CALGARY,
April 30, 2013 /CNW/ - RIA Resources
Corp. (TSXV: RIA) ("RIA") announces that the previously
announced terms of the arm's length arrangement agreement (the
"Arrangement Agreement") dated effective April 3, 2013 with Qwest Diversified Capital
Corp. ("QDCC") have been amended. QDCC and RIA have
entered into an arm's length amended and restated arrangement
agreement dated April 29, 2013 (the
"Amended and Restated Arrangement Agreement") pursuant to
which, among other things, the parties have agreed to restructure
the plan of arrangement so as to: (i) effect the transfer of all
the assets and liabilities of RIA to a newly formed wholly-owned
subsidiary of RIA; and (ii) effect an amalgamation between RIA and
QDCC to form a new corporation ("Amalco") where shareholders
of RIA shall receive 0.014 Series 1 Special Shares of Amalco
("Amalco Special Shares") for each common share of RIA then
held (the "Exchange Ratio").
The name of Amalco shall be "Qwest Diversified
Capital Corporation". The Exchange Ratio under the Amended and
Restated Arrangement Agreement provides shareholders of RIA the
same effective consideration as provided under the terms of the
original Arrangement Agreement. That is, the Exchange Ratio implies
a value of $0.14 per RIA Share, for
aggregate deemed consideration of approximately $3,316,000, representing a 86% premium to the
closing price of RIA's Shares on the TSX Venture Exchange on
April 29, 2013, the last day of
trading prior to this announcement. It is anticipated that
the effective date of the Arrangement will be on or before
June 20, 2013 (the "Effective
Date").
Consistent with the terms of the original
Arrangement Agreement, holders of Amalco Special Shares have the
right to redeem their shares at a price per share equivalent to net
asset value of Amalco divided by the number of Amalco Special
Shares issued and outstanding at a date at least five years and one
day from the date of issue of the Amalco Special Shares to RIA
shareholders, all as more fully described in the articles of
incorporation and unanimous shareholders agreement of Amalco. The
Amalco Special Shares are non-voting shares