OKLAHOMA CITY, June 30, 2014 /PRNewswire/ - Equal Energy
Ltd. ("Equal" or the "Company") (NYSE: EQU) (TSX: EQU) announced
today that Glass Lewis & Co. ("Glass Lewis") has recommended
that shareholders vote FOR the acquisition of Equal by a
subsidiary of Petroflow Energy Corporation.
Glass Lewis is the second major independent proxy advisor to
support the transaction. As previously disclosed, last week Equal
Energy announced that proxy advisor Institutional Shareholder
Services Inc. ("ISS") supported the transaction.
Like ISS, Glass Lewis also recommended that shareholders vote
FOR the non-binding advisory proposal to approve the
compensation that might become payable to Equal's named executive
officers in connection with the transaction (the "Compensation
Proposal").
"We have now obtained unanimous support from the leading two
proxy advisors for the Petroflow transaction," said Michael Doyle, Equal's Chairman of the Board.
"Both proxy advisors considered all aspects of the transaction,
including criticism by a third party who had instead proposed a
leveraged recapitalization. Both concluded that the Petroflow
transaction deserves the support of our shareholders."
Glass Lewis is a leading independent international corporate
governance analysis and proxy voting firm that serves institutional
investors globally that collectively manage more than $15 trillion in assets. Glass Lewis conducts a
careful review of public disclosure to determine what is in the
best interests of shareholders.
In recommending that shareholders vote FOR the
transaction and the Compensation Proposal, Glass Lewis stated:
"Even after giving consideration to the merits of a leveraged
recapitalization, we believe that the proposed merger is the
greater value for shareholders. The merger consideration offers
certainty of value and an attractive unaffected control premium to
shareholders." 1
About the transaction
As previously disclosed, the proposed acquisition would proceed
under a plan of arrangement under the Business Corporations
Act (Alberta) (the
"Arrangement") involving Equal, the shareholders of Equal
("Equal Shareholders"), Petroflow Energy Corporation and Petroflow
Canada Acquisition Corp. ("Petroflow Sub" and together with
Petroflow Energy Corporation, "Petroflow").
Under the Arrangement, Petroflow Sub will acquire all of the
outstanding common shares of Equal for US$5.43 in cash per share. Upon completion of the
Arrangement, Equal Shareholders will also receive a cash dividend
of US$0.05 per share. Equal's board
of directors recommends Equal Shareholders vote FOR the
Arrangement.
Glass Lewis comments on lack of a superior buyout
offer
In its favorable 14-page report, Glass Lewis commented that the
Board "conducted a very lengthy and extensive strategic review
process prior to entering into the proposed arrangement agreement
with Petroflow." Glass Lewis continued: "We note the termination
fee in the arrangement agreement should not represent too great of
a hurdle for a potential competing bidder to overcome, in our view.
Yet since the initial announcement of the arrangement agreement
back in December 2013, and to the
best of our knowledge, no other party has made a competing offer
for the Company."
"In fact, we note that from December
9, 2013 up to the publication date of our Proxy Paper, the
Company's NYSE-listed stock price has not closed above the implied
merger value, which suggests to us that most investors and
shareholders likely believe that Petroflow's offer represents a
full and fair value for the Company. Based on these factors and
absent a superior buyout offer, we believe that the proposed
arrangement agreement is in the best interests of the Company's
shareholders. Accordingly, we recommend that shareholders vote FOR
this proposal." 1
(1) Consent to quote the Glass Lewis report was neither
sought nor obtained.
How to vote
Every share voted is very important. Equal Shareholders are
encouraged to vote as soon as possible.
Any Equal Shareholder that has questions or requires more
information with regard to the voting of Equal shares should
contact Kingsdale Shareholder Services by toll-free telephone in
North America at 1-866-581-1479 or
collect call outside North America
at 416-867-2272, or by e-mail at
contactus@kingsdaleshareholder.com.
Equal's Board encourages Equal Shareholders to VOTE NOW FOR
THE ARRANGEMENT to receive the full value of Petroflow's
US$5.43 per share premium offer, as
well as the US$0.05 per share
dividend payable on completion of the Arrangement.
