- This article has been updated with more information
- Camber Energy Inc’s (NYSEAMERICAN: CEI) share price rose more than 15% before the market today. That’s why it happened.
Investors appear to be responding positively to Camber Energy’s announcement that it received a letter from NYSE American on November 19, 2021 in response to the company’s request for an extension of the date by which the company is due to file financial reports in. suspense.
The company is not in compliance with the stock exchange’s continuous listing standards as set out in section 1007 of the NYSE American Company Guide as it failed to timely file (the default). the following reports (collectively, the overdue reports): (i) Form 10-K for the 9 month transition period ended December 31, 2020; (ii) Form 10-Q for the period ended March 31, 2021; and (iii) Form 10-Q for the period ended June 30, 2021. Failure to file will be resolved by filing the delayed reports.
Camber originally intended to remedy the failure to file no later than November 19, 2021. But due to certain circumstances, the company asked the Exchange to grant the company a brief extension of the deadline to file the delayed reports. . And the Exchange accepted the company’s request and allowed them until December 17, 2021 to file the delayed reports.
If Camber is unable to remedy the delinquency by December 17, 2021, the company may request an additional extension until the maximum healing period of May 20, 2022. And NYSE regulatory staff will periodically review the company to verify that it is meeting the milestones. in the scheme.
If Camber does not make progress in accordance with the plan during the plan period or if the company does not complete its delayed filings and any subsequent delayed filings with the SEC by the end of the maximum 12 month processing period on the 20th May 2022, the Exchange staff will initiate a delisting procedure, if applicable. The Company may appeal a decision to strike off personnel in accordance with Section 1010 and Part 12 of the Company Handbook.
Last week, the company also announced that Viking Energy Group – a majority-owned subsidiary of Camber Energy – has entered into a membership interest purchase agreement with RESC Renewables Holdings, LLC (the seller) to purchase all of the Membership interest (collectively, the acquisition interest) of New Rise Renewables, LLC.
New Rise owns all of the interests in each of the New Rise Renewables Reno, LLC and New Rise Processing Reno, LLC (and together with New Rise and New Rise Reno, known as the acquired entities). The acquired entities are in the process of designing, developing, constructing and bringing into commercial operation a processing plant located in Reno, Nevada, designed to produce renewable diesel.
The purchase price of the interest earned must be equal to the appraised value of the interest earned (as determined by a third-party valuation company approved by Viking and the seller) less the amount of the Viking bond, which is defined in the MIPA as the face value of the bond financing or other credit facility arranged by Viking to complete the purchase of the accrued interest, facilitate the payment of New Rise commitments as set out in the MIPA and to complete the remainder of the ‘Factory up to and beyond the date on which the Factory begins commercial operations. The face value of the Viking Bond is estimated to be between $ 250 and $ 275 million depending on market conditions.
The purchase price, subject to authorized adjustments, must be paid as follows:
(i) $ 8,000,000 in cash on the closing date; and
(ii) as to the remainder, through the issuance of convertible preferred shares of Viking with the following characteristics: (i) no voting rights; (ii) a dividend rate of 7.25% per annum with dividends payable semi-annually in cash or Viking common stock (or a combination of the two) in each case at Viking’s option, with dividends beginning to accrue on first day of the month immediately following the date on which the Factory begins its commercial operations;
(iii) conversion rights with the preferred shares convertible into Viking common stock at a fixed conversion price equal to the volume weighted average price of Viking common stock during the period beginning on the date – on which the terms of the MIPA are disclosed by Viking through a current report on Form 8-K filed with the SEC and ending on the tenth business day after the closing date;
(iv) all conversions will be subject to a 9.99% share lock-up, and conversion rights for 40% of the preferred shares will not apply until the date the Plant commences commercial operations; and
(v) redemption rights and other characteristics of the preferred shares to be determined by Viking’s accounting consultants, so that the preferred shares may qualify as “permanent equity” on Viking’s balance sheet.
Viking’s obligation to purchase the vested interests is conditional on a number of elements set out in the MIPA, including, without limitation: (i) Viking having obtained the Viking Bond (on satisfactory terms and conditions for Viking in its sole discretion; and (ii) Viking having completed its due diligence investigation of the Acquired Entities and the Plant, and – in its sole discretion – being satisfied with the results of such due diligence investigation. has no guarantee that the conditions will be met.
The closing date for the acquisition of vested interests must be no later than 2 working days after the last of the closing conditions set out in the MIPA have been met or waived (other than conditions which, by their nature, must be satisfied at the closing date).
Concurrent with the execution of MIPA, New Rise Processing executed and delivered to Viking a promissory note in the principal amount of $ 1.5 million (the note), and Viking advanced $ 1.5 million. dollars at New Rise Processing on November 19, 2021, under the note. New Rise Processing’s obligations under the Note are secured by: (i) a guarantee executed by the seller (RESC Renewable Holdings, LLC) in favor of Viking, and (ii) a security pledge agreement executed by RESC, LLC (the seller’s owner) in favor of Viking, giving Viking a first position and perfect security over 20% of the seller’s shares. Each of the Note, Guarantee and Pledge Agreement is dated November 18, 2021. The Note bears interest at the rate of 10% per annum, and all principal and accrued interest due hereunder is payable. on the earlier of the following dates: (i) the acquisition by Viking of the vested interests or (ii) June 30, 2022.
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