Dollar amounts and number of shares below are expressed in thousands, except per
share amounts.
OVERVIEW
Ecoark Holdings Inc. ("Ecoark Holdings" or the "Company") is a diversified
holding company, incorporated in the state of Nevada on November 19, 2007.
Through Ecoark Holdings wholly owned subsidiaries, the Company has operations in
three areas: (i) oil and gas, including exploration, production and drilling
operations on over 20,000 cumulative acres of active mineral leases in Texas,
Louisiana, and Mississippi and transportation services, (ii) post-harvest
shelf-life and freshness food management technology, and (iii) financial
services including investing in a select number of early stage startups each
year. The Company's subsidiaries consist of Ecoark, Inc. ("Ecoark"), a Delaware
corporation which is the parent of Zest Labs, Inc. ("Zest Labs"), 440IoT Inc., a
Nevada corporation ("440IoT"), Banner Midstream Corp., a Delaware corporation
("Banner Midstream") and Trend Discovery Holdings Inc., a Delaware corporation
("Trend Holdings").
See Note 16 to Unaudited Condensed Consolidated Financial Statements included in
this Quarterly Report on Form 10-Q for the information regarding the merger with
Trend Discovery Holdings Inc. in May 2019 and the acquisition of Banner
Midstream Corp. ("Banner Midstream") in March 2020.
Banner Midstream has four operating subsidiaries: Pinnacle Frac Transport LLC
("Pinnacle Frac"), Capstone Equipment Leasing LLC ("Capstone"), White River
Holdings Corp. ("White River"), and Shamrock Upstream Energy LLC ("Shamrock").
Pinnacle Frac provides transportation of frac sand and logistics services to
major hydraulic fracturing and drilling operations. Capstone procures and
finances equipment to oilfield transportation service contractors. These two
operating subsidiaries of Banner Midstream are revenue producing entities.
White River and Shamrock are engaged in oil and gas exploration, production, and
drilling operations on over 10,000 cumulative acres of active mineral leases in
Texas, Louisiana, and Mississippi.
Since the acquisition of Banner Midstream on March 27, 2020, which currently
comprises the exploration, production and drilling operations, the Company has
focused its efforts to a considerable extent on expanding its exploration and
production footprint and capabilities by acquiring real property and working
interests in oil and gas mineral leases.
On June 11, 2020, the Company acquired certain energy assets from SR Acquisition
I, LLC for $1 as part of the ongoing bankruptcy reorganization of Sanchez Energy
Corporation. The transaction includes the transfer of 262 total wells in
Mississippi and Louisiana, approximately 9,000 acres of active mineral leases,
and drilling production materials and equipment. The 262 total wells include 57
active producing wells, 19 active disposal wells, 136 shut-in with future
utility wells, and 50 shut-in pending plugging wells. Included in the assignment
are 4 wells in the Tuscaloosa Marine Shale formation.
On June 18, 2020, the Company acquired certain energy assets from SN TMS, LLC
for $1 as part of the ongoing bankruptcy reorganization of Sanchez Energy
Corporation. The transaction includes the transfer of wells, active mineral
leases, and drilling production materials and equipment.
On August 14, 2020, the Company entered into an Asset Purchase Agreement (the
"Asset Purchase Agreement") by and among the Company, White River E&P LLC, a
Texas Limited Liability Company and a wholly-owned subsidiary of the Company
Rabb Resources, LTD. and Claude Rabb, the sole owner of Rabb Resources, LTD.
