Fortem Resources Inc.

On October 6, 2021 Fortem filed a voluntary Chapter 11 bankruptcy petition in the US Bankruptcy Court for the District of Nevada and says it will keep operating as a debtor-in-possession. A plan of reorganization is being negotiated but not yet filed or signed, and a debtor-in-possession loan of undetermined size is expected to be sought. Creditor collection actions are automatically stayed. OTC Pink halted trading on October 7, 2021, and the filing says the stock remains suspended pending a review of continued listing on the NEX Exchange in Canada. This follows the cease trade order and the repeated Utah payment deferrals, though the filing itself does not state the cause. The filing is signed by Marc A. Bruner as CEO, replacing Michael Caetano, and the address has moved to Vancouver. What happens to existing shares is not yet determined.

bankruptcy or receivership

On May 22, 2020 Fortem signed further amendments to the Utah purchase agreements (Black Dragon/WEM Dragon, fifth amendment; Rolling Rock/Rockies Standard Oil, sixth amendment). The remaining US$3.8M (Moenkopi) and US$5.3M (Mancos) are still payable only out of 12.5% of financing proceeds, and the payment, drilling, bond-replacement and Wellington Flats workover deadlines (plus a US$300,000 workover payment on Mancos) move from May 2020 to August 1, 2020. The attached press release says the Alberta Securities Commission cease trade order, in place almost a year, has still not been revoked, that work on the audit of the year ended February 29, 2020 has started, and lists inability to raise funds to close the purchases as a risk. This continues the pattern of repeated deadline extensions with no payments reported.

material agreement

On September 19, 2019 Fortem signed a non-binding term sheet to farm out part of its Mancos interest in Grand County, Utah (held via Rolling Rock) to an unnamed arm's-length party. The party would commit up to US$15M in up to ten tranches to re-enter wells, starting with three wells, in exchange for a 100% operating interest in those wells. Fortem would get 20% of income after payout, rising to 25% after a 2.0x return. This depends on a definitive agreement not yet signed, and the press release cites the cease trade order issued against the company as a risk. It is a possible route to funding Utah work, but nothing is committed yet.

material agreement

On July 11, 2019 Fortem said its financial statements from the May 2017 quarter through the November 2018 quarter, including the audited years to Feb 28, 2018, should no longer be relied on. It had wrongly reported that Colony Energy, Black Dragon, Rolling Rock and City of Gold were not 'variable interest entities', and some shares issued for fees and property purchases were valued at the private placement price rather than market value. Corrected 10-Q and 10-K filings are expected by August 9, 2019. The 10-K for the year to Feb 28, 2019 was late; the Alberta Securities Commission granted a management cease trade order on July 4, 2019 restricting trading by the CEO and CFO until it is filed. This is the larger follow-through on the 2018 non-reliance and open amended-10-Q thread, and corrected figures are still not shown.

financial restatement

Fortem disclosed a US$220,000 one-year investor relations deal with Oilprice.com (signed April 18, 2019; US$55,000 due by June 14, then US$15,000 a month), subject to TSX Venture Exchange approval. Oilprice published a promotional article on May 20 before approval; Fortem says it learned of it May 24 and retracted it, and says no funds have been advanced. It also says the Paradox Public Relations agreement (March 2019) was terminated. The Alberta heavy oil purchase closing was extended again, to on or before June 15, 2019, for a CDN$100,000 payment credited to the price. This is the third closing date for that deal (Nov 15, 2018, Mar 15, 2019), and it has still not closed.

material agreement

On May 16, 2019 Fortem signed further amendments to its two Utah purchase agreements. The remaining US$3.8M (Moenkopi, Black Dragon/WEM) and US$5.3M (Mancos, Rolling Rock/RSOC) are now payable only from financings, at 12.5% of each financing's proceeds (down from 25% under the earlier amendments), with final payment dates pushed to May 1, 2020. Drilling deadlines move to May 1, 2020 (Moenkopi) and May 31, 2020 (Mancos), and Fortem must re-enter and work over the Wellington Flats Well by May 1, 2020. Rolling Rock's interest to be acquired rises from 50% to 75%, the US$300,000 workover payment is due by May 1, 2020, bond replacement is due by July 1, 2019, and Fortem will issue 300,000 shares each to WEM and RSOC, with Fortem guaranteeing both subsidiaries' obligations. Subject to TSX Venture Exchange approval, it also plans to issue 600,000 shares to two accredited investors (purpose not stated). This continues the Utah payment-extension thread; it delays cash payments but adds shares.

