(TSX: AAV)
CALGARY,
AB, Nov. 7, 2022 /CNW/ - Advantage Energy
Ltd. ("Advantage" or the "Corporation") announces the terms of its
substantial issuer bid (the "Offer") pursuant to which the
Corporation will offer to purchase for cancellation up to
$100,000,000 of its common shares
(the "Shares"). The Offer will proceed by way of a modified
Dutch auction and holders of Shares ("Shareholders") wishing to
tender to the Offer may do so pursuant to: (i) auction tenders in
which the tendering Shareholders specify the number of Shares being
tendered at a specified price of not less than $11.20 and not more than $12.90 per Share in increments of $0.10 per Share; or (ii) purchase price tenders
in which the tendering Shareholders do not specify a price per
Share, but rather agree to have a specified number of Shares
purchased at the purchase price to be determined as provided in the
Offer (the "Purchase Price"). Shareholders who validly tender
Shares without specifying the method in which they are tendering
their Shares, will be deemed to have made a purchase price
tender.
The Offer is expected to commence on November 10, 2022 and remain open for acceptance
until 5:00 p.m. (Eastern Standard
Time) on December 16, 2022, or
at such later time and date to which the Offer may be extended or
varied by the Corporation (the "Expiration Date"), unless
withdrawn. The Offer would be for approximately 4.9% of the total
number of issued and outstanding Shares if the Purchase Price is
determined to be $11.20 (which is the
minimum price per Share under the Offer) or approximately 4.3% of
the total number of issued and outstanding Shares if the Purchase
Price is determined to be $12.90
(which is the maximum price per Share under the Offer). As of
November 7, 2022, there were
181,114,976 Shares issued and outstanding.
For purposes of determining the Purchase Price, Shareholders who
make, or who are deemed to have made, a purchase price tender will
be deemed to have tendered their Shares at the minimum price of
$11.20 per Share. The
Purchase Price to be paid by Advantage for each validly deposited
Share taken up by the Corporation will be determined upon
expiration of the Offer and will be based on the number of Shares
validly deposited pursuant to auction tenders and purchase price
tenders, and the prices specified by Shareholders making auction
tenders. As a result, Shareholders who tender their Shares
will set the Purchase Price for the Offer. The Purchase Price
will be the lowest price (which will not be less than $11.20 per Share and not more than $12.90 per Share) that enables the
Corporation to purchase Shares up to the aggregate amount of
$100,000,000, determined in
accordance with the terms of the Offer. All Shares purchased
by Advantage pursuant to the Offer (including Shares tendered at
auction prices below the Purchase Price) will be purchased at the
same Purchase Price.
All Shares not purchased under the Offer (including Shares not
purchased because of proration, invalid tender, or Shares deposited
pursuant to auction tenders at auction prices in excess of the
Purchase Price), or Shares properly withdrawn before the Expiration
Date, will be returned to the Shareholders.
If the aggregate purchase price for Shares validly tendered
pursuant to auction tenders and purchase price tenders is greater
than the aggregate amount of $100,000,000, Advantage will purchase Shares from
the Shareholders who made purchase price tenders or auction tenders
at or below the Purchase Price as finally determined by Advantage
on a pro rata basis, except that "odd lot holders"
(Shareholders who own fewer than 100 Shares) will not be subject to
proration.
Advantage expects to mail the formal offer to purchase, issuer
bid circular, letter of transmittal, notice of guaranteed delivery
and other related documents (collectively, the "Offer Documents")
containing the terms and conditions of the Offer, instructions for
tendering Shares, and the factors considered by Advantage and its
Board of Directors in determining to approve the Offer, among other
considerations, on or about November 10,
2022. The Offer Documents will be filed with the
applicable securities regulators in Canada and may be accessed at www.sedar.com.
Shareholders should carefully read the Offer Documents prior
to making a decision with respect to the Offer. The Offer will not
be conditional upon any minimum number of Shares being tendered.
The Offer will, however, be subject to other conditions
described in the Offer Documents and Advantage will reserve the
right, subject to applicable laws, to withdraw, extend or vary the
Offer, if, at any time prior to the payment for deposited Shares,
certain events occur. As previously disclosed in the
Corporation's news release dated November 2,
2022, the Corporation intends to fund the Offer with a
combination of cash on hand and drawings on existing credit
facilities. Advantage's Board of Directors has approved the
making of the Offer. However, none of Advantage, its Board of
Directors, the dealer manager or the depositary makes any
recommendation to any Shareholder as to whether to deposit or
refrain from depositing Shares under the Offer, how many Shares to
deposit and whether to specify a price and, if so, at what price to
deposit such Shares. Shareholders are urged to evaluate
carefully all information in the Offer, consult their own
financial, legal, investment and tax advisors and make their own
decisions about whether to deposit Shares under the Offer, how many
Shares to deposit and whether to specify a price and, if so, at
what price to deposit such Shares.
The Offer referred to in this news release has not yet
commenced. This news release is for informational purposes
only and does not constitute an offer to buy or the solicitation of
an offer to sell Shares. An offer to buy the Shares will only
be made pursuant to the Offer Documents to be filed with the
applicable securities regulators in Canada. The Offer will be optional for
all Shareholders, who will be free to choose whether to
participate, how many Shares to tender and, in the case of auction
tenders, at what price to tender within the specified range.
Any Shareholder who does not validly deposit any Shares (or
whose Shares are not taken up and purchased by Advantage under the
Offer) will realize a proportionate increase in such Shareholder's
equity interest in Advantage, to the extent that Shares are
purchased under the Offer.
