SCHEDULE: Empire Petroleum CEO Morrisett Reduces Stake Below 5%
Insider Ownership Update
Empire Petroleum Corp's President and CEO, Michael R. Morrisett, has reduced his beneficial ownership in the company to 2.49% after a private sale of shares and options on November 5, 2025.
Summary
- Michael R. Morrisett, President and CEO of Empire Petroleum Corp, now beneficially owns 866,087 shares, representing 2.49% of the company's common stock.
- This ownership includes 520,000 shares issuable upon the exercise of currently exercisable stock options and 35,000 shares underlying vested but deferred restricted stock units.
- Mr. Morrisett ceased to be a beneficial owner of more than 5% of the common stock on November 5, 2025.
- On November 5, 2025, Mr. Morrisett sold the remainder of his 4/3/19 Option (589,100 shares) and an additional 187,084 shares of Common Stock in a private transaction for an aggregate sales price of $1,600,000.
- The ownership percentage is calculated based on 34,266,208 outstanding shares of Common Stock as of September 30, 2025.
- The filing reflects a 1-for-4 reverse common stock split that became effective on March 7, 2022.
Sentiment
Score: 4
Explanation: The significant reduction in the CEO's beneficial ownership below 5% through a private sale of a large block of shares and options is a key event that could be viewed with caution by investors. While Mr. Morrisett remains CEO and expects future equity awards, and has previously supported company financing, the scale of the sale warrants a slightly negative sentiment.
Positives
- Mr. Morrisett's previous sales of shares (May 27, 2021, and September 28, 2021) were structured to incentivize an investor to purchase unsecured convertible notes from Empire New Mexico LLC, a wholly-owned subsidiary, which supported company financing.
- Mr. Morrisett participated in the company's rights offering on April 22, 2024, purchasing 73,389 shares for $366,945, demonstrating continued investment in the company.
- Mr. Morrisett expects to continue receiving equity awards as compensation for his role as an executive officer, indicating ongoing alignment with company performance.
Negatives
- The significant sale of 776,184 shares and options by the CEO, reducing his beneficial ownership below 5%, could be perceived negatively by investors, potentially signaling a lack of confidence or a desire to diversify personal holdings.
Future Outlook
Mr. Morrisett expects to continue receiving equity awards as compensation for serving as an executive officer of the Company. He may purchase additional shares or dispose of shares in the future based on various factors including tax and estate planning, stock price levels, market conditions, economic and industry conditions, and the company's business prospects and financial performance.
Management Comments
- "Mr. Morrisett expects that he will continue to receive equity awards as compensation for serving as an executive officer of the Company in accordance with Section 2.3 Equity Awards of the Employment Agreement."
- "Mr. Morrisett may purchase additional shares, or dispose of shares, of Common Stock in various amounts and at various times depending upon Mr. Morrisett's continuing assessment of pertinent factors, including without limitation, tax and estate planning considerations, the price levels of the Common Stock, conditions in the securities markets and general economic and industry conditions, and the business prospects, financial condition and results of operations of the Company."
Industry Context
This filing is specific to an individual's ownership stake and does not provide broader industry context or trends. It primarily reflects an insider's portfolio management decisions within the oil and gas sector.
Related Party Transactions
- Mr. Morrisett engaged in arrangements on May 14, 2021, to sell shares to an investor, specifically to incentivize that investor to purchase unsecured convertible notes from Empire New Mexico LLC, a wholly-owned subsidiary of the Company.
Stakeholder Impact
- Shareholders: The reduction in the CEO's stake might raise questions about management's long-term commitment or outlook, potentially influencing investor sentiment.
- Company: Mr. Morrisett's previous actions to incentivize convertible note purchases benefited the company by facilitating capital raises for its subsidiary.
Next Steps
- Mr. Morrisett expects to continue receiving equity awards as compensation for his role as an executive officer.
- Mr. Morrisett may purchase or dispose of additional shares in the future based on various personal and market factors.
