OKLAHOMA CITY, June 12, 2014 /PRNewswire/ - Equal Energy Ltd.
("Equal" or the "Company") (NYSE: EQU) (TSX: EQU) today announced
it has filed a definitive management information circular and proxy
statement (the "Circular") with respect to a proposed plan of
arrangement under the Business Corporations Act
(Alberta) (the
"Arrangement") involving Equal, the shareholders of Equal
("Equal Shareholders"), Petroflow Energy Corporation and Petroflow
Canada Acquisition Corp. ("Petroflow Sub" and together with
Petroflow Energy Corporation, "Petroflow").
Equal's Board of Directors (the "Board")
recommends in the Circular that Equal Shareholders vote FOR
the Arrangement.
Under the Arrangement, Petroflow Sub will
acquire all of the outstanding common shares of Equal for
US$5.43 per share, payable in cash.
Upon completion of the Arrangement, Equal Shareholders will also
receive a cash dividend of US$0.05
per share.
"This all-cash offer plus dividend represents
the best value for Equal shareholders and reflects the outcome of a
rigorous process undertaken to explore the full range of strategic
alternatives to maximize value for shareholders," said Michael Doyle, Chairman of the Board. "The Board
of Directors is unanimous in its view that the Petroflow
Arrangement is the best way forward for Equal and its shareholders
and we recommend that shareholders vote to approve the
Arrangement."
Equal Shareholders are encouraged to read the
Circular and are invited to attend a special meeting of Equal
Shareholders, which will be held on July 8,
2014 in Calgary, Alberta,
Canada to consider the Arrangement. Complete information
regarding voting at the meeting or by proxy and applicable proxy
cut-off times is included in the Circular.
About the Arrangement
The Arrangement is the culmination of a
strategic review process conducted by an independent committee of
the Board (the "Special Committee").
The all-cash consideration offered by Petroflow
is a 56% premium to the closing price of Equal's shares on
March 22, 2013, the trading day prior
to the Company's announcement that it was pursuing a strategic
alternatives process. It is also a 23% premium to the closing
price on November 18, 2013, the
trading day prior to Equal's announcement that the strategic
alternatives process successfully resulted in exclusive
negotiations for a proposed transaction.
Subsequent to the initial announcement of the
Arrangement in December 2013, Equal
and Petroflow amended the agreement dated May 1, 2014 to provide for, among other things,
an extension of the outside date of the Arrangement Agreement to
July 31, 2014 and payment by Equal of
two dividends of US$0.05 per common
share.
The first dividend payment was made on
May 28, 2014, and the second dividend
payment will be made upon completion of the Arrangement.
The unanimous recommendation by Equal's Board
that Equal Shareholders approve the Arrangement follows the work of
the Special Committee which considered a full range of strategic
alternatives to maximize value for Equal Shareholders. These
alternatives included continuing as a going concern, a management
buyout, capital acceleration, a corporate sale, an increased return
of capital to Equal Shareholders by a dividend distribution or
share buyback, a foreign asset income trust, a master limited
partnership, and an acquisition by an outside bidder.
Added Mr. Doyle: "The Board of Directors
communicated with 19 potential arm's length bidders, entered into
confidentiality agreements with seven, and ultimately received
final proposals from two bidders. Of these, the proposal submitted
by Petroflow was the superior offer."
Equal's Board encourages Equal Shareholders
to VOTE NOW FOR THE ARRANGEMENT to receive the full value of
Petroflow's US$5.43 per share premium
offer, as well as the additional US$0.05 per share dividend that is payable on
completion of the Arrangement.
How to Vote
Your vote is very important, regardless of the
number of Equal shares you hold. Equal Shareholders are encouraged
to vote as soon as possible.
Any Equal Shareholder who has questions or
requires more information about voting of their Equal shares should
contact Kingsdale Shareholder Services by toll-free telephone in
North America at 1-866-581-1479 or
collect call outside North America
at 416-867-2272, or by e-mail at
contactus@kingsdaleshareholder.com.
