Cub will acquire up to a 50% W.I. in the Besni licence that includes one license totalling 53,906 gross acres. The onshore block is located in the Gaziantep District of the southeastern Anatolia region of Turkey. The license contains four Mardin oil prospects with estimated gross resources of 1 to 8 MMbbl.
Cub and Anatolia have entered into an Arrangement Agreement pursuant to which Cub and Anatolia have agreed that the Transaction will be undertaken by way of a plan of arrangement under the ABCA. Under the terms of the Transaction, Cub has agreed to acquire all of the issued and outstanding Anatolia Shares at an exchange ratio of 0.106 of a Cub Share for each Anatolia Share.
Pursuant to the Arrangement Agreement, following the Transaction Anatolia warrants will cease to represent the right to acquire Anatolia Shares and will convert, according to their terms, and will represent the right to acquire such number of Cub Shares at such exercise price as determined in accordance with their terms and the Exchange Ratio. In addition, all of Anatolia's outstanding options will be surrendered or otherwise terminated prior to the closing of the Transaction.
The board of directors of Anatolia unanimously (other than one director who abstained from voting because he is also a director of Cub) supports the Transaction, has determined that the Transaction is in the best interest of Anatolia and recommends that the shareholders of Anatolia vote in favour of the Transaction. All senior officers and directors of Anatolia, who collectively hold 6.5% of the issued and outstanding Anatolia Shares, have entered into agreements with Cub pursuant to which they have agreed to vote their shares in favor of the Transaction at the Anatolia shareholders meeting. Salida Capital L.P., which holds 7.7% of the total number of issued and outstanding shares of Anatolia, has agreed to vote its shares in favour of the Transaction at the Anatolia shareholders meeting.
The Arrangement Agreement provides for non-solicitation covenants, subject to fiduciary obligations of the board of directors of Anatolia, and the right of Cub to match any Superior Proposal (as defined in the Arrangement Agreement). The Arrangement Agreement, among other things, provides for non-completion fees of $200,000 payable by Cub and $400,000 payable by Anatolia in the event the Transaction is not completed or is terminated by either party in certain circumstances. The Arrangement Agreement provides that completion of the Transaction is subject to certain conditions, including the receipt of all required regulatory approvals, including the approval of the TSXV, the approval of the shareholders of Anatolia and Turkish and Ukrainian regulatory approvals. The Transaction is expected to close on or before June 30, 2013.
Full details of the Transaction will be included in an information circular to be mailed to Anatolia shareholders in accordance with applicable securities laws. A copy of the information circular and related documents will be filed under Anatolia's issuer profile on SEDAR at www.sedar.com. A copy of the Arrangement Agreement will also be filed under each of Cub's and Anatolia's issuer profiles at www.sedar.com.
Financial Advisors and Fairness Opinion
Canaccord Genuity Corp. is acting as financial advisor to Cub with respect to the Transaction.
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