Lateral Capital Corp.

TSX VENTURE : LCP


Lateral Capital Corp.

February 16, 2014 02:25 ET

Lateral Capital Corp. Announces Proposed Acquisition

CALGARY, ALBERTA--(Marketwired - Feb. 16, 2014) -

NOT FOR DISSEMINATION IN THE UNITED STATES. FAILURE TO COMPLY WITH THIS RESTRICTION MAY CONSTITUTE A VIOLATION OF UNITED STATES SECURITIES LAW.

Lateral Capital Corp ("Lateral" or the "Company") (TSX VENTURE:LCP) is pleased to announce it has entered into a binding agreement to acquire a private company ("PrivateCo") that has rights to earn an 80% interest in approximately 376,000 acres (net approximately 301,000 acres) in Saskatchewan (the "Lands"). Lateral will acquire all of the issued and outstanding shares of PrivateCo for an aggregate purchase price of $4,750,000, comprised of cash in the amount of $750,000 and the issuance of an aggregate of 22,222,223 common shares in the capital of the Company at a price of $0.18 per share (the "PrivateCo Acquisition"). The Company and the shareholders of PrivateCo have negotiated a definitive purchase and sale agreement for the PrivateCo Acquisition. The Closing of the PrivateCo Acquisition will be subject to conditions customary for transactions of this nature including acceptance by the TSX Venture Exchange.

The Lands are one of the largest contiguous land positions in Saskatchewan and includes all conventional petroleum and natural gas rights from surface to basement. PrivateCo acquired two 2-D seismic lines totalling 24km in 2013 which identified a number of potential drilling locations. A larger (53km) 2D seismic program is being shot in February 2014 to detail the features identified, with the planned drilling of two exploratory wells. Well costs for a 1000m test are approximately $600,000 to drill, complete and tie-in. Lateral intends to capitalize on the favorable economic terms of the Saskatchewan government royalty regime and believes there is significant potential in this large acreage position.

An independent third party reviewed various land sale prices for exploration licenses from 2010 to 2013 published by Saskatchewan Energy and Mines and advised the Company that the purchase price is below the estimated value based on the lowest of the average sale values. The price for the land in offsetting acreages has been approximately $66.00 per acre. Mr. Murray Swanson, a director of the Company, is also a director and a shareholder of PrivateCo. In connection with the approval by the Company of the PrivateCo Acquisition, Mr. Swanson declared his personal interest in the PrivateCo Acquisition and abstained from voting on the approval of the PrivateCo Acquisition. The PrivateCo Acquisition is exempt from the valuation and minority approval requirements of Multilateral Instrument 61-101.

As announced previously the Company is currently assessing opportunities to acquire assets (in addition to the PrivateCo Acquisition), and if the Company is able to reach an agreement to acquire assets (details of which will be provided if agreement is reached) it intends to offer securities on a private placement basis to complete any such acquisition. Any such private placement will be subject to acceptance of the TSX Venture Exchange.

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 release.

This press release does not constitute an offer of the securities of the Company for sale in the United States. The securities of the Company have not been registered under the United States Securities Act of 1933, (the "1933 Act") as amended, and may not be offered or sold within the United States absent registration or an exemption from registration under the 1933 Act. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any state in which such offer, solicitation or sale would be unlawful.

About Lateral

Lateral's business strategy is to seek to provide shareholders with growth by exploiting existing assets in a financially disciplined manner and by acquiring additional (predominantly) light oil assets. As part of its corporate strategy of acquiring additional assets, the Company is typically in the process of evaluating several potential transactions at any time which individually or together could be material. The Company cannot predict whether any current or future opportunities will result in one or more transactions involving the Company. The Company may complete financings of equity or debt or issue equity or utilise debt facilities to finance all or a portion of any such potential acquisitions.

Cautionary and Forward-Looking Statements

This news release contains forwardlooking statements and forwardlooking information within the meaning of applicable securities laws. These statements relate to future events or future performance. All statements other than statements of historical fact may be forwardlooking statements or information. More particularly and without limitation, this news release contains forwardlooking statements and information relating to the PrivateCo Acquisition including the completion thereof (including the closing date), The ability of PrivateCo to earn it's interest in the Lands, the results of existing 2-D seismic, potential future seismic programs (including the nature and extent thereof), future drilling and anticipated costs relating thereto and the nature of applicable royalties, opportunities to acquire assets and raise capital as well as the Company's corporate strategy. The forwardlooking statements and information are based on certain key expectations and assumptions made by management of the Company, including, without limitation, the Company's ability to complete the PrivateCo Acquisition, identify suitable asset acquisition opportunities, reach agreement for the acquisition of assets and obtain financing on acceptable terms or at all. Although management of the Company believes that the expectations and assumptions on which such forward looking statements and information are based are reasonable, undue reliance should not be placed on the forwardlooking statements and information since no assurance can be given that they will prove to be correct.

Forward-looking statements and information are provided for the purpose of providing information about the current expectations and plans of management of the Company relating to the future. Readers are cautioned that reliance on such statements and information may not be appropriate for other purposes, such as making investment decisions. Since forwardlooking statements and information 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, the Company's ability to identify and complete additional suitable acquisitions to further the Company's growth as well as risks associated with the oil and gas industry in general such as 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 reserves, production, costs and expenses; health, safety and environmental risks; commodity price and exchange rate fluctuations; marketing and transportation; loss of markets; environmental risks; competition (including for capital, assets and skilled personnel); incorrect assessment of the value of acquisitions and failure to realize the anticipated benefits of acquisitions; ability to access sufficient capital from internal and external sources on acceptable terms or at all; failure to obtain required regulatory and other approvals and changes in legislation, including but not limited to tax laws, royalties and environmental regulations. Accordingly, readers should not place undue reliance on the forwardlooking statements, timelines and information contained in this news release. Readers are cautioned that the foregoing list of factors is not exhaustive.

The forwardlooking statements and information contained in this news release are made as of the date hereof and no undertaking is given to update publicly or revise any forwardlooking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws or the TSX Venture Exchange. The forward-looking statements or information contained in this news release are expressly qualified by this cautionary statement.

Contact Information

  • Lateral Capital Corp.
    Corbin Blume
    President & CEO
    (587) 350-7500
    (587) 350-7505 (FAX)