KLR Energy Acquisition Corp. ("KLRE" or the “Company”)
(NASDAQ:KLRE) (NASDAQ:KLREU) (NASDAQ:KLREW) today announced the
completion of its business combination with Tema Oil and Gas
Company ("Tema"), an oil and gas exploration and production company
with assets in the core of the Delaware Basin in Loving County,
Texas. The transaction was approved by the boards of directors of
both companies and was approved at a special meeting of KLRE's
stockholders on April 26, 2017. In connection with the
transaction, the Company has been renamed Rosehill Resources Inc.
(“Rosehill Resources”), and its common stock, units and warrants
will begin trading on The NASDAQ Capital Market under the symbols
"ROSE", “ROSEU” and "ROSEW”, respectively, on April 28, 2017.
Gary Hanna, Rosehill Resources’ Chairman of the
Board of Directors commented, “We are very pleased to finalize the
combination of KLRE and Tema. We believe the newly-formed Rosehill
Resources has a solid foundation of high growth assets with core
locations in the Delaware Basin, a strong balance sheet and an
experienced management team. The Company is well-positioned for
growth and success in this prolific basin.”
J.A. (Alan) Townsend, Rosehill Resources’ Chief
Executive Officer added, “We believe Rosehill Resources’ proven
track record of operational excellence and strong well results
demonstrates the underlying value of our Delaware Basin acreage.
Rosehill Resources now has the size and capability to build on its
core Delaware Basin portfolio through acquisitions, exploitation
and exploration, which will provide a solid foundation of
production growth and add value for our shareholders.”
The size of the Company's board of directors has
been increased from five members to seven members, and consists
of Gary C. Hanna, Edward Kovalik, J.A. (Alan)
Townsend, Frank Rosenberg, William Mayer, Harry
Quarls, and Francis Contino.
In connection with the business combination,
certain institutional investors purchased $75 million of Rosehill
Resources Series A Preferred Stock and warrants (the "Private
Placement"). In addition, Tema's parent, Rosemore, Inc.
("Rosemore"), and KLRE's sponsor, KLR Energy Sponsor, LLC
(“Sponsor”), purchased $20.0 million of Series A Preferred Stock to
backstop redemptions (the “Backstop”). The proceeds of the Private
Placements and the Backstop were used to fund a portion of the cash
consideration required to effect the business combination.
Following the closing of the transaction, Tema and its affiliates,
including Rosemore, collectively are the single largest stockholder
of Rosehill Resources. Sponsor is expected to retain a significant
equity stake in Rosehill Resources and has two representatives on
Rosehill Resources' Board of Directors.
Advisors
BMO Capital Markets and KLR Group, LLC ("KLR
Group") acted as private placement agents to KLRE. Vinson &
Elkins L.L.P. acted as legal counsel to KLRE and KLR Group. Petrie
Partners, LLC acted as financial advisor and Norton Rose Fulbright
US LLP acted as legal counsel to Rosemore and Tema.
About Rosehill Resources Inc. (formerly
known as KLR Energy Acquisition Corp.)
Rosehill Resources is an oil and gas exploration
company with producing assets in Texas and New Mexico, and its
investment activity will be focused on the Delaware Basin portion
of the Permian Basin. The Company’s strategy for growth will
include the organic development of its core acreage position in
Loving County as well as focused acquisitions in the Delaware
Basin.
About KLR Group
KLR Group is a full-service boutique investment
bank focused on the energy industry founded in 2012 and led by
Edward Kovalik, Stephen Lee and Reid Rubinstein. With offices in
Houston and New York, KLR Group is committed to providing clients
access to a broad range of financial services, advice and solutions
typically available only to the largest public companies. These
solutions include public and private, corporate and asset-level
financings across the capital spectrum, advisory services, equity
research, sales and trading, and merchant banking. To learn more
about KLR Group, please visit www.KLRGroup.com.
Forward-Looking Statements
This communication includes certain statements that
may constitute "forward-looking statements" for purposes of the
federal securities laws. Forward-looking statements include, but
are not limited to, statements that refer to projections, forecasts
or other characterizations of future events or circumstances,
including any underlying assumptions. The words "anticipate,"
"believe," "continue," "could," "estimate," "expect," "intends,"
"may," "might," "plan," "possible," "potential," "predict,"
"project," "should," "would" and similar expressions may identify
forward-looking statements, but the absence of these words does not
mean that a statement is not forward-looking. Forward-looking
statements may include, for example, statements about: the benefits
of the business combination; the future financial performance of
the Company following the business combination; changes in the
Company’s reserves and future operating results; and expansion
plans and opportunities. These forward-looking statements are based
on information available as of the date of this communication, and
current expectations, forecasts and assumptions, and involve a
number of judgments, risks and uncertainties. Accordingly,
forward-looking statements should not be relied upon as
representing the Company’s views as of any subsequent date, and the
Company does not undertake any obligation to update forward-looking
statements to reflect events or circumstances after the date they
were made, whether as a result of new information, future events or
otherwise, except as may be required under applicable securities
laws. You should not place undue reliance on these forward-looking
statements. As a result of a number of known and unknown risks and
uncertainties, the Company’s actual results or performance may be
materially different from those expressed or implied by these
forward-looking statements. Some factors that could cause actual
results to differ include: (i) the outcome of any legal proceedings
that may be instituted against the Company following announcement
and closing of the business combination and transactions
contemplated thereby; (ii) the risk that the proposed business
combination disrupts current plans and operations of the Company as
a result of the announcement and consummation of the transactions
described herein; (iii) the Company’s ability to recognize the
anticipated benefits of the business combination, which may be
affected by, among other things, competition and the ability of the
Company to grow and manage growth profitably following the business
combination; (iv) costs related to the business combination; (v)
changes in applicable laws or regulations; (vi) the possibility
that the Company may be adversely affected by other economic,
business, and/or competitive factors , including, but not limited
to, future trends in energy markets and commodity prices; and (vii)
other risks and uncertainties described herein, as well as those
risks and uncertainties discussed from time to time in other
reports and other public filings with the Securities and Exchange
Commission (the "SEC") by the Company.
Additional information concerning these and other
factors that may impact our expectations and projections can be
found in our periodic filings with the SEC, including our Annual
Report on Form 10-K for the fiscal year ended December 31, 2016,
and in the definitive proxy statement filed by the Company with the
SEC on April 12, 2017, as amended or supplemented. Our SEC filings
are available publicly on the SEC's website at www.sec.gov. The
Company disclaims any obligation to update the forward-looking
statements, whether as a result of new information, future events
or otherwise, except as may be required under applicable securities
laws.
Disclaimer
This communication shall neither constitute an
offer to sell or the solicitation of an offer to buy any
securities, nor shall there be any sale of securities in any
jurisdiction in which the offer, solicitation or sale would be
unlawful prior to the registration or qualification under the
securities laws of any such jurisdiction.
Contact:
KLR Energy Acquisition Corp. / Rosehill Resources Inc.
Gary C. Hanna
(713) 654-8080
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