June 22, 2009 19:57 ET
CALGARY, ALBERTA--(Marketwire - June 22, 2009) - Pure Energy Services Ltd. (TSX:PSV) ("Pure Energy") and Canadian Sub-Surface Energy Services Corp. (TSX:CSE) ("CanSub") announced today that they have closed the previously announced plan of arrangement (the "Arrangement") under the Business Corporations Act (Alberta) involving Pure Energy, CanSub and the security holders of CanSub whereby Pure Energy acquired all of the issued and outstanding class A voting common shares of CanSub ("CanSub Shares") for consideration comprised of 7,834,566 common shares of Pure Energy ("Pure Shares").
Under the terms of the Arrangement, CanSub shareholders received 0.3017 of a Pure Share for each CanSub Share. Shareholders of CanSub who have not already done so should submit completed letters of transmittal and share certificates to the depositary under the Arrangement, Olympia Trust Company. Pure Shares will be issued to such shareholders following the receipt of such documents. Options to acquire CanSub Shares ("CanSub Options") that were not exercised prior to the closing of the Arrangement with an exercise price greater than or equal to $0.5282 were exchanged by the holder thereof for a cash payment in the amount of $0.05 per CanSub Option and such CanSub Options were cancelled. CanSub Options that were not exercised prior to the closing of the Arrangement with an exercise price less than $0.5282 were cancelled and the holder of such CanSub Options received a number of Pure Shares in respect of such CanSub Options equal to a fraction, where the numerator is the amount by which $0.5282 exceeds the exercise price of such CanSub Options, and the denominator is $0.5282, multiplied by 0.3017, the product of which is multiplied by the number of CanSub Shares the holder would have been entitled to receive on the exercise of such CanSub Options immediately prior to the closing of the Arrangement. Accordingly, an aggregate of 650 Pure Shares were issued to such holders of CanSub Options under the Arrangement.
In connection with the Arrangement, Brad Gabel, Harry Knutson and Miles Lich have been appointed to Pure Energy's board of directors while Paul Little and Neal Stanley have resigned. J. Kevin Delaney will remain as Chief Executive Officer of Pure Energy. Additionally, Brad Gabel has been appointed as President, Canadian Completion Services, Rutger Niers has been appointed as President, Drilling Services and US Completion Services and Troy Simoneau has been appointed as Chief Operating Officer, Canadian Completion Services.
Mr. Kevin Delaney, the CEO of Pure Energy, stated "This transaction strengthens our management team and provides the operational capability to deliver services to both Pure Energy's and CanSub's customers operating in key oil and gas exploration and production resource plays in western Canada and the U.S. Rocky Mountain region. The combined company is one of the largest providers of wireline and testing services in Canada, and the transaction will also facilitate our continued growth in the Rocky Mountain and other selected regions of the United States."
Mr. Brad Gabel, President and the former CEO of CanSub, stated "I would like to thank the CanSub shareholders for their overwhelming support of this transaction as evidenced through the approval by 99.99% of holders of CanSub Shares as well as approval by 99.99% of holders of CanSub Shares and CanSub Options voting together as a single class. I believe that this transaction provides CanSub's shareholders with an opportunity to leverage on CanSub's operational excellence and Pure Energy's United States platform. The management team is excited about the opportunities presented by this transaction."
Committed Credit Facilities
Pure Energy has also entered into an amended and restated credit agreement with its senior lender that provides a secured $18 million demand revolving operating credit facility ("Operating Facility") and a secured $80 million one year extendible revolving credit facility ("Revolving Facility"). The Revolving Facility is subject to renewal on March 31, 2010, and if not extended would term out with 25% of the outstanding balance being repaid over one year and the remaining balance due upon expiry of the one year amortization period. Borrowings under the Operating Facility will bear interest at either: (i) the lender's prime rate plus 1.50%, or (ii) bankers acceptance rates plus 2.75%. Borrowings under the Revolving Facility will bear interest at either: (i) the lender's prime rate plus 2.50%, or (ii) bankers acceptance rates plus 4.00%. The other terms of the new facilities, including financial covenants and borrowing limits, are similar to those contained in Pure Energy's current credit facilities.
Pure Energy is an oilfield services company that provides completion and drilling related services to oil and gas exploration and development entities in the Western Canadian Sedimentary Basin and, through its wholly-owned subsidiary, Pure Energy Services (USA), Inc., in the Rocky Mountain region of the United States.
CanSub is a Calgary-based oilfield services company operating from field locations in the Western Canadian Sedimentary Basin and in North Dakota, U.S.A. CanSub provides cased-hole wireline, production testing, well optimization and swabbing services to junior, intermediate and senior oil and gas exploration and production companies.
Pure Energy Services Ltd.Kevin DelaneyChief Executive Officer(403) 262-4000orPure Energy Services Ltd.Brian PetersChief Financial Officer(403) 262-4000orCanadian Sub-Surface Energy Services Corp.Brad GabelPresident(403) 262-3247
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