Advantage has retained RBC Dominion Securities Inc. to act as
financial advisor and dealer manager in connection with the Offer
and Computershare Investor Services Inc. ("Computershare") to act
as depositary. Any questions or requests for information may
be directed to Computershare at 1 (800) 564-6253 (Toll-Free within
North America) or 1 (514) 982-7555
(outside North America) or to RBC
Dominion Securities Inc. as dealer manager for the Offer at
advantagesib@rbccm.com.
Forward-Looking Information
and Advisory
The information in this press release contains certain
forward-looking statements, including within the meaning of
applicable securities laws. These statements relate to future
events or our future intentions or performance. All statements
other than statements of historical fact may be forward-looking
statements. Forward-looking statements are often, but not always,
identified by the use of words such as "anticipate", "continue",
"demonstrate", "expect", "may", "can", "will", "believe", "would"
and similar expressions and include statements relating to, among
other things, references to the aggregate amount of Shares to be
purchased for cancellation under the Offer; the structure of the
bid including a modified Dutch auction procedure; the terms and
conditions and price range of tenders; timing for mailing the Offer
Documents, the commencement and expiration of the Offer; the
Corporation's intention to fund the Offer with a
combination of cash on hand and drawings on existing credit
facilities; and the Offer not being conditional upon any minimum
number of Shares being tendered. Advantage's actual decisions,
activities, results, performance or achievement could differ
materially from those expressed in, or implied by, such
forward-looking statements and accordingly, no assurances can be
given that any of the events anticipated by the forward-looking
statements will transpire or occur or, if any of them do, what
benefits that Advantage will derive from them.
Forward-looking statements are not guarantees of future
performance and involve a number of risks and uncertainties, some
that are similar to other oil and gas companies and some that are
unique to Advantage. Advantage's actual results may differ
materially from those expressed or implied by its forward-looking
statements and readers are cautioned not to place undue reliance on
them. Such risks and uncertainties, certain of which are
beyond Advantage's control, include, but not limited to: changes in
general economic, market and business conditions; industry
conditions, including as a result of demand and supply effects
resulting from the COVID-19 pandemic; actions by governmental or
regulatory authorities including increasing taxes and changes in
investment or other regulations; changes in tax laws, royalty
regimes and incentive programs relating to the oil and gas
industry; Advantage's success at acquisition, exploitation and
development of reserves; unexpected drilling results; changes in
commodity prices, currency exchange rates, net capital
expenditures, reserves or reserves estimates and debt service
requirements; the occurrence of unexpected events involved in the
exploration for, and the operation and development of, oil and gas
properties, including hazards such as fire, explosion, blowouts,
cratering, and spills, each of which could result in substantial
damage to wells, production and processing facilities, other
property and the environment or in personal injury; changes or
fluctuations in production levels; delays in anticipated timing of
drilling and completion of wells; individual well productivity;
competition from other producers; the lack of availability of
qualified personnel or management; credit risk; changes in laws and
regulations including the adoption of new environmental laws and
regulations and changes in how they are interpreted and enforced;
ability to comply with current and future environmental or other
laws; stock market volatility and market valuations; liabilities
inherent in oil and natural gas operations; competition for, among
other things, capital, acquisitions of reserves, undeveloped lands
and skilled personnel; incorrect assessments of the value of
acquisitions; geological, technical, drilling and processing
problems and other difficulties in producing petroleum reserves;
ability to obtain required approvals of regulatory authorities; and
ability to access sufficient capital from internal and external
sources to fund the Offer and otherwise. Many of these risks and
uncertainties and additional risk factors are described in the
Corporation's Annual Information Form which is available at
www.sedar.com ("SEDAR") and www.advantageog.com. Readers are also
referred to risk factors described in other documents Advantage
files with Canadian securities authorities.
With respect to forward-looking statements contained in this
press release, Advantage has made assumptions regarding, but not
limited to: conditions in general economic and financial
markets; effects of regulation by governmental agencies;
current and future commodity prices and royalty regimes; future
exchange rates; royalty rates; future operating costs; future
transportation costs and availability of product transportation
capacity; availability of skilled labor; availability of drilling
and related equipment; timing and amount of net capital
expenditures; the impact of increasing competition; the price of
crude oil and natural gas; that the Corporation will have
sufficient cash flow, debt or equity sources or other financial
resources required to fund its capital and operating expenditures
and requirements as needed; that the Corporation's conduct and
results of operations will be consistent with its expectations;
that the Corporation will have the ability to develop the
Corporation's properties in the manner currently contemplated;
current or, where applicable, proposed assumed industry conditions,
laws and regulations will continue in effect or as anticipated; the
estimates of the Corporation's production and reserves volumes and
the assumptions related thereto (including commodity prices and
development costs) are accurate in all material respects;
the impact and duration of ongoing global events and the ability
of the Corporation to carry on its operations as currently
contemplated in light of such events; and that
the Corporation will have cash on hand and will be able to draw on
its credit facilities to fund the Offer.
Management has included the above summary of assumptions and
risks related to forward-looking information above and in its
continuous disclosure filings on SEDAR in order to provide
shareholders with a more complete perspective on Advantage's future
operations and such information may not be appropriate for other
purposes. Advantage's actual results, performance or achievement
could differ materially from those expressed in, or implied by,
these forward-looking statements and, accordingly, no assurance can
be given that any of the events anticipated by the forward-looking
statements will transpire or occur, or if any of them do so, what
benefits that Advantage will derive there from. Readers are
cautioned that the foregoing lists of factors are not
exhaustive.
These forward-looking statements are made as of the date of
this news release and Advantage disclaims any intent or obligation
to update publicly any forward-looking statements, whether as a
result of new information, future events or results or otherwise,
other than as required by applicable securities laws.
SOURCE Advantage Energy Ltd.