Pulse Seismic Inc.
TSX : PSD

Pulse Seismic Inc.

July 14, 2010 07:00 ET

Pulse Seismic and Divestco Amend Binding Letter of Intent to Purchase Entire Seismic Data Library From Divestco

CALGARY, ALBERTA--(Marketwire - July 14, 2010) - Pulse Seismic Inc. ("Pulse" or the "Company") (TSX:PSD) today announced that Pulse and Divestco Inc. ("Divestco") have amended their Binding Letter of Intent dated July 2, 2010 to purchase the entire 3D and 2D seismic data library from Divestco. The cash portion of the purchase price has been increased by $5.7 million, while the benefit of certain pending seismic data transactions that were previously to be retained wholly by Divestco has been reallocated between Pulse and Divestco. 

The amendment is in response to an unsolicited competing offer recently received by Divestco. The Amended Binding Letter of Intent also now provides for break fees of $4.0 million if either party terminates the transaction under certain circumstances.

"Pulse is focused on the Company's strategic plan of growth through quality seismic data acquisitions", stated Doug Cutts, President and CEO. "The increase in our bid confirms our belief that we are adding quality seismic data to our extensive inventory. We are increasing our 3D seismic data base from approximately 12,900 net square kilometres to 28,000 net square kilometres and an additional 80,000 net kilometres of 2D seismic data for a total of approximately 338,000 net kilometres."

CORPORATE PROFILE

Pulse is a market leader in the acquisition, marketing and licensing of 2D and 3D seismic data for the western Canadian energy sector. Not including the datasets to be added through the transaction described above, Pulse owns the second-largest licensable seismic data library in Canada, currently consisting of approximately 258,000 net kilometres of 2D seismic and 12,900 net square kilometres of 3D seismic. The library extensively covers the Western Canada Sedimentary Basin where most of Canada's oil and natural gas exploration and development occurs.

This news release contains information that constitutes "forward-looking information" or "forward-looking statements" (collectively, "forward-looking information") within the meaning of applicable securities legislation. This forward-looking information includes, among other things, statements regarding:

  • the expected closing date of the transaction;
  • the expected method of financing the transaction;
  • the conditions of the transaction;
  • the size of Pulse's data library upon completion of the transaction;
  • Pulse's business strategy; and
  • Other expectations, beliefs, plans, goals, objectives, assumptions, information and statements about possible future events, conditions, results and performance.

Undue reliance should not be placed on forward-looking information. Forward-looking information is based upon current expectations, estimates and projections that involve a number of risks and uncertainties which could cause actual results to vary and in some instances to differ materially from those anticipated in the forward-looking information. 

The material risk factors that could cause actual results to differ materially from the forward-looking information include, but are not limited to:

  • general economic and industry conditions;
  • the demand for seismic data and participation surveys;
  • the pricing of data library license sales;
  • the level of pre-funding of participation surveys, and the ability of the Company to make subsequent data library sales from such participation surveys; 
  • the ability of the Company to complete participation surveys on time and within budget;
  • the price and demand for oil and natural gas;
  • the level of oil and natural gas exploration and development activities;
  • the ability of the Company's customers to raise capital;
  • environment, health and safety risks;
  • the effect of seasonality and weather conditions on participation surveys;
  • federal and provincial government laws and regulation, including taxation, royalty rates, environment and safety;
  • competition from other seismic data library companies;
  • dependence upon qualified seismic field contractors;
  • dependence upon key management, operations and marketing personnel;
  • loss of seismic data; and
  • protection of Intellectual Property. 

The foregoing list of risks is not exhaustive. Additional information on these risks and other factors which could affect the Company's operations or financial results are included in the Risk Factors section of the Company's Management's Discussion & Analysis for the most recent calendar year and interim periods. Forward-looking information is based upon the assumptions, expectations, estimates and opinions of the Company's management at the time the information is presented. 

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