Torchlight Eliminates $1,100,953 in Debt

Rhea-AI Summary

Torchlight Energy Resources (NASDAQ:TRCH) announced a significant debt conversion, with $1,100,953 of subordinated debt being converted into common stock. Specifically, $500,000 converts at $0.43 per share and $600,953 at a new price of $0.50, down from $0.75. CEO John Brda views this as a crucial step towards finalizing Torchlight's proposed business combination with Metamaterial Inc., highlighting the importance of reducing outstanding debt.

Positive

• Conversion of $1,100,953 subordinated debt into common stock improves balance sheet.
• Lower conversion prices ($0.43 and $0.50) facilitate debt reduction.

Negative

• None.

PLANO, TX / ACCESSWIRE / December 23, 2020 / Torchlight Energy Resources, Inc. (NASDAQ:TRCH), an oil and gas exploration company ("Torchlight"), announced today that the holders of $1,100,953 of Torchlight's subordinated debt have agreed to convert such debt into the common stock of Torchlight, with $500,000 of the subordinated debt converting at $0.43 per share, and $600,953 of the subordinated debt converting at a renegotiated conversion price of $0.50 per share, as compared to the original conversion price of $0.75.

"The conversion of this portion of Torchlight's debt is a positive step for the Company," stated John Brda, Chief Executive Officer of Torchlight. "Not only is this progress toward the closing of Torchlight's proposed business combination with Metamaterial Inc., but we also believe it to be a good practice to clean outstanding debt off of our books."

About Torchlight Energy Resources, Inc.

Torchlight Energy Resources, Inc. (TRCH), based in Plano, Texas, is a high growth oil and gas Exploration and Production (E&P) company with a primary objective of acquisition and development of domestic oil fields. Torchlight has assets focused in West and Central Texas where their targets are established plays such as the Permian Basin. For additional information on Torchlight, please visit www.torchlightenergy.com.

Forward-Looking Statement

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which are intended to be covered by the "safe harbor" created by those sections. All statements in this release that are not based on historical fact are "forward looking statements." These statements may be identified by words such as "estimates," "anticipates," "projects," "plans," "strategy," "goal," or "planned," "seeks," "may," "might", "will," "expects," "intends," "believes," "should," and similar expressions, or the negative versions thereof, and which also may be identified by their context. All statements that address operating performance or events or developments Torchlight Energy Resources expects or anticipates will occur in the future, such as stated objectives or goals, our refinement of strategy, our attempts to secure additional financing, our exploring possible business alternatives, or that are not otherwise historical facts, are forward-looking statements. While management has based any forward-looking statements included in this release on its current expectations, the information on which such expectations were based may change. Forward-looking statements involve inherent risks and uncertainties which could cause actual results to differ materially from those in the forward-looking statements as a result of various factors, including those risks and uncertainties described in or implied by the Risk Factors and in Management's Discussion and Analysis of Financial Condition and Results of Operations sections of our 2019 Annual Report on Form 10-K, filed on March 16, 2020 and our other reports filed from time to time with the Securities and Exchange Commission. We urge you to consider those risks and uncertainties in evaluating our forward-looking statements. We caution readers not to place undue reliance upon any such forward-looking statements, which speak only as of the date made. Except as otherwise required by the federal securities laws, we disclaim any obligation or undertaking to publicly release any updates or revisions to any forward-looking statement contained herein (or elsewhere) to reflect any change in our expectations with regard thereto, or any change in events, conditions, or circumstances on which any such statement is based.

Additional Information and Where to Find It

Torchlight will prepare a proxy statement for Torchlight's stockholders to be filed with the SEC. The proxy statement will be mailed to Torchlight's stockholders. Torchlight urges investors, stockholders and other interested persons to read, when available, the proxy statement, as well as other documents filed with the SEC, because these documents will contain important information about the proposed business combination transaction. Such persons can also read Torchlight's Annual Report on Form 10-K for the fiscal year ended December 31, 2019, for a description of the security holdings of its officers and directors and their respective interests as security holders in the consummation of the transactions described herein. Torchlight's definitive proxy statement will be mailed to stockholders of Torchlight as of a record date to be established for voting on the proposed business combination. Torchlight's stockholders will also be able to obtain a copy of such documents, without charge, by directing a request to: John A. Brda, President of Torchlight Energy Resources, Inc., 5700 W. Plano Parkway, Suite 3600, Plano, Texas 75093; e-mail: john@torchlightenergy.com. These documents, once available, can also be obtained, without charge, at the SEC's web site (http://www.sec.gov).

Participants in Solicitation

Torchlight and its directors, executive officers and other members of their management and employees, under SEC rules, may be deemed to be participants in the solicitation of proxies of Torchlight stockholders in connection with the proposed business combination. Investors and security holders may obtain more detailed information regarding the names, affiliations and interests of Torchlight's directors in its Annual Report on Form 10-K for the fiscal year ended December 31, 2019, which was filed with the SEC on March 16, 2020. Information regarding the persons who may, under SEC rules, be deemed participants in the solicitation of proxies to Torchlight's stockholders in connection with the proposed business combination will be set forth in the proxy statement for the proposed business combination when available. Information concerning the interests of Torchlight's participants in the solicitation, which may, in some cases, be different than those of Torchlight's equity holders generally, will be set forth in the proxy statement relating to the proposed business combination when it becomes available.

Investor Relations Contact

Derek Gradwell
Integrous Communications
Phone: 512-270-6990
dgradwell@integcom.us, ir@torchlightenergy.co

SOURCE: Torchlight Energy Resources, Inc.

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FAQ

What is the significance of Torchlight Energy Resources converting $1,100,953 in debt?

The conversion reduces long-term liabilities, aiding Torchlight's financial health and facilitating a merger with Metamaterial Inc.

What are the new conversion prices for Torchlight's subordinated debt?

The new conversion prices are $0.43 per share for $500,000 and $0.50 per share for $600,953.

How does debt conversion affect TRCH's stock performance?

Debt conversion can positively impact stock performance by improving the company's balance sheet and reducing financial risk.

Who is the CEO of Torchlight Energy Resources?

John Brda is the CEO of Torchlight Energy Resources.