/NOT FOR DISTRIBUTION TO U.S. NEWS WIRE
SERVICES OR DISSEMINATION IN THE UNITED
STATES/
CALGARY, AB, Sept. 3, 2021 /CNW/ - (TSX: PMT) (TSX:
RBY) – Perpetual Energy Inc. ("Perpetual" or the "Company")
and Rubellite Energy Inc. ("Rubellite") are pleased to announce
that the previously announced Plan of Arrangement under the
Business Corporations Act (Alberta) (the "Plan of
Arrangement") involving Perpetual, the shareholders of
Perpetual, and Rubellite was completed on September 3, 2021 (the "Effective Date"). The
completion of the Plan of Arrangement followed the overwhelming
support of the Plan of Arrangement by the shareholders of the
Company at its special shareholder meeting held on August 31, 2021 and the receipt today of the
final order of the Court of Queen's Bench of Alberta approving the Plan of Arrangement.
Odd Lot Consolidation
Pursuant to steps in the Plan of Arrangement and as previously
announced, Perpetual consolidated (the "Consolidation") its common
shares ("Common Shares") on the basis of 1,000 to 1 (the "Ratio")
and subsequently split the Common Shares (the "Split") on the same
Ratio (the Consolidation and the Split are together, the "Share
Capital Amendments"). Shareholders who own a number of Common
Shares less than the Ratio (the "Consolidated Shareholders") will
be paid an amount in cash of $0.3419
per Common Share, being the volume weighted average trading price
of the Common Shares on the Toronto Stock Exchange ("TSX") for the
20-day period prior to the Effective Date (the "Consolidation
Consideration"). Based on the Ratio, approximately
650,000 Common Shares will be cancelled as a result of the
Consolidation and Perpetual will pay an aggregate of approximately
$225,000 to the Consolidated
Shareholders.
Following completion of the Consolidation, the Company will have
approximately 64.0 million Common Shares outstanding. Letters of
transmittal with respect to the Consolidation and the Plan of
Arrangement were mailed out to all registered shareholders. All
registered shareholders of Perpetual will be required to send their
certificates representing pre-consolidation common shares with a
properly executed letter of transmittal to Perpetual's transfer
agent, Odyssey Trust Company, in accordance with the instructions
provided in the letter of transmittal. Shareholders who hold their
common shares through a broker or other intermediary and do not
have Common Shares registered in their own name will not be
required to complete a letter of transmittal.
Rubellite Warrants
Under the terms of the Plan of Arrangement, for every 46 common
shares of Perpetual ("Common Shares") held, shareholders (other
than Consolidated Shareholders) will receive 1 common share of
Rubellite ("Rubellite Common Share") and 12 warrants to purchase
Rubellite Common Shares ("Rubellite Warrants"). Each Rubellite
Warrant entitles the holder to subscribe for one Rubellite Common
Share at a price of $2.00 per share
until 4:30 p.m. (Calgary time) on October 4, 2021 (the "Expiry Time"). The
Rubellite Warrants effectively provide for a "rights offering"
whereby shareholders will have the equal opportunity to purchase
additional Rubellite Common Shares. Rubellite will raise
approximately $33.4 million through
the exercise of the Rubellite Warrants (the "Arrangement Warrant
Financing") which is fully backstopped.
The Rubellite Common Shares and Rubellite Warrants have been
conditionally approved for listing by the TSX. Trading in respect
of the Rubellite Common Shares and Rubellite Warrants is expected
to commence on or about Thursday September
9, 2021 under the symbols "RBY" and "RBY.WT",
respectively.
Private Placement Financings
As previously announced, Rubellite will complete a non-brokered
private placement of a minimum of $10.5
million to up to $20 million
of Rubellite Common Shares at an issuance price of $2.00 per Rubellite Common Share (the
"Non-Brokered Private Placement"). The Non-Brokered Private
Placement is expected to close at the same time as the Arrangement
Warrant Financing and brokered private placement for which
$30 million is currently held in
escrow (the "Brokered Private Placement" and collectively, the
"Financings").
Any qualifying Shareholders or new investors who are "accredited
investors" within the meaning of National Instrument 45-106 –
Prospectus Exemptions, or other qualified persons in jurisdictions
outside of Canada as determined by
Rubellite and are interested in participating in the Non-Brokered
Private Placement should contact the Company at
PrivatePlacement@rubelliteenergy.com. Rubellite will use its
reasonable commercial efforts to allow qualifying Shareholders or
new investors to participate in the Non-Brokered Private Placement,
subject to rejection or allotment as determined solely by Rubellite
in whole or in part of their subscription amount. If any
subscription amount is rejected or reduced by Rubellite, the
subscription amount or any reduction to the subscription amount and
all monies tendered therewith will be returned forthwith to the
subscriber, without interest or deduction.
Concurrent with the completion of the Arrangement Warrant
Financing and the Non-Brokered Private Placement, subscription
receipts previously issued under the $30
million Brokered Private Placement will automatically be
exchanged on a one-for-one basis for Rubellite Common Shares.
Proceeds from the Financings of approximately $73.9 million (assuming the minimum issuance
under the Non-Brokered Private Placement) will be used to repay
promissory notes in connection with Rubellite's acquisition of the
Clearwater assets from Perpetual,
and establish positive working capital to fund transaction costs
and Rubellite's planned future drilling programs.
