CORDY OILFIELD SERVICES INC. ANNOUNCES EXECUTION OF PURCHASE “AGREEMENT TO ACQUIRE THE BUSINESS AND ASSETS OF PLATINUM NORT...
March 10 2020 - 7:38PM
Cordy Oilfield Services Inc. (“
Cordy” or the
“
Company”) (TSX VENTURE: CKK) is pleased to
announce that its wholly owned subsidiary Cordy Environmental Inc.
(“
CEI”) has entered into an asset
purchase agreement dated March 10th, 2020 with Platinum North
Resources Ltd. (“
Platinum North”) and Heart River
Holdings (2011) Ltd. (“
Heart River”), collectively
the “
Vendors”, to purchase, for an aggregate
purchase price of $4.25 million, subject to customary adjustments,
all of the business, assets, property and equipment used in the
Vendors’ business operating in northern Alberta and northeastern
British Columbia (the “
Acquisition”).
Purchase Price and Payment
The aggregate purchase price for the Acquisition
is $4.25 million, subject to adjustments, is payable by way of cash
payments at closing of $2,500,000, the issuance of 25,000,000
($750,000) common shares of Cordy at a deemed price of $0.03 per
common share and promissory notes in the principal amount of
$1,000,000. The promissory notes are non-interest bearing and
will be due and payable 150 days following the closing and their
repayment will be secured by a general security agreement.
Financing
In conjunction with the acquisition, CEI has
entered into a sale and leaseback agreement with a private lender
in the net amount of $4,250,000, payable over a five-year term with
an effective interest rate of 7.45%.
Platinum North and Heart
River
The Vendors operate diversified transportation
and logistics services businesses which primarily support liquid
waste management and reclamation and remediation in the oil and gas
industry in northern Alberta. The assets utilized include a fleet
of winch trucks, texas beds, picker trucks, end dumps, walking
floors, gravel trucks and flat deck super B's. The Acquisition
complements Cordy’s existing liquid waste business and expands its
reclamation and remediation capabilities. Additionally, the
Acquisition provides a strategic expansion of Cordy’s geographical
footprint into a corridor that, over the long term, should see an
increase in demand for services from an increase in exploration and
production of natural gas to support LNG Canada and Costal Gas
Link. The Acquisition further exemplifies Cordy’s goal to continue
to develop sustainable operations, with a focus on waste management
and responsible environmental stewardship.
By way of the Acquisition, Cordy will be adding
approximately 20 employees and contract operators. Cordy is also
pleased to announce that the former president and CEO of the
Vendors, Craig Heitrich, will be retained as a Vice President and
Chief Operating Officer of Cordy.
The Acquisition is subject to the satisfaction
of customary closing conditions, including the acceptance of the
TSX Venture Exchange (“TSXV”).
Additional information on Cordy is available on
our website www.cordy.ca or on SEDAR at www.sedar.com.
For general information,
please contact: Darrick Evong Chief Executive Officer
IR@cordy.ca Phone: (403) 262-7667 |
Neither 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.
Forward-Looking Information: This news release
contains “forward-looking information” within the meaning of
applicable Canadian securities legislation. All statements, other
than statements of historical fact, included herein are
forward-looking information. In particular, this news release
contains forward-looking information in relation to: the proposed
Acquisition; the business, assets, property and equipment of the
Vendors in the proposed Acquisition; the satisfaction of the
conditions for completion of the proposed Acquisition; the
issuance of common shares to satisfy a portion of the purchase
price for the proposed Acquisition; the availability of
satisfactory financing for the proposed Acquisition; and the
potential closing date for the proposed Acquisition. This
forward-looking information reflects Cordy’s current beliefs and
is based on information currently available to Cordy and on
assumptions Cordy believes are reasonable. These assumptions
include, but are not limited to: the completion of satisfactory due
diligence by Cordy in relation to the proposed Acquisition; the
satisfactory fulfilment of all of the conditions precedent to the
proposed Acquisition; the receipt of all required approvals for the
proposed Acquisition including Cordy board of directors approval,
and TSXV acceptance; the issuance of the common shares as
disclosed above as part of the purchase price for the proposed
Acquisition; market acceptance of the proposed Acquisition; and
acceptable financing to complete the proposed Acquisition. Forward
looking information is subject to known and unknown risks,
uncertainties and other factors that may cause the actual results,
level of activity, performance or achievements of Cordy to be
materially different from those expressed or implied by such
forward-looking information. Such risks and other factors may
include, but are not limited to: general business, economic,
competitive, political and social uncertainties; general capital
market conditions and market prices for securities; delay or
failure to receive board or regulatory approvals; the actual
results of future operations; competition; changes in legislation,
including environmental legislation, affecting Cordy; the timing
and availability of external financing on acceptable terms;
conclusions of economic evaluations and appraisals; and lack of
qualified, skilled labour or loss of key individuals. A
description of additional assumptions used to develop such
forward-looking information and a description of additional risk
factors that may cause actual results to differ materially from
forward-looking information can be found in Cordy’s disclosure
documents on the SEDAR website at www.sedar.com. Although Cordy
has attempted to identify important factors that could cause
actual results to differ materially from those contained in
forward-looking information, there may be other factors that cause
results not to be as anticipated, estimated or intended. Readers
are cautioned that the foregoing list of factors is not exhaustive.
Readers are further cautioned not to place undue reliance on
forward-looking information as there can be no assurance that the
plans, intentions or expectations upon which they are placed will
occur. Forward-looking information contained in this news
release is expressly qualified by this cautionary statement. The
forward-looking information contained in this news release
represents the expectations of Cordy as of the date of this news
release and, accordingly, is subject to change after such date.
However, Cordy expressly disclaims any intention or obligation to
update or revise any forward-looking information, whether as a
result of new information, future events or otherwise, except as
expressly required by applicable securities law.
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