Pursuant to the Asset Purchase Agreement, the Company completed the acquisition
of certain assets of Rabb Resources, LTD. The acquired assets consisted of
certain real property and working interests in oil and gas mineral leases. The
Company in June 2020 previously provided for bridge financing to Rabb Resources,
LTD under the $225 Senior Secured Convertible Promissory Note. As consideration
for entering into the Asset Purchase Agreement, the Company agreed to pay Rabb
Resources, LTD. A total of $3,500 consisting of (i) $1,500 in cash, net of $304
in outstanding amounts related to the note receivable and accrued interest
receivable, and (ii) $2,000 payable in common stock of the Company, which based
on the closing price of the common stock as of the date of the Asset Purchase
Agreement equaled 514 shares. The Company accounted for this acquisition as an
asset acquisition under ASC 805 and that the Company has early adopted the
amendments of Regulation S-X dated May 21, 2020 and has concluded that this
acquisition was not significant. Accordingly, as a result of the amendment, the
presentation of the Rabb Resources, LTD historical financial statements under
Rule 3-05 and related pro forma information under Article 11 of Regulation S-X,
respectively, were not required to be presented.
On September 4, 2020, White River SPV 3, LLC, a wholly-owned subsidiary of
Banner Midstream entered into an Agreement and Assignment of Oil, Gas and
Mineral Lease with a privately held limited liability company (the "Assignor").
Under the Lease Assignment, the Assignor assigned a 100% working interest (75%
net revenue interest) in a certain oil and gas lease covering in excess of 1,600
acres (the "Lease"), and White River paid $1,500 in cash to the Assignor. The
Company accounted for this acquisition as an asset acquisition under ASC 805 and
that the Company has early adopted the amendments of Regulation S-X dated May
21, 2020 and has concluded that this acquisition was not significant.
Accordingly, as a result of the amendment, the presentation of the historical
financial statements under Rule 3-05 and related pro forma information under
Article 11 of Regulation S-X, respectively, were not required to be presented.
42
On September 30, 2020, the Company and White River Energy, LLC ("White River
Energy"), a wholly-owned subsidiary of the Company entered into three asset
purchase agreements (the "Asset Purchase Agreements") with privately-held
limited liability companies to acquire working interests in the Harry O'Neal oil
and gas mineral lease (the "O'Neal OGML"), the related well bore, crude oil
inventory and equipment. Immediately prior to the acquisition, White River
Energy owned an approximately 61% working interest in the O'Neal OGML oil well
and a 100% working interest in any future wells.
The purchase price of these leases were $126, $312 and $312, respectively,
totaling $750. The consideration paid to the Sellers was in the form of 341
shares of common stock. The Company accounted for this acquisition as an asset
acquisition under ASC 805 and that the Company has early adopted the amendments
of Regulation S-X dated May 21, 2020 and has concluded that this acquisition was
not significant. Accordingly, as a result of the amendment, the presentation of
the historical financial statements under Rule 3-05 and related pro forma
information under Article 11 of Regulation S-X, respectively, were not required
to be presented.
Our principal executive offices are located at 303 Pearl Parkway, Suite 200, San
Antonio, TX 78215, and our telephone number is (800) 762-7293. Our website
address is http://ecoarkusa.com/. Our website and the information contained on,
or that can be accessed through, our website will not be deemed to be
incorporated by reference in and are not considered part of this report.
Impact of COVID-19
The recent outbreak of COVID-19, which has been declared by the World Health
Organization to be a pandemic, has spread across the globe and is impacting
worldwide economic activity. The COVID-19 public health epidemic prevented the
Company from conducting business activities at full capacity for an indefinite
period of time, including due to risk of spread of the disease within these
groups or due to shutdowns requested or mandated by governmental authorities.
COVID-19 did not have a material effect on the Condensed Consolidated Statements
of Operations or the Condensed Consolidated Balance Sheets included in this Form
10-Q. However, it did have a material impact on our management's ability to
operate effectively and meet some of our filing deadlines. The impact included
the difficulties of working remotely from home including slow Internet
connection, the inability of our accounting and financial officers to
collaborate as effectively as they would otherwise have in an office environment
and issues arising from mandatory state quarantines.
