American Resources Corporation (NASDAQ:AREC) said it has agreed to sell exclusive patent rights in carbon nanostructure and graphene technology to Novusterra Inc for US$16 million worth of Novusterra stock, paid in Class A common shares.
Also, members of American Resources will take over the management of Novusterra as well as join its board of directors.
American Resources said it intends to dividend most of the shares that it receives through this transaction to its underlying investors at or before Novusterra's public offering, which is still subject to exchange and US Securities Exchange Commission approvals.
READ: American Resources Corporation increases specialty carbon order book at record prices
American Resources Corporation (NASDAQ:AREC) CEO Mark Jensen said: "We believe this transaction with Novusterra will enable us to unlock the value of these technologies for American Resources' shareholders as well as establish a platform and team for growing the business opportunity and maximizing the value of the technologies themselves.”
Jensen noted that graphene is one of the most exciting technologies in the market today, due to its wide array of applications in products such as batteries and sustainable infrastructure materials.
“Utilizing carbon as a feedstock to provide a low-cost input for commercial applications ensures that higher volume markets for carbon nanostructures can be capitalized on cost-effectively. With Novusterra applying for their public listing, it will provide a platform for growth, ability to expand the team and position the company for future success," he said in a statement.
Graphene is extremely thin and extremely light, yet harder than diamonds. Graphene has become a valuable and useful nanomaterial due to its exceptionally high tensile strength, electrical conductivity, transparency, and being the thinnest two-dimensional material in the world. The global market for graphene is rapidly expanding with most demand focused on the development in semiconductors, electronics, electric batteries, and composites.
Pursuant to the terms of the transaction, Dr. Gregory Jensen will be named CEO of Novusterra and Dr Gerardine (Gerri) Botte as CTO, while Mark LaVerghetta will be named chair of the board, and other board members will include Dr Byron Price, Eugene Nichols and Goran Antic.
Also, Novusterra will fund the sponsored research program at Texas Tech University to advance the pre-processing, carbon nanostructure and graphene technology to commercialization. Novusterra will also work to list on a public exchange in an effort to fund the development and commercialization of the technology with a focus on infrastructure and battery storage applications;
Additionally, Novusterra will have rights to lease certain properties and facilities in Indiana, Kentucky and West Virginia from American Resources, which will allow for synergistic opportunities for both companies as they work to develop a consistent and sustainable feedstock of carbon material.
Finally, Novusterra and ReElement Technologies will enter into a joint services agreement on electrolysis technology, which is used in both companies’ processes and will generate additional synergies and cost-saving technologies.
American Resources focuses on running streamlined operations as a supplier of raw materials to the infrastructure and electrification marketplace, while helping the world achieve its goals of carbon neutrality.
Contact the author at susie@proactiveinvestors.com