CALGARY, ALBERTA--(Marketwired - Aug 12, 2013) - Donnybrook Energy Inc. ("Donnybrook" or the "Company") (TSX VENTURE:DEI) reports that it is proposing to consolidate its common shares and change the name of the Company. Additional information relating to the proposed share consolidation and name change is included in Donnybrook's information circular dated August 8, 2013 (the "Information Circular"), which is available on SEDAR at www.sedar.com.
Donnybrook has mailed the Information Circular with respect to its annual and special meeting of shareholders of the Company ("Shareholders") scheduled for September 6, 2013 (the "Meeting"). As part of that Meeting, Shareholders will be asked to consider and approve a special resolution to consolidate the issued and outstanding common shares of the Company ("Common Shares") on the basis of one (1) post-consolidation Common Share for up to every forty-three (43) pre-consolidation Common Shares, or such lesser ratio that the board of directors of the Company (the "Board"), in its sole discretion, may determine to be appropriate (the "Consolidation"). In addition, Shareholders will be asked to consider and approve a special resolution to change the name of the Company to Deca Exploration Inc. or such other name as the Board may determine to approve (the "Name Change").
There are currently 195,436,066 Common Shares issued and outstanding. Assuming a consolidation ratio of 43 pre-Consolidation Common Shares for each post-Consolidation Common Share, the Consolidation would result in there being approximately 4,545,024 Common Shares issued and outstanding.
The Board considers that the Consolidation would be in the best interests of the Shareholders as it could lead to increased interest by a wider audience of potential investors and would better position the Company to obtain financing and pursue acquisition opportunities.
To be effective, each of the Consolidation and Name Change must be approved by at least two-thirds of the Shareholders present or represented by proxy at the Meeting. In addition, each of the Consolidation and Name Change are also subject to approval by the TSX Venture Exchange. If approved by the Shareholders, the Board may determine not to proceed with the Consolidation and/or Name Change, in its sole discretion.
Additionally, at the Meeting, Shareholders will be asked to consider and approve an ordinary resolution confirming an amendment to the Company's by-laws relating to the advance notice for the nomination of directors (the "By-Law Amendment"). The Board has approved the By-Law Amendment, subject to approval by the Shareholders at the Meeting. The By-Law Amendment will not be in force prior to the Meeting being held.
Donnybrook will continue to consider strategic alternatives and the maximization of shareholder value and which alternatives may include further acquisitions or dispositions of assets, recapitalization or mergers with other companies. Except as required by law, Donnybrook does not intend to disclose developments with respect to strategic alternatives until the board of directors of the Company has approved a definitive transaction or strategic alternative. The Company cautions that there are no guarantees that a transaction will be undertaken or a strategic alternative pursued.
Donnybrook has a net cash position of approximately $3 million, is debt free and is currently producing approximately 275 net boe per day from its properties located at Bigstone and Fir, Alberta.
Further information relating to Donnybrook is also available on its website at www.donnybrookenergy.ca.
ON BEHALF OF THE BOARD OF DONNYBROOK ENERGY INC.
Malcolm F. W. Todd, Chief Executive Officer
FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements or information ("forward-looking statements") within the meaning of applicable securities laws. The use of any of the words "will", "expects", "believe", "plans", "potential" and similar expressions are intended to identify forward-looking statements. More particularly and without limitation, this press release contains forward-looking statements concerning the proposed Consolation, including the proposed consolidation ratio, increased interest of potential investors, the Consolidation's facilitation of future financings and acquisition opportunities, the proposed Name Change, the By-Law Amendment.
The forward-looking statements in this press release are based on certain key expectations and assumptions made by Donnybrook, including the receipt of all necessary approvals, including but not limited to shareholder and regulatory approvals including the approval of the TSX Venture Exchange. There is no assurance that these expectations and assumptions will be met or satisfied and there is therefore no assurance that the Consolidation and/or Name Change will be completed or that the By-Law Amendment will become effective.
Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited the risks relating to the failure to obtain necessary shareholder or regulatory approvals required in order to proceed with the Consolidation, Name Change and By-Law Amendment and uncertainty regarding increased interest of potential investors and future financing and acquisition opportunities. Additional information on these and other factors that could affect the operations or financial results of Donnybrook are included in Donnybrook's Annual Information Form, management's discussion and analysis and other documents filed with applicable securities regulatory authorities and may be accessed through the SEDAR website (www.sedar.com). The forward-looking statements contained in this press release are made as of the date hereof and Donnybrook undertakes no obligation to update publicly or revise any forward-looking statements, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws. The forward-looking statements contained in this press release are expressly qualified by this cautionary statement.
Where amounts are expressed on a barrel of oil equivalent ("boe") basis, natural gas volumes have been converted to oil equivalence at six thousand cubic feet per barrel. The term boe may be misleading, particularly if used in isolation. A boe conversion ratio of six thousand cubic feet per barrel is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Given that the value ratio based on the current price of crude oil as compared to natural gas is significantly different from the energy equivalency of 6:1, utilizing a conversion on a 6:1 basis may be misleading as an indication of value.
