CALGARY, June 16, 2016 /CNW/ - Raimount Energy Inc. ("Raimount" or the "Company") is pleased to announce that it has received approval of shareholders on a "majority of the minority" basis to consolidate the Company's interest in the Garrington and Woolford areas (the "Assets") in which the Company currently operates. Pursuant to respective asset purchase agreements entered into with the Company, 514421 Alberta Ltd. ("514 Alberta"), a company controlled by Steve Vavra and 713443 Alberta Ltd. ("713 Alberta"), a company controlled by Greg Vavra, have each, transferred their respective 25% interest in the Assets to Raimount. Raimount now holds a 100% interest in the Assets.
Raimount has made a cash payment of $250,000.00 and issued 566,000 common shares to 713 Alberta for 713 Alberta's 25% interest in the Assets and has issued 865,733 common shares to 514 Alberta for its 25% interest in the Assets. In addition, upon achieving certain valuation thresholds in respect of the Assets on or before October 31, 2019, up to a further 732,667 common shares will be issued to each of the vendors (the "Earn Out Shares"). Neither acquisition is dependent on closing of the other, and each transaction was negotiated separate from the other. The Company is very excited to be in a position to consolidate the Assets without expending substantial cash to achieve the same. Raimount remains very well financed, with no debt and approximately $5.4 million in cash after this transaction.
The acquisitions result in Raimount moving from a 50% to 100% interest in both core areas of operations, and streamlines and accelerates the assessment and proposed development of these assets. The Assets will provide Raimount with a strong core position in an area experiencing significant drilling and development, even in the face of the current oil and natural gas price challenges. The acquisitions are effective as of the close of business January 31, 2016.
Assuming all Earn Out Shares are issued, Greg Vavra will own and control, directly or indirectly 1,995,956 common shares (24.3% ) and Steve Vavra will own and control, directly and indirectly 2,318,940 common shares (27.8%) of Raimount.
Raimount's common shares trade on the TSX Venture Exchange under the symbol "RMT". Raimount is engaged in the accumulation, development and maintenance of oil and gas properties in the Western Canadian Basin, with substantial prospective lands in southern Alberta.
This press release contains forward-looking information. More particularly, this press release contains statements concerning the prospective acquisition of certain oil and gas interests by the Company from related parties, the terms and conditions of the acquisitions, and the resulting benefits of the acquisitions. Although the Company believes in light of the experience of its officers and directors, current conditions and expected future developments and other factors that have been considered appropriate that the expectations reflected in this forward-looking information are reasonable, undue reliance should not be placed on them because the Company can give no assurance that they will prove to be correct. Forward-looking information involves known and unknown risks, uncertainties, assumptions and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking information. The terms and conditions of the prospective acquisitions may change based on the Company's due diligence on the respective properties of the vendors, receiving requisite regulatory approvals and the ability to meet the conditions of the formal agreement in the required timeframes. The forward-looking statements contained in this press release are made as of the date hereof and the Company undertakes no obligations to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.
Completion of the transactions is subject to a number of conditions, including but not limited to, TSX Venture Exchange acceptance and disinterested shareholder approval. The proposed transactions cannot close until the required shareholder approval is obtained. There can be no assurance that the proposed transactions will be completed as proposed or at all.
This press release is not an offer of the securities for sale in the United States. The securities have not been 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 an exemption from registration. This press 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.
The TSX Venture Exchange Inc. has in no way passed upon the merits of the Proposed Transaction and has neither approved nor disapproved the contents of this press release.
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 press release.
SOURCE Raimount Energy Inc.
For further information: Greg Vavra, President & CEO; Ken Mullen, Director, Raimount Energy Inc., 2420,645-7th Avenue SW, Calgary, Alberta, T2P 4G8, Phone: 403-265-6292