Camber Energy, Inc., based in Houston, Texas, has received preliminary non-binding approval from the staff of the NYSE American of the planned terms of its contemplated acquisition of a midstream pipeline integrity services, specialty construction and field services company in an all-stock transaction.
According to the interim CEO of Camber, Louis G. Schott, ”We have had numerous discussions with the staff of the NYSE American concerning the structure of the company’s planned acquisition and have received their preliminary approval of the terms of the transaction as set forth in the non-binding term sheet between the parties. While their approval of the definitive documents will, of course, be necessary, the NYSE American has been instrumental in providing us guidance in structuring the transaction. Based on the preliminary approval of the NYSE American, we are continuing our due diligence, beginning to prepare definitive documents, and moving towards a planned closing in the next four weeks.”
Mr. Schott noted further, ”As we continue our due diligence, we become more excited about the acquisition and its potential for growth. If we are successful in closing, we believe this transaction will enable the company to leverage its available cash reserves and build shareholder value through a change in business focus to pipeline service and construction. Following the acquisition, we anticipate substantial opportunities to leverage growth in the markets the pending acquisition is targeting. We are also reviewing several additional acquisition targets concurrent with our due diligence on the target that will potentially expand its offerings, capabilities and opportunities for revenue.”
Also, the closing of the transaction is subject to customary closing conditions, negotiation of final transaction documents and transaction terms, and other conditions, including, but not limited to the consent of the holder of our Series C Preferred Stock, executing an agreement with Camber’s Series C Preferred Stock holder amending the Series C Preferred Stock to alter the conversion rights, and obtaining the requisite NYSE American approval. The terms of the Letter of Intent contemplate issuing the seller a new series of convertible preferred stock which will be convertible into between 67% and 70% of Camber’s outstanding common stock on a fully-diluted basis (after shareholder approval as required under applicable NYSE American rules and requirements). The transaction may not close timely, on the terms set forth in the Letter of Intent, or at all. The transaction is subject to the conditions above, and the parties contemplate entering into a definitive agreement in connection with the transaction on or before May 7, 2019, which agreement and definitive terms associated therewith will be included on a Form 8‑K filed by the Company.
Conclusively, the transaction (upon receipt of shareholder approval) will result in the shareholders of the acquired entity obtaining voting control over the Company. In addition, the Company plans to pursue additional acquisitions in connection with this potential transaction.
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