While it is not possible at this time to estimate with sufficient certainty the
impact that COVID-19 could have on the Company's business, the continued spread
of COVID-19 and the measures taken by federal, state, local and foreign
governments could disrupt the operation of the Company's business. The COVID-19
outbreak and mitigation measures have also had and may continue to have an
adverse impact on global and domestic economic conditions, which could have an
adverse effect on the Company's business and financial condition, including on
its potential to conduct financings on terms acceptable to the Company, if at
all. In addition, the Company has taken temporary precautionary measures
intended to help minimize the risk of the virus to its employees, including
temporarily requiring employees to work remotely, and discouraging employee
attendance at in-person work-related meetings, which could negatively affect the
Company's business. These measures are continuing. The extent to which the
COVID-19 outbreak impacts the Company's results will depend on future
developments that are highly uncertain and cannot be predicted, including new
information that may emerge concerning the severity of the virus and the actions
to contain its impact.
The CARES Act includes, among other things, provisions relating to payroll tax
credits and deferrals, net operating loss carryback periods, alternative minimum
tax credits and technical corrections to tax depreciation methods for qualified
improvement property. The CARES Act also established a Paycheck Protection
Program ("PPP"), whereby certain small business are eligible for a loan to fund
payroll expenses, rent and related costs.
Critical Accounting Policies, Estimates and Assumptions
In reading and understanding the Company's discussion of results of operations,
liquidity and capital resources, one should be aware of key policies, judgments
and assumptions that are important to the portrayal of financial conditions and
results. The Company has recently entered into the commodity business through
its acquisition of Banner Midstream. The Company has included several new
accounting policies related to this segment of this business.
Our revenues from periods prior to fiscal 2020 were generated principally from
the sale of hardware. In the six months ended September 30, 2020, revenues were
principally from professional services from our financing segment as well as oil
and gas services related to our production, transportation and logistics service
business contained in Banner Midstream.
A significant percentage of our operating expenses results from non-cash
share-based compensation, which is typical of technology companies as well as
costs related to our exploration and driver costs.
For the share-based compensation, we have granted shares, options and warrants
to employees, consultants and investors as incentives to generate success for
the Company instead of making cash payments. The accounting calculations for
this type of compensation can be complex and are derived from models like the
Black-Scholes option pricing model that requires judgment in making assumptions
and developing estimates.
We have also invested heavily in research and development expenses. Those
investments have required cash payments principally for the development of our
software solutions and the testing of those solutions in our labs and on some
customer projects. We have not capitalized any of that development effort, so
there are no research and development costs to amortize in the future.
We have been conservative in our treatment of income taxes. Our historical
losses have resulted in net operating losses for tax purposes. Applying
accounting policies, we have recorded a "valuation allowance" against both
current and future tax benefits of the losses. We will not recognize any
benefits until such time as we are assured that we will generate taxable income.
43
RESULTS OF OPERATIONS
Overview
The discussion below addresses the Company's operations and liquidity which were
impacted by the acquisition of Trend Holdings in May 2019 and Banner Midstream
in March 2020 as described above.
Results of Operations for the Three Months Ended September 30, 2020 and 2019
Revenues
Revenues for the three months ended September 30, 2020 were $3,278 as compared
to $44 for the three months ended September 30, 2019, an increase of $3,234. The
increase was primarily due to the addition of the oil and gas operations as the
result of the Banner Midstream acquisition on March 27, 2020. Revenues were
comprised of $104 and $28 in the financing segment; $0 and $16 in the technology
segment; and $3,174 and $0 in the commodity segment for the three months ended
September 30, 2020 and 2019, respectively.
Cost of Revenues and Gross Profit
Cost of revenues for the three months ended September 30, 2020 was $2,333 as
compared to $16 for the three months ended September 30, 2019, an increase of
$2,317. The increase was primarily due to the addition of the oil and gas
operations as the result of the Banner Midstream acquisition on March 27, 2020.
