News

Oryx Petroleum and its Major Shareholders Execute Definitive Agreements for Significant Equity Investment and Debt Restructuring

03 May 2017

Calgary, Alberta, May 3, 2017

Proposed $30 million cash investment, $24.1 million of indebtedness converted to equity and maturity date on indebtedness to AOG extended to July 2019

Oryx Petroleum Corporation Limited (“Oryx Petroleum” or the “Corporation”) today announces that it has entered into a series of agreements with the Corporation’s two largest shareholders, The Addax and Oryx Group (“AOG”) and Zeg Oil and Gas Ltd (“Zeg Oil and Gas”), which provide as follows:

• Zeg Oil and Gas has subscribed for 29,916,831 common shares of the Corporation (each, a “Common Share”) at $0.33426 per Common Share (the “Zeg Oil and Gas Subscription”), resulting in an aggregate subscription price of $10 million payable at closing in cash;

• AOG has subscribed for 131,933,226 Common Shares at $0.33426 per Common Share (the “AOG Subscription”), resulting in an aggregate subscription price of $44.1 million, $20 million of which is payable at closing in cash and the balance of which will be paid through the extinguishment of $24.1 million of principal and accrued interest owing under the Loan Agreement dated March 11, 2015 (the “Loan Agreement”) between an affiliate of AOG and a wholly-owned subsidiary of the Corporation; and

• AOG and the Corporation have agreed to amend the Loan Agreement (the “Loan Amendment”) to (i) extend the maturity date from March 10, 2018 to July 1, 2019, and (ii) require that, after May 11, 2017, accrued interest be paid out in Common Shares approximately every six months, rather than in cash upon maturity, at the then current five day volume-weighted average trading price for the Common Shares.

Each of the AOG Subscription, the Zeg Oil and Gas Subscription and the Loan Amendment is subject to the acceptance of the Toronto Stock Exchange and approval of minority shareholders in accordance with Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101”). The AOG Subscription and the Zeg Oil and Gas Subscription are also subject to the concurrent closing of both subscriptions, the successful restructuring of the contingent consideration obligation owed in connection with the original purchase of Oryx Petroleum’s interest in the Hawler license area, and certain customary conditions.

The AOG Subscription, the Zeg Oil and Gas Subscription and the Loan Amendment will be submitted to the shareholders of the Corporation for consideration at the previously announced Annual Meeting of Shareholders to be held on June 7, 2017. Shareholders of record at the close of business on April 20, 2017 will be entitled to notice of and, subject to the requirements of the Toronto Stock Exchange and MI 61-101, to vote at the meeting. Further information regarding the proposed transactions will be available in the Corporation’s management proxy circular for the meeting, which will be mailed to shareholders entitled to notice of the meeting in the coming days, and a material change report to be filed on the Corporation’s profile on SEDAR.

Subject to obtaining all required approvals and satisfying all other conditions to closing, the AOG Subscription and the Zeg Oil and Gas Subscription are expected to close in the second half of June 2017. Following closing, the Corporation will have 430,960,393 Common Shares outstanding with AOG owning 60.9% and Zeg Oil and Gas owning 24.5%. Assuming the closing occurs on July 31, 2017, the cut-off date defined in the subscription agreements, on such date, the balance of principal and accrued interest owing under the Loan Agreement will be reduced to approximately $78.1 million.

All dollar amounts in this news release are in United States dollars.