Calgary, Alberta--(Newsfile Corp. - May 6, 2021) - HB2 Origination, LLC ("Origination") is pleased to announce that it has entered into an engagement letter with Eight Capital (the "Agent") as lead agent and sole bookrunner in connection with a private placement of subordinated voting subscription receipts (the "Subordinated Voting Subscription Receipts") at a price of $4.01 per Subordinated Voting Subscription Receipts and multiple voting subscription receipts (the "Multiple Voting Subscription Receipts", and together with the Subordinated Voting Subscription Receipts, the "Subscription Receipts") at a price of $401.29 per Multiple Voting Subscription Receipts of Alpine Summit Energy Partners Finco, Inc. ("Finco"), a special purpose company incorporated solely for the purposes of the Offering (as defined below). The Offering will be conducted on a "best efforts" agency basis for total gross proceeds of the Canadian dollar equivalent to US$3 million, which may be upsized to US$5 million (the "Offering"). The Offering is being undertaken in connection with the previously announced business combination (the "Proposed Transaction") between Origination and Red Pine Petroleum Ltd. ("Red Pine") and is expected to close on or about May 27, 2021. In connection with the Proposed Transaction, the shareholders of Red Pine will be asked to approve a change of the name of the Resulting Issuer (as defined below) to "Alpine Summit Energy Partners, Inc.".
The Subscription Receipts will be created and issued pursuant to the terms of a subscription receipt agreement (the "Subscription Receipt Agreement") to be entered into among the Agent, Finco and Odyssey Trust Company to act as the subscription receipt agent (the "Subscription Receipt Agent"). Each Subordinate Voting Subscription Receipt and each Multiple Voting Subscription Receipt will entitle the holder thereof to receive, without payment of any additional consideration and without further action on the part of the holder, one Class A common share of Finco (a "Class A Finco Share") and one Class B common share of Finco (a "Class B Finco Share"), respectively, upon satisfaction of the Escrow Release Conditions (as will be defined in the Subscription Receipt Agreement). Each Class A Finco Share and each Class B Finco Share will be exchanged for one subordinate voting share and one multiple voting share, respectively, of Red Pine following the completion of the Proposed Transaction (the "Resulting Issuer").
In consideration for its services in connection with the Offering, the Agent will be paid a cash commission equal to 6% of the gross proceeds raised in the Offering, 50% of which commission will be paid on the closing date of the Offering and the remaining 50% of which commission will be deposited in escrow pending satisfaction or waiver of the Escrow Release Conditions.
Upon closing of the Offering, the aggregate gross proceeds of the Offering less 50% of the cash commission and the Agent's expenses (the "Escrowed Funds") will be deposited in escrow with the Subscription Receipt Agent pending satisfaction or waiver of the Escrow Release Conditions, in accordance with the provisions of the Subscription Receipt Agreement. If the Escrow Release Conditions are not satisfied at or before 5:00 p.m. (Toronto time) on the prescribed date determined by Origination and the Agent, each acting reasonably, the Escrowed Funds together with accrued interest thereon will be returned to the holders of Subscription Receipts on a pro rata basis and the Subscription Receipts will be cancelled. To the extent that the Escrowed Funds are insufficient to refund such amounts to each holder of the Subscription Receipts, Finco shall be liable for and will contribute such amounts as are necessary to satisfy the shortfall.
The net proceeds of the Offering will be used by the Resulting Issuer for corporate and general working capital purposes.
This news release does not constitute an offer to sell, or a solicitation of an offer to buy, any securities under the Offering in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act"), or any state securities laws and may not be offered or sold within the United States or to U.S. Persons (as defined under the U.S. Securities Act) unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.
HB2 Origination, LLC is a US-based company that operates oil and gas assets in the Austin Chalk and Eagle Ford formations in the Giddings Field near Austin, Texas.
For further information, please contact:
HB2 Origination, LLC
Chris Nilan, Head of Capital Markets
Phone: 615.488.0087 x1104
Forward-Looking Information and Statements
This news release contains certain "forward-looking information" within the meaning of applicable Canadian securities legislation and may also contain statements that may constitute "forward-looking statements" within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. Such forward-looking information and forward-looking statements are not representative of historical facts or information or current condition, but instead represent only Origination's beliefs regarding future events, plans or objectives, many of which, by their nature, are inherently uncertain and outside of Origination's control. Generally, such forward-looking information or forward-looking statements can be identified by the use of forward-looking terminology such as "plans", "expects", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates", "believes", or the negative or variations of such words and phrases or may contain statements that certain actions, events or results "may", "could", "would", "might" or "will be taken", "will continue", "will occur" or "will be achieved". The forward-looking information and forward-looking statements contained herein may include, but are not limited to, information concerning the Proposed Transaction and the Offering, expectations regarding whether the Proposed Transaction will be consummated, including whether conditions to the consummation of the Proposed Transaction will be satisfied, the terms and conditions of the Offering, the timing for completing the Offering and the use of net proceeds of the Offering.
By identifying such information and statements in this manner, Origination is alerting the reader that such information and statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of Origination (or the Resulting Issuer) to be materially different from those expressed or implied by such information and statements. In addition, in connection with the forward-looking information and forward-looking statements contained in this news release, Origination has made certain assumptions. Among the key factors that could cause actual results to differ materially from those projected in the forward-looking information and statements are the following: the ability to consummate the Proposed Transaction and the Offering; the ability to obtain requisite regulatory and shareholder approvals and the satisfaction of other conditions to the consummation of the Proposed Transaction on the proposed terms and schedule; the ability to satisfy the conditions to the consummation of the Offering or to the conversion of the Subscription Receipts; the ability to close the Offering on the proposed terms or at all; the potential impact of the announcement or consummation of the Proposed Transaction on relationships, including with regulatory bodies, employees, suppliers, contractors and competitors; changes in general economic, business and political conditions, including changes in the financial markets; changes in applicable laws; and compliance with extensive government regulation. Should one or more of these risks, uncertainties or other factors materialize, or should assumptions underlying the forward-looking information or statements prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected. Although Origination believes that the assumptions and factors used in preparing, and the expectations contained in, the forward-looking information and statements are reasonable, undue reliance should not be placed on such information and statements, and no assurance or guarantee can be given that such forward-looking information and statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information and statements. The forward-looking information and forward-looking statements contained in this news release are made as of the date of this news release, and Origination does not undertake to update any forward-looking information and/or forward-looking statements that are contained or referenced herein, except in accordance with applicable securities laws.
Not for distribution to United States newswire services or for release publication, distribution or dissemination directly, or indirectly, in whole or in part, in or into the United States.
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