Cost of Revenues were comprised of $0 and $0 in the financing segment; $0 and
$16 in the technology segment; and $2,333 and $0 in the commodity segment for
the three months ended September 30, 2020 and 2019, respectively. Gross margins
decreased from 63% for the three months ended September 30, 2019 to 28% for the
three months September 30, 2020 due to changes in inventory of crude oil.
Operating Expenses
Operating expenses for the three months ended September 30, 2020 were $4,834 as
compared to $2,542 for the three months ended September 30, 2019, an increase of
$2,292. Operating expenses were comprised of $65 and $61 in the financing
segment; $625 and $2,481 in the technology segment; and $4,144 and $0 in the
commodity segment for the three months ended September 30, 2020 and 2019,
respectively. The $2,292 increase was due principally to the expenses, including
wages and consulting fees, related to the addition of the oil and gas operations
as the result of the Banner Midstream acquisition on March 27, 2020 and the
depreciation, depletion, amortization and accretion for Banner Midstream in
2020, partially offset by the reduction in the Zest Labs selling expenses.
44
Selling, General and Administrative
Selling, general and administrative expenses for the three months ended
September 30, 2020 were $4,375 compared with $1,683 for the three months ended
September 30, 2019. Cost reduction initiatives were focused on salary related
and professional fees for the technology segment offset by the costs incurred
for Banner Midstream as this was acquired in March 2020. These were offset by
changes in share-based compensation which for the three month period ended
September 30, 2020 were not comparable to 2019.
Depreciation, Amortization, Depletion and Accretion
Depreciation, amortization, depletion and accretion expenses for the three
months ended September 30, 2020 were $323 compared to $71 for the three months
ended September 30, 2019. Depreciation, amortization, depletion and accretion
expenses were comprised of $0 and $0 in the financing segment; $63 and $71 in
the technology segment; and $260 and $0 in the commodity segment for the three
months ended September 30, 2020 and 2019, respectively. The $252 increase
resulted primarily from the acquisition of Banner Midstream and the depletion
and accretion is the result of the oil and gas properties maintained by Banner
Midstream. The technology and financing segment do not have depletion or
accretion.
Research and Development
Research and development expense decreased 82% to $136 in the three months ended
September 30, 2020 compared with $788 in the three months ended September 30,
2019. The $652 reduction in costs related primarily to the maturing of
development of the Zest Labs freshness solutions.
Other Income (Expense)
Change in fair value of derivative liabilities for the three months ended
September 30, 2020 was a non-cash gain of $1,011 as compared to a non-cash loss
of ($960) for the three months ended September 30, 2019. The $1,971 increase was
a result of the reduction in the stock price in the three months ended September
30, 2020 compared to the three months ended September 30, 2019. In addition,
there was a non-cash gain in the three months ended September 30, 2020 from the
extinguishment of the derivative liabilities that when converted to shares of
common stock of $14,952 compared to ($839) in the three months ended September
30, 2019. In the period ended September 30, 2020, there was a non-cash loss on
the conversion of debt and other liabilities to shares of common stock of
$1,775.
Interest expense, net of interest income, for the three months ended September
30, 2020 was $1,314 as compared to $76 for the three months ended September 30,
2019. The increase was the result of the interest incurred on the debt assumed
in the Banner Midstream acquisition as well as the value related to the granting
of warrants for interest of $1,265.
Net Income (Loss)
Net income from continuing operations for the three months ended September 30,
2020 was $8,985 as compared to a net loss of ($4,389) for the three months ended
September 30, 2019. The $13,374 increase in net income was primarily due to the
non-cash changes in the fair value of the derivative liability and the non-cash
losses incurred on the conversion of debt to equity, offset by the non-cash gain
on the exchange of warrants for common stock described herein. The net income
(loss) was comprised of $774 and ($32) in the financing segment; $3,047 and
($4,357) in the technology segment; and net income of $5,164 and $0 in the
commodity segment for the three months ended September 30, 2020 and 2019,
respectively.
