8-K
Verde Clean Fuels, Inc. (VGAS)
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT REPORT
**** Pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): May 15, 2023
Verde Clean Fuels, Inc.
****(Exact name of registrant as specified in its charter)
| Delaware | 001-40743 | 85-1863331 |
|---|---|---|
| (State or other jurisdiction of<br><br> incorporation or organization) | (Commission File Number) | (I.R.S. Employer <br><br>Identification No.) |
600 Travis Street, Suite 5050
Houston, TX 77002
(469
)
398-2200
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation to the registrant under any of the following provisions:
| ☐ | Written<br>communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|---|---|
| ☐ | Soliciting<br>material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| --- | --- |
| ☐ | Pre-commencement<br>communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| --- | --- |
| ☐ | Pre-commencement<br>communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
| --- | --- |
Securities registered pursuant to Section 12(b) of the Act:
| Title of Each Class | Trading Symbol(s) | Name of each exchange on which registered |
|---|---|---|
| Class A Common Stock, par value $0.0001 per share | VGAS | The Nasdaq Capital Market |
| Warrants, each whole warrant exercisable for one share of Class A Common Stock at an exercise price of $11.50 per share | VGASW | The Nasdaq Capital Market |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934.
Emerging growth company ☒
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☒
Item 2.02. Results of Operations and FinancialCondition
On May 15, 2023, Verde Clean Fuels, Inc. (the “Company”) issued a press release reporting the financial results for its first quarter 2023. A copy of the press release is attached to this Current Report on Form 8-K (“Current Report”) as Exhibit 99.1 and is incorporated herein solely for purposes of this Item 2.02 disclosure.
Item 9.01. Financial Statement and Exhibits.
(d) Exhibits.
| Exhibit Number | Description |
|---|---|
| 99.1* | Press Release dated May 15, 2023 |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). |
| * | Filed herewith. |
| --- | --- |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Date: May 15, 2023 | Verde Clean Fuels, Inc. | ||
|---|---|---|---|
| By: | /s/ Ernest Miller | ||
| Name: | Ernest Miller | ||
| Title: | Chief Executive Officer and <br><br>Interim Chief Financial Officer |
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Exhibit 99.1
Verde Clean Fuels, Inc. Reports First Quarter2023 Earnings
Houston, TX, May 15, 2023 - Verde Clean Fuels, Inc. (Nasdaq: VGAS) (“Verde”), a company focused on becoming leading supplier of gasoline and other fuels derived from renewable feedstocks or natural gas, today reported first quarter 2023 GAAP diluted loss per share of $(0.09). The loss consists of ongoing general and administrative and research and development expenses related to the Company’s continuing focus on development of its first commercial facility based on Verde’s proprietary STG+® technology which is designed to produce gasoline utilizing either stranded natural gas or waste feedstocks that are otherwise landfilled.
Business Update Highlights
| ● | Progressed development of the Verde/Cottonmouth Ventures Joint Venture converting natural gas to gasoline in the Permian Basin. Verde and Cottonmouth Ventures LLC, a wholly-owned subsidiary of Diamondback Energy,<br> Inc., are evaluating multiple Permian Basin locations in collaboration with other natural<br> gas players to provide a higher value outlet for Permian Basin gas. |
|---|---|
| ● | Advanced the Front-End Engineering and Design (FEED) preparations for the Maricopa, Arizona renewable gasoline project. Verde contractors have begun conducting site diligence on the Verde lease within Waste Management’s Sierra Estrella landfill in Maricopa, Arizona. The company is conducting geotechnical analysis, water well testing, electricity interconnection studies, among other site-related evaluations. Verde is optimizing the Arizona plant configuration to realize the most value to the project from recently passed regulatory changes such as the Inflation Reduction Act. |
| --- | --- |
| ● | Verde has received preliminary approval from the Arizona Industrial Development Authority not-to-exceed<br>$250,000,000 of revenue bonds to be issued from time to time in one or more tax-exempt and/or taxable series to finance biofuel production<br>and transmission facilities to be located in Maricopa County, Gila County and/or Pinal County, Arizona, for the benefit of Maricopa Renewable<br>Fuels I, LLC and its affiliates. |
| --- | --- |
| ● | Identified strategic priorities for 2023 that will support Verde’s first commercial deployment<br>of its STG+ syngas-to-gasoline process. |
| --- | --- |
“Verde has taken significant steps toward the first commercial deployment of our STG+ process. This milestone will begin to establish the value of the company as we grow our renewable and natural gas derived synthetic gasoline businesses. I applaud the Verde team on their execution to date,” said Ernie Miller, chief executive officer.
