Since the summer of 2016, we have been methodically repositioning the company to aggressively grow and compete in our industry. There have been many challenges, but I would say the single biggest challenge and accomplishment was recruiting our team of people. We fundamentally believe people make money and create value, not assets, and for that reason we have been patient, thoughtful and selective in building the Paleo Resources team.
Below is a recap of some of the key challenges and events since the second quarter of 2016:
2Q of 2016: The company's former board of directors agreed to have myself and my associates recapitalize their balance sheet resulting in our significant stake in the company, which led to the reconstitution of the board and management changes.
1Q of 2017: The company closed a $10mm equity/debt financing with ACH Management LLC, which eventually resulted in litigation due to ACH’s breach and cessation of the funding commitment. The company also commenced its drilling campaign in Polk county during 1Q 2017, which led to 5 wells being successfully drilled and completed.
1Q of 2018: We converted our outstanding debentures to common equity, making me the largest single beneficial shareholder in the company, which eliminated significant debt and solidified a core of committed long term stakeholders in the company.
4Q of 2018: The company settled the ACH Management litigation, which resulted in eliminating more than 90% of the non-insider debt, freed the company to seek other financing arrangements and ameliorated a creditor risk to the company’s oil and gas asset base.
1Q of 2019: Our board completed its management changes as part of a best-in-class CEO recruitment and re-branded the company to Paleo Resources, Inc.
We are positioned to be a top tier oil and gas operator focused on creating long-term value for our shareholders through a disciplined capital allocation strategy and a commitment to safe, responsible, and cost-effective operations. Over the long haul, our view is that fundamental success, and nothing else, will foster our stock price and create liquidity in the market for our investors. Accordingly, our daily stock price is not our focus.
You should know that I am not compensated by salary, wages or other incentives as executive chairman of the board. Maximizing the value of the company is my focus, and I am firmly committed to the success of Paleo Resources, Inc.
We look forward to the challenges ahead as we strive for excellence and would be honored for you to join our shareholders as we embark on our journey.
Roger S. Braugh, Jr., Executive Chairman