Search the web
Welcome, Guest
[Sign Out, My Account]
EDGAR_Online

Quotes & Info
Enter Symbol(s):
e.g. YHOO, ^DJI
Symbol Lookup | Financial Search
CAK > SEC Filings for CAK > Form 8-K on 22-Nov-2013All Recent SEC Filings

Show all filings for CAMAC ENERGY INC. | Request a Trial to NEW EDGAR Online Pro

Form 8-K for CAMAC ENERGY INC.


22-Nov-2013

Entry into a Material Definitive Agreement, Creation of a Direct Financial Obli


Item 1.01. Entry Into A Material Definitive Agreement

Transfer Agreement

On November 19, 2013, CAMAC Energy Inc. (the "Company") entered into a Transfer Agreement (the "Transfer Agreement") with CAMAC Petroleum Limited ("CPL"), CAMAC Energy Holdings Limited ("CEHL"), CAMAC International (Nigeria) Limited ("CINL") and Allied Energy Plc ("Allied", together with CEHL and CINL, the "Allied Parties"), pursuant to which the Company, through its wholly owned subsidiary CPL, agreed to acquire Allied's remaining economic interests in a production sharing contract (the "PSC") and related assets, contracts and rights pertaining to those certain Oil Mining Leases 120 and 121 (the "OMLs") located offshore Nigeria, which include the currently producing Oyo Field (the "Assets"). Under the terms of the Transfer Agreement, the Company will acquire the Assets from Allied in exchange for $170 million in cash, 497,454,857 shares of the Company's common stock and a $50 million convertible subordinated promissory note (the "Acquisition"). The transfer of the Allied Parties' contractual rights to the PSC will be accomplished by novation of all of Allied's and CINL's right, title and interest in and to the PSC through a novation agreement (described below), which has been executed by the Company, CPL and the Allied Parties but will not become effective until the closing of the Acquisition. Upon completion of the Acquisition as contemplated by the Transfer Agreement, the Company will own a 100% economic interest in the PSC covering the OMLs.

To fund the cash portion of the consideration to be paid by the Company for the Assets, and a portion of anticipated capital expenditures for development of the Oyo Field, the Company has entered into a share purchase agreement (described below) with the Public Investment Corporation (SOC) Limited, a state-owned company registered and duly incorporated in the Republic of South Africa ("PIC"), for the private placement of an aggregate of 376,884,422 shares of the Company's common stock in exchange for an aggregate cash investment of $270 million (the "Private Placement"). The Private Placement will be completed in two equal installments. The first installment of $135 million (the "First Closing") in exchange for 188,442,211 shares of the Company's common stock will be due at the closing of the Acquisition. The second installment (the "Second Closing") of $135 million in exchange for 188,442,211 shares of the Company's common stock will be due on the later of (i) 90 days after the First Closing and
(ii) as soon as practicable after the conditions to the Second Closing are satisfied.

The Company will issue the $50 million convertible subordinated promissory note (the "Convertible Subordinated Note") in favor of Allied as partial consideration for the Assets upon the closing of the Acquisition. The principal of the Convertible Subordinated Note will be deemed advanced in two equal $25 million tranches at each of the First Closing and Second Closing of the Private Placement. Interest on the Convertible Subordinated Note will accrue at a rate per annum of LIBOR plus 5%, payable quarterly in cash until the maturity of the Convertible Subordinated Note five years from the closing of the Acquisition. At the election of the holder, the Convertible Subordinated Note will be convertible into shares of the Company's common stock at an initial conversion price of $0.7164 per share, subject to customary anti-dilution adjustments. The Convertible Subordinated Note will be subordinated to the Company's existing and future senior indebtedness and will be subject to acceleration upon an Event of Default (as defined in the Convertible Subordinated Note) and to mandatory prepayment upon (i) the Company's issuance of capital stock or incurrence of indebtedness, the proceeds of which the Company does not apply to repayment of senior indebtedness or (ii) any capital markets debt issuance to the extent the net proceeds of such issuance exceed $250 million.


The closing of the Acquisition is cross-conditioned upon (i) the Company's receipt of the first $135 million cash investment from PIC upon the First Closing of the Private Placement, (ii) approval of the Transfer Agreement and the transactions contemplated thereby by (A) holders of at least a majority of all outstanding shares of common stock present in person, or voting by proxy, at a special meeting of the Company's stockholders and (B) holders of at least a majority of all outstanding shares of common stock held by all of the holders of common stock excluding CEHL and its affiliates, (iii) acceptance of the listing of the Company's stock on the Johannesburg Stock Exchange (the "JSE"); (iv) execution and delivery of a registration rights agreement and a right of first refusal and corporate opportunities agreement by the parties to the Acquisition; and (v) satisfaction of other customary conditions to closing.

Pursuant to the Transfer Agreement, the Company has made customary representations and warranties and agreed to certain covenants particular to the Acquisition, including an agreement to maintain, for a period of 42 months following the closing of the Acquisition, the Company's listing of common stock on the JSE and one or more of the NYSE MKT or the London Stock Exchange and to enter into a registration rights agreement upon the closing of the Acquisition that will require the Company to file a registration statement covering the . . .



Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

The information set forth under Item 1.01 regarding the Convertible Subordinated Note is incorporated by reference into this Item 2.03.



Item 3.02. Unregistered Sales of Equity Securities

Pursuant to the Transfer Agreement, the Company will issue 497,454,857 shares of common stock to Allied as part of the purchase price upon completion of the Acquisition. Following the closing of the Acquisition, the Company may also potentially issue additional shares of common stock to Allied in the event that Allied elects to receive shares of common stock instead of cash in connection with the Milestone Payments.

