CALGARY,
April 2, 2013 /CNW/ - Toscana
Energy Income Corporation (Toscana Energy or the Company) (TSX
Venture: TEI) wishes to announce that in connection with the
remaining contractual obligations owed by the Company to its
manager, Toscana Energy Corporation (the Manager), the
Company will issue an aggregate of 164,650 common shares in the
capital of the Company (each a Common Share) at a deemed
price of $22.73 per share. The
Common Shares will have a one year self imposed escrow
provision. The liability was incurred pursuant to the
performance fee provisions (the Performance Fee) of a
management agreement dated March 5,
2010 between the Company and the Manager (the Management
Agreement) (such agreement subsequently superseded by a new
management agreement dated October 11,
2012).
In summary, the Performance Fee is payable as a
result of the pre-tax rate of return to the shareholders of the
Company exceeding 8% per annum, the hurdle rate established in the
Management Agreement, which is set out in more detail in the
information circular of the Company dated September 7, 2012. The Manager receives 20%
of the amount that exceeds this rate of return. As a result
of the going public transaction with Senmar Capital Corp.
which closed on October 11, 2012, the
value of the Common Shares were set at $22.73 per Common Share representing a 127%
increase in value from their original cost base of $10 per Common Share.
The total amount payable under the Performance
Fee was $5,346,426 and it was agreed
by the Company and the Manager that this fee would be payable one
third in cash and the balance in Common Shares at a deemed price of
$22.73 per share. The cash
portion of this fee has since been paid. There are seven
shareholders of the Manager that will participate in the
Performance Fee, four of which are currently officers and/or
directors of the Company. The Company will also be paying an
amount of cash equal to the dividends that would have been paid had
such Common Shares been issued on the date that the Performance Fee
was due and payable.
About Toscana Energy Income
Corporation
Toscana Energy Income Corporation is a conventional oil and gas
producer with a mandate to acquire high quality, long life oil and
gas assets including royalties, non-operated working interests and
unitized production for yield and capital appreciation.
Toscana Energy Income Corporation is managed by Sprott Toscana
through Toscana Energy Corporation. Sprott Toscana is a member of
the Sprott Group of Companies.
About Sprott Toscana
Sprott Toscana (formerly Toscana Merchant Group) is a team of
Calgary-based energy specialists
that manage three separate businesses: Toscana Energy Income
Corporation (through Toscana Energy Corporation), Toscana Financial
Income Trust and Maple Leaf Energy Income LPs. In
July 2012, Toscana Merchant Group
joined the Sprott Group of Companies when it was acquired by Sprott
Inc. (TSX: SII), Canada's leading
alternative asset manager and a global leader in resource
investing.
Forward-Looking Statements
This news release contains forward‐looking
statements and forward‐looking information within the meaning of
applicable securities laws. These statements relate to future
events or future performance. All statements other than
statements of historical fact may be forward‐looking statements or
information. Forward‐looking statements and information are
often, but not always, identified by the use of words such as
"appear", "seek", "anticipate", "plan", "continue", "estimate",
"approximate", "expect", "may", "will", "project", "predict",
"potential", "targeting", "intend", "could", "might", "should",
"believe", "would" and similar expressions.
More particularly and without limitation,
this news release contains forward‐looking statements and
information concerning the expected issuance of common shares in
the capital of the Company in satisfaction of the liability owed by
the Company to the Manager. The forward‐looking statements
and information are based on certain key expectations and
assumptions made by management of the Company and although
management of the Company believes that the expectations and
assumptions on which such forward looking statements and
information are based are reasonable, undue reliance should not be
placed on the forward‐looking statements and information since no
assurance can be given that they will prove to be correct.
Forward-looking statements and information
are provided for the purpose of providing information about the
current expectations and plans of management of the Company
relating to the future. Readers are cautioned that reliance on such
statements and information may not be appropriate for other
purposes, such as making investment decisions. Since
forward‐looking statements and information 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 to, the risks associated with
the oil and gas industry in general such as operational risks in
development, exploration and production delays or changes in plans
with respect to exploration or development projects or capital
expenditures; the uncertainty of reserve estimates; the uncertainty
of estimates and projections relating to reserves, production,
costs and expenses; health, safety and environmental risks;
commodity price and exchange rate fluctuations; marketing and
transportation; loss of markets; environmental risks; competition;
incorrect assessment of the value of acquisitions and failure to
realize the anticipated benefits of acquisitions; ability to access
sufficient capital from internal and external sources; failure to
obtain required regulatory and other approvals and changes in
legislation, including but not limited to tax laws, royalties and
environmental regulations. Accordingly, readers should not place
undue reliance on the forward‐looking statements, timelines and
information contained in this news release. Readers are cautioned
that the foregoing list of factors is not exhaustive.
The forward‐looking statements and
information contained in this news release are made as of the date
hereof and no undertaking is given to update publicly or revise any
forward‐looking statements or information, whether as a result of
new information, future events or otherwise, unless so required by
applicable securities laws or the TSX Venture Exchange. The
forward-looking statements or information contained in this news
release are expressly qualified by this cautionary
statement
Neither the TSX Venture Exchange nor its
Regulation Services Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this release.
SOURCE Toscana Energy Income Corporation