TSX Venture Exchange Symbol: SNV
CALGARY, Oct. 15, 2013 /CNW/ - Sonoro Energy Ltd.
("Sonoro" or "the Company") (TSX-V: SNV) is pleased to announce a
proposed non-brokered private placement (the "Private Placement")
of up to 32,550,000 Post-Consolidation Shares (as defined below) at
a price of $0.08 per
Post-Consolidation Share for gross proceeds of up to Cdn
$2,604,000, subject to shareholder
and TSX Venture Exchange ("TSXV") approval.
As of the date hereof, Sonoro has entered into
an agreement (the "Subscription Agreement") with Geopetrol
International Holding Inc. ("Geopetrol") whereby Geopetrol has
agreed to subscribe for 26,300,000 Post-Consolidation Shares under
the Private Placement pursuant to the terms and conditions of the
Subscription Agreement, subject to shareholder and TSXV approval of
the Private Placement and Consolidation (as defined below) and
completion of the Consolidation. The proposed Private Placement
would (i) result in Geopetrol, an insider currently holding
approximately 17.4 % of the issued and outstanding common shares of
the Company, becoming a control person, within the meaning of TSXV
Policy 1.1; and (ii) constitutes a "related party transaction"
within the meaning of Multilateral Instrument 61-101 -
Protection of Minority Security Holders in Special
Transactions, and will be put before shareholders at a special
meeting (the "Meeting") of shareholders of the Company which is
expected to be held in early to mid-December, 2013.
In conjunction with the Private Placement,
Sonoro proposes to consolidate its issued and outstanding common
shares on the basis of one (1) new common share of the Company
(a "Post-Consolidation Share") for every ten (10) existing
common shares (the "Consolidation"), subject to shareholder and
TSXV approval. The proposed amendment to the articles of the
Company to allow for the Consolidation will be put before
shareholders at the Meeting.
Both management and the Board of Directors
believe that it is in the best interests of Sonoro to reduce the
number of outstanding common shares by way of a
consolidation. The Consolidation, if approved, will enable
Sonoro to offer securities of the Company under the Private
Placement in accordance with the minimum pricing rules of the
TSXV. Additional potential benefits of the Consolidation
include a higher post-Consolidation share price resulting in
greater interest in Sonoro and lower transaction costs.
As of October 15,
2013, there were 264,518,053 common shares of Sonoro issued
and outstanding and, if the proposed Consolidation is approved,
there will be approximately 26,451,805 Post-Consolidation Shares.
The implementation of the Consolidation would not affect the total
shareholders' equity of Sonoro or any components of shareholders'
equity as reflected on Sonoro's financial statements except: (i) to
change the number of issued and outstanding common shares; and (ii)
to change the stated capital of the common shares to reflect the
Consolidation.
The Company is continuing discussions with the
appropriate government officials, including through direct meetings
and discussions, with a view to receiving formal confirmation of
its License at both the Federal and Provincial level. The Company
expects that discussions may continue for some time before final
confirmations and approvals are received.
Mr. Richard
Wadsworth, Chairman and CEO of Sonoro, commented "Geopetrol
has proven to be a strong financial and technical partner.
Their participation in this financing provides support to Sonoro's
continued efforts to obtain approvals from the necessary
authorities in Iraq. "
Geopetrol commented "We are pleased to have the
opportunity to further invest in Sonoro, and we look forward to
working closely with Sonoro to realise the potential of the Asphalt
License we have signed with the Salah ad Din Province in
Iraq. Geopetrol remains
committed to the current process and, ultimately, operations in
Iraq."
At June 30, 2013,
Sonoro had cash of $1,360,532 and
positive working capital of $1,447,747 (inclusive of cash). Since that
time, the Company has continued to incur costs related to its
ongoing operations. Accordingly, the Company believes that
Private Placement is necessary in order to provide additional cash
to finance ongoing activities related to confirming the Company's
rights and then carrying out operating activities in relation to
those rights and for general working capital requirements. Full
details regarding the proposed Private Placement and Consolidation
will be mailed to Sonoro's securityholders in connection with the
Meeting.
About Sonoro
Sonoro is an international bitumen exploration
and development company. Our current focus is a pure play on
asphalt resource exploration and development in Iraq. Sonoro has initiated the
evaluation of resource opportunities under its asphalt license
agreement in the Salah ad Din Province.
Forward-Looking Information
Certain statements in this news release may
constitute "forward-looking information" ("forward-looking
statements") within the meaning of applicable Canadian securities
laws. Forward-looking statements are often, but not always,
identified by the use of words such as "anticipate", "plan",
"intend", "estimate", "potential", "could", "ongoing",
"prospective", "expected" and similar words suggesting future
outcomes. By their nature, forward-looking statements are based on
current expectations regarding future events that involve a number
of assumptions, known and unknown risks, and uncertainties and
other factors that may cause the actual results, performance or
achievements of Sonoro, or the industry, to differ materially from
the anticipated results, performance or achievements expressed or
implied by such forward-looking statements. Such factors include,
but are not limited to, expectations and assumptions concerning the
timing and anticipated receipt of required regulatory and
shareholder approvals for the Consolidation and Private Placement;
the ability of Sonoro and Geopetrol to satisfy the other conditions
of the Subscription Agreement and to complete the Private
Placement; and the estimated timing of the completion of the
Consolidation and the closing of the Private Placement.
Given these uncertainties, you should not rely
on forward-looking statements. These forward-looking statements
also represent our estimates and assumptions only as of the date
that they initially were made. We expressly disclaim a duty to
provide updates to any forward-looking statements, and the
estimates and assumptions associated with them, to reflect events
or circumstances or changes in expectations or the occurrence of
anticipated events after the date they initially were made, except
and to the extend required by applicable law.
Neither the TSXV nor its Regulation Service Provider (as
that term is defined in the policies of the TSXV) accepts
responsibility for the adequacy or accuracy of this
release.
SOURCE Sonoro Energy Ltd.
