/NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR
DISSEMINATION IN THE UNITED
STATES./
CALGARY, July 3, 2013 /CNW/ - Surge Energy Inc. ("Surge"
or the "Company") (TSX: SGY) is pleased to announce the closing of
its previously announced $247.5
million equity financing.
The financing was completed in connection with
the previously announced acquisition (the "Acquisition") by the
Company of certain assets in Saskatchewan. The Company issued
15,000,000 units ("Units") of the Company on a "bought deal" basis
at a price of $15.00 per Unit, for
gross proceeds of $225 million as
part of a "bought deal" financing with a syndicate of underwriters
led by Macquarie Capital Markets Canada Ltd. and including GMP
Securities L.P., National Bank Financial Inc., CIBC World Markets
Inc., TD Securities Inc., Scotia Capital Inc., FirstEnergy Capital
Corp., Dundee Securities Ltd. and Cormark Securities Inc.
Each Unit was comprised of one common share ("Common Share") of the
Company at a price of $5.00 per
Common Share and two subscription receipts ("Subscription
Receipts") at a price of $5.00 per
Subscription Receipt of the Company. The Underwriters have
exercised their option to purchase up to an additional 4,500,000
Subscription Receipts, for proceeds of an additional $22.5 million. The gross proceeds from the sale
of Subscription Receipts are being held in escrow pending the
satisfaction of all conditions to the completion of the
Acquisition, provided that the closing date of the Acquisition is
on or before September 30, 2013, at
which time each Subscription Receipt will entitle the holder to
receive a Common Share, without further payment or action on the
part of the holder, upon the closing of the Acquisition. If the
Acquisition is not completed on or before September 30, 2013 or is terminated at an earlier
time, holders of Subscription Receipts will receive, for each
Subscription Receipt held, a cash payment equal to the Subscription
Receipt offering price and any interest earned thereon during the
term of the escrow. It is anticipated that the Subscription
Receipts will be listed and posted for trading on the Toronto Stock
Exchange under the symbol SGY.R at the open of markets today, until
the conversion of the Subscription Receipts into Common Shares is
completed. The gross proceeds from the issuance of Common Shares
will be used to pay down debt and for general corporate purposes
and the gross proceeds from the issuance of Subscription Receipts
will be used to partially fund the Acquisition.
The financing was completed by way of a short
form prospectus in all of the provinces of Canada and on a private placement basis in
the United States pursuant to
exemptions from the registration requirements of the U.S securities
laws.
FORWARD LOOKING STATEMENTS:
This press release contains forward-looking
statements. More particularly, this press release contains
statements concerning the anticipated completion of the
Acquisition, the conversion of the Subscription Receipts into
Common Shares and the timing thereof, the listing of the
Subscription Receipts on the TSX and use of the proceeds from the
financing.
The forward-looking statements are based on
certain key expectations and assumptions made by Surge, including
anticipated expenses, cash flow and capital expenditures,
expectations and assumptions concerning the performance of existing
wells and success obtained in drilling new wells, and the
application of regulatory and royalty regimes.
Although Surge believes that the expectations
and assumptions on which the forward-looking statements are based
are reasonable, undue reliance should not be placed on the
forward-looking statements because Surge can give no assurance that
they will prove to be correct. Since forward-looking statements
address future events and conditions, by their very nature they
involve inherent risks and uncertainties. Actual results could
differ materially from those currently anticipated due to a number
of factors and risks. These include, but are not limited to, risks
associated with the oil and gas industry in general (e.g.,
operational risks in development, exploration and production;
delays or changes in plans with respect to exploration or
development projects or capital expenditures; the uncertainty of
reserve estimates; the uncertainty of estimates and projections
relating to production, costs and expenses, and health, safety and
environmental risks), commodity price and exchange rate
fluctuations and uncertainties resulting from potential delays or
changes in plans with respect to exploration or development
projects or capital expenditures. Certain of these risks are set
out in more detail in Surge's Annual Information Form which has
been filed on SEDAR and can be accessed at www.sedar.com.
The forward-looking statements contained in this
press release are made as of the date hereof and Surge undertakes
no obligation 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.
This news release does not constitute an offer
to sell or a solicitation of an offer to buy any of the securities
in the United States. The
securities have not been and will not be registered under the
United States Securities Act of 1933, as amended (the "U.S.
Securities Act") or any state securities laws and may not be
offered or sold within the United
States or to U.S. Persons unless registered under the U.S.
Securities Act and applicable state securities laws or an exemption
from such registration is available.
Neither the TSX nor its Regulation Services
Provider (as that term is defined in the policies of the TSX)
accepts responsibility for the adequacy or accuracy of this
release.
SOURCE Surge Energy Inc.