Note 13 – Related Party Transactions

Phil Mulacek beneficially owns approximately 29.3% of the Company’s outstanding shares of common stock as of June 30, 2026 and is a board member of Energy Evolution and a majority owner of Petroleum Independent & Exploration, LLC and related entities (collectively “PIE”). Energy Evolution independently beneficially owns approximately 33.1% of the Company’s outstanding shares of common stock as of June 30, 2026.

The Company has a shared services agreement with PIE that includes access to administrative, engineering and support-services as well as building and insurance services and provides that the Company will reimburse PIE for the out-of-pocket costs incurred by PIE in providing such services to the Company.

On June 17, 2025, the Company issued the June Note to Mr. Mulacek. Mr. Mulacek advanced Empire $2.0 million under the June Note in the second quarter of 2025. In August 2025, Empire completed an equity raise and repaid the outstanding June Note balance and all accrued and unpaid interest.

On September 24, 2025, Empire issued the September Note to Mr. Mulacek. Mr. Mulacek advanced Empire $2.0 million under the September Note in the third quarter of 2025. The note was fully repaid in February 2026.

On September 24, 2025, and as amended on November 5, 2025, Empire issued Mr. Mulacek a warrant certificate granting him the right to purchase up to 138,889 shares of common stock of Empire at $4.32 per share.

On January 5, 2026, the Company issued 562,500 shares of common stock at an agreed upon price of $3.20 per share to Energy Evolution to acquire the remaining 40% of certain New Mexico interests.

On February 19, 2026, Empire issued the February 2026 Note to Mr. Mulacek in the amount of $3.0 million. The note matures on May 19, 2026, at an interest rate of 5.5% per annum. In March 2026, Mr. Mulacek fully converted the outstanding balance at a contractual conversion price of $2.99 per common share of Empire’s stock for total shares of 1,003,344.

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On March 8, 2026, the Company entered into a letter agreement with Mr. Mulacek (the “EPC Hedging Letter Agreement”), pursuant to which Mr. Mulacek opened an account at UBS Financial Services Inc. (“UBS”) for the sole purpose of effecting commodity risk mitigating hedges on behalf of the Company (“EPC Hedging”). The parties entered into the EPC Hedging Letter Agreement because at such time, Mr. Mulacek was able to secure better commercial terms than the Company. The EPC Hedging Letter Agreement provided that all EPC Hedging would be conducted either (a) at the direction of the Company’s management and/or the Company’s Audit Committee or (b) after consultation with and approval from the Company’s management and/or the Company’s Audit Committee. The EPC Hedging Letter Agreement further provided that (i) any profits or losses arising in connection with EPC Hedging would be for the Company’s account, (ii) the parties would promptly make settlement payments as necessary after the monetization of any such EPC Hedging, and (iii) the Company would promptly reimburse Mr. Mulacek for any out-of-pocket costs and expenses incurred by him in connection with EPC Hedging. In the second quarter of 2026, due to circumstances outside of the Company’s control, all outstanding derivative positions related to the EPC Hedging were early settled by UBS, as UBS was contractually permitted to do, for a net realized loss of approximately $1.9 million. As of June 30, 2026, cash settlement of the $2.1 million total net realized loss on derivative positions with UBS remains payable to Mr. Mulacek. Mr. Mulacek has indicated a willingness to allow the Company to pay such amount to him with a reasonable rate of interest in 24 equal monthly installments.  The net realized loss on derivative positions are reflected within loss on derivatives on the Company’s unaudited interim condensed consolidated statements of operations and the payable to Mr. Mulacek is reflected within accounts payable – related party on the unaudited interim condensed consolidated balance sheets. The Company expects that it will issue a promissory note to Mr. Mulacek in the third quarter of 2026 to memorialize such arrangement.

On March 18, 2026, Empire elected to participate in a three-well oil and natural gas development program with various related parties in Louisiana for a 25% working interest. Participation was funded by issuance of approximately 1.8 million shares of Empire common stock at a price of $3.00 per share. As of June 30, 2026, we have accrued approximately $1.0 million for additional costs incurred related to the gas development program.