- American Acquisition Opportunity Inc ("AMAO") has entered into a merger agreement with Royalty Management Corp. ("RMC" or the "Company"); upon closing, it is anticipated that the combined company will be listed on the Nasdaq Stock Market
- RMC is a next-generation royalty company focused on expanding its current cashflow and revenue streams by identifying undervalued assets while constructively supporting communities
- The transaction positions RMC to capitalize on organic and inorganic growth opportunities with the goal of paying dividends from cashflow as early as 2023
American Resources Corporation (NASDAQ:AREC) ("American Resources" or the "Company"), a next generation and socially responsible supplier of rare earth and critical elements, carbon and advanced carbon materials to the new infrastructure and electrification marketplace, today announced that the special purpose acquisition vehicle it has sponsored has successfully entered into a definitive agreement that will result in Royalty Management Corporation becoming a publicly listed company. Upon closing of the transaction, the combined company will be named Royalty Management Company and expects to be listed on the Nasdaq Stock Market under the ticker symbol "RMCO." The resulting company will continue to be based in Fishers, Indiana and will be led by a diverse board of innovators in mineral, agriculture, natural resources, intellectual property and energy transition sectors.
Mark Jensen, Chief Executive Officer of AMAO, said, "Our focus for AMAO was to partner with a dynamic cash-flowing company that didn't require a complicated or highly dilutive financing as part of the de-SPAC process in order to thrive on its own as a public company. We evaluated over 50 targets during our process and went to in-depth analysis on over five targets. Once we reduced the size of capital in trust, we gained a significant amount of flexibility to focus on opportunities that better fit our intended thesis that we believe will be accretive to our shareholders. We also wanted to invest in a company that understood the importance of generating strong returns in today's market without the immediate need for raising capital while also having a vision on how to grow the business in line with how the economy and world markets are trending. RMC fits this mold with how it is transforming the royalty industry, focusing on current cash flow while creating a broad funnel of future long-term royalty streams in transitionary industries. We are excited to create this synergistic relationship between RMC and AMAO so that the combined company can continue to build on its impressive growth trajectory as a public company and deliver both yield and growth to our shareholders."
Leading Royalty Company Focused on Sustainable Outcomes for All Stakeholders
Founded in 2021, RMC is changing the way operators and investors view royalty streams. The world is changing, and the monetization of more diverse revenue streams is needed as well. RMC focuses on current revenue streams through undervalued resources that fit today's infrastructure market while making investments in assets that fit tomorrow's electrification, mineral resources and infrastructure needs. Additionally, RMC looks at all ways to monetize end of life assets through sustainable development and stakeholder engagement to generate solid cash flow streams while also driving communities forward.
The business combination values RMC at an implied $111 million pro forma enterprise value, at a price of $10.00 per share, assuming no redemptions by AMAO shareholders. The boards of directors of AMAO and RMC have approved the proposed transaction, which is expected to be completed in the fourth quarter of 2022, subject to, among other things, the approval by AMAO's stockholders and by RMC's shareholders and the satisfaction or waiver of other customary closing conditions. The transaction will result in gross proceeds of approximately $16 million to RMC (assuming no redemptions by AMAO stockholders and prior to the payment of transaction expenses).
Additional information about the proposed transaction, including a copy of the merger agreement and investor presentation, will be provided in a Current Report on Form 8-K to be filed by AMAO with the Securities and Exchange Commission and available at https://www.sec.gov/.
Financial Scale with Track Record of Rapid Growth
Since RMC's inception in 2021, the company has grown revenue, cash flow and has a growing backlog of attractive near-term cash flow-oriented growth opportunities. This growth has been achieved while generating free cash flow and profitability. Through this transaction, RMC will have operational and financial flexibility to take advantage of opportunities as they present themselves that can further drive shareholder value. The strength of RMC's financial performance reduces the need for a separate PIPE transaction, which can often times complicate a balance sheet or capital structure.
EF Hutton, division of Benchmark Investments, LLC, is serving as capital markets advisor and served as underwriter for AMAO's initial public offering in March 2021. Loeb & Loeb, LLP is serving as legal advisor to AMAO. Law Office of Clifford J. Hunt, P.A. is serving as SEC legal advisor to RMC and Barnes & Thornburg LLP is serving as Indiana corporate law advisor to RMC.
Investor Conference Call Information
RMC and AMAO will host a joint investor conference call on Thursday July 7th, 2022 at 10:30 AM ET to discuss the proposed transaction. To listen to the prepared remarks, dial 1-877-407-4019 (U.S.) and reference the American Acquisition Opportunity (AMAO) Merger Call.
