Triton Energy Corp.

Triton Energy Corp.

December 15, 2009 04:00 ET

Triton Announces Financing, Acquisition and New Management Group

CALGARY, ALBERTA--(Marketwire - Dec. 15, 2009) - Triton Energy Corp. ("Triton" or the "Corporation") (TSX VENTURE:TEZ) is pleased to announce that it has entered into a definitive agreement (the "Agreement") which provides for (i) a non-brokered private placement of an aggregate of $10.0 million (the "Private Placement"), (ii) the acquisition of assets from Waldron Energy Corporation, a private oil and gas company (the "Waldron Acquisition"), (iii) the appointment of a new management team and board of directors (collectively, the "Management Group"), and (iv) a rights offering to current holders of Triton common shares (the "Rights Offering") (collectively the "Transaction").

The new management team will be led by Ernest G. Sapieha as President & Chief Executive Officer, Murray J. Stodalka as Executive VP Engineering & Operations, Byron Lissel as VP Exploration and Nanna Eliuk as VP Geophysics & Land (collectively, the "Management Team"). The Management Team is also complemented by a full team of experienced professionals.

Upon closing of the Transaction, the new board of directors will be comprised of Donald Archibald, John E. Zahary, Thomas A. Budd, David R.J. Lefebvre and Ernest G. Sapieha, and possibly one additional director designated by Messrs. Sapieha and Stodalka.

It is anticipated that the shareholders of Triton will be asked to approve a change of the Corporation's name to "Waldron Energy Corp." at the next meeting of the shareholders.

Management Team

The Management Team has significant expertise and a proven track record of creating shareholder value, most recently at Compton Petroleum Corporation ("Compton"). Using a strategy focused on exploring, developing and acquiring unconventional natural gas reserves, controlling infrastructure and operating with high working interest, the Management Team grew Compton from inception to an intermediate producer with over 30,000 boepd of production, 1.3TCF (215MMboe) of reserves and over $500 million in retained earnings.

Additionally, the Management Team brings to Triton, through Waldron Energy Corporation ("Waldron"), a new core focus area in Central Alberta with undeveloped lands and prospects with significant room to expand. These lands include a number of drill ready prospects and re-completions targeting deep basin liquids rich tight natural gas, where the Management Team has considerable drilling experience. The team has drilled in excess of 1,000 wells in Alberta, including a significant number of successful deep horizontal multi-staged fractured wells.

The Management Team will apply its past experience to grow the recapitalized Triton through a combination of organic growth and acquisitions. The Management Team has assembled a full team of professionals that possess the skills, experience and desire to repeat their previous success.

Ernest G. Sapieha, CA Mr. Sapieha has in excess of 25-years of executive
President & CEO experience in the oil and gas industry.
Director Previously, Mr. Sapieha was the founder of Compton
and acted as President & CEO until January 2009.

Murray J. Stodalka, P.Eng Mr. Stodalka is a professional engineer with over
Executive VP Engineering 25-years of engineering and operations experience
& Operations in the oil and gas industry. Previously, Mr.
Stodalka was VP Engineering and Operations at
Compton from 1996 to March 2009, and prior thereto
held progressively senior positions at Texaco,
Exxon USA and Pennzoil.

Byron Lissel, P.Geol Mr. Lissel is a professional geologist with over
VP Exploration 25-years of experience in the oil and gas
industry. Mr. Lissel was Compton's original VP
Exploration and was responsible for the assembly
of Compton's Southern Alberta land base, which
lead to the discovery of the Hooker resource play.
Subsequent to Compton, Mr. Lissel held the
position of VP Exploration at Pocaterra Resources,
Tsunami Exploration and Stratosphere Energy.

Nanna Eliuk, P. Geoph Ms. Eliuk is a professional geophysicist with over
VP Geophysics & Land 15-years of experience in the oil and gas
industry. Ms. Eliuk spent five years at Compton
as a Senior Geophysicist and prior thereto held
senior positions at Hunt Oil and Husky Energy.

New Board of Directors

The new board of directors will be comprised of individuals with strong track records and distinguished careers in both the oil & gas and capital markets industry. The directors have held prominent lead positions within a range of successful companies, and their combined experience and expertise will provide the Management Team with invaluable advice, guidance and support.

Donald Archibald, Mr. Archibald is an independent businessman and
B.Comm,MBA brings an extensive wealth of knowledge and
Director experience as a leader in the public oil and gas
industry. Currently, Mr. Archibald is Chairman at
Iteration Energy Ltd. and Cequence Energy Ltd.,
and serves as a director at Progress Energy
Resources Corp., Ember Resources Inc., Sea NG
Corp., Spartan Exploration Ltd. and several other
private companies. Previously, Mr. Archibald held
the position of Chairman & CEO at Cyries Energy
Inc., and President & CEO at Cequel Energy Inc.
and Cypress Energy Inc.

