Alpharetta, Georgia, Feb. 25, 2015 (GLOBE NEWSWIRE) -- ("Legend", the
"Company") is pleased to announce
that it has entered into a nonbinding letter of intent (LOI) with
Black Diamond Energy Holdings, LLC (dba Maxxon
Energy and related companies- together Maxxon), to
purchase 100% of its limited liability company membership
interests.
The purchase price to be paid is $4.354 million,
with an initial payment of $1.5 million at closing, and the balance
of the purchase price being payable pursuant to a secured
promissory note in the principal amount of $2,854,000 due on the
first anniversary date of closing, together with five (5%) percent
interest per annum. The note will be secured by certain
assets of the acquired combined entities. The original
founders of Maxxon will also receive newly created Legend perpetual
convertible preferred stock with a value of approximately
$260,000.
Maxxon was founded in 2012 and has grown from
zero revenue to over $10 million in 2014 revenue (unaudited).
Maxxon is a last mile trucking company in North Dakota (The
Bakken), transporting oil for various companies, many of which are
some of the largest oil producing operators in North Dakota.
Its customers include Statoil, Northern Tier Energy (Western
Refineries) and Bridger Trading Group.
Maxxon's unaudited net income and EBITDA of over
$1.5 million for the year ended December 31, 2014, currently has no
debt and as of the same year end had (unaudited) approximately $6
million in total assets (which include cash, receivables and the
depreciated value of its rolling stock).
Maxxon began operations in 2012 with six (6) trucks and as of
2015 owns 13 trucks, with additional leases of seven (7) trucks,
for a current operational fleet of 20 trucks. The combined
Maxxon-Legend management team expects that by June 30, 2015,
subsequent to closing of the acquisition by Legend, total trucks in
operation will be between 25 to 30 trucks owned and/or
operated.
Based on internal forecasts, Al Valentin, Maxxon
CEO and founder, indicates that "2015 is growing substantially in
all metrics organically, with improvements expected with assistance
by the Legend management team and its philosophy of making the
appropriate investments in infrastructure to allow that continuing
growth to occur. This transaction is exactly what we have
been looking for-- to grow the company and build long-term
sustainability." Valentin further states that "both Andy Reckles,
Legend CEO, and Warren Binderman, Legend CFO, will become an
integral part of making Maxxon and Legend together, more
synergistic, working alongside us to enhance value for company-wide
stakeholders."
Binderman notes that "this deal is the result of
great cooperation between the soon to be combined companies, and
the efficiencies that will enhance stakeholder value." Binderman
further states that "in working through the mechanics of the
acquisition, Al and his management team have shown themselves to be
excellent operators who know how to build a business producing
significant returns on investment. We are looking forward to
working closely with all parties as we integrate into one
company."
Reckles states that "we at Legend couldn't be
more excited about the possible acquisition of Maxxon Energy.
Al has proven that he is an excellent manager and knows exactly how
to grow a business. We are only too happy to make Maxxon a
part of the Legend family and are looking forward to growing our
oil field services segment around the Maxxon platform."
The LOI is nonbinding and the parties are
conducting diligence and working toward a definitive purchase
agreement which they hope to sign and close upon in approximately
30 to 45 days. As a result of the nonbinding nature of the
LOI, there is currently no assurance that Legend will complete its
purchase of 100% of the equity interests of Maxxon.
About Legend Oil and Gas Ltd.
Legend Oil and Gas Ltd. is a managed risk, oil
and gas exploration/exploitation, development and production
company with activities currently focused on leases in southeastern
Kansas and Oklahoma.
Forward-looking Statements:
This press release contains forward-looking
statements concerning future events and the Company's growth and
business strategy. Words such as "expects," "will," "intends,"
"plans," "believes," "anticipates," "hopes," "estimates," and
variations on such words and similar expressions are intended to
identify forward-looking statements. Although the Company believes
that the expectations reflected in such forward-looking statements
are reasonable, no assurance can be given that such expectations
will prove to have been correct. Forward looking statements in this
press release include statements about our drilling development
program. These statements involve known and unknown risks and
are based upon a number of assumptions and estimates that are
inherently subject to significant uncertainties and contingencies,
many of which are beyond the control of the Company. Actual results
may differ materially from those expressed or implied by such
forward-looking statements. Factors that could cause actual results
to differ materially include, but are not limited to, the timing
and results of our 2015 drilling and development plan.
Additional factors include increased expenses or unanticipated
difficulties in drilling wells, actual production being less than
our development tests, changes in the Company's business;
competitive factors in the market(s) in which the Company operates;
risks associated with oil and gas operations in the United States;
and other factors listed from time to time in the Company's filings
with the Securities and Exchange Commission including the Company's
Annual Report on Form 10-K for the year ended December 31, 2013 and
Form 10-Q for the quarter ended September 30, 2014. The Company
expressly disclaims any obligations or undertaking to release
publicly any updates or revisions to any forward-looking statements
contained herein to reflect any change in the Company's
expectations with respect thereto or any change in events,
conditions or circumstances on which any statement is based.
CONTACT: Warren Binderman
Chief Financial Officer
(678) 366-4587