Key Dates
| Date | Description |
|---|---|
| 2014-12-30 | Empire Petroleum Holdings, LLC purchased 929,516 shares of Common Stock. |
| 2017-12-01 | Mr. Morrisett was granted a warrant to purchase 125,000 shares of Common Stock. |
| 2017-12-29 | Mr. Morrisett purchased 5,000 shares of Common Stock. |
| 2019-03-29 | Empire Holdings dissolved, and Mr. Morrisett received 418,282 shares of Common Stock. |
| 2019-04-03 | The December 2017 Warrant expiration date was extended to April 2, 2029. |
| 2019-04-03 | Mr. Morrisett was granted a non-qualified stock option to purchase 625,000 shares of Common Stock. |
| 2019-04-03 | First installment of 312,500 shares from the 4/3/19 Option vested. |
| 2020-04-03 | Second installment of 156,250 shares from the 4/3/19 Option vested. |
| 2020-12-31 | Mr. Morrisett was granted a non-qualified stock option to purchase 500,000 shares of Common Stock. |
| 2021-04-03 | Third installment of 156,250 shares from the 4/3/19 Option vested. |
| 2021-05-14 | Mr. Morrisett entered into an arrangement to sell up to 75,000 shares to an investor. |
| 2021-05-27 | Mr. Morrisett exercised 75,000 shares from the December 2017 Warrant and sold them to an investor. |
| 2021-08-18 | Date of Mr. Morrisett's Employment Agreement with the Company. |
| 2021-09-28 | Mr. Morrisett exercised the remainder of the December 2017 Warrant (50,000 shares) and partially exercised the 4/3/19 Option (35,900 shares), selling both to an investor. |
| 2022-02-28 | Mr. Morrisett was granted restricted stock units for 10,000 shares of Common Stock. |
| 2022-02-28 | Mr. Morrisett was granted a non-qualified stock option to purchase 30,000 shares of Common Stock (expired unexercised on August 31, 2025). |
| 2022-02-28 | Mr. Morrisett was granted a non-qualified stock option to purchase 30,000 shares of Common Stock (expires August 31, 2026). |
| 2022-03-07 | 1-for-4 reverse common stock split became effective. |
| 2022-05-25 | Mr. Morrisett was granted restricted stock units for 12,500 shares of Common Stock. |
| 2022-06-30 | Mr. Morrisett purchased 1,500 shares of Common Stock in the open market. |
| 2022-10-11 | Mr. Morrisett was granted restricted stock units for 6,250 shares of Common Stock. |
| 2022-12-30 | Mr. Morrisett was granted restricted stock units for 6,250 shares of Common Stock. |
| 2023-02-28 | First installment of 30,000 shares from the Feb 28, 2022 option vested. |
| 2023-03-01 | Restricted stock units for 10,000 shares granted on Feb 28, 2022, vested in full. |
| 2023-06-01 | Restricted stock units for 12,500 shares granted on May 25, 2022, vested in full. |
| 2023-11-01 | Restricted stock units for 6,250 shares granted on Oct 11, 2022, vested in full. |
| 2024-01-01 | Restricted stock units for 6,250 shares granted on Dec 30, 2022, vested in full. |
| 2024-03-07 | Company initiated a rights offering to holders of Common Stock. |
| 2024-03-28 | Company supplemented its prospectus for the Rights Offering. |
| 2024-04-10 | The Rights Offering expired at 5:00 p.m., Eastern Time. |
| 2024-04-22 | Mr. Morrisett purchased 73,389 shares of Common Stock through the Rights Offering. |
| 2025-08-31 | A non-qualified stock option for 30,000 shares granted on Feb 28, 2022, expired unexercised. |
| 2025-09-30 | Outstanding shares of Common Stock were 34,266,208, used for ownership percentage calculation. |
| 2025-11-05 | Mr. Morrisett sold shares and options in a private transaction and ceased to be a beneficial owner of more than 5% of Common Stock. |
| 2025-11-07 | Date of filing of this Schedule 13D Amendment No. 2. |
| 2026-08-31 | A non-qualified stock option for 30,000 shares granted on Feb 28, 2022, expires. |
| 2029-04-02 | The December 2017 Warrant and the 4/3/19 Option expire. |
Recommendation
holdThe significant reduction in the CEO's beneficial ownership below 5% is a notable event that could be interpreted negatively by the market. However, the filing also indicates Morrisett's continued role as CEO and expectation of future equity awards, suggesting ongoing involvement. His past actions, such as participating in the rights offering and facilitating capital raises, show some alignment. Given the mixed signals, a 'hold' recommendation is appropriate to observe market reaction and future company performance before making a stronger directional call. The sale could be for personal financial planning, but the size warrants caution.
Keywords
Empire Petroleum Corp, Michael R. Morrisett, Schedule 13D, Beneficial ownership, Stock options, Restricted stock units, Share sale, CEO, Oil and gas, Equity awards
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