CALGARY, ALBERTA--(Marketwired - Jan 20, 2016) -
1. The name and address of the offeror.
Dreamworks Investment Holdings Ltd. ("Dreamworks")
4700 Bankers Hall West
888 - 3rd Street S.W.
Calgary, Alberta T2P 5C5
2. The designation and number or principal amount of securities and the offeror's securityholding percentage in the class of securities of which the offeror acquired ownership or control in the transaction or occurrence giving rise to the obligation to file the news release, and whether it was ownership or control that was acquired in those circumstances
On January 18, 2016, Dreamworks, a private issuer controlled by Mr. Clayton H. Riddell ("Riddell"), acquired ownership of 322,018,088 common shares ("Common Shares") (representing approximately 48% of the Common Shares issued under the Rights Offering (as defined below)) in the capital of Perpetual Energy Inc. ("Perpetual") for aggregate cash consideration of $12,098,130.35 pursuant to the terms of an equity backstop agreement between Dreamworks and Perpetual dated November 20, 2015 (the "Backstop Agreement"). Pursuant to the Backstop Agreement, Dreamworks agreed to exercise its basic subscription right and additional subscription privilege, if applicable, under Perpetual's rights offering as described in Perpetual's final prospectus dated December 7, 2015 (the "Rights Offering"), to the maximum extent possible such that, after giving effect to the purchase of Common Shares subscribed for and taken up by holders of rights pursuant to the basic subscription right and the additional subscription privilege under the Rights Offering (including any Common Shares subscribed for and taken up by Dreamworks pursuant to its basic subscription right and additional subscription privilege, as applicable), Perpetual would have received an aggregate amount in respect of the issuance of such Common Shares that is not less than the amount equal to the number of Common Shares outstanding on the record date of the Rights Offering multiplied by $0.1630, being approximately $25 million.
All of the Common Shares acquired by Dreamworks were acquired pursuant to the Rights Offering. Holders of rights under the Rights Offering other than Dreamworks subscribed for and purchased an aggregate of 343,349,378 Common Shares pursuant to the Rights Offering.
Prior to the completion of the Rights Offering, Dreamworks owned 24,958,186 Common Shares, representing approximately 7% of the outstanding Common Shares. Upon completion of the Rights Offering, Dreamworks now owns approximately 33% of the issued and outstanding Common Shares.
In addition to the Common Shares acquired by Dreamworks, on January 18, 2016, Riddell also directly and indirectly acquired an additional 105,391,076 Common Shares under the Rights Offering for aggregate cash consideration of $3,959,513.53 (the "Additional Riddell Shares"). The Additional Riddell Shares are controlled by Riddell. Of the 105,391,076 Additional Riddell Shares, 12,919,942 Common Shares are held by the Riddell Family Charitable Foundation ("RFCF") (a private charitable foundation controlled by Riddell); 61,283,834 Shares are held by Treherne Resources Ltd. ("Treherne") (a private issuer controlled by Riddell); 29,104,803 Common Shares are held by Warner Investment Holdings Ltd. ("Warner") (a private issuer controlled by Riddell); 276,182 Common Shares are held directly by Riddell; and 1,806,315 Common Shares are held by an account managed by Riddell.
Dreamworks, RFCF, Treherne, Warner, Riddell and Riddell's managed account are collectively referred to herein as the "Riddell Entities".
Except as set out above, Riddell is not acting jointly or in concert with any person in connection with the ownership or control of Common Shares of Perpetual.
All of the Common Shares acquired by the Riddell Entities were acquired pursuant to the Rights Offering. Holders of rights under the Rights Offering other than the Riddell Entities subscribed for and purchased an aggregate of 237,958,302 Common Shares pursuant to the Rights Offering.
Prior to the completion of the Rights Offering, the Riddell Entities owned 39,796,379 Common Shares, representing approximately 10% of the outstanding Common Shares. Upon completion of the Rights Offering, the Riddell Entities now own approximately 45% of the issued and outstanding Common Shares.
3. The designation and number or principal amount of securities and the offeror's securityholding percentage in the class of securities immediately after the transaction or occurrence giving rise to the obligation to file a news release:
See 2 above.
4. The designation and number or principal amount of securities and the percentage of outstanding securities of the class of securities referred to in paragraph 3 over which:
(i) the offeror, either alone or together with any joint actors, has ownership and control,
See 2 above.
(ii) the offeror, either alone or together with any joint actors, has ownership but control is held by other persons or companies other than the offeror or any joint actor,
Not applicable.
(iii) the offeror, either alone or together with any joint actors, has exclusive or shared control but does not have ownership,
Not applicable.
5. The name of the market in which the transaction or occurrence that gave rise to the news release took place.
Not applicable.
6. The value, in Canadian dollars, of any consideration offered per security if the offeror acquired ownership of a security in the transaction or occurrence giving rise to the obligation to file a news release.
The Riddell Entities (which include Dreamworks) effectively paid cash consideration of $0.0376 per Common Share acquired by it pursuant to the Rights Offering. The aggregate cash consideration paid by the Riddell Entities (which include Dreamworks) to Perpetual was $16,057,643.88.
7. The purpose of the offeror and any joint actors in effecting the transaction or occurrence that gave rise to the news release, including any future intention to acquire ownership of, or control over, additional securities of the reporting issuer.
The Riddell Entities (which include Dreamworks) acquired the Common Shares pursuant to the Rights Offering for investment purposes and may, depending on market and other conditions, increase or decrease its beneficial ownership, control or direction over securities of Perpetual through market Rights Offering, private agreements, or otherwise.
8. The general nature and the material terms of any agreement, other than lending arrangements, with respect to securities of the reporting issuer, entered into by the offeror, or any joint actor, and the issuer of the securities or any other entity in connection with the transaction or occurrence giving rise to the news release, including agreements with respect to the acquisition, holding, disposition or voting of any securities.
Dreamworks is party to the Backstop Agreement, the material terms of which are described above.
The descriptions of the Backstop Agreement and the Rights Offering herein are qualified in their entirety by reference to the Backstop Agreement and to Perpetual's final prospectus dated December 7, 2015, which have been filed on SEDAR by Perpetual.
9. The names of any joint actors in connection with the disclosure required by this form.
RFCF (a private charitable foundation controlled by Riddell); Treherne (a private issuer controlled by Riddell); Warner Investment Holdings Ltd. (a private issuer controlled by Riddell); Riddell; and Riddell's managed account.
10. In the case of a transaction or occurrence that did not take place on a stock exchange or other market that represents a published market for the securities, including an issuance from treasury, the nature and value in Canadian dollars of the consideration paid by the offeror.
See 6 above.
11. If applicable, a description of any change in any material fact set out in a previous report by the entity under the early warning requirements or Part 4 of National Instrument 62-103 in respect of the reporting issuer's securities.
Not applicable.
12. If applicable, a description of the exemption from securities legislation being relied on by the offeror and the facts supporting that reliance.
The Common Shares were acquired pursuant to the Rights Offering by prospectus.
Dated at Calgary, Alberta, this 20th day of January, 2016.
