Prairie Operating Co. 8-K

What Happened

• On April 8, 2026, Prairie Operating Co. (the “Company”) entered a letter agreement with Hudson Bay PH XIX LLC (“High Trail”) to repurchase 13,727 shares of the Company’s Series F Convertible Preferred Stock for $18,999,047.64 in cash. Accrued but unpaid dividends on those shares will be paid in Common Stock (calculated using the Series F Certificate formula). The Company issued High Trail a warrant to buy 4,000,000 shares of Common Stock at $0.01 per share (the “First Penny Warrant”) on that date; a second warrant for 3,000,000 shares (the “Second Penny Warrant”) will be issued on July 8, 2026 if certain Anniversary Warrants are not issued.

Key Details

• Repurchase: 13,727 Series F shares repurchased for $18,999,047.64 (Apr 8, 2026); accrued dividends paid in Common Stock per the Series F formula.
• Warrants: First Penny Warrant for 4,000,000 common shares at $0.01 (immediately exercisable); Second Penny Warrant for 3,000,000 may be issued on July 8, 2026 if triggered. Penny Warrants terminate six months after no Series F shares remain outstanding and require the issuable shares to be “Freely Tradeable” for the prior 90 days.
• Amendments: Anniversary Warrant issuance date moved from April 9, 2026 to July 8, 2026; formula reduced from 125% to 75% of Stated Value for calculating Anniversary Warrant shares. Certain footnotes and calculation mechanics (including an alternate VWAP calculation window) were revised.
• Other terms: High Trail waived the previously announced $3.0 million cash extension fee subject to conditions; the agreement grants High Trail registration rights (file within 30 days; effectiveness targets of 30/60 days) with failure penalties tied to 1% of Daily VWAP × affected Registrable Shares, and 18‑month participation rights to subscribe for up to 35% of future equity offerings. The Cash Sweep Amount for High Trail was set at 50% for Cash Sweep Financings and 25% for DFCF Actions.

Why It Matters

• For investors, the deal reduces the outstanding Series F preferred via a cash repurchase but also introduces potential dilution: High Trail has warrants for up to 7,000,000 common shares (if the Second Penny Warrant is issued) and will receive common shares to satisfy accrued dividends. The registration rights and immediately exercisable penny warrants make those shares actionable and potentially marketable if registration is completed. The agreement also delays and reduces potential Anniversary Warrant dilution and alters certain payment/conversion calculation mechanics, while giving High Trail participation rights that could affect the size and allocation of future equity financings.