45
Results of Operations for the Six Months Ended September 30, 2020 and 2019
Revenues
Revenues for the six months ended September 30, 2020 were $5,591 as compared to
$79 for the six months ended September 30, 2019, an increase of $5,512. The
increase was primarily due to the addition of the oil and gas operations as the
result of the Banner Midstream acquisition on March 27, 2020. Revenues were
comprised of $194 and $52 in the financing segment; $0 and $27 in the technology
segment; and $5,397 and $0 in the commodity segment for the six months ended
September 30, 2020 and 2019, respectively.
Cost of Revenues and Gross Profit
Cost of revenues for the six months ended September 30, 2020 was $3,426 as
compared to $61 for the six months ended September 30, 2019, an increase of
$3,365. The increase was primarily due to the addition of the oil and gas
operations as the result of the Banner Midstream acquisition on March 27, 2020.
Cost of Revenues were comprised of $0 and $0 in the financing segment; $0 and
$61 in the technology segment; and $3,426 and $0 in the commodity segment for
the six months ended September 30, 2020 and 2019, respectively. Gross margins
increased from 22% for the six months ended September 30, 2019 to 38% for the
six months ended September 30, 2020 due to lower costs involved with executing
the projects and changes in inventory of crude oil.
Operating Expenses
Operating expenses for the six months ended September 30, 2020 were $8,250 as
compared to $5,065 for the six months ended September 30, 2019, an increase of
$3,185. Operating expenses were comprised of $194 and $200 in the financing
segment; $1,607 and $4,865 in the technology segment; and $6,449 and $0 in the
commodity segment for the six months ended September 30, 2020 and 2019,
respectively. The $3,185 increase was due principally to the expenses, including
wages and consulting fees, related to the addition of the oil and gas operations
as the result of the Banner Midstream acquisition on March 27, 2020 and the
depreciation, depletion, amortization and accretion for Banner Midstream in
2020, partially offset by the reduction in the Zest Labs selling expenses.
Selling, General and Administrative
Selling, general and administrative expenses for the six months ended September
30, 2020 were $7,260 compared with $3,232 for the six months ended September 30,
2019. Cost reduction initiatives were focused on salary related and professional
fees for the technology segment offset by the costs incurred for Banner
Midstream as this was acquired in March 2020.
Depreciation, Amortization, Depletion and Accretion
Depreciation, amortization, depletion and accretion expenses for the six months
ended September 30, 2020 were $624 compared to $148 for the six months ended
September 30, 2019. Depreciation, amortization, depletion and accretion expenses
were comprised of $0 and $0 in the financing segment; $126 and $148 in the
technology segment; and $498 and $0 in the commodity segment for the six months
ended September 30, 2020 and 2019, respectively. The $476 increase resulted
primarily from the acquisition of Banner Midstream and the depletion and
accretion is the result of the oil and gas properties maintained by Banner
Midstream. The technology and financing segment do not have depletion or
accretion.
46
Research and Development
Research and development expense decreased 78% to $366 in the six months ended
September 30, 2020 compared with $1,685 in the six months ended September 30,
2019. The $1,319 reduction in costs related primarily to the maturing of
development of the Zest Labs freshness solutions.
Other Income (Expense)
Change in fair value of derivative liabilities for the six months ended
September 30, 2020 was a non-cash loss of ($16,382) as compared to a non-cash
loss of ($16) for the six months ended September 30, 2019. The $16,366 decrease
was a result of the reduction in the stock price in the six months ended
September 30, 2020 compared to the six months ended September 30, 2019. In
addition, there was a non-cash gain in the six months ended September 30, 2020
from the extinguishment of the derivative liabilities that when converted to
shares of common stock of $16,583 compared to ($839) in the prior year period.
