CAMBER ENERGY, INC. 10-Q

ITEM 1. LEGAL PROCEEDINGS From time to time, the Company may be involved in litigation relating to claims arising out of commercial operations in the normal course of business. As of March 31, 2026, other than the matter described below, there were no pending or threatened lawsuits that could reasonably be expected to have a material effect on the Company’s results of operations. On June 15, 2022, a Petition for Damages ( Danny Paul Gastal and Ignatius Hoffpauir v. Petrodome Operating, LLC, et. al. ) was filed in The 15th Judicial District Court for the Parish of Acadia in the State of Louisiana against a wholly-owned subsidiary of Petrodome Energy, LLC (“Petrodome”) and two other parties (collectively, the “Defendants”) related to a flowline leak on a salt-water disposal well owned by a third party and operated by Petrodome. The owner of the property where the leak occurred and his tenant farmer (collectively, the “Plaintiffs”) alleged environmental damage as a result of the leak and sought damages for the cost of remediation, loss of use and loss of income. Subsequently, the suit was amended to name the insurers of both Petrodome and the well owner. Petrodome and the well owner made a “limited admission” of liability for environmental damage under Louisiana Code of Civil Procedure article 1563 and La. R.S. 30:29 and presented a “most feasible plan” to remediate the property to the Louisiana Department of Conservation & Energy (“LDCE”) at a January 6, 2026 public hearing. The LDCE approved the plan which is expected to cost approximately $286,000 to implement. On or about April 24, 2026, the parties reached a settlement agreement pursuant to which the Defendants agreed to pay the Plaintiffs approximately $10.3 million for damages and to fund and implement the LDCE-approved remediation plan and to diligently perform whatever remediation, restoration, clean-ups, investigation(s), evaluation(s), testing, and/or other work, if any, that the LDCE deems necessary in order to obtain the required no further action letter for the limited admission area. The Company believes that the settlement amount will be fully funded by applicable insurance policies maintained by Petrodome and the well owner. The settlement liability and the insurance proceeds receivable have been recorded in the Company’s condensed consolidated financial statements at and for the three months ended March 31, 2026. The settlement of this claim did not have any impact on the Company’s consolidated results of operations or net cash flows. ITEM 1A. RISK FACTORS As a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934, the Company is not required to provide the information under this item. ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS During the three months ended March 31, 2026, the Company did not issue any unregistered equity securities. ITEM 3. DEFAULTS UPON SENIOR SECURITIES None. ITEM 4. MINE SAFETY DISCLOSURES None.