CALGARY, ALBERTA -- (Marketwired) -- 06/26/13 -- Tuscany Energy Ltd. ("Tuscany") (TSX VENTURE: TUS) and Diaz Resources Ltd. ("Diaz") (TSX VENTURE: DZR) today announced that they have mailed to shareholders of record as of the close of business on June 7, 2013, a joint information circular and proxy statement (the "Joint Information Circular") and related materials in connection with the annual and special meetings of the holders of common shares of Tuscany and Diaz to be held on July 15, 2013 to, among other things, consider and, if deemed advisable, approve the acquisition by Tuscany of all of the issued and outstanding common shares ("Diaz Shares") of Diaz in exchange for common shares ("Tuscany Shares") of Tuscany on the basis of 0.31 of a Tuscany Share for each Diaz Share (the "Business Combination"). It is proposed that the acquisition be completed pursuant to a plan of arrangement under section 193 of the Business Corporations Act (Alberta).
The proposed Business Combination requires the approval of at least two-thirds of the votes cast by Diaz shareholders, as well as the approval of a majority of the votes cast by both Diaz shareholders and Tuscany shareholders (voting separately) after excluding the votes of those shareholders required to be excluded in determining minority approval in accordance with applicable securities laws. The Business Combination is also subject to customary stock exchange and court approvals.
Tuscany is also pleased to announce that it has received a term sheet from its lender whereby it has indicated it is prepared to provide Tuscany a $9.1 million revolving facility (the "Facility") following completion of the Business Combination. The Facility will be available for general corporate purposes related to Tuscany's exploration for, and development and production of, oil and natural gas, and will be secured with a first floating charge over all real and personal property of Tuscany. The Facility will carry interest at a rate of prime plus 1.25% and is subject to the execution of definitive loan documentation following completion of the Business Combination and Tuscany maintaining a working capital ratio of no less than 1.00 to 1.
For further details and information with respect to the Business Combination, please see the Joint Information Circular which is available on SEDAR at www.sedar.com. Assuming that all approvals are obtained and that all other conditions precedent are satisfied, closing of the Business Combination is expected to occur as soon as possible following the annual and special meetings.
At the Evesham field, water disposal upgrading has been completed in June, which encompassed the deepening and re-completion of a vertical well for water disposal, the connection of this well by pipeline to existing infrastructure, adding a water disposal pump and the upgrading of bottom hole pumps. As a result of the expansion, the fluid handling capacity has been increased from 6,000 barrels per day to 12,000 barrels per day.
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