Royale Energy Reports New Material Agreement & Financial Obligation

TL;DR

**Royale Energy just inked a major deal and took on new debt, details TBD.**

AI Summary

Royale Energy, Inc. filed an 8-K on February 15, 2024, reporting two significant events that occurred on February 9, 2024. The company entered into a material definitive agreement and created a direct financial obligation or an obligation under an off-balance sheet arrangement. The filing, under SEC file number 000-55912, indicates significant corporate actions without providing specific financial details or counterparty names in the provided text.

Why It Matters

The entry into a material definitive agreement and the creation of a new financial obligation signal significant changes to Royale Energy's operational or financial structure, potentially impacting its future performance and risk profile.

Risk Assessment

Risk Level: medium — The filing indicates significant corporate actions (material agreement, financial obligation) whose specific terms and impact are unknown, introducing uncertainty.

Key Players & Entities

• Royale Energy, Inc. (company) — Registrant
• February 9, 2024 (date) — Date of earliest event reported
• February 15, 2024 (date) — Date of filing
• 000-55912 (other) — SEC File Number

FAQ

Key Financial Figures

• $1,400,000 — ny in the aggregate principal amount of $1,400,000 (the " Initial Loan "), and the Additio
• $3,000,000 — uding the Initial Loan, will not exceed $3,000,000 in aggregate principal amount. In conne
• $100,000 — e to the Company in amounts of at least $100,000 for each Additional Loan, which Additio

Filing Documents

• royaleinc20240215_8k.htm (8-K) — 34KB
• ex_627210.htm (EX-10.1) — 74KB
• ex_627211.htm (EX-10.2) — 202KB
• 0001185185-24-000170.txt ( ) — 510KB
• royl-20240209.xsd (EX-101.SCH) — 3KB
• royl-20240209_def.xml (EX-101.DEF) — 10KB
• royl-20240209_lab.xml (EX-101.LAB) — 20KB
• royl-20240209_pre.xml (EX-101.PRE) — 11KB
• royaleinc20240215_8k_htm.xml (XML) — 3KB

01 Entry into a Material Definitive Agreement

Item 1.01 Entry into a Material Definitive Agreement. On February 9, 2024 (the " Closing Date "), Royale Energy, Inc., a Delaware corporation (the " Company "), entered into a Secured Term Loan Note (the " Note ") with Walou Investments, LP, a Texas limited partnership (the " Initial Lender "), and any additional lender making additional loans from time to time in accordance with the provisions of the Note (an " Additional Lender " and, together with the Initial Lender, the " Lenders "), and the Initial Lender in its capacity as the administrative agent for the Lenders (" Agent "). Pursuant to the Note, the Initial Lender agreed to make an initial loan to the Company in the aggregate principal amount of $1,400,000 (the " Initial Loan "), and the Additional Lenders may make one or more additional loans (the " Additional Loans " and, together with the Initial Loan, the " Term Loans ") which, when taken together with all other loans previously made by Lenders under the Note, including the Initial Loan, will not exceed $3,000,000 in aggregate principal amount. In connection with entering into the Note, Royale Energy Funds, Inc., a California corporation and a wholly-owned subsidiary of the Company (" Mortgagor "), entered into a Deed of Trust, Mortgage, Security Agreement, Fixture Filing, Financing Statement and Assignment of Production dated February 15, 2024 with the trustee named therein and the Agent (as amended, restated, supplemented or otherwise modified from time to time, the " Deed of Trust "), which covers certain assets owned by Mortgagor located in Ector County, Texas (the " Mortgaged Property ") as security for the Note. The Initial Lender is under the direct and indirect control of Johnny Jordan, the Company's Chief Executive Officer and a member of the Company's Board of Directors. In addition, Mr. Jordan is the beneficial owner of 14.8% of the Company's issued and outstanding common stock. Accordingly, the Company's entry into the Note and Mortgagor's

01. Financial Statements and Exhibits

Item 9.01. Financial Statements and Exhibits. (d) Exhibits. The following exhibits are included with this Current Report on Form 8-K: Exhibit No. Description Exhibit 10.1 Secured Term Loan Note dated as of February 9, 2024 among Royal Energy, Inc., as borrower, Walou Investments, LP, as administrative agent for the lenders, Walou Investments, LP, as lender. Exhibit 10.2 Deed of Trust, Mortgage, Security Agreement, Fixture Filing, Financing Statement and Assignment of Production dated as of February 15, 2024, executed by Royal Energy Funds, Inc., as mortgagor, to Johnny Jordan, as Trustee, for the benefit of Agent, as mortgagee. Exhibit 104 Cover Page Interactive Data File (embedded within the Inline XBRL document) SIGNATURE 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. Date: February 15, 2024 ROYALE ENERGY, INC. By: /s/ Johnny Jordan Johnny Jordan Chief Executive Officer