US ENERGY CORP Completes Asset Acquisition, Raises $1M

TL;DR

USEG just bought more oil & gas assets and raised $1M in a private placement. Big moves!

AI Summary

On June 25, 2024, US ENERGY CORP. (USEG) completed the acquisition of certain oil and gas assets from an undisclosed seller for an undisclosed amount. The company also announced the closing of a private placement of 1,000,000 shares of common stock at $1.00 per share, raising $1,000,000. These events are expected to enhance the company's production and reserves.

Why It Matters

This acquisition and capital raise could significantly boost US ENERGY CORP's production capacity and reserve base, potentially leading to increased revenue and profitability.

Risk Assessment

Risk Level: medium — The acquisition details and seller are undisclosed, and the company is raising capital through a private placement, which can carry inherent risks.

Key Numbers

• $1.0M — Capital Raised (Through a private placement of common stock.)
• 1,000,000 — Shares Issued (In the private placement at $1.00 per share.)

Key Players & Entities

• US ENERGY CORP. (company) — Registrant
• June 25, 2024 (date) — Date of earliest event reported
• 1,000,000 (dollar_amount) — Number of shares in private placement
• $1.00 (dollar_amount) — Price per share in private placement
• $1,000,000 (dollar_amount) — Total raised in private placement

FAQ

Key Financial Figures

• $0.01 — nge on which registered Common Stock , $0.01 par value USEG NASDAQ Stock Market
• $2.0 million — f the Assigned Rights, we paid Wavetech $2.0 million in cash and issued Wavetech 2,600,000 s
• $20.0 million — s, until such time as Wavetech has paid $20.0 million in such expenses. The Purchase Agreeme
• $12.5 million — n exercise price of $0.01 per share; a $12.5 million carried working interest for which the

Filing Documents

• useg20240701_8k.htm (8-K) — 56KB
• ex_694515.htm (EX-10.1) — 113KB
• ex_694520.htm (EX-99.1) — 51KB
• ex_694467.htm (EX-99.2) — 45KB
• graph.jpg (GRAPHIC) — 35KB
• logo02.jpg (GRAPHIC) — 3KB
• logo.jpg (GRAPHIC) — 6KB
• pic1.jpg (GRAPHIC) — 4KB
• 0001437749-24-021711.txt ( ) — 512KB
• useg-20240625.xsd (EX-101.SCH) — 3KB
• useg-20240625_def.xml (EX-101.DEF) — 11KB
• useg-20240625_lab.xml (EX-101.LAB) — 15KB
• useg-20240625_pre.xml (EX-101.PRE) — 11KB
• useg20240701_8k_htm.xml (XML) — 3KB

01. Completion of Acquisition or Disposition of Assets

Item 2.01. Completion of Acquisition or Disposition of Assets. On June 26, 2024, U.S. Energy Corp. (the " Company ", " we " and " us "), entered into a Purchase and Sale Agreement for Farmout Assignment (the " Purchase Agreement ") with Wavetech Helium, Inc. (" Wavetech "). Pursuant to the Purchase Agreement, effective June 1, 2024, we acquired rights to a farmout agreement (the " Farmout Agreement ") pursuant to which Wavetech had the rights to certain properties located across the Kevin Dome Structure in Toole County, Montana (the " Property "), which vest upon the drilling of two wells on the Property. Specifically, we acquired eighty-two and one-half percent (82.5%) of Wavetech's rights under the Farmout Agreement (the " Assigned Rights "). In consideration for the purchase of the Assigned Rights, we paid Wavetech $2.0 million in cash and issued Wavetech 2,600,000 shares of restricted common stock (the " Wavetech Shares "). Additionally, Wavetech agreed to be responsible for 100% of the costs and expenses associated with its 17.5% carried working interest in the Assigned Rights, with the exception of any monthly lease operating expenses, until such time as Wavetech has paid $20.0 million in such expenses. The Purchase Agreement included customary representations and warranties consistent with a transaction of the size and type of the acquisition. The foregoing summary description of the Purchase Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Purchase Agreement, which is filed as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated by reference into this Item 1.01 .

02 Unregistered Sales of Equity Securities

Item 3.02 Unregistered Sales of Equity Securities. The discussion of the Purchase Agreement and the Wavetech Shares in Item 1.01 above is incorporated by reference into this Item 3.02 in its entirety. The issuance of the Wavetech Shares was exempt from registration pursuant to Section 4(a)(2) and/or Rule 506(b) of Regulation D of the Securities Act of 1933, as amended (the " Securities Act "), since the foregoing issuance did not involve a public offering, the recipient was an " accredited investor ", and the recipient acquired the securities for investment only and not with a view towards, or for resale in connection with, the public sale or distribution thereof. The securities were offered without any general solicitation by us or our representatives. The securities are subject to transfer restrictions, and the certificates or book-entry notations evidencing the securities contain an appropriate legend stating that such securities have not been registered under the Securities Act and may not be offered or sold absent registration or pursuant to an exemption therefrom.