John E. Zahary, M.Phil, Mr. Zahary is a well recognized professional
P.Eng engineer and chief executive with extensive
Director experience, currently acting as President & CEO of
Harvest Energy Trust. Prior to his current role,
Mr. Zahary was President & CEO of Viking Energy
Trust. Mr. Zahary is a past governor of the
Canadian Association of Petroleum Producers, past
chair and current board member of the Petroleum
Technology Research Center and past President and
current board member at the Alberta Chamber of
Commerce. Mr. Zahary also presently serves as a
director at several public and private

Thomas A. Budd, MBA, CMA Mr. Budd is an independent investor and has
Director established a reputation as one of Canada's top
mergers and acquisitions and financial advisors,
playing an instrumental part in a significant
amount of Canada's oil & gas transactions. Most
recently, Mr. Budd served as President and Vice
Chairman, Head of Investment Banking at GMP Corp.
and Griffiths McBurney Canada Corp. until 2008.

David R. J. Lefebvre, Mr. Lefebvre is a partner of Stikeman Elliott LLP
M.A., LL.M and a leading corporate, securities and mergers
Director and acquisitions lawyer. Mr. Lefebvre's focus has
been on national and international mergers and
acquisitions, capital markets, project financings,
private equity and corporate governance. Mr.
Lefebvre currently serves on the board of
directors of a number of public and private

Ernest G. Sapieha, CA As above.
Director, President & CEO

Corporate Strategy

The Management Team has extensive experience in creating shareholder value through a focused full-cycle business plan and believes the current market environment of depressed commodity prices, resulting in decreased prices for assets, lands, and services, provides the ideal opportunity to position Triton as a strong player in natural gas resource plays complemented by light oil.

Not only has the Management Team worked together successfully in the past, they also possess the knowledge and technical expertise required to grow the recapitalized Triton on a cost-effective basis. Using the proven business model of being a dominant player in core areas, operating with high working interests, and achieving operating efficiency by controlling infrastructure, the goal of the Management Team following the completion of the Transaction will be for the Corporation to achieve high returns on investment on top quality economic plays on a full-cycle basis.

Following the Transaction, the business plan will be to focus on the deep basin of Alberta and to continue to generate a repeatable inventory of liquids rich tight natural gas drilling prospects in Central Alberta, accompanied by light oil prospects. In order to achieve this plan, the Management Team will concentrate on the internal generation of prospects and strategic acquisitions followed by an aggressive exploration, development and exploitation program. It is expected that the recapitalized Triton will be debt-free with production of approximately 810 boepd.

Private Placement

Pursuant to the Private Placement, the Management Group, together with additional subscribers identified by the Management Group, will subscribe for a combination of up to 30,769,231 units (the "Units") of Triton at a price of $0.26 per unit and up to 23,076,923 common shares (the "Common Shares") of Triton at a price of $0.13 per Common Share, for total proceeds of $10.0 million. It is anticipated that the Units will be subscribed for by members of the Management Group and other third party investors. The Common Shares issued under the Private Placement will be issued to other third party investors.

Each Unit will consist of one Common Share, one Common Share issued on a "flow-through basis" and two Common Share purchase warrants (the "Performance Warrants"). Each Performance Warrant will entitle the holder to purchase one Common Share at a price of $0.17 for a period of 5 years. The Performance Warrants will vest and become exercisable as to one-third upon the 20-day weighted average trading price of the Common Shares ("Trading Price") equaling or exceeding $0.24, an additional one-third upon the Trading Price equaling or exceeding $0.36 and a final one-third upon the Trading Price equaling or exceeding $0.42.

Following the completion of the Private Placement and the Waldron Acquisition, and after giving effect to the Rights Offering, assuming that 100% of the rights exercisable thereunder are exercised, it is anticipated that members of the Management Group will purchase an aggregate of $6 million to $7 million of Units under the Private Placement, representing approximately 43 to 49 percent of the basic outstanding Common Shares and approximately 57 to 64 percent of the outstanding Common Shares on a fully-diluted basis.

Proceeds from the Private Placement will initially be used to pay off bank debt and for working capital purposes.

Waldron Acquisition

Triton will also acquire the undeveloped land and drill ready and re-completion prospects of Waldron for aggregate proceeds of $1.98 million. In consideration thereof, Triton will issue 15,200,000 units ("Waldron Units") at a price of $0.13 per Waldron Unit. Each Waldron Unit shall consist of one Common Share and one Common Share purchase warrant, which will have the same terms as the Performance Warrants.


