TMXU-Same people that did reverse merger for PFAP back in January. Brian Sherer from Silicon Valley Bank and Cagan Mcafee Capital Partners.
PFAP formerly Pacific East Advisors trading at $13 per share with a market Cap of 507 million dollars.
Pacific East Advisors, Inc. Announces $17 Million Funding, Name Change to Pacific Asia Petroleum, Inc. and Merger With Inner Mongolia Production Company LLC and Advanced Drilling Services, LLC
CUPERTINO, Calif., May 8 /PRNewswire-FirstCall/ -- Pacific East Advisors, Inc. ("PEA"), a Delaware company whose shares are publicly quoted for sale on the Pink Sheets under the symbol "PCAD.PK", today announced that effective May 7, 2007, (i) Advanced Drilling Services, LLC ("ADS"), a Delaware limited liability company, merged with and into DrillCo Acquisition, LLC ("DrillCo Merger Sub"), a Delaware limited liability company and a wholly-owned subsidiary of PEA (the "DrillCo Merger"), and (ii) Inner Mongolia Production Company LLC ("IMPCO"), a New York limited liability company, merged with and into IMPCO Acquisition, LLC ("IMPCO Merger Sub"), a New York limited liability company and a wholly-owned subsidiary of PEA (the "IMPCO Merger," and together with the DrillCo Merger, the "Mergers"). Under the terms of the Mergers, ADS' and IMPCO's operations were merged with and into DrillCo Merger Sub and IMPCO Merger Sub, respectively, with these merger subsidiaries carrying on the ongoing business operations of ADS and IMPCO, interest holders of ADS and IMPCO became stockholders of PEA, PEA changed its name to "Pacific Asia Petroleum, Inc.," and all of the officers and directors of PEA resigned and the following persons were appointed as officers and directors of PEA: (i) Frank C. Ingriselli, Chief Executive Officer, President, Secretary and Director; (ii) Laird Q. Cagan, Director; (iii) Elizabeth P. Smith, Director; (iv) Stephen F. Groth, Vice President and Chief Financial Officer; and (v) Jamie Tseng, Executive Vice President.
Immediately prior to the closing of the Mergers, ADS closed a private equity financing (the "Offering") which raised $17 million in exchange for the issuance of 13,600,000 ADS Class B Interests to qualified investors. Upon the closing of the Mergers, (i) each of the 9,850,000 ADS Class A Interests which were issued and outstanding automatically converted on a 1:1 basis into the right to receive an aggregate of 9,850,000 shares of PEA Common Stock, (ii) each of the 13,600,000 ADS Class B Interests issued in the Offering which were issued and outstanding automatically converted on a 1:1 basis into the right to receive an aggregate of 13,600,000 shares of PEA Series A Preferred Stock, (iii) each of the 347,296 IMPCO Class A Units which were issued and outstanding automatically converted on a 1:17 basis into the right to receive an aggregate of 5,904,032 shares of PEA Common Stock, and (iv) each of the 594,644 IMPCO Class B Units which were issued and outstanding automatically converted on a 1:17 basis into the right to receive an aggregate of 10,108,948 shares of PEA Series A Preferred Stock. Following the Mergers and the financings detailed herein, PEA's outstanding shares total 16,222,154 shares of Common Stock and 23,708,952 shares of Series A Preferred Stock, for an aggregate total of 39,931,106 shares of capital stock outstanding. Further, PEA now has outstanding warrants to purchase 1,860,000 shares of Series A Preferred Stock, outstanding options to purchase 836,400 shares of Common Stock, and has reserved 4,000,000 shares of Common Stock under PEA's 2007 Stock Plan (of which no shares or options have been issued or granted).
PEA was incorporated in the State of Delaware in 1979 under the name "Gemini Marketing Associates, Inc." In 1994, PEA changed its name to "Big Smith Brands, Inc.," and in 2006 PEA changed its name to "Pacific East Advisors, Inc." As described above, PEA's new name is now "Pacific Asia Petroleum, Inc." ("Pacific Asia Petroleum").
IMPCO and ADS have collectively raised approximately $21.6 million in private equity financings to date. Immediately prior to the closing of the Mergers, ADS closed a private equity financing which raised $17 million, and in the third quarter of 2006, IMPCO closed a private equity financing that raised approximately $4.6 million. Using proceeds raised in the IMPCO offering, IMPCO already commenced operational activities in China and successfully drilled its first producing well in a prospective area in Inner Mongolia.
Pacific Asia Petroleum is a holding company for new energy ventures to be developed through its subsidiaries, including IMPCO and ADS, and through joint ventures and other partnerships in which its subsidiaries will participate, in order to reduce risk in these ventures. As a result of the Mergers, Pacific Asia Petroleum became the parent company of Inner Mongolia Production Co (HK) Limited, a wholly-owned subsidiary of IMPCO organized under the laws of Hong Kong ("IMPCO HK"), and a Chinese joint venture company named Inner Mongolia Sunrise Petroleum JV Company, which is owned 97% by IMPCO HK and 3% by Beijing Jinrun Hongda Technology Co., Ltd. (an unaffiliated Chinese corporation), that was formed as an indirect subsidiary of IMPCO to engage in Chinese energy ventures. While it is possible that Pacific Asia Petroleum may engage in projects through these and other subsidiaries and joint ventures in which it is involved in the staffing of personnel and/or be involved in other phases of operations in energy ventures, Pacific Asia Petroleum envisions that a significant portion of its business will be limited to investments in these ventures. Pacific Asia Petroleum believes that this business strategy will help Pacific Asia Petroleum maximize returns, reduce exposure and spread risk appropriately among several ventures.
The members of Pacific Asia Petroleum's new senior management team has collectively over 125 years of global experience in the fields of petroleum engineering, geology, field development and production, operations, international business development, and finance. Several members of the Pacific Asia Petroleum management team have held management and executive positions with Texaco Inc. and have managed successful and profitable projects in China, elsewhere in Asia, and around the world. The Pacific Asia Petroleum management team is bolstered with the addition of experts in oil drilling, operations, geological, engineering and sales, all of whom have experience working in China's energy sector.
Pacific Asia Petroleum's first venture, which already has been initiated by IMPCO, involves the drilling of several oil wells in recently discovered fields in Inner Mongolia, China, and has already yielded revenues in the first quarter of 2007. As a result of the Mergers, Pacific Asia Petroleum has also become a party to a number of letters of intent, including (i) a letter of intent providing a subsidiary of Pacific Asia Petroleum with certain rights related to China's Mudanjiang Energy Development Project, and (ii) a letter of intent granting a subsidiary of Pacific Asia Petroleum an economic interest in a joint venture for bus manufacturing in Tianjin, China, involving the import of advanced hydraulic hybrid energy technology for the production of buses.
In addition, in November 2006 IMPCO entered into an Agreement for Joint Cooperation with China United Coalbed Methane Co., Ltd. (the Chinese Government-designated company holding exclusive rights to negotiate with foreign companies), which agreement provides exclusive rights to a large prospective contract area for coal bed methane ("CBM") production located in the Shanxi Province of China, with an option to convert such agreement into a production sharing agreement. Pacific Asia Petroleum is also currently negotiating an additional CBM production sharing opportunity in China. CBM is a high-profile focus area of the Chinese Government and an area where China encourages foreign investment. To assist in its efforts, Pacific Asia Petroleum has enlisted the aid of one of the world's premier CBM experts who successfully assisted in the development and operation of the first such CBM venture in China with the international energy industry. Pacific Asia Petroleum hopes to finalize one or more of these CBM production sharing agreements so that an early production scheme can be realized.
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