In the period ended September 30, 2020, there was a non-cash loss on the
conversion of debt and other liabilities to shares of common stock of $3,969 and
a loss on the sale of fixed assets and abandonment of oil and gas properties of
$105 and $83, respectively.
Interest expense, net of interest income, for the six months ended September 30,
2020 was $2,155 as compared to $135 for the six months ended September 30, 2019.
The increase was the result of the interest incurred on the debt assumed in the
Banner Midstream acquisition as well as the value related to the granting of
warrants for interest of $1,790 and the amortization of debt discount of $149.
Net Loss
Net loss from continuing operations for the six months ended September 30, 2020
was $12,196 as compared to $6,035 for the six months ended September 30, 2019.
The $6,161 decrease in net loss was primarily due to the non-cash changes in the
fair value of the derivative liability and the non-cash losses incurred on the
conversion of debt to equity, offset by the non-cash gain on the exchange of
warrants for common stock described herein. The net income (loss) was comprised
of ($140) and ($148) in the financing segment; ($2,308) and ($5,887) in the
technology segment; and net loss of ($9,748) and $0 in the commodity segment for
the six months ended September 30, 2020 and 2019, respectively.
47
Liquidity and Capital Resources
Liquidity is the ability of a company to generate funds to support its current
and future operations, satisfy its obligations, and otherwise operate on an
ongoing basis. Significant factors in the management of liquidity are funds
generated by operations, levels of accounts receivable and accounts payable and
capital expenditures.
Net cash used in operating activities was ($5,171) for the six months ended
September 30, 2020, as compared to net cash used in operating activities of
($3,137) for the six months ended September 30, 2019. Cash used in operating
activities is related to the Company's net loss partially offset by non-cash
expenses, including share-based compensation and the change in the fair value of
the derivative liability and net losses incurred in the conversion of debt and
liabilities to shares of common stock as well as losses on the sale of fixed
assets and abandonment of oil and gas properties.
Net cash used in investing activities was $3,171 for the six months ended
September 30, 2020, as compared to $8 net cash provided for the six months ended
September 30, 2019. Net cash used in investing activities in 2020 related to the
advancement of a note receivable of $275, and the net purchases of fixed assets
and oil and gas properties.
Net cash provided by financing activities for the six months ended September 30,
2020 was $9,600 that included $12,602 (net of fees) raised via issuance of stock
for the exercise of warrants and stock options, offset by proceeds and
repayments of long-term debt and notes payable including related parties of
$3,002. This compared with the six months ended September 30, 2019 amounts of
$3,334 provided by financing that included $951 provided through the credit
facility, $1,980 from proceeds received from the sale of preferred stock and
$403 from proceeds from advances from related parties.
To date we have financed our operations through sales of common stock and the
issuance of debt.
In addition to these transactions, the Company in the period April 1, 2020
through September 30, 2020, entered into the following transactions:
(a) On April 16, 2020, the Company received $386 in Payroll Protection Program
funding related to Ecoark Holdings, and the Company also received on April
13, 2020, $1,482 in Payroll Protection Program funds for Pinnacle Frac LLC,
a subsidiary of Banner Midstream.
(b) On May 1, 2020, an institutional investor elected to convert its remaining
shares of Series B Preferred shares into 161 common shares.
(c) On April 1 and May 5, 2020, two institutional investors elected to convert
their 1 Series C Preferred share into 1,379 common shares.
(d) On May 10, 2020, the Company received approximately $6,294 from accredited
institutional investors holding 1,379 warrants issued on November 13, 2019
with an exercise price of $0.73 and holding 5,882 warrants with an exercise
price of $0.90. The Company agreed to issue to these investors an additional
number of warrants as a condition of their agreement to exercise the
November 2019 warrants.
At September 30, 2020 we had cash (including restricted cash) of $1,664, and a
working capital deficit of $6,731 and $16,689 as of September 30, 2020 and March
31, 2020, respectively. The decrease in the working capital deficit is the
result of the change in the fair value of the derivative liabilities offset by
the repayment and conversion of debt and liabilities to shares of common stock.