Additional Information
In connection with the Arrangement, Equal filed a definitive
proxy statement with the Securities and Exchange Commission (the
"SEC") on June 11, 2014. The
definitive proxy statement has also been filed on the Canadian
SEDAR filing system at www.sedar.com, and is available on Equal's
website at www.equalenergy.ca The definitive proxy statement
contains important information about the proposed Arrangement and
related matters. INVESTORS AND SHAREHOLDERS ARE URGED TO CAREFULLY
READ THE DEFINITIVE PROXY STATEMENT.
Investors and shareholders may obtain free copies of the
definitive proxy statement and other documents filed with the SEC
by Equal through the website maintained by the SEC at www.sec.gov.
In addition, investors and shareholders may obtain free copies of
the definitive proxy statement from Equal by telephone at (405)
242-6000, or by mail at: Equal Energy Ltd., 4801 Gaillardia Pkwy,
Suite 325, Oklahoma City, OK,
73142 Attn: Investor Relations.
Equal and its Directors and executive officers may be deemed to
be participants in the solicitation of proxies from the
shareholders of Equal in connection with the Arrangement.
Information regarding the interests of these Directors and
executive officers in the Arrangement is included in the definitive
information circular and proxy statement described above.
Additional information regarding these Directors and executive
officers is also included in Amendment No. 1 to Equal's Annual
Report on Form 10-K for the year ended December 31, 2013,
which was filed with the SEC on April 29,
2014. This document is available free of charge at the SEC's
web site at www.sec.gov, and from Equal by telephone at (405)
242-6000, or by mail at: Equal Energy Ltd., 4801 Gaillardia Pkwy,
Suite 325, Oklahoma City, OK,
73142 Attn: Investor Relations.
About Equal Energy
Equal Energy is an oil and gas exploration and production
company based in Oklahoma City,
Oklahoma. Our oil and gas assets are centered on the Hunton
liquids-rich natural gas property in Oklahoma. Our shares are listed on the New
York Stock Exchange and the Toronto Stock Exchange under the symbol
(EQU). Our convertible debentures are listed on the Toronto Stock
Exchange under the symbols EQU.DB.B.
Forward-looking Statements
Certain information in this press release constitutes
forward-looking statements under applicable securities laws
including statements relating to the completion of the Arrangement
and payment of consideration and the dividend pursuant to the
Arrangement. Any statements that are contained in this press
release that are not statements of historical fact may be deemed to
be forward-looking statements. Forward-looking statements are often
identified by terms such as "may," "should," "anticipate,"
"expects," "seeks" and similar expressions.
Forward-looking statements necessarily involve known and unknown
risks, such as risks associated with oil and gas production;
marketing and transportation; loss of markets; volatility of
commodity prices; currency and interest rate fluctuations;
imprecision of reserve and future production estimates;
environmental risks; competition; incorrect assessment of the value
of acquisitions; failure to realize the anticipated benefits of
dispositions; inability to access sufficient capital from internal
and external sources; changes in legislation, including but not
limited to income tax, environmental laws and regulatory matters;
and failure to obtain shareholder approval or to meet other closing
conditions for the Arrangement, including the failure of Petroflow
to obtain financing for the completion of the Arrangement. Readers
are cautioned that the foregoing list of factors is not
exhaustive.
Readers are cautioned not to place undue reliance on
forward-looking statements as there can be no assurance that the
plans, intentions or expectations upon which they are placed will
occur. Such information, although considered reasonable by
management at the time of preparation, may prove to be incorrect
and actual results may differ materially from those anticipated.
Forward looking statements contained in this press release are
expressly qualified by this cautionary statement.
Additional information on these and other factors that could
affect Equal's operations or financial results are included in
Equal's reports on file with Canadian and U.S. securities
regulatory authorities and may be accessed through the SEDAR
website (www.sedar.com), the SEC's website (www.sec.gov), Equal's
website (www.equalenergy.ca) or by contacting Equal. Furthermore,
the forward looking statements contained in this press release are
made as of the date of this press release, and Equal does 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 expressly
required by securities law.
All dollar values are in US dollars unless otherwise stated.
SOURCE Equal Energy Ltd.