PHX Minerals Inc.

09/24/2021 | Press release | Distributed by Public on 09/24/2021 10:48

Completion of Acquisition (Form 8-K)

Completion of Acquisition

As previously disclosed, on September 16, 2021, PHX Minerals Inc. (the "Company" or "PHX")entered into two separate Purchase and Sale Agreements (collectively, the "Purchase Agreements") with affiliated sellers to acquire certain mineral and royalty assets primarily located in De Soto, Caddo, Bossier and Sabine Parishes, Louisiana and Harrison and Nacogdoches Counties, Texas located in the Haynesville play (the "Assets").

On September 24, 2021 ("Closing Date"), the Company completed the Acquisition for an aggregate consideration of $7,249,347, comprised of $728,214 in cash and 2,349,207shares of the Company's common stock (the "Equity Consideration"). The Assets acquired include mineral and royalty assets totaling approximately 817 net royalty acres in the Haynesville play. A portion of the Equity Consideration is being held in escrow to satisfy potential indemnity claims arising under the Purchase Agreements. To the extent not returned to the Company in connection with indemnity claims or to the extent not held in connection with any unresolved indemnity claims, the shares held in escrow will be released to Sellers approximately six months after the Closing Date.

The Purchase Agreements include registration rights relating to the Equity Consideration pursuant to which the Company agrees to register with the Securities and Exchange Commission the shares constituting the Equity Consideration. The Company agrees to file a resale registration statement and to use reasonable best efforts to cause such registration statement to be declared effective as promptly as possible after the filing thereof.

The foregoing description of the Purchase Agreements is qualified in its entirety by reference to the full text of the Purchase Agreements, which has been filed as Exhibits 10.1 and 10.2 to the Current Report on Form 8-K filed on September 16, 2021 and which are incorporated by reference herein.

Unregistered Sales of Equity Securities

The information regarding the Purchase Agreement and the issuance of the Equity Consideration contemplated thereunder set forth in Item 2.01 of this Current Report on Form 8-K is incorporated into this Item 3.02 by reference. The Equity Consideration was issued in reliance upon an exemption from the registration requirements of the Securities Act of 1933, as amended, pursuant to Section 4(a)(2) thereof, which exempts transactions by an issuer not involving any public offering.

Financial Statements & Exhibits.

(d) Exhibits