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At the
closing, Harvest received $80 million in cash, a $12 million six-month 11% note
payable to Harvest by the purchaser, and cancellation of $30 million in debt
owed by Harvest to CT Energy. Harvest
used part of this cash consideration to pay the remaining debt it owed to CT
Energy and for other expenses and adjustments associated with the
transaction. Net cash proceeds received
after paying the above closing adjustments and other expenses was $69.4
million. Also at the closing, CT Energy
relinquished its 8,667,597 shares of Harvest common stock, which will be held
as treasury shares, and agreed to terminate the warrant, issued in June 2015,
to purchase up to an additional 34,070,820 shares of Harvest common stock. With the return of the shares held by CT
Energy, Harvest now has 44,318,567 outstanding shares.
After
receiving payment of the purchaser's note payable of $12.0 million less taxes,
funding a reserve for potential change of control payments and working capital,
the estimated cash remaining is expected to be $62 million. Upon the potential exercise of vested options
held by employees, the estimated outstanding shares of Harvest common stock is
expected to be 48,693,768 shares.
As a result
of the transaction, Harvest has ceased to have a presence in Venezuela, two
of the directors appointed by CT Energy to Harvest's board resigned, Harvest
owes no debt to CT Energy, and the relationship between Harvest and CT Energy
has terminated.
Going
forward, Harvest's primary tangible asset is its oil and gas interests in Gabon. Harvest has received two proposals for the
purchase of its Gabon
interests and is in discussions with both potential buyers; however, there can
be no assurances that these discussions or either proposal may lead to a
definitive transaction. Harvest is
currently evaluating the possible sale of its Gabon interests, distributions of
cash to its stockholders, and possible dissolution of the Company.
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