75% of the Units issued to new officers, directors and employees of Triton and their associates and affiliates under the Private Placement and 75% of the Waldron Units will be subject to contractual escrow. The escrowed securities will be released in successive six-month intervals such that one-third of the escrowed securities will be released six months after the closing date of the Private Placement, one-third will be released 12 months after the closing date of the Private Placement and the remaining one-third will be released 18 months after the closing date of the Private Placement.

Rights Offering

The Agreement also provides that, following the completion of the Private Placement, the Waldron Acquisition and the appointment of the Management Group, Triton will initiate the Rights Offering by way of a rights offering circular. The Rights Offering will allow holders of Common Shares, as at the record date set by the board of directors in respect of the Rights Offering (the "Record Date"), to be issued one right for each Common Share held. Each four full rights will entitle the holder to purchase one Common Share. The exercise price under the Rights Offering shall, subject to regulatory approval, be $0.13 per share, being equal to the price of the Common Shares issued under the Private Placement. Subscribers for Common Shares or Units pursuant to the Private Placement and recipients of the Waldron Units will not be entitled to participate in the Rights Offering with respect to any such securities. The Rights Offering is subject to the approval of the TSX Venture Exchange ("TSXV") and other applicable regulatory authorities. The Record Date for the Rights Offering will be established once all regulatory approvals are obtained.

Shareholder and Stock Exchange Approvals

Completion of the Transaction is subject to a number of conditions and approvals including, but not limited to, the approval of the TSXV and the approval by a majority of the shareholders of Triton. If required, shareholder approval may be achieved by Triton obtaining, on or before December 30, 2009, written consent from shareholders holding not less that 50.1% of the outstanding Common Shares (the "Written Consent"). In the event the Written Consent is not obtained, Ernest G. Sapieha and Murray J. Stodalka have the ability to terminate the Transaction or, at their election, to determine whether or not they want to proceed with a meeting of shareholders of Triton to approve the Transaction. Messrs. Sapieha and Stodalka are Control Persons of Waldron as defined in TSXV Policy 1.1.

Board of Directors' Recommendation

The board of directors of Triton has determined that the Transaction is in the best interest of Triton's shareholders, has unanimously approved the Transaction and recommends that Triton's shareholders approve the Agreement and execute the Written Consent. Any shareholder of Triton wishing to obtain and execute the Written Consent should contact Triton as set out below.

The board of directors and officers of Triton who, in aggregate, control approximately 10% of the Common Shares, have entered into support agreements or agreed to enter into support agreements pursuant to which they have agreed or will agree, among other things, to execute the Written Consent.

The Agreement

The Agreement contains a number of customary representations, warranties and conditions and provides for a non-completion fee of $300,000 payable by Triton to certain members of the Management Group in certain circumstances. The complete Agreement will be accessible on Triton's SEDAR profile at

Financial Advisors

Macquarie Capital Markets Canada Ltd. is acting as financial advisor to Triton with respect to the Transaction.

National Bank Financial Inc. is acting as financial advisor to the Management Group and Blackmont Capital Inc. is acting as strategic advisor with respect to the Agreement.

About Triton

Triton Energy Corp. is a Calgary, Alberta based company engaged in the exploration, development and production of petroleum and natural gas. The Corporation's common shares are listed on the TSX Venture Exchange under the trading symbol "TEZ".

Forward Looking and Cautionary Statements

This news release may include forward-looking statements including opinions, assumptions, estimates, management's assessment of future plans and operations, and, more particularly, statements concerning the completion of the Transaction contemplated by the Agreement, the business plan of the Management Group, use of proceeds and debt levels and production following completion of the Transaction.

When used in this document, the words "will," "anticipate," "believe," "estimate," "expect," "intent," "may," "project," "should," and similar expressions are intended to be among the statements that identify forward-looking statements.

The forward-looking statements are founded on the basis of expectations and assumptions made by Triton, which include, but are not limited to, the timing of the receipt of the required shareholder, regulatory and third party approvals, the future operations of, and transactions completed by, Triton as well as the satisfaction of other conditions pertaining to the completion of the Transaction.

Forward-looking statements are subject to a wide range of risks and uncertainties, and although Triton believes that the expectations represented by such forward-looking statements are reasonable, there can be no assurance that such expectations will be realized.

Any number of important factors could cause actual results to differ materially from those in the forward-looking statements including, but not limited to, shareholder, regulatory and third party approvals not being obtained in the manner or timing set forth in the Agreement, the ability to implement corporate strategies, the state of domestic capital markets, the ability to obtain financing, changes in general market conditions and other factors more fully described from time to time in the reports and filings made by Triton with securities regulatory authorities.

Except as required by applicable laws, Triton does not undertake any obligation to publicly update or revise any forward-looking statements.

The term "Boe" may be misleading, particularly if used in isolation. A boe conversion of 6 Mcf: 1 bbl is based upon an energy equivalency conversion method primarily applicable at the burner tip and it does not represent a value equivalency at the well head.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.

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