Prime Tex Group is evaluating a possible acquisition of 1606’s contractual interests in a 132-acre Texas energy project, with no definitive agreement or transaction value established.
Key Investor Takeaways
- 1606 Corp. (USOTC:CBDW) has signed a non-binding letter of intent with Prime Tex Group concerning its Texas biomass power and data center project.
- The proposed transaction could involve the acquisition or assignment of contractual rights associated with approximately 132 acres and an existing power generation facility.
- Prime Tex’s stated timber and sawmill operations may offer potential synergies with the property’s biomass infrastructure.
- The agreement is non-exclusive, allowing 1606 to continue evaluating alternative development, financing and sale opportunities.
- The LOI expires on December 31, 2026, unless extended, and neither party is obligated to complete a transaction.
Why CBDW Stock Is in Focus
1606 Corp. (USOTC:CBDW) announced that it entered into a non-binding letter of intent with Prime Tex Group, USA, dated September 6, 2026, regarding a potential transaction involving its Texas power generation and data center development project.
Prime Tex has expressed preliminary interest in acquiring or receiving an assignment of 1606’s contractual rights under the existing Purchase and Sale Agreement covering the property.
The project comprises approximately 132 acres and includes an existing biomass power generation facility and associated infrastructure.
1606 has been evaluating the property for redevelopment involving data centers, high-performance computing and AI-related infrastructure.
Under the LOI, Prime Tex may review information concerning the purchase agreement, property, generation facility, power infrastructure, permits and title.
However, the agreement does not require Prime Tex to undertake due diligence, negotiate definitive terms or complete an acquisition.
No purchase price, financing arrangement or proposed transaction structure has been agreed.
Prime Tex’s Biomass Operations Provide Potential Strategic Link
According to Prime Tex, its US operations include an operating sawmill in Kountze, Texas, acquired through Prime Tex Lumber LLC.
The company also reports that it is developing another sawmill in Kennard, Texas, with production anticipated by the end of 2026.
Both facilities are expected to generate wood chips that could be used as biomass fuel.
Prime Tex has also outlined plans involving additional sawmill acquisitions, forest resources, biochar production and biomass pellet facilities.
These activities could provide a potential connection between Prime Tex’s timber operations and the existing biomass infrastructure at 1606’s Texas property.
Nevertheless, the announcement does not establish any agreement to supply biomass, restart power generation or develop the site jointly.
Why This Matters for Investors
The LOI introduces another potential route for 1606 to realise value from its contractual interests in the Texas project.
Rather than pursuing development independently, the company could potentially transfer its interests to an industrial operator with activities connected to biomass fuel production.
Such a transaction might alter 1606’s exposure to the project’s future development requirements, depending on the final structure and consideration.
However, the agreement remains preliminary and does not establish an asset sale, financing commitment or completed partnership.
The non-exclusive structure is particularly relevant because it preserves 1606’s ability to negotiate with other interested parties.
Management continues to consider several alternatives, including acquiring and developing the property, securing financing, establishing strategic partnerships, identifying end users or selling its contractual interests.
For investors, the central uncertainty is which option, if any, will ultimately proceed and what financial terms it would involve.
The announcement does not provide a project valuation, expected transaction proceeds, development budget or timeline for bringing the power facility into operation.
Consequently, the LOI does not establish an immediate revenue or earnings contribution.
What to Watch Next
The immediate development will be whether Prime Tex proceeds with due diligence and the parties negotiate a definitive agreement.
Investors can monitor announcements concerning the proposed transaction structure, purchase consideration and any financing or operational commitments.
The December 31, 2026, LOI expiration provides a defined date for the current preliminary arrangement, although the parties may extend it in writing.
Updates on alternative negotiations, power infrastructure assessments and potential data center development plans could also clarify the project’s direction.
Until definitive agreements are executed, either party can discontinue discussions without completing a transaction.