No securities regulatory authority has either approved or
disapproved of the contents of this news release. The securities
being offered have not been, nor will they be, registered under the
United States Securities Act of 1933, as amended, and may not be
offered or sold in the United
States or to, or for the account or benefit of, U.S. persons
absent registration or an applicable exemption from the
registration requirements. This news release shall not
constitute an offer to sell or the solicitation of an offer to buy
nor shall there be any sale of the securities in any State in which
such offer, solicitation or sale would be unlawful.
ADDITIONAL INFORMATION
About Perpetual
Perpetual is an oil and natural gas exploration, production and
marketing company headquartered in Calgary, Alberta. Perpetual owns a diversified
asset portfolio, including liquids-rich conventional natural gas
assets in the deep basin of West Central Alberta, heavy crude oil
and shallow conventional natural gas in Eastern Alberta, including undeveloped bitumen
leases in Northern Alberta and
prospective undeveloped acreage in the emerging Clearwater play fairway through Rubellite
Energy Inc. Additional information on Perpetual can be accessed at
www.sedar.com or from the Corporation's website at
www.perpetualenergyinc.com.
About Rubellite
Rubellite is a Canadian energy company incorporated by Perpetual
Energy Inc. and established through a plan of arrangement on
September 3, 2021. Rubellite is
engaged in the exploration, development and production of heavy
crude oil from the Clearwater
formation in Eastern Alberta,
utilizing multi-lateral drilling technology. Rubellite has a pure
play Clearwater asset base and is
pursuing a robust organic growth plan focused on superior corporate
returns and free funds flow generation while maintaining a
conservative capital structure and prioritizing ESG excellence.
The Toronto Stock Exchange has neither approved nor disapproved
the information contained herein.
Forward-Looking Information
Certain information in this news release may constitute
forward-looking information or statements pertaining to Perpetual
and Rubellite (together "forward-looking information") under
applicable securities laws. The forward-looking information
includes, without limitation, statements with respect to: the
timing for the listing of the Rubellite Common Shares and Rubellite
Warrants on the TSX; the timing and completion of the Arrangement
Warrant Financing, Non-Brokered Private Placement and the issuance
of Rubellite Common Shares pursuant to the Brokered Private
Placement; the anticipated benefits of, the Plan of Arrangement and
the other transactions to Perpetual's shareholders and other
stakeholders; and other similar statements.
Forward-looking information is based on current expectations,
estimates and projections that involve a number of known and
unknown risks, which could cause actual results to vary and in some
instances to differ materially from those anticipated by Perpetual
or Rubellite and described in the forward-looking information
contained in this news release. In particular and without
limitation of the foregoing, material factors or assumptions on
which the forward-looking information in this news release is based
include: the successful completion of Arrangement Warrant
Financing, Non-Brokered Private Placement and the issuance of
Rubellite Common Shares pursuant to the Brokered Private Placement;
anticipated benefits to Perpetual and Rubellite's shareholders; the
ability of Perpetual and Rubellite to continue as a going concern
in the event the Arrangement Warrant Financing, Non-Brokered
Private Placement and the Rubellite Common Shares issued pursuant
to the Brokered Private Placement are not completed; the ability of
Rubellite to successfully operate the Clearwater assets; forecast commodity prices
and other pricing assumptions; forecast production volumes based on
business and market conditions; foreign exchange rates; near-term
pricing and continued volatility of the market; Rubellite's and
Perpetual's capacity and continued operations; estimates of
quantities of crude oil from properties and other sources not
currently classified as proved; accounting estimates and judgments;
future use and development of technology and associated expected
future results; the ability to obtain regulatory approvals; the
successful and timely implementation of capital projects; ability
to general sufficient cash flow to meet current and future
obligations; estimated abandonment and reclamation costs, including
associated levies and regulations applicable thereto; Rubellite's
ability to operate under the management of Perpetual pursuant to
the management services agreement; the ability of Rubellite and
Perpetual to obtain and retain qualified staff and equipment in a
timely and cost-efficient manner, as applicable; the successful
listing of the Rubellite Shares and Arrangement Warrants on the
TSX; the retention of key properties; forecast inflation and other
assumptions inherent in Perpetual's current guidance and estimates;
the continuance of existing tax, royalty, and regulatory regimes;
the accuracy of the estimates of reserves volumes; ability to
access and implement technology necessary to efficiently and
effectively operate assets; and the ongoing and future impact of
the coronavirus on commodity prices and the global economy, among
others.
Undue reliance should not be placed on forward-looking
information, which is not a guarantee of performance and is subject
to a number of risks or uncertainties, including without limitation
those described herein and under "Risk Factors" in Perpetual's
Annual Information Form and MD&A for the year ended
December 31, 2020 and in other
reports on file with Canadian securities regulatory authorities
which may be accessed through the SEDAR website
(www.sedar.com) and at Perpetual's website
(www.perpetualenergyinc.com). In addition, defence
costs of legal claims such as the Sequoia litigation can be
substantial, even with respect to claims that have no merit and due
to the inherent uncertainty of the litigation process, the
resolution of the Sequoia litigation to which the Company has
become subject could have a material effect on the Company's
financial position and results of operations.
Readers are cautioned that the foregoing list of risk factors
is not exhaustive. Forward-looking information is based on the
estimates and opinions of Perpetual's and Rubellite's management at
the time the information is released, and Perpetual and Rubellite
disclaim any intent or obligation to update publicly any such
forward-looking information, whether as a result of new
information, future events or otherwise, other than as expressly
required by applicable securities law.
SOURCE Perpetual Energy Inc.