SCWorx, American Environmental Partners enter reverse merger agreement

American Environmental Partners has signed a definitive agreement and plan of merger on Dec. 21, 2023 with SCWorx Corp. Upon completion of the transaction and approval of the business combination listing application by Nasdaq, the combined company will be named American Environmental Partners, Inc., and the shares will trade on Nasdaq under the ticker symbol “AEPT.” The transaction, which was approved by the Boards of Directors of both American Environmental Partners and Worx, is expected to close in the first quarter of calendar year 2024, subject to shareholder approval, regulatory approval and other customary closing conditions. Under the Agreement, Worx has agreed to merge its wholly-owned subsidiary into American Environmental Partners, with American Environmental Partners as the surviving company. As merger consideration for their shares, American Environmental Partners shareholders will receive shares of Worx common stock equal to 83% of the combined Company, on a fully diluted basis, after giving effect to a pre-merger capital raise of up to $6 million by American Environmental Partners, which is a condition to completion of the Agreement. Therefore, Worx shareholders will own 17% of the combined company on a fully-diluted basis after the merger. Upon completion of the Agreement, pursuant to the Merger Agreement, the board of directors of the new Company will consist of five directors, with four designated by American Environmental Partners and one designated by Worx. The Transaction will be considered a “reverse merger” because the shareholders of American Environmental Partners will own more than a majority of the outstanding common stock of the Company following completion of the Proposed Transaction. As such, the Agreement is subject to NASDAQ approving a listing application based on initial inclusion standards. In addition, the closing of the Agreement is subject to satisfaction of the following conditions: satisfactory completion of due diligence review by both parties, American Environmental Partners raising up to $6 Million of equity, and approval by both Worx and American Environmental shareholders, as well as other customary closing conditions.