
65,660
|
||||||
Value of services contributed by employee
|
0
|
50,000
|
||||||
Amortization of warrant value and conversion feature on convertible notes
|
60,064
|
2,574
|
||||||
Lease option impairment
|
0
|
181,475
|
||||||
Change in operating assets and liabilities:
|
||||||||
Prepaids
|
14,000
|
(14,000
|
)
|
|||||
Accounts payable and accrued liabilities
|
47,340
|
14,344
|
||||||
Net cash used in operating activities
|
(235,963
|
)
|
(81,862
|
)
|
||||
Cash flows from financing activities:
|
||||||||
Proceeds from convertible notes issued
|
127,500
|
132,500
|
||||||
Proceeds from stock issuance
|
117,500
|
0
|
||||||
Net cash provided by financing activities
|
245,000
|
132,500
|
||||||
|
||||||||
Net increase in cash
|
9,037
|
50,638
|
||||||
|
||||||||
Cash - Beginning of year
|
68,743
|
18,105
|
||||||
|
||||||||
Cash - End of year
|
$
|
77,780
|
$
|
68,743
|
||||
|
||||||||
Noncash Investing and Financing Activities
|
||||||||
|
||||||||
Common stock subscribed in exchange for investment
|
$
|
5,000
|
$
|
300,000
|
||||
Common stock options issued for outstanding payables
|
$
|
4,894
|
$
|
0
|
||||
|
Masterson West II Summarized Balance Sheet
|
2017
|
|||
Total Assets (option and partial consideration to purchase certain oil and gas assets)
|
$
|
300,000
|
||
|
||||
Total Liabilities and Equity
|
$
|
300,000
|
2017
|
2016
|
|||||||||||||||
|
Current
|
Long Term
|
Total
|
|||||||||||||
Convertible Notes Outstanding
|
$
|
208,950
|
$
|
51,050
|
$
|
260,000
|
$
|
132,500
|
||||||||
Debt Issue Costs – Warrants and Conversion Feature
|
(71,694
|
)
|
(3,684
|
)
|
(75,378
|
)
|
(73,656
|
)
|
||||||||
|
||||||||||||||||
Convertible Notes Outstanding, Net
|
$
|
137,256
|
$
|
47,366
|
$
|
184,622
|
$
|
58,844
|
|
Weighted Average
|
|||||||
|
Options
|
Exercise Price
|
||||||
|
||||||||
|
||||||||
Outstanding at End of Year 2015
|
6,250
|
$
|
2.56
|
|||||
|
||||||||
Granted
|
600,000
|
$
|
0.15
|
|||||
|
||||||||
Granted
|
550,000
|
$
|
0.25
|
|||||
|
||||||||
Cancelled or Exercised
|
2,083
|
$
|
1.44
|
|||||
|
||||||||
Outstanding at End of Year 2016
|
1,154,167
|
$
|
0.21
|
|||||
|
||||||||
Granted
|
0
|
|||||||
Cancelled or Exercised
|
0
|
|||||||
Outstanding at End of Year 2017
|
1,154,167
|
0.21
|
|
2017
|
2016
|
||||||
Statutory tax rate
|
34%
|
|
34%
|
|
||||
|
||||||||
Expected tax benefit
|
$
|
(280,000
|
)
|
$
|
(129,000
|
)
|
||
Nondeductible expenses
|
0
|
101,000
|
||||||
Benefit of losses not recognized
|
280,000
|
28,000
|
||||||
|
||||||||
Tax provision (benefit) as reported
|
$
|
0
|
$
|
0
|
||||
|
1.
|
I have reviewed this annual report on Form 10‑K of Empire Petroleum Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a‑15(e) and 15d‑15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
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April 2, 2018
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/s/ Thomas Pritchard | ||
Thomas Pritchard
|
|||
Chief Executive Officer
|
1.
|
I have reviewed this annual report on Form 10‑K of Empire Petroleum Corporation;
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2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
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The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a‑15(e) and 15d‑15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
April 2, 2018
|
/s/ Michael R. Morrisett | ||
Michael R. Morrisett | |||
President (principal financial officer)
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
April 2, 2018
|
/s/ Thomas Pritchard | ||
Thomas Pritchard
|
|||
Chief Executive Officer
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
April 2, 2018
|
/s/ Michael R. Morrisett | ||
Michael R. Morrisett | |||
President (principal financial officer)
|