CALGARY, ALBERTA–(Marketwired – Jan. 26, 2016) – Manitok Energy Inc. (“Manitok” or the “Corporation“) (TSX VENTURE:MEI) is pleased to announce that on January 26, 2016, Manitok has closed the second tranche of its previously announced best-efforts private placement offering of common shares (the “Common Shares“) in the capital of Manitok issued at a price of $0.13 per Common Share and Common Shares (“Flow-through Shares” and together with the Common Shares, the “Offered Shares“) issued on a “flow-through” basis in respect of Canadian exploration expense under the Income Tax Act (Canada) at a price of $0.15 per Flow-through Share (the “Brokered Private Placement“). As previously announced, in connection with the Brokered Private Placement, Manitok has entered into an agency agreement dated effective as of December 22, 2015 with a syndicate of agents (the “Agents“) co-led by Integral Capital Markets, a division of Integral Wealth Securities Limited and GMP Securities L.P., with a syndicate including Dundee Securities Inc., National Bank Financial Inc. and Canaccord Genuity Group Inc.
After the first and second tranche closing of the Offering (as defined below), Manitok issued an aggregate of 39,240,462 Common Shares and 36,249,500 Flow-through Shares resulting in aggregate gross proceeds to Manitok of $10,538,685. In connection with the first and second tranche of the Offering, Manitok has paid an aggregate of approximately $431,000 in commissions and finder’s fees and related expenses (including legal fees) and has issued an aggregate of 1,241,127 Common Share purchase warrants of Manitok (“Broker Warrants“) to the Agents, with each Broker Warrant entitling the holder thereof to acquire one Common Share at an exercise price of $0.13 per Common Share for a period of 18 months after the date of issuance of such Broker Warrants.
In connection with the second tranche closing of the Brokered Private Placement, Manitok issued an aggregate of 3,520,731 Common Shares resulting in aggregate gross proceeds to Manitok of $457,695. Manitok is also pleased to announce it has closed a second tranche of its concurrent non-brokered private placement of 11,952,900 Common Shares and 1,170,000 Flow-through Shares for aggregate gross proceeds to Manitok in the amount of $1,729,377 (the “Non-Brokered Private Placement” and together with the Brokered Private Placement, the “Offering“). Under the second tranche closing of the Offering, Manitok issued an aggregate of 15,473,631 Common Shares and 1,170,000 Flow-through Shares resulting in aggregate gross proceeds to Manitok of $2,187,072.
On December 31, 2015 Manitok announced that it had closed its first tranche of the Brokered Private Placement and the concurrent non-brokered private placement of an aggregate of 23,766,831 Common Shares and 35,079,500 Flow-through Shares under the first tranche of the Brokered Private Placement, and resulting in aggregate gross proceeds to Manitok of $8,351,613.
Due to additional interest from existing shareholders, Manitok anticipates closing a third tranche of the Non-Brokered Private Placement on or about February 4, 2016.
The proceeds from the Offering of the Common Shares will be used by Manitok to reduce its bank debt, for Manitok’s 2016 capital program and for general corporate purposes. The proceeds from the Offering of the Flow-through Shares will be used by Manitok to earn eligible Canadian exploration expenses.
As previously announced and in conjunction with the second closing of the Offering, Manitok’s credit facility will be revised to $60.0 million in January 2016. The previously reported $10.0 million payment in March 2016 and $20.0 million payment in May 2016 will no longer be required. The credit facility will be up for a customary review in June 2016.
Completion of the Offering will be subject to a number of conditions, including, without limitation, receipt of all regulatory approvals, including approval of the TSX Venture Exchange, Manitok obtaining from its lender, approval for certain amendments to its existing credit facility, including certain extension and reduction in the existing principal repayment schedule. All of the securities issued in connection with the Offering are subject to a four-month hold period under applicable Canadian securities laws.
Manitok is a public oil and gas exploration and development Corporation focusing on conventional oil and gas reservoirs in the Canadian foothills and southeast Alberta. The Corporation will utilize its experience to develop the untapped conventional oil and liquids-rich natural gas pools in both the foothills and southeast Alberta areas of the Western Canadian Sedimentary Basin.