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8-K - CURRENT REPORT - PEDEVCO CORP | ped_ex8k.htm |
EXHIBIT 99.1
Pacific Energy Development Provides Transaction Update
Asset Due Diligence Completed Successfully
Definitive Documents Now Being Drafted
Anticipated to Close By August 31, 2017
July
18, 2017 – PEDEVCO Corp. d/b/a Pacific Energy Development
(NYSE MKT: PED) (the “Company”), announced today that
the planned transaction previously announced by the Company on June
22, 2017, that would clean up the Company’s balance sheet by
converting the majority of its debt to equity followed by an equity
investment of $12 million into the Company to provide development
capital for the Company’s oil and gas assets, has
successfully completed the investor’s asset due diligence
stage and is moving into drafting of the definitive investment
documents with a view to closing the equity investment concurrent
with the restructuring of the Company’s debt no later than
August 31, 2017.
The
investor, with whom the Company has been in discussions since
November 2016, retained Netherland Sewell & Associates
(“NSAI”), a premier oil and gas consulting firm, to
provide an independent review and assessment of the Company’s
oil and gas assets. Following the investor’s in-depth review
of the Company’s assets by NSAI, the investor notified the
Company that it was prepared to move forward with the transaction
and is now conducting corporate and financial due diligence on the
Company while simultaneously working with the Company to draft
definitive investment documents.
Mr. Michael Peterson, the President and Chief Executive Officer of
the Company, commented, "We are thrilled that we have successfully
passed the investor’s asset due diligence hurdle as conducted
by one of the premier oil and gas consulting firms in the world,
and are now proceeding with corporate and financial due diligence
and preparation of definitive documentation with a view to
completing the equity investment and debt restructuring
transactions by the end of August 2017. During the past weeks of
working closely with the investor group, the Company’s
management team has become very excited to work with them going
forward as they have the vision, plan and capital to significantly
grow the Company’s assets and cash flow. We look forward to
quickly wrapping up the financial due diligence and finalizing
definitive documentation over the coming weeks.”
The planned transaction calls for all of the Company’s fixed
debt, except for the approximately $6 million senior secured
position that matures May 2019 (which will have modified, more
favorable terms to the Company), to convert into 75% of the equity
of the Company, followed by an equity investment of $12 million to
be made by the new investor for approximately 51% of the common
stock of the Company. The result would be a company with only
approximately $6 million in debt and an estimated $70 million in
assets, including $12 million in cash. If the planned transaction
is consummated as planned, the Company would immediately increase
its stockholders’ equity by approximately $70 million, remove
most of the debt burden on the Company, and provide the development
capital needed to execute the development plan of its current key
assets. The plan is anticipated to significantly increase the value
of the Company’s shares to the benefit of its common equity
shareholders. As a result of these transactions, the Company
believes it would emerge properly capitalized and positioned to
initially grow through execution of its development plan to
increase cash flow, and then seek to expand through accretive
acquisitions of oil and gas properties and operating
companies.
The Company has not yet entered into binding definitive agreements,
and the contemplated transaction remains subject to corporate and
financial due diligence, completion of documentation, NYSE MKT
approval, and final sign-off by the Company’s lenders, and
may not be consummated on terms and conditions acceptable to the
Company, its lenders and the investor, if at all.
About Pacific Energy Development (PEDEVCO Corp.)
PEDEVCO
Corp, d/b/a Pacific Energy Development (NYSE MKT: PED), is a
publicly-traded energy company engaged in the acquisition and
development of strategic, high growth energy projects, including
shale oil and gas assets, in the United States. The Company’s
principal asset is its D-J Basin Asset located in the D-J Basin in
Colorado. Pacific Energy Development is headquartered in Danville,
California, with an operations office in Houston,
Texas.
Cautionary Statement Regarding Forward Looking
Statements
All
statements in this press release that are not based on historical
fact are "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995 and the provisions
of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended (the
“Acts”). In particular, when used in the preceding
discussion, the words “estimates,”
“believes,” “hopes,” “expects,”
“intends,” “plans,”
“anticipates,” or “may,” and similar
conditional expressions are intended to identify forward-looking
statements within the meaning of the Act, and are subject to the
safe harbor created by the Act. Any statements made in this news
release other than those of historical fact, about an action, event
or development, are forward-looking statements. While management
has based any forward-looking statements contained herein on its
current expectations, the information on which such expectations
were based may change. These forward-looking statements rely on a
number of assumptions concerning future events and are subject to a
number of risks, uncertainties, and other factors, many of which
are outside of the Company's control, that could cause actual
results to materially differ from such statements. Such risks,
uncertainties, and other factors include, but are not necessarily
limited to, those set forth under Item 1A "Risk Factors" in the
Company's Annual Report on Form 10-K for the year ended December
31, 2016 and subsequently filed Quarterly Reports on Form 10-Q
under the heading "Risk Factors". The Company operates in a highly
competitive and rapidly changing environment, thus new or
unforeseen risks may arise. Accordingly, investors should not place
any reliance on forward-looking statements as a prediction of
actual results. The Company disclaims any intention to, and
undertakes no obligation to, update or revise any forward-looking
statements, except as otherwise required by law, and also takes no
obligation to update or correct information prepared by third
parties that are not paid for by the Company. Readers are also
urged to carefully review and consider the other various
disclosures in the Company's public filings with the Securities
Exchange Commission (SEC).
Contacts
Pacific
Energy Development
1-855-733-3826
PR@pacificenergydevelopment.com