Pursuant to the Share Purchase Agreement, the Company will issue an aggregate of 376,884,422 shares of common stock to PIC in consideration for an aggregate investment of $270 million in cash by PIC upon completion of the Private Placement.

Pursuant to the Convertible Subordinated Note, the Company may potentially issue up to 69,793,411 shares of common stock upon the holder's election to convert all or any portion of the outstanding principal amount of, and/or any accrued and unpaid interest on, the Convertible Subordinated Note.

The information set forth under Item 1.01 is incorporated by reference into this Item 3.02.


The transactions described above do not involve any public offering and the securities issued in connection with the Acquisition and the Private Placement, and the securities that may be issued under the Convertible Subordinated Note, are exempt from the registration requirements of the Securities Act of 1933 (the "Securities Act") pursuant to Section 4(2) of the Securities Act for the offer and sale of securities not involving a public offering and Rule 506 of Regulation D promulgated thereunder and, with respect to the securities to be issued in connection with the Private Placement, pursuant to Regulation S for offshore transactions involving non-U.S. persons. The securities described above will not be registered under the Securities Act or the securities laws of any other jurisdiction. Unless they are registered, the securities may be offered and sold only in transactions that are exempt from registration under the Securities Act and the securities laws of any other applicable jurisdiction. This exemption will be based on certain representations, warranties, agreements and covenants of Allied and PIC contained in the Transfer Agreement and the Share Purchase Agreement, respectively.



Item 7.01. Regulation FD Disclosure

On November 20, 2013, the Company issued a press release announcing the entry into the transactions described above and certain related matters. A copy of the Company's press release, dated November 20, 2013, announcing the entry into the transactions described above and certain related matters is furnished herewith as Exhibit 99.1.

In accordance with General Instruction B.2 of Form 8-K, the information in this
Section 7.01 of this Current Report on Form 8-K shall not be deemed "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall it be deemed incorporated by reference in any filing. The information set forth in, or in any exhibit to, this Form 8-K shall not be deemed an admission as to the materiality of any information in this report on Form 8-K that is required to be disclosed solely to satisfy the requirements of Regulation FD.

Important Additional Information

The Company, its directors and certain of its executive officers may be deemed to be participants in the solicitation of proxies from the Company's stockholders in connection with the matters to be considered at a special meeting of the stockholders of the Company relating to the proposed transactions described above. The Company intends to file a definitive proxy statement with the SEC in connection with any such solicitation of proxies from the Company's stockholders. THE COMPANY'S STOCKHOLDERS ARE STRONGLY ENCOURAGED TO READ ANY SUCH PROXY STATEMENT AND ACCOMPANYING PROXY CARD WHEN THEY BECOME AVAILABLE AS THEY WILL CONTAIN IMPORTANT INFORMATION. Information regarding the ownership of the Company's directors and executive officers in the Company's stock, restricted stock units and stock options is included in their SEC filings on Forms 3, 4, and 5, which can be found at the Company's website at www.camacenergy.com in the section for "Investors." More detailed information regarding the identity of potential participants at the special meeting, and their direct or indirect interests, by security holdings or otherwise, will be set forth in the proxy statement and other materials to be filed with the SEC in connection with the special meeting. Information can also be found in the Company's Annual Report on 10-K for the year ended December 31, 2012, filed with the SEC on April 15, 2013. The Company's stockholders will be able to obtain any proxy statement, any amendments or supplements to the proxy statement and other documents filed by the Company with the SEC for no charge at the SEC's website at www.sec.gov. Copies will also be available at no charge at the Company's website at www.camacenergy.com or by writing to the Company at 1330 Post Oak Boulevard, Suite 2250, Houston, Texas 77056, Attn: Corporate Secretary.




Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

Exhibit Descriptions

2.1*    Transfer Agreement by and among CAMAC Energy Inc., CAMAC Energy Holdings
        Limited, CAMAC International (Nigeria) Limited and Allied Energy Plc.

10.1    Share Purchase Agreement by and between CAMAC Energy Inc. and Public
        Investment Corporation SOC Limited.

10.2    Third Agreement Novating Production Sharing Contract by and among Allied
        Energy Plc, CAMAC International (Nigeria) Limited and CAMAC Petroleum
        Limited.

99.1    Press Release announcing the transactions.

* The Schedules to the Transfer Agreement have been omitted pursuant to Item 601(b) of Regulation S-K and will be provided to the SEC upon request.


  Add CAK to Portfolio     Set Alert         Email to a Friend  
Get SEC Filings for Another Symbol: Symbol Lookup
Quotes & Info for CAK - All Recent SEC Filings
Sign Up for a Free Trial to the NEW EDGAR Online Pro
Detailed SEC, Financial, Ownership and Offering Data on over 12,000 U.S. Public Companies.
Actionable and easy-to-use with searching, alerting, downloading and more.
Request a Trial      Sign Up Now


Copyright © 2014 Yahoo! Inc. All rights reserved. Privacy Policy - Terms of Service
SEC Filing data and information provided by EDGAR Online, Inc. (1-800-416-6651). All information provided "as is" for informational purposes only, not intended for trading purposes or advice. Neither Yahoo! nor any of independent providers is liable for any informational errors, incompleteness, or delays, or for any actions taken in reliance on information contained herein. By accessing the Yahoo! site, you agree not to redistribute the information found therein.