Verde Clean Fuels, Inc. was formed through the completion of the previously announced business combination between CENAQ Energy Corp. and Bluescape Clean Fuels Intermediate Holdings, LLC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
| Three-months ended | Three-months ended | |||||
|---|---|---|---|---|---|---|
| March 31,2023 | March 31,2022 | |||||
| General and administrative expenses | $ | 4,333,465 | $ | 1,328,035 | ||
| Contingent Consideration | (1,299,000 | ) | - | |||
| Research and development expenses | 82,662 | 97,242 | ||||
| Total Operating (income) loss | 3,117,127 | 1,425,277 | ||||
| Provision for income taxes | - | - | ||||
| Net income (net loss) | (3,117,127 | ) | (1,425,277 | ) | ||
| Net income (loss) attributable to noncontrolling interest | (2,542,666 | ) | - | |||
| Net income (loss) attributable to Verde Clean Fuels, Inc. | $ | (574,461 | ) | $ | (1,425,277 | ) |
| Earnings per share | ||||||
| Weighted average Class A Common Stock outstanding, basic and diluted | 6,124,245 | N/A | ||||
| Loss per Share of Class A Common Stock | $ | (0.09 | ) | N/A |
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CONSOLIDATED BALANCE SHEETS
(Unaudited)
| December 31,2022 | |||||
|---|---|---|---|---|---|
| Current assets: | |||||
| Cash and cash equivalents | 34,807,815 | $ | 463,475 | ||
| Restricted cash | 100,000 | - | |||
| Prepaid expenses | 1,571,318 | 113,676 | |||
| Deferred transaction costs | - | 3,258,880 | |||
| Deferred financing costs | 28,847 | 6,277 | |||
| Total current assets | 36,507,980 | 3,842,308 | |||
| Non current assets: | |||||
| Security deposits | 258,000 | 258,000 | |||
| Property, plant and equipment, net | 6,834 | 7,414 | |||
| Operating lease right-of-use assets, net | 268,085 | 323,170 | |||
| Finance lease right of use assets, net | 5,432,847 | - | |||
| Intellectual patented technology | 1,925,151 | 1,925,151 | |||
| Total Non-current assets | 7,890,917 | 2,513,735 | |||
| Total assets | 44,398,897 | $ | 6,356,043 | ||
| LIABILITIES AND STOCKHOLDER’S EQUITY | |||||
| Current liabilities: | |||||
| Accounts payable | 242,804 | $ | 2,857,223 | ||
| Accrued liabilities | 995,344 | 762,119 | |||
| Operating lease liabilities – current portion | 182,885 | 237,970 | |||
| Finance lease liabilities – current portion | 188,034 | - | |||
| Notes payable – insurance premium financing | 7,444 | 11,166 | |||
| Promissory note – related party | 409,279 | - | |||
| Income taxes payable | 312,446 | - | |||
| Total Current liabilities | 2,338,236 | 3,868,478 | |||
| Non-current liabilities: | |||||
| Contingent consideration | - | 1,299,000 | |||
| Other accrued expenses – long term | 1,587,975 | - | |||
| Operating lease liabilities | 85,200 | 85,200 | |||
| Finance lease liabilities – long term | 5,268,768 | - | |||
| Total Non-liabilities | 6,941,943 | 1,384,200 | |||
| Total liabilities | 9,280,179 | $ | 5,252,678 | ||
| Stockholders’ equity | |||||
| Intermediate Member’s Equity | - | $ | 12,775,902 | ||
| Class A common stock, par value 0.0001 per share, 9,358,620 shares issued and outstanding as of March 31, 2023 | 936 | - | |||
| Class C common stock, par value 0.0001 per share, 22,500,000 shares issued and outstanding as of March 31, 2023 | 2,250 | - | |||
| Additional paid in capital | 33,924,078 | - | |||
| Accumulated deficit | (21,753,603 | ) | (11,672,537 | ) | |
| Noncontrolling interest | 22,945,057 | - | |||
| Total stockholders’ equity | 35,118,718 | 1,103,365 | |||
| Total liabilities and stockholders’ equity | 44,398,897 | $ | 6,356,043 |
All values are in US Dollars.
