This news release is issued pursuant to National
Instrument 62-104 – Take-Over Bids and Issuer Bids and National
Instrument 62-103 – The Early Warning System and Related Take-Over
Bid and Insider Reporting Issues in connection with the filing of
an early warning report.
Gran Tierra Energy Inc. (NYSE American:GTE) (NYSE
MKT:GTE) (TSX:GTE) ("
Gran Tierra") is pleased to
announce the closing of the sale of its Peru business pursuant to
the previously announced share purchase agreement entered into
between the Gran Tierra Energy International Holdings
("
GTEIH"), Gran Tierra, PetroTal Ltd.
("
PetroTal") and Sterling Resources Ltd.
("
Sterling"), effective November 9, 2017 (the
"
Peru SPA") and arrangement
agreement entered into between PetroTal and Sterling, effective
November 9, 2017 (the "
Arrangement
Agreement", and the transactions contemplated by
the Peru SPA and the Arrangement Agreement, collectively, the
"
Peru Transaction").
Gary Guidry, President and Chief Executive
Officer of Gran Tierra, commented "Consistent with our strategy of
focusing on our core exploration, development and production assets
in Colombia, we are pleased to close the sale of Gran Tierra’s
Peruvian assets to Sterling. We are confident that Sterling’s
management team is committed to unlocking the potentially
significant asset value in Peru and maximizing value for their
shareholders. Gran Tierra is retaining a significant equity
ownership position in Sterling and a 20% carried working interest
in Block 107, located in the Ucayali basin in Peru. Gran Tierra is
well-positioned to participate in upside value created by Sterling
in the Peruvian assets. We extend our best wishes for success to
Sterling and its employees.”
Pursuant to the Arrangement Agreement: (a)
PetroTal completed a reverse take-over of Sterling; (b) Sterling
and PetroTal were amalgamated; and (c) the management and board of
directors of Sterling was reconstituted.
Pursuant to the Peru SPA, Sterling has acquired
all of the issued and outstanding shares of Gran Tierra Energy
International Peru Holdings B.V. ("GTEIPH") from
GTEIH in exchange for 187,250,000 common shares in the capital of
Sterling (the "Common Shares"),
representing approximately 34.8% of the issued and outstanding
Common Shares, plus or minus a cash-settled working capital
adjustment. GTEIPH indirectly holds all of Gran Tierra's Peruvian
assets.
GTEIH has filed an early warning report in
connection with its acquisition of 187,250,000 Common Shares
pursuant to the Peru SPA. Immediately prior to the completion of
the Peru SPA, GTEIH did not own any Common Shares in Sterling.
After giving effect to the Peru SPA, GETIH, together with Gran
Tierra Resources Limited ("GTRL"), held
246,100,000 Common Shares representing approximately 45.77% of the
Common Shares. A copy of the early warning report filed by the
GTEIH in connection with the Peru SPA is available on SEDAR,
located at www.sedar.com.
The divestiture pursuant to the Peru SPA is
expected to allow Gran Tierra to focus on its core Colombian
exploration, development, and production operations. Gran Tierra
will evaluate its investment in Sterling from time to time and may,
based on such evaluation, market conditions and other
circumstances, increase or, subject to applicable escrow periods
under the rules of the TSX Venture Exchange
("TSXV"), decrease shareholdings as circumstances
require through market transactions, private agreements, or
otherwise.
In connection with the Peru Transaction, GTEIH
has entered into:
- along with GTRL, an investor rights agreement with Sterling,
pursuant to which, inter alia, GTEIH and GTRL together have the
right to nominate two directors to the board of Sterling as well as
certain demand and piggy-back registration rights and certain
pre-emptive rights and GTEIH and GTRL are prohibited from
exercising voting rights over more than 30% of the issued and
outstanding Common Shares, the whole subject to the terms and
conditions set forth therein; and
- a carried interest and option agreement with Sterling and a
Peruvian subsidiary, pursuant to which GTEIH has a 20% carried
working interest in Block 107, located in the Ucayali basin in
Peru, which interest may, at the option of GTEIH, either be
converted to a non-carried working interest or be forfeited
following the drilling of an exploration well in Block 107.
GTEIH expects that Common Shares which it
acquired pursuant to the Peru Transaction will be deposited with an
escrow agent and subject to the terms of an escrow agreement,
substantially in the form required by the TSXV.
Contact Information
For investor and media inquiries please
contact:
Gary GuidryChief Executive Officer
Ryan EllsonChief Financial Officer
Rodger TrimbleVice President, Investor
Relations
403-265-3221info@grantierra.com
About Gran Tierra Energy
Inc.Gran Tierra Energy Inc. together with its subsidiaries
is an independent international energy company focused on oil and
natural gas exploration and production in Colombia. The Company
continues to pursue new growth opportunities, leveraging its
financial strength. The Company’s common shares trade on the NYSE
American and the Toronto Stock Exchange under the ticker symbol
GTE. Additional information concerning Gran Tierra is available at
www.grantierra.com. Information on the Company's website does not
constitute a part of this press release. Investor inquiries may be
directed to info@grantierra.com or (403) 265-3221.
Gran Tierra's Securities and Exchange Commission
filings are available on a website maintained by the Securities and
Exchange Commission at http://www.sec.gov and on SEDAR at
http://www.sedar.com.
Forward Looking Statements and Legal
Advisories:This press release contains opinions,
forecasts, projections, and other statements about future events or
results that constitute forward-looking statements within the
meaning of the United States Private Securities Litigation Reform
Act of 1995, Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended,
and financial outlook and forward looking information within the
meaning of applicable Canadian securities laws (collectively,
"forward-looking statements"). The use of the words "will" and
"believes", derivations thereof and similar terms identify
forward-looking statements. In particular, but without limiting the
foregoing, this news release contains forward-looking statements
regarding the anticipated benefits of the Peru Transaction to Gran
Tierra and its shareholders.
The forward-looking statements contained in this
news release are based on certain assumptions made by Gran Tierra
based on management's experience and other factors believed to be
appropriate. Gran Tierra believes these assumptions to be
reasonable at this time, but the forward-looking statements are
subject to risk and uncertainties, many of which are beyond Gran
Tierra's control, which may cause actual results to differ
materially from those implied or expressed by the forward looking
statements. These include the factors discussed or referenced in
Gran Tierra's reports filed with the Securities and Exchange
Commission, including, without limitation, under the caption "Risk
Factors" in Gran Tierra's Annual Report on Form 10-K filed March 1,
2017 and its subsequently filed Quarterly Reports on Form 10-Q.
These filings are available on a Web site maintained by the
Securities and Exchange Commission at http://www.sec.gov and on
SEDAR at www.sedar.com. All forward-looking statements are made as
of the date of this press release and the fact that this press
release remains available does not constitute a representation by
Gran Tierra that Gran Tierra believes these forward-looking
statements continue to be true as of any subsequent date. Actual
results may vary materially from the expected results expressed in
forward-looking statements. Gran Tierra disclaims any intention or
obligation to update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise,
except as expressly required by applicable.
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