/NOT FOR DISTRIBUTION TO U.S. NEWS WIRE
SERVICES OR DISSEMINATION IN THE UNITED
STATES./
CALGARY, Dec. 6, 2016 /CNW/ – Montana Exploration Corp.
("Montana Exploration" or the "Company") (TSXV: MTZ)
today announced that it will be offering rights to holders of its
common shares at the close of business on the record date of
December 12, 2016, on the basis of
one right for each common share held (the "Rights
Offering"). Each four (4) rights will entitle the holder
to subscribe for one common share of Montana Exploration Corp. upon
payment of the subscription price of C$0.195 per common share. There are
currently 49,790,875 common shares of the Company issued and
outstanding. If all the rights issued under the rights
offering are validly exercised, the Rights Offering will raise
gross proceeds of approximately C$2.4
million. Vanco-Stock Ltd., a company controlled by a
director of the Company, has given a written commitment to exercise
its rights for proceeds of $1,321,442.
The rights will expire at 4:30
p.m. (Toronto Time) on January 13,
2017 (the "Expiry Time"), after which time
unexercised rights will be void and of no value. Shareholders
who fully exercise their rights will be entitled to subscribe for
additional common shares, if available as a result of unexercised
rights prior to the Expiry Time, subject to certain limitations as
set out in the Company's rights offering circular. The Company
expects to close the Rights Offering on or about January 13, 2017.
Details of the Rights Offering will be set out in the rights
offering notice and rights offering circular which will be
available under Montana's profile at www.SEDAR.com. The
rights offering notice and accompanying rights certificate will be
mailed to each registered eligible shareholder as at the record
date. Registered shareholders who wish to exercise their
rights must forward the completed rights certificate, together with
the applicable funds, to the rights agent, Computershare Investor
Services, Inc. ("Computershare"), on or before the Expiry
Time. Shareholders who own their common shares through an
intermediary, such as a bank, trust company, securities dealer or
broker, will receive materials and instructions from their
intermediary.
The Rights Offering will be conducted in Canada only. However, certain holders of
common shares in jurisdictions outside of Canada may be able to participate in the
Rights Offering where they can establish that the transaction is
exempt under applicable legislation. If you are a holder of
common shares and reside outside of Canada please see the rights offering notice
and rights offering circular to determine your eligibility and the
process and timing requirements to receive and, or, exercise your
rights. The Company requests any U.S. shareholder or other
ineligible holder interested in exercising their rights to contact
the Company at their earliest convenience.
Funds raised through the Rights Offering will be used to pay for
general and administrative (G&A) as well as geological,
engineering and land (technical) expenses. The Company currently
has G&A plus technical requirements of approximately
$200,000 per month. The Company has
taken steps to minimize its G&A and technical expenses while
retaining sufficient resources to maintain the Company's lands and
to conduct the Drilling Program announced on September 27, 2016. Actions to reduce G&A
expenses have included signing an office lease extension to
March 31, 2017 at a reduced rate,
maintaining administrative staff on a four-day work week, delaying
payment of executive salaries, and payment of consulting services
through equity-based compensation.
The Rights Offering is part of a broader financial plan for the
Company (the "Financial Plan") comprised of:
(1)
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The Rights Offering
governed by this Circular, for proceeds of up to $2.4
million;
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(2)
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The farm-out
transaction, pursuant to which a Drilling Program is being
conducted (the Company will also receive prospect fees of
USD$250,000 in conjunction with the farm out)(see the September 27,
2016 press release);
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(3)
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Raising additional
capital through the public markets to reduce or eliminate the
working capital deficiency and to provide funds for further future
drilling;
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(4)
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Pursuing other farm
out transactions in respect to the Company's natural gas prospects
and the remainder of the Company's Shaunavon prospects;
and
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(5)
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The sale of non-core
assets, including its Pine Mills field interests in Wood County,
Texas, (see November 30, 2016 press release), and other non-core
assets in the State of Montana.
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ABOUT MONTANA EXPLORATION CORP.
Montana Exploration Corp. is an oil and gas exploration and
production company focusing on the Shaunavon oil and Eagle gas opportunities
underlying its extensive land holdings and drilling rights in the
state of Montana. In the United
States, the company operates through its wholly-owned
subsidiaries, Montana Land &
Exploration, Inc., GFP Texas Inc. and GFP Central USA Inc. The
company's common shares are listed on the TSX Venture Exchange
under the trading symbol "MTZ". Additional information regarding
the company is available at www.SEDAR.com or at
www.MontanaExplorationCorp.com.
Neither the 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.
The securities offered have not been
registered under the U.S. Securities Act of 1933, as amended,
and may not be offered or sold in the United States absent registration or an
applicable exemption from the registration requirements.
This press release shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale
of the securities in any State in which such offer, solicitation
or sale would be unlawful.
Forward Looking Statements
This press release contains statements that constitute
"forward-looking information" or "forward- looking" statements"
(collectively "forward-looking information") within the
meaning of applicable securities legislation. Forward-looking
information is often, but not always, identified by the use of
words such as "anticipate", believe", "expect", "plan", "intend",
"forecast", "target", "project", "guidance", "may", "will",
"should" "could", "estimate", "predict" or similar words suggesting
future outcomes or language suggesting an outlook. These
forward-looking statements include, among other things, statements
relating to: (i) the funds to be raised under the Offering; (ii)
estimated costs of the Offering; (iii) available funds to the
Corporation after expenses of the Offering; (iv) additional sources
of required funding for the Corporation; (v) the use of the funds
raised under the Offering; (vi) (vii) the particulars of the
Financial Plan and the Corporation's ability to execute the
Financial Plan or any portion thereof; and (viii) estimated G&A
requirements.
Forward-looking statements and information contained in this
press release are based on our current beliefs as well as
assumptions made by, and information currently available to, us.
Although we consider these assumptions to be reasonable based on
information currently available to us, they may prove to be
incorrect.
By their very nature, the forward-looking statements included in
this press release involve inherent risks and uncertainties, both
general and specific, and risks that predictions, forecasts,
projections and other forward-looking statements will not be
achieved. We caution readers not to place undue reliance on these
statements as a number of important factors could cause the actual
results to differ materially from the beliefs, plans, objectives,
expectations and anticipations, estimates and intentions expressed
in such forward-looking statements.
Furthermore, the forward- looking statements contained in this
press release are made as of the date of this document and we do
not undertake any obligation to update publicly or to revise any of
the included forward- looking statements, whether as a result of
new information, future events or otherwise, except as required by
applicable law. The forward-looking statements contained in this
press release are expressly qualified by this cautionary
statement.
SOURCE Montana Exploration Corp.