About Royalty Management Corporation
Royalty Management Corporation is a royalty company building shareholder value to benefit both its shareholders and communities by acquiring and developing high value assets in a sustainable market environment. The model is to acquire and structure cashflow streams around assets that can support the communities by monetizing the current existing cash flow streams while identifying transitionary cash flow from the assets for the future.
About American Acquisition Opportunity Inc.
American Acquisition Opportunity Inc. is a special purpose acquisition company formed for the purpose of effecting a merger, stock purchase or similar business combination with one or more businesses. While the Company is able to evaluate opportunities in many sectors, it intends to focus its search on land and resource holding companies. The Company's units, common stock and warrants are listed on the Nasdaq Capital Market.
About American Resources Corporation
American Resources Corporation is a next-generation, environmentally and socially responsible supplier of high-quality raw materials to the new infrastructure market. The Company is focused on the extraction and processing of metallurgical carbon, an essential ingredient used in steelmaking, critical and rare earth minerals for the electrification market, and reprocessed metal to be recycled. American Resources has a growing portfolio of operations located in the Central Appalachian basin of eastern Kentucky and southern West Virginia where premium quality metallurgical carbon and rare earth mineral deposits are concentrated.
American Resources has established a nimble, low-cost business model centered on growth, which provides a significant opportunity to scale its portfolio of assets to meet the growing global infrastructure and electrification markets while also continuing to acquire operations and significantly reduce their legacy industry risks. Its streamlined and efficient operations are able to maximize margins while reducing costs. For more information visit americanresourcescorp.com or connect with the Company on Facebook, Twitter, and LinkedIn.
About reElement Technologies LLC
ReELEMENT Technologies LLC is redefining how critical and rare earth elements are both sourced and processed while focusing on the recycling of end-of-life products such as rare earth permanent magnets and lithium-ion batteries, as well as coal-based waste streams and byproducts to create a low-cost and environmentally-safe, circular supply chain. American Rare Earth has developed its innovative and scalable "Capture-Process-Purify" process chain in conjunction with its licensed intellectual property including 16 patents and technologies and sponsored research partnerships with three leading universities to support the domestic supply chain's growing demand for magnet and battery metals. For more information visit reelementtech.com or connect with the Company on Facebook, Twitter, and LinkedIn.
This press release contains statements that constitute "forward-looking statements," including with respect to the initial public offering. No assurance can be given that the offering discussed above will be completed on the terms described, or at all. Forward-looking statements are subject to numerous conditions, many of which are beyond the control of the Company, including those that will be set forth in the "Risk Factors" section of the Company's registration statement and proxy statement/prospectus to be filed with the SEC. Copies will be available on the SEC's website, www.sec.gov. The Company undertakes no obligation to update these statements for revisions or changes after the date of this release, except as required by law.
Important Information for Investors and Stockholders
This document relates to a proposed transaction between the American Acquisition Opportunity Inc. and Royalty Management Corporation. This document does not constitute an offer to sell or exchange, or the solicitation of an offer to buy or exchange, any securities, nor will there be any sale of securities in any jurisdiction in which such offer, sale or exchange would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. American Acquisition Opportunity Inc. intends to file a registration statement on Form S-4 with the SEC, which will include a document that serves as a prospectus and proxy statement of American Acquisition Opportunity Inc., referred to as a proxy statement/prospectus. A proxy statement/prospectus will be sent to all of the American Acquisition Opportunity Inc.'s stockholders. American Acquisition Opportunity Inc. also will file other documents regarding the proposed transaction with the SEC. Before making any voting decision, investors and security holders of American Acquisition Opportunity Inc. are urged to read the registration statement, the proxy statement/prospectus and all other relevant documents filed or that will be filed with the SEC in connection with the proposed transaction as they become available because they will contain important information about the proposed transaction.
Investors and security holders will be able to obtain free copies of the registration statement, the proxy statement/prospectus and all other relevant documents filed or that will be filed with the SEC by the American Acquisition Opportunity Inc. through the website maintained by the SEC at www.sec.gov.
Special Note Regarding Forward-Looking Statements
This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks, uncertainties, and other important factors that could cause the Company's actual results, performance, or achievements or industry results to differ materially from any future results, performance, or achievements expressed or implied by these forward-looking statements. These statements are subject to a number of risks and uncertainties, many of which are beyond American Resources Corporation's control. The words "believes", "may", "will", "should", "would", "could", "continue", "seeks", "anticipates", "plans", "expects", "intends", "estimates", or similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. Any forward-looking statements included in this press release are made only as of the date of this release. The Company does not undertake any obligation to update or supplement any forward-looking statements to reflect subsequent events or circumstances. The Company cannot assure you that the projected results or events will be achieved.
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RedChip Companies Inc.
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