CALGARY, ALBERTA–(Marketwired – July 2, 2015) – Forent Energy Ltd. (TSX VENTURE:FEN)(“Forent” or the “Company”) is pleased to report that the Company has closed its previously announced acquisition of an Alberta-based private resource company (the “Acquisition Company”) and a concurrent non-brokered private placement, for an aggregate of $ 2.2 million at 40 cents per share on a post-consolidation basis. Forent’s current Management and insiders participated for an aggregate of $984,000 of the combined transactions. The Company has also completed a 20:1 consolidation of its common shares prior to the closing.
Equity Issue for Acquisition Company
The consideration paid by Forent consisted of 2,800,500 common shares, at 40 cents per common share, for total consideration of $1,120,200, following the completion of the Company’s previously announced 20:1 share consolidation. The Acquisition Company brings to Forent approximately $870,000 in cash and $250,000 of assets composed of natural gas production and five sections of mineral rights prospective for Cardium oil production, on trend with existing production. Officers and Directors of Forent have subscribed for $120,000 or 120,000 common shares in the Acquisition Company.
Non-brokered Private Placement
The Company has also completed a $1,080,000 non-brokered private placement at a price of 40 cents per share or 2,700,000 common shares. W. Brett Wilson and associates subscribed for $664,000 of the private placement. Additional Directors and Officers of the Company subscribed for $200,000 or 500,000 common shares. The shares issued pursuant to the placement have a hold period of four months and one day from the date of issuance.
Net proceeds from the private placement and the corporate acquisition mentioned above will be used to strengthen Forent’s balance sheet and for general corporate purposes.
As part of the corporate acquisition, Forent is pleased to welcome Mr. Robyn Lore and Mr. Curtis Hartzler to its executive team.
W. Brett Wilson, Chairman of the Board of Directors of Forent, states, “We are pleased to have Messrs. Lore and Hartzler join Forent as significant investors, Directors, and key management. Their ability to add value with new deal flow compliments and strengthens the existing management team. We see many acquisitions and merger opportunities in this market.”
Mr. Lore was most recently the President and CEO of Kallisto Energy. Previously he has been a Managing Director of Rosetta Exploration Inc. and Berkana Energy Corp. and has held numerous senior positions over more than 25 years in the industry, including President of Petroland Services Ltd., Director and Corporate Secretary of New Cache Petroleum Ltd., President and Director of Aldona Resources Ltd., President of Granisko Resources Inc. and Vice-President of Heritage Oil Corporation.
While at Granisko, Mr. Lore oversaw the company’s growth in less than two years from $1 million to an appraised value of more than $200 million. Mr. Lore went on to work with Heritage Oil Corporation helping to grow it from a start-up to an active international E & P company.
Mr. Lore will assume the role of President, Chief Executive Officer and Chairman of the Board of Forent. In conjunction with Mr. Lore’s appointment, Mr. Richard Wade will become the Company’s new Chief Operating Officer.
Mr. Lore, states, “I became involved with Forent because I like the people and the assets. I’m looking forward to working with the board and staff of Forent to grow a vibrant and efficient junior.”
Mr. Hartzler, P.Eng., joins the Company as Vice-President Business Development and director. He has worked in the Canadian oil and gas industry for more than 40 years. His early industry experience was in the area of field operations, completion and facilities construction, with field time spent in Rainbow Lake, Rocky Mountain House and the Crossfield regions of west central Alberta. He then moved into the economic and reserve evaluations field of the industry and was employed by the firm which today is known as GLJ Petroleum Consultants. Mr. Hartzler subsequently moved into senior management roles for both private and public companies, including Poco Petroleum Ltd, Penn West Petroleum Ltd, Birchill Resources Ltd, Goose River Resources Ltd, G2 Resources Ltd and Kallisto Energy Ltd.
Board of Directors Restructuring
Concurrent with the corporate acquisition, the Company announces Messrs. Robert Crosbie, Scott Reeves, and Richard Wade have stepped down from the Board of Directors and Messrs. Robyn Lore, Curtis Hartzler, John McLeod, and Martin Hislop have been appointed.
Forent would like to thank the outgoing Directors for their service and dedication over the past number of years.
Mr. McLeod, P.Eng., served as a director and advisor to Heritage Oil from 1999 to 2014. He has had numerous senior executive, director and advisory roles; most recently with Kallisto Energy until its recapitalization in the fall of 2014.
Martin Hislop is a Chartered Accountant and retired businessman with over 30 years’ experience in all aspects of financing and managing private and listed oil and gas companies, partnerships and trusts. He is founder and former CEO of APF Energy Trust (“APF”), which was sold to StarPoint Energy Trust for approximately one billion dollars in June 2005. He was the President and CEO of Lakewood Energy Inc., a TSX listed oil and gas company, which was created as a result of the merger of 10 limited partnership drilling funds he created beginning in 1986. He also serves on the board of Lightstream Resources.
The resulting Board will now have seven members: Robyn Lore (Chairman), John Forgeron, Curtis Hartzler, Martin Hislop, John McLeod, Wayne Rousch and W. Brett Wilson.
Credit Facility Renewal
Forent is pleased to announce that it has received an indicative term sheet which provides for a revolving production loan facility of up to $8,000,000. The credit facility is initially maintained at the previous renewal value of $7,000,000 and may be increased to $8,000,000, subject to the completion of this financing and further due diligence.
Stock Option Grant
Forent announces the grant of 1,300,000 stock options to certain directors and officers pursuant to the Company’s stock option plan. The options vest over a 2 year period, are exercisable at a price of $0.40 per share, and expire in June 2020. The shares issuable upon exercise of the options may not be traded for 4 months and one day from the date of grant.
Also as a condition of closing of the corporate acquisition, 402,041 options held by insiders of the company were voluntarily cancelled.
Consolidation of Common Shares
Following the 20:1 consolidation of the Company’s common shares, the issue of common shares in consideration for the Acquisition Company, and the issue of common shares for the non-brokered private placement, Forent Energy Ltd. will have approximately 14,932,660 common shares issued and outstanding which trade on the TSX Venture Exchange under the symbol “FEN”.
With Forent’s reorganization, board of directors, strong management team and plentiful opportunities, the Company is poised to move forward to create shareholder value.
This news release shall not constitute an offer to sell or the solicitation of any offer to buy, nor shall there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful. The securities offered have not been and will not be registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or applicable exemption from the registration requirements of the U.S. Securities Act and applicable state securities laws.
NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.
FORENT ENERGY LTD.
President & CEO
(403) 262-9444 #201
FORENT ENERGY LTD.
Brad R. Perry
(403) 262-9444 #208