Tourmaline Oil Corp. and Topaz Energy Corp. announced that they have entered into an agreement with Peters & Co. Limited (the "Lead Underwriter"), on behalf of a syndicate of underwriters (together with the Lead Underwriter, the "Underwriters"), pursuant to which the Underwriters have agreed to purchase, on a bought deal basis, from Tourmaline 7,000,000 common shares of the Company (the "Common Shares") at a price of $15.45 per Common Share (the "Offering Price") for total gross proceeds to the Selling Shareholder of $108.15 million (the "Offering"). The Company will not receive any of the proceeds of the Offering.
The Selling Shareholder currently holds 58,149,494 common shares of Topaz, representing approximately 45.17% of the issued and outstanding common shares. Following the closing of the Offering, the Selling Shareholder will hold 51,149,494 common shares, representing approximately 39.73% of the issued and outstanding common shares of Topaz.
Tourmaline is selling the Common Shares as part of a long term plan to reduce its equity position as Topaz develops and continues to succeed as an independent royalty and infrastructure company. Tourmaline's reduction in Topaz equity is also in step with its commitment to continue to reduce overall debt levels of Tourmaline and accelerate shareholder returns as the long term debt target is achieved. The Offering will expand Topaz's free-trading share float and provide new and existing shareholders with enhanced trading liquidity which is in-line with Topaz's strategic objectives.
The Common Shares will be offered by way of a short form prospectus to be filed in all of the provinces of Canada. Private placement offerings in the United States will be made to "qualified institutional buyers" pursuant to Rule 144A of the United States Securities Act of 1933. The Offering is expected to close on or about September 21, 2021 and is subject to certain conditions including, but not limited to, the receipt of all necessary corporate and regulatory approvals, including the approval of the Toronto Stock Exchange and the applicable securities regulatory authorities. No securities regulatory authority has either approved or disapproved of the contents of this news release.
The securities being offered have not been, nor will they be, registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States or to, or for the account or benefit of, U.S. persons absent registration or an applicable exemption from the registration requirements. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any State in which such offer, solicitation or sale would be unlawful.