American Noble Gas, Inc. announced that it has entered into a securities purchase agreement with two accredited returning institutional investors for a private placement of senior unsecured convertible promissory notes due June 29, 2022 for gross proceeds of $850,000 on May 13, 2022. The notes were issued at par, bear interest at a fixed rate of 8% per annum, and are convertible into 2,125,000 common shares at a fixed conversion price per share of $0.40. The notes may be voluntarily repaid in cash in full or in part by the company at any time in an amount equal to 120% of the principal amount of each note and any accrued and unpaid interest, and shall be mandatorily repaid in cash in an amount equal to 50% of the then outstanding principal amount equal to 120% of the principal amount of each note and any accrued and unpaid interest in the event of the consummation by the company of any public or private offering or other financing for gross proceeds of at least $2,000,000 but not greater than $3,000,000, or 100% of the then outstanding principal amount equal to 120% of the principal amount of a note and any accrued and unpaid interest in the event of the consummation by the Company of any public or private offering or other financing for gross proceeds of in excess of $3,000,000.

The conversion of the notes is each subject to beneficial ownership limitations such that the investors may not convert the notes to the extent that such conversion would result in an investor being the beneficial owner in excess of 4.99% stake in the company, which beneficial ownership limitation may be increased or decreased up to 9.99% upon notice to the company, provided that any increase in such limitation will not be effective until 61 days following notice. The company has also granted the investors certain automatic and piggy-back registration rights whereby the company has agreed to register the resale by the investors of the conversion shares. The company also issued an aggregate of 425,000 common shares as commitment shares to the investors as additional consideration for the purchase of the notes.

The company issued securities pursuant to an exemption from the registration requirements of the Securities Act provided in Section 4(a)(2) of the Securities Act and/or Regulation D promulgated thereunder. The transaction included participation from 2 investors.