These liabilities were assumed in the Banner Midstream in March 2020. The
Company is dependent upon raising additional capital from future financing
transactions to meet its needs for cash during the next 12 months. The Company
raised approximately $12,253 in warrant exercises in the six months ended
September 30, 2020, and can raise an additional $1,624 from the exercise of
warrants that remain outstanding. We expect that the revenue generating
operations of Banner Midstream will continue to improve the liquidity of the
Company moving forward. However, going forward, the effect of the pandemic on
the capital markets may limit our ability to raise additional capital on the
terms acceptable to us at the time we need it, if at all. As disclosed in Note
1, COVID-19 has had an impact on our management's ability to operate
effectively. The challenges related to remote work and travel restrictions that
we as a smaller company have faced in striving to meet our disclosure
obligations in a timely manner while taking the steps to protect the health and
safety of our employees have impacted, and may continue to further impact, our
ability to raise additional capital.
The Company has agreed to fund 100% of the cost, estimated to be approximately
$4,700, associated with the drilling and completion of an initial deep
horizontal well in the Austin Chalk formation as part of their Participation
Agreement with Blackbrush Oil & Gas, L.P. The Company has agreed to pay the
amount of the drilling costs into a designated escrow account by the
commencement of the drilling, which is expected in January 2021.
48
Contractual Obligations
Our contractual obligations are included in our Notes to the Unaudited Condensed
Consolidated Financial Statements. To the extent that funds generated from our
operations, together with our existing capital resources, are insufficient to
meet future requirements, we will be required to obtain additional funds through
equity or debt financings. No assurance can be given that any additional
financing will be made available to us or will be available on acceptable terms
should such a need arise.
Off-Balance Sheet Arrangements
As September 30, 2020 and March 31, 2020, we had no off-balance sheet
arrangements.
Cautionary Note Regarding Forward Looking Statements
This report contains "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995, including expected increase in
revenues from oil and gas operations, the funding of the initial well drilling
in the Austin Chalk formation and future liquidity. All statements other than
statements of historical fact are "forward-looking statements" for purposes of
federal and state securities laws, including: any projections of earnings,
revenues or other financial items; any statements of the plans, strategies and
objectives of management for future operations; any statements concerning
proposed new products, services or developments; any statements regarding future
economic conditions or performance; any statements of belief; and any statements
of assumptions underlying any of the foregoing. The words "believe," "may,"
"estimate," "continue," "anticipate," "intend," "should," "plan," "could,"
"target," "potential," "is likely," "will," "expect" and similar expressions, as
they relate to us, are intended to identify forward-looking statements. We have
based these forward-looking statements largely on our current expectations and
projections about future events and financial trends that we believe may affect
our financial condition, results of operations, business strategy and financial
needs.
The results anticipated by any or all of these forward-looking statements might
not occur. Important factors that could cause actual results to differ from
those in the forward-looking statements include, among other things, volatility
of oil prices, the risks arising from the impact of the COVID-19 pandemic,
including its future effect on the U.S. and global economies and on our Company,
competition, government regulation or action, the costs and results of drilling
activities, risks inherent in drilling operations, availability of equipment,
services, resources and personnel required to conduct operating activities,
ability to replace reserves and uncertainties related to reserve estimates, the
Company's ability to raise additional capital on acceptable terms when needed,
uncertainties related to ongoing litigation, risks related to potential impact
of natural disasters, and cybersecurity risks. Further information on our risk
factors is contained in our filings with the SEC, including our Annual Report on
Form 10-K for the year ended March 31, 2020 and registration statement on Form
S-3 filed on October 16, 2020. We undertake no obligation to publicly update or
revise any forward-looking statements, whether as the result of new information,
future events or otherwise.
© Edgar Online, source Glimpses
RISKON INTERNATIONAL, INC. 