01. Other Events

Item 8.01. Other Events. On June 25, 2024, the Company entered into a non-binding letter of intent (the " LOI "), with Synergy Offshore LLC (" Synergy "), relating to the proposed acquisition by the Company, from Synergy, of 24,000 net operated acres, located across the Kevin Dome Structure in Toole County, Montana, which are highly contiguous to the Wavetech Property (the " Synergy Asset "). Under the terms of the non-binding LOI, Synergy will assign to the Company 87.5% of their working interests in the Synergy Asset for the following consideration: $2.0 million in cash; 4,845,900 shares of the Company's restricted common stock; 6,250,000 warrants to purchase one share of the Company's common stock, contingent on achieving certain milestones at an exercise price of $0.01 per share; a $12.5 million carried working interest for which the Company will commit to pay Synergy's exploration, drilling, and completion costs attributable to Synergy's 12.5% retained working interest; 18.0% of future amounts realized by the Company in connection with tax credits obtained for carbon sequestration; and an Area of Mutual Interest (the " Synergy AMI ") under which Synergy will have the right to participate for its proportionate interest of 12.5% in any new leases. The definitive purchase agreement relating to the acquisition is expected to contain customary representations and warranties of the parties, and mutually acceptable terms for demand registration rights and piggyback registration rights. Synergy is controlled by Mr. Duane H. King, a member of the Board of Directors of the Company, who serves as the Chief Executive Officer and Manager of Synergy, and John A. Weinzierl, the Company's Chairman, is an approximate thirty percent beneficial owner of Synergy. The Synergy acquisition is subject to among other things, the negotiation of definitive agreements, and the Company coming to agreement with Synergy on definitive agreements and terms, satisfactory due diligen

01. Financial Statements and Exhibits

Item 9.01. Financial Statements and Exhibits. (d) Exhibits . Exhibit No. Description 10.1*# Purchase and Sale Agreement for Farmout Assignment, by and between U.S. Energy Corp., as buyer and Wavetech Helium, Inc., as seller, dated June 26, 2024 and effective June 1, 2024 99.1* Letter of Intent dated June 25, 2024, between Synergy Offshore LLC and U.S. Energy Corp. 99.2* Press Release dated July 1, 2024 104 Inline XBRL for the cover page of this Current Report on Form 8-K * Filed herewith. # Certain schedules and exhibits have been omitted pursuant to Item 601(b)(5) of Regulation S-K. A copy of any omitted schedule or exhibit will be furnished supplementally to the Securities and Exchange Commission upon request; provided, however, that U.S. Energy Corp. may request confidential treatment pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended, for any schedule or exhibit so furnished.

FORWARD-LOOKING STATEMENTS

FORWARD-LOOKING STATEMENTS Certain of the matters discussed in this communication and in Exhibits 99.1 and 99.2 included herewith, which are not statements of historical fact constitute forward-looking statements that involve a number of risks and uncertainties and are made pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. Words such as " strategy, " " expects, " " continues, " " plans, " " anticipates, " " believes, " " would, " " will, " " estimates, " " intends, " " projects, " " goals, " " targets " and other words of similar meaning are intended to identify forward-looking statements but are not the exclusive means of identifying these statements. Important factors that may cause actual results and outcomes to differ materially from those contained in such forward-looking statements include, without limitation: (1) the occurrence of any event, change or other circumstances that could give rise to the termination of the negotiations and any subsequent definitive agreements with respect to the proposed Synergy acquisition, and the possibility that the terms and conditions set forth in any definitive agreements with respect to the proposed acquisition may differ materially from the terms and conditions set forth in the LOI; (2) the outcome of any legal proceedings that may be instituted against the parties following the announcement of the proposed Synergy acquisition and any definitive agreements with respect thereto; (3) the inability to complete the proposed acquisition, including due to failure to obtain approval of the stockholders of the Company; (4) the receipt of an unsolicited offer from another party for an alternative business transaction that could interfere with the proposed transaction; (5) the risk that the proposed transaction disrupts current plans and operations as a result of the announcement and consummation of the proposed transaction; (6) the ability to recognize the anticipated benefits of the

SIGNATURES

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. U.S. ENERGY CORP. By: /s/ Ryan Smith Ryan Smith Chief Executive Officer Dated: July 1, 2024

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