Viking Energy Group, Inc. (OTCQB:VKIN) (“Viking”) and Camber Energy, Inc. (NYSE:CEI) (“Camber”) are pleased to announce that they have entered into a non-binding letter of intent (“LOI”) dated January 23, 2020, regarding a proposed merger of Viking with Camber. A copy of the LOI was included in Viking’s and Camber’s Current Reports on Form 8-K filed on January 24, 2020, with the Securities and Exchange Commission, and available under "Investors" at www.vikingenergygroup.com and www.camber.energy.
The proposed merger contemplates Camber issuing newly-issued shares of common stock, on a fully-diluted pro rata basis, to the equity holders of Viking having an 85% interest in the post-closing entity in exchange for 100% of the outstanding equity securities of Viking by means of a reverse triangular merger in which a newly formed wholly-owned subsidiary of Camber shall merge with and into Viking, with Viking continuing as the surviving corporation (the “Merger”) and wholly-owned subsidiary of Camber after the Merger. If the closing of the Merger occurs (the “Closing”), the Viking equity holders prior to the Merger shall own approximately 85% of Camber’s issued and outstanding common stock immediately after the Merger, and the Camber equity holders prior to the Merger shall own approximately 15% of Camber’s issued and outstanding common stock immediately after the Merger, in each case on a fully-diluted, as-converted basis as of immediately prior to the Closing (including options, warrants and other rights to acquire equity securities of Viking or Camber). Camber plans to increase its authorized number of shares to complete the issuance of shares in the Merger set forth above.
The Merger would be an arm’s length transaction, and pursuant to the terms of the LOI, the parties intend to negotiate and sign a definitive agreement (the “Definitive Agreement”) in respect of the Merger as soon as practicable and on or before February 17, 2020. Completion of the Merger is subject to a number of conditions, as set out in the LOI, including but not limited to the following: (i) execution of the Definitive Agreement; (ii) Viking’s subsidiary, Elysium Energy, LLC, closing the acquisition disclosed in the Current Reports on Form 8-K filed by Viking on October 11, 2019, and December 23, 2019, respectively (the “New Acquisition”); and (iii) receipt of all required regulatory, corporate and third party approvals, including the approval of the stockholders of each of Viking and Camber, and the fulfillment of all applicable regulatory requirements and conditions necessary to complete the Merger.
James Doris, President & CEO of Viking, stated, “Our company is excited about the proposed merger. We believe the transaction will help broaden our shareholder base, improve liquidity and provide increased visibility to the institutional investor community, which ultimately should contribute to increased shareholder value.”
Louis G. Schott, Interim CEO of Camber, stated, “We are very pleased with this prospective merger. Viking has demonstrated an ability to transact and execute, in particular in a challenging environment. Combining Viking’s business strategy and operational expertise with the Camber platform should create substantial value for Camber.”
Advisory Group Services, Ltd. dba RHK Capital, of Westport, CT is advising Viking on the transaction.