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About Verde Clean Fuels
Verde Clean Fuels, Inc. is a renewable energy company specializing in the conversion of synthesis gas, or syngas, derived from diverse feedstocks, such as biomass, municipal solid waste and mixed plastics, as well as natural gas (including synthetic natural gas) and other feedstocks, into gasoline through an innovative and proprietary liquid fuels technology, the STG+^®^ process. Through its STG+^®^ process, Verde converts syngas into Reformulated Blend-stock for Oxygenate Blending (“RBOB”) gasoline. Verde is focused on the development of commercial facilities aimed at turning waste and other bio-feedstocks into a usable stream of syngas which is then transformed into a single finished fuel, such as gasoline, without any additional refining steps.
To learn more about Verde, please visit www.verdecleanfuels.com.
Forward Looking Statements
The information included herein and in any oral statements made in connection herewith include “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. All statements, other than statements of present or historical fact included herein, regarding the benefits of the transaction, Verde’s future financial performance following the transaction, as well as Verde’s strategy, future operations, financial position, estimated revenues and losses, projected costs, prospects, plans and objectives of management are forward-looking statements. When used herein, including any oral statements made in connection herewith, the words “could,” “should,” “will,” “may,” “believe,” “anticipate,” “intend,” “estimate,” “expect,” “project,” the negative of such terms and other similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. These forward-looking statements are based on Verde management’s current expectations and assumptions about future events and are based on currently available information as to the outcome and timing of future events. Except as otherwise required by applicable law, Verde disclaims any duty to update any forward-looking statements, all of which are expressly qualified by the statements in this section, to reflect events or circumstances after the date hereof. Verde cautions you that these forward-looking statements are subject to risks and uncertainties, most of which are difficult to predict and many of which are beyond the control of Verde. These risks include, but are not limited to, general economic, financial, legal, political and business conditions and changes in domestic and foreign markets; the failure to realize the anticipated benefits of the business combination, the risks related to the growth of Verde’s business and the timing of expected business milestones; the ability of Verde to obtain financing in connection with the transaction or in the future; and the effects of competition on Verde’s future business. Should one or more of the risks or uncertainties described herein and in any oral statements made in connection therewith occur, or should underlying assumptions prove incorrect, actual results and plans could differ materially from those expressed in any forward-looking statements. There may be additional risks that Verde presently do not know or that Verde currently believe are immaterial that could cause actual results to differ from those contained in the forward-looking statements. Additional information concerning these and other factors that may impact Verde’s expectations and projections can be found in Verde’s filings with the Securities and Exchange Commission (the “SEC”). Verde’s SEC filings are available publicly on the SEC’s website at www.sec.gov.
Contacts
Investor Relations Contact
For Verde Clean Fuels:
Ernie Miller – CEO
investor@verdecleanfuels.com
Media Contact
Kellie Woods
verde@ink-co.com
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