Royale Energy enters into definitive merger agreement with Matrix Oil Management
Royale Energy and privately held Matrix Oil Management Corporation jointly announced that they have entered into a definitive agreement to merge whereby Royale will acquire substantially all of Matrix, and certain Matrix affiliated entities in exchange for 50% of the common stock of the Company, the assumption of Matrix's senior secured debt in the amount of approximately $12.4M, and the issuance of approximately $20.1M of a newly created Series B Convertible Preferred stock to Matrix's shareholders. The Transaction remains subject to the approval of the shareholders of both companies. This strategic transaction will create a high-growth California-focused operating company with an executive team experienced in raising accretive capital and acquiring, operating and developing successful oil and gas projects. The Sansinena Field in which Matrix acquired a 50% interest in June 2016 in particular provides more than 40M barrels of oil equivalent of net 3P reserves, of which more than 12M BOE of those reserves are in the proved reserve category. Upon consummation of the Transaction, Jonathan Gregory will continue to serve as CEO of Royale, while Johnny Jordan, President of Matrix, will serve as President and COO. Don Hosmer will continue to lead Royale's Direct Working Interest program, which has successfully raised over $9M in direct drilling funds during the last 24 months. Royale's 30-year history of raising outside drilling funds will prove instrumental in funding the development of the combined companies' substantial undeveloped reserve base.