CINCINNATI, Jan. 21, 2014 /PRNewswire/ -- EQM Technologies
& Energy, Inc. (OTCQB: EQTE) ("EQM"), a leading provider of
environmental services to government and commercial sectors,
announced today that it has entered into a memorandum of
understanding (the "MOU") with Sullivan International Group, Inc.
("Sullivan") regarding a potential merger of EQM and Sullivan.
Sullivan, headquartered in San Diego,
CA, is a privately-held professional services firm providing
applied science, environmental, and technology services to the
commercial and government sectors.
The MOU, which is non-binding and subject to the satisfactory
completion of a mutual due diligence review, provides that EQM and
Sullivan will negotiate and enter into a merger agreement pursuant
to which Sullivan would merge with and into a subsidiary of
EQM. For the trailing 12 months as of September 30, 2013, EQM and Sullivan generated
approximately $100 million in
combined revenues. In the merger, Sullivan's stockholders
would receive approximately $2
million in cash and 16 million shares of EQM's common stock,
which amounts may be adjusted based on the parties' due diligence
review and EQM's expected debt level following the merger.
Upon completion of the merger, Sullivan's CEO Steve Sullivan would become President and a
director of EQM.
"A potential merger with Sullivan presents an exciting
opportunity for EQM to expand our revenue base and to produce
efficiencies that will benefit our customers and make us more
competitive in the marketplace," said Jon
Colin, Interim Chief Executive Officer of EQM. "We believe
that a merger with Sullivan would provide substantial value to
EQM's stockholders."
"Having worked with EQM over the past decade, the opportunity to
combine forces through a merger is a natural progression in this
already successful and mutually beneficial relationship," said
Steve Sullivan, Chief Executive
Officer of Sullivan. "A merger also will provide a broader base of
project opportunities essential to retaining existing employees and
attracting the top talent needed to compete in today's evolving
environmental industry."
The obligations of the parties to complete the merger under the
terms of the merger agreement would be subject to various
conditions, including but not limited to a condition that EQM raise
at least $10 million in net proceeds
in a PIPE or public offering of its common stock, that EQM and
Sullivan receive all required approvals in connection with the
merger and the financing and the drafting and execution of
definitive transaction documents. The parties plan to work
together to complete the financing on or before June 30, 2014. There can be no assurance
that the parties will enter into a merger agreement or will be able
to complete the financing or the merger.
The MOU contains a binding exclusivity provision in which
Sullivan has agreed that for 180 days it will not enter into
another agreement with a third party with respect to the
acquisition or sale of Sullivan or a material part of its assets,
or engage in any related discussions with a third party. This
exclusivity provision will be extended automatically for an
additional 180 days if EQM enters into a letter of intent or
similar agreement with an underwriter or placement agent with
respect to the financing.
Notwithstanding the above, the MOU does not preclude EQM from
continuing to pursue or close other potential acquisition
candidates.
About EQM Technologies & Energy, Inc.
EQM, based in Cincinnati, OH,
is a leading provider of environmental services - consulting &
engineering, clean technology, and remediation & construction
management - to the public and industrial sectors, with
approximately 204 employees and satellite offices and operations in
11 states. EQM has longstanding relationships and multi-year
contracts with numerous federal agencies, including the
Environmental Protection Agency and the Department of Defense
(including the Air Force Center for Engineering & Environment,
Naval Facilities Engineering Command, and the Army Corps of
Engineers), as well as private sector clients across numerous
industries. For more information, please visit www.eqm.com.
About Sullivan International Group, Inc.
Sullivan, based in San Diego,
CA, is an award winning provider of environmental services,
including consulting & engineering, environmental technologies,
energy services and remediation & construction management, to
both the private and federal sectors, with approximately 168
employees and satellite offices and operations in 10 states. Ranked
as one of the nation's top 200 environmental firms by Engineering
News-Record (ENR) in 2013, Sullivan serves numerous federal
agencies, including the Environmental Protection Agency, the
Department of Defense (including the Air Force Center for
Engineering & Environment, Naval Facilities Engineering
Command, and the Army Corps of Engineers), as well as private
sector clients across multiple industries. For additional
information, please visit www.onesullivan.com.
This press release may contain forward-looking statements
made in reliance upon the safe harbor provisions of Section 27A of
the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. Forward-looking
statements include all statements that do not relate solely to
historical or current facts, and can be identified by the use of
words such as "may," "will," "expect," "project," "estimate,"
"anticipate," "plan," "believe," "potential," "should," "continue"
or the negative versions of those words or other comparable words.
These forward-looking statements are not guarantees of future
actions or performance. These forward-looking statements are
based on information currently available to us and our current
plans or expectations, and are subject to a number of uncertainties
and risks that could significantly affect current plans,
anticipated actions and our future financial condition and results.
The uncertainties and risks include, but are not limited to,
our ability to successfully implement our business strategy,
changes and fluctuations in the U.S. public sector's spending
priorities, changes in laws and regulations related to the
protection of the environment, our need for additional financing
and the availability and terms of any such financing, and our
ability to successfully integrate acquired businesses and realize
anticipated synergies. Certain of these risks and
uncertainties are described in greater detail in our filings with
the Securities and Exchange Commission. We are under no
obligation to (and expressly disclaim any such obligation to)
update or alter our forward-looking statements, whether as a result
of new information, future events or otherwise.
Contact
EQM Technologies & Energy, Inc.
Robert R. Galvin, 800-229-7495 or
513-742-7219
Chief Financial Officer
Fax: 513-825-7495
rgalvin@eqm.com
SOURCE EQM Technologies & Energy, Inc.