Additional Information
In connection with the Arrangement, Equal filed
a definitive proxy statement with the Securities and Exchange
Commission (the "SEC") on June 11,
2014. The definitive proxy statement has also been filed on
the Canadian SEDAR filing system at www.sedar.com, and is available
on Equal's website at www.equalenergy.ca The definitive proxy
statement contains important information about the proposed
Arrangement and related matters. INVESTORS AND SHAREHOLDERS ARE
URGED TO CAREFULLY READ THE DEFINITIVE PROXY STATEMENT. Investors
and shareholders may obtain free copies of the definitive proxy
statement and other documents filed with the SEC by Equal through
the website maintained by the SEC at www.sec.gov. In addition,
investors and shareholders may obtain free copies of the definitive
proxy statement from Equal by telephone at (405) 242-6000, or by
mail at: Equal Energy Ltd., 4801 Gaillardia Pkwy, Suite 325,
Oklahoma City, OK, 73142 Attn:
Investor Relations. Equal will furnish the finalized proxy
statement to its shareholders when it is available.
Equal and its Directors and executive officers
may be deemed to be participants in the solicitation of proxies
from the shareholders of Equal in connection with the Arrangement.
Information regarding the interests of these Directors and
executive officers in the Arrangement is included in the definitive
information circular and proxy statement described above.
Additional information regarding these Directors and executive
officers is also included in Amendment No. 1 to Equal's Annual
Report on Form 10-K for the year ended December 31, 2013, which was filed with the
SEC on April 29, 2014. This document
is available free of charge at the SEC's web site at www.sec.gov,
and from Equal by telephone at (405) 242-6000, or by mail at: Equal
Energy Ltd., 4801 Gaillardia Pkwy, Suite 325, Oklahoma City, OK, 73142 Attn: Investor
Relations.
About Equal Energy:
Equal Energy is an oil and gas exploration and production company
based in Oklahoma City, Oklahoma.
Our oil and gas assets are centered on the Hunton liquids-rich
natural gas property in Oklahoma.
Our shares are listed on the New York Stock Exchange and the
Toronto Stock Exchange under the symbol (EQU). Our convertible
debentures are listed on the Toronto Stock Exchange under the
symbols EQU.DB.B.
Forward-looking Statements:
Certain information in this press release constitutes
forward-looking statements under applicable securities laws
including statements relating to the completion of the Arrangement
and payment of consideration and the dividend pursuant to the
Arrangement. Any statements that are contained in this press
release that are not statements of historical fact may be deemed to
be forward-looking statements. Forward-looking statements are often
identified by terms such as "may," "should," "anticipate,"
"expects," "seeks" and similar expressions.
Forward-looking statements necessarily involve
known and unknown risks, such as risks associated with oil and gas
production; marketing and transportation; loss of markets;
volatility of commodity prices; currency and interest rate
fluctuations; imprecision of reserve and future production
estimates; environmental risks; competition; incorrect assessment
of the value of acquisitions; failure to realize the anticipated
benefits of dispositions; inability to access sufficient capital
from internal and external sources; changes in legislation,
including but not limited to income tax, environmental laws and
regulatory matters; and failure to obtain shareholder approval or
to meet other closing conditions for the Arrangement, including the
failure of Petroflow to obtain financing for the completion of the
Arrangement. Readers are cautioned that the foregoing list of
factors is not exhaustive.
Readers are cautioned not to place undue
reliance on forward-looking statements as there can be no assurance
that the plans, intentions or expectations upon which they are
placed will occur. Such information, although considered reasonable
by management at the time of preparation, may prove to be incorrect
and actual results may differ materially from those anticipated.
Forward looking statements contained in this press release are
expressly qualified by this cautionary statement.
Additional information on these and other
factors that could affect Equal's operations or financial results
are included in Equal's reports on file with Canadian and U.S.
securities regulatory authorities and may be accessed through the
SEDAR website (www.sedar.com), the SEC's website (www.sec.gov),
Equal's website (www.equalenergy.ca) or by contacting Equal.
Furthermore, the forward looking statements contained in this press
release are made as of the date of this press release, and Equal
does not undertake any obligation to update publicly or to revise
any of the included forward-looking statements, whether as a result
of new information, future events or otherwise, except as expressly
required by securities law.
All dollar values are in US dollars unless
otherwise stated.
SOURCE Equal Energy Ltd.