ENP Newswire - 02 January 2014 Release date- 31122013 - Magnum Energy Inc. (MEN-TSXV) announces that the Corporation has signed a purchase and sale agreement with Artisan Energy Corporation , to sell Magnum's 50% working interest in the Provost area of Alberta . The purchase price for the Provost Asset is $5,600,000 , which will be comprised of the following: assumption by Artisan of a $3,000,000 convertible debenture currently held by Magnum (the 'Magnum Debenture'), as amended and subject to the approval of the debenture holders of the Magnum Debenture; payment by Artisan of a $165,450 interest payment due to the current holders of the Magnum Debenture (the 'Interest Payment'), through the issuance of common shares of Artisan at the same price as a proposed financing to be undertaken in conjunction with this transaction, which is subject to the approval of the debenture holders of the Magnum Debenture. The issuance of shares by Artisan is also subject to the filing, receipt of a prospectus and approval of the TSX Venture Exchange . In the event that Artisan is unable or does not issue the Artisan shares as contemplated in satisfaction of the Interest Payment, the Interest Payment shall immediately be payable by Artisan in cash to the holders of the Magnum Debenture. The Interest Payment constitutes a non-refundable deposit by Artisan with respect to the acquisition of the Provost Asset; a cash payment of $100,000 , payable by Artisan to Magnum and a cash payment by Artisan in the amount of $3,334,550 against the borrowing facility currently held by Magnum. In addition, at closing, Magnum will issue a $1,000,000 debenture to Artisan (the 'Artisan Debenture'). The Artisan Debenture will have a term of 3 years, will bear an interest rate of 9% per annum and will be non-convertible. Magnum will have the right to early repayment of any portion of the Artisan Debenture with no penalty. The Artisan Debenture will have a first security position against all of the assets of Magnum and Magnum will not be permitted to undertake any additional borrowing or subordination of the Artisan Debenture without the prior consent of Artisan, such consent not to be unreasonably withheld. In addition to customary closing conditions, Artisan's acquisition of the Provost Asset is conditional on Artisan completing a minimum financing of $5,000,000 . Closing of the acquisition of the Provost Asset is anticipated to occur on or before February 14, 2014 . Contact: Richard Nemeth President & CEO Magnum Energy Inc. Tel: 604.948.2688 Email: firstname.lastname@example.org [Editorial queries for this story should be sent to email@example.com ] ((Comments on this story may be sent to firstname.lastname@example.org ))
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