material agreement

On December 17, 2018 Fortem and the seller agreed to extend closing of the September 2018 Alberta heavy oil lease purchase from November 15, 2018 to on or before March 15, 2019. The filing does not give a reason or say whether any extra deposit was paid. The deal has not yet closed.

material agreement

On September 26, 2018 Fortem agreed to buy a 100% working interest in three heavy oil leases covering 20,719 hectares (51,200 acres) in north central Alberta from a major Canadian oil and gas company for $3,000,000 plus GST. $200,000 was paid as a deposit and closing is set for November 15, 2018, extendable 60 days for a further $100,000 deposit. Drilling is hoped for in Q1 2019 after regulatory and First Nations consultation, which is a prerequisite to operations. This is a new Alberta asset alongside the Godin leases.

material agreement

On September 21, 2018 Fortem dismissed its auditor Dale Matheson Carr-Hilton LaBonte and appointed Davidson & Company LLP. The prior auditor's reports for fiscal 2018 and 2017 had a going-concern warning and an adverse opinion on internal controls, citing four material weaknesses, including the misapplied business-combination accounting that led to the 2017 quarterly restatements. The filing says there were no disagreements with the former auditor.

auditor change

On August 16, 2018 the Utah purchase agreements were amended once more (third for Black Dragon, fourth for Rolling Rock), pushing certain payments to October 1, 2019. If the shares are not listed on the TSX Venture Exchange by October 1, 2018, the deadline stays December 31, 2018. Fortem again ratified and guaranteed the obligations. This moves the listing condition from the May 2018 amendment's August 1, 2018 date, which was evidently not met in time.

material agreement

On July 18, 2018 Fortem sold 600,000 shares at US$2.00 for gross proceeds of US$1,200,000 to one non-U.S. investor, in connection with the financing condition required by the TSX Venture Exchange for listing its shares. This is the largest cash raise in the filings so far and moves the listing plan forward, though the filing does not say the listing is approved.

capital raising announcement

On May 28, 2018 Black Dragon (with WEM Dragon) and Rolling Rock (with Rockies Standard Oil) amended their Utah purchase agreements again, pushing certain Moenkopi and Mancos payments to August 1, 2019. However, if Fortem's shares are not listed on the TSX Venture Exchange by August 1, 2018, the deadline stays December 31, 2018. Fortem again ratified and guaranteed both subsidiaries' obligations. This extends the August 2017 deadlines, but only if the listing happens.

material agreement

On January 17, 2018 Fortem determined that its unaudited financial statements for the quarters ended May 31 and August 31, 2017 should no longer be relied on. It had incorrectly accounted for the fair booked value of Colony Energy, Black Dragon, Rolling Rock and City of Gold, the four companies bought in 2017, and expects to file amended quarterly reports. This undermines the earlier reported figures, including the $30.3 million loss for the May quarter; the filing does not give corrected numbers.

financial restatement

On August 24, 2017 Fortem, through Rolling Rock, acquired a 75% interest in Mancos formation leases covering 2,313.09 acres at a Utah state (SITLA) auction, with Rockies Standard Oil holding the other 25%. Black Dragon likewise acquired a 75% interest in Moenkopi leases covering 3,852.41 acres, and Rolling Rock and Rockies Standard Oil acquired a further 5,174 acres in a 50/50 partnership. This expands the Utah acreage beyond the April 2017 deals; the filing does not state the prices paid.

asset acquisition disposition

On August 17, 2017 Fortem's two US subsidiaries amended their April purchase agreements, pushing payments out to December 31, 2018 but raising the cash price. Rolling Rock's rises from US$2.4 million to US$3.6 million, plus a US$300,000 workover payment, and Black Dragon's from US$2.7 million to US$3.9 million. Each also adds 250,000 Fortem shares and US$25,000 every 60 days from September 1, 2017. Payments are tied to 25% of any financing raised, with the first US$1.5 million exempt before a stock exchange listing, and Fortem guaranteed both subsidiaries. This replaces the September 2017 payment dates set in the April deals and increases the total owed, though early payment can cut or waive the extras.

material agreement

On May 17, 2017 Fortem bought City of Gold, LLC from MAB Resources and JM Magna for 30,000,000 shares at a deemed US$2.00 each; 15,000,000 were issued at closing and 15,000,000 are due after City of Gold earns an option. City of Gold holds 2,930,259 Asia Pacific Mining shares and warrants and an option tied to a Myanmar exploration project, which is a mineral project rather than oil and gas. The option can only be earned once an exploration license is issued, subject to a financing condition. The filing says Marc Bruner's entities (Blue Phoenix and MAB Resources) now hold 37,500,000 shares, 32.36% of the company, and it reports a change in control item.

asset acquisition disposition

On April 17, 2017 Fortem bought Rolling Rock Resources, LLC from MAB Resources Holdings and JM Magna Holdings for a US$100,000 non-refundable deposit and 20 million shares (10 million each). Rolling Rock's only asset is a purchase agreement with Rockies Standard Oil Company: US$2.4 million cash (US$2.15 million if paid by September 1, 2017) plus the cost of three horizontal Mancos wells in each of three Federal Units by February 28, 2019, to earn 50% of the leases. This adds another 20 million shares and large cash and drilling commitments, following the Colony and Black Dragon deals.

asset acquisition disposition

On April 12, 2017 Fortem bought Black Dragon, LLC from Blue Phoenix Energy and Pacific Petroleum for a US$100,000 non-refundable deposit and 20 million shares (10 million each). Black Dragon's only asset is a purchase agreement with WEM Dragon, LLC: US$2.7 million cash (US$2.4 million if paid by September 1, 2017) plus the cost of drilling two horizontal Moenkopi wells by February 28, 2019, to earn a 75% interest (80% net revenue interest). The deal can be rescinded if Black Dragon terminates over title defects by April 17, 2017. This is a second acquisition from the same sellers as Colony, and again pays largely in new shares.

asset acquisition disposition

On April 7, 2017 Fortem bought 100% of Colony Energy, LLC, which holds Alberta Crown petroleum and oil sands leases on 20 sections (12,960 acres) in the Godin area of Northern Alberta. It paid 10,000,000 shares each to Blue Phoenix Energy and Pacific Petroleum for 83.4%, and agreed to issue 4,000,000 shares to Grassy Butte LLC for the other 16.7% (1,000,000 at closing, then 1,000,000 on each of the next three anniversaries). Colony also owes Grassy Butte Energy milestone payments of up to US$210,000; Fortem advanced US$30,000 for the closing payment, backed by a promissory note from Colony. This is the first acquisition after the early-2017 share sales and adds about 21 million shares at closing, with 3 million more to come.

asset acquisition disposition

The company settled US$496,180 of debt with three creditors on January 13, 2017 by issuing 1,984,720 shares at US$0.25, and US$59,142.91 with one more creditor on January 30 by issuing 236,571 shares. One settlement was with Precision Asset Consulting Executives Inc., a related party because director Michael Caetano is a director and shareholder of it. About 2.2 million new shares replace the debt.

capital raising announcement

On May 17, 2016 the company issued a US$200,000 10% secured convertible debenture to one investor, maturing six months after issue and secured against all of the company's property. It converts at US$0.20 per unit (share plus a US$0.40 warrant for two years), and the investor also received 200,000 additional units. This adds secured debt and potential dilution.

capital raising announcement

The company settled CAD$555,000 of promissory notes (issued to Stockbridge Resources Corp. in June and July 2012 and later assigned to Professional Trading S.A.) by paying CAD$200,000 in cash and issuing 538,461 shares at $0.65. This removes the loan from the company's debts in exchange for cash and new shares.

capital raising announcement

The company (filing under the name Strongbow Resources, Inc.) signed a farmout deal with Harvest Operations Corp. to earn a 100% working interest in a petroleum and natural gas license covering 5,120 acres in the Compeer Area of Alberta, which has no proven reserves or current production. To earn it, the company must spud a test well by June 1, 2012 (estimated cost $1.6-1.75 million), with a CAD$350,000 penalty if it cannot get Alberta operator status by March 30, 2012 or meet the well commitment. It also sold 1,333,333 shares at $0.15 for $200,000; the filing reports a change in shell company status, so this marks the start of oil and gas operations.

asset acquisition disposition