CALGARY, Sept. 13, 2017 /CNW/ – Manitok Energy Inc. (“Manitok“) (TSX-V: MEI) is pleased to announce that it has entered into a definitive amalgamation agreement with Corinthian Oil Corp. (“Corinthian“) and 2065718 Alberta Inc., a wholly owned subsidiary of Manitok (“Acquireco“), dated effective September 12, 2017 (the “Amalgamation Agreement“) to acquire all of the issued and outstanding shares of Corinthian (the “Transaction“).
Manitok will acquire approximately 180 boe/d of production (25% oil and liquids) with related oil battery and gas gathering system, as well as over 120,000 acres of land including 100,000 acres of net undeveloped land primarily located in the Heathdale area of southern Alberta. The production is mainly from the Colony, Glauconitic and Detrital formations, on which Manitok has identified additional exploitation opportunities. In addition to the production and land, there is approximately $2.9 million of net working capital, including $2.0 million of cash, which will increase Manitok’s liquidity, and not less than $5.0 million in total tax pools. Based on the engineering report effective December 31, 2016 prepared by GLJ Petroleum Consultants Ltd., independent qualified reserves evaluator of Corinthian, the total proved plus probable reserves associated with the Heathdale property is approximately 1.85 million boe (24% oil and liquids).
The Transaction will be structured as a three-cornered amalgamation pursuant to which Manitok will acquire all of the issued and outstanding Corinthian common shares (“Corinthian Shares“) in exchange for Manitok common shares (“Manitok Shares“), and Corinthian and Acquireco will amalgamate under the name “Corinthian Oil Corp.” (“Amalco“) pursuant to the provisions of the Business Corporations Act (Alberta). Amalco will be a wholly-owned subsidiary of Manitok following the completion of the Transaction.
Subject to certain adjustments contained in the Amalgamation Agreement, an aggregate of $3,100,000 Manitok Shares are being issued to the holders of Corinthian Shares (“Corinthian Shareholders“) at a deemed price of $0.070486665 per Manitok Share (the “Manitok Share Consideration“), being the five day volume weighted average price of Manitok Shares prior to the execution of the Amalgamation Agreement. Approximately 43,979,949 aggregate Manitok Shares will be issued to the Corinthian Shareholders under the Transaction.
Corinthian intends to obtain a unanimous written resolution of Corinthian Shareholders approving the Transaction on or before September 22, 2017. In the event that such written resolution cannot be obtained by September 22, 2017, Corinthian will call a special meeting of the Corinthian Shareholders to approve the Transaction (the “Corinthian Meeting“). In the event that the Corinthian Meeting is called to approve the Transaction, the Manitok Share Consideration will be adjusted to the five day volume weighted average price of Manitok Shares prior to the date of the Corinthian Meeting.
Closing of the Transaction will occur as soon as possible upon all of the conditions contained in the Amalgamation Agreement being satisfied or waived, including obtaining all consents, approvals and authorizations (including, without limitation, all stock exchange, securities commission and other regulatory approvals) required or necessary in connection with the Transaction, including the approval of the Transaction by the Corinthian Shareholders. A copy of the Amalgamation Agreement will be available under Manitok’s SEDAR profile at www.sedar.com.
About Manitok
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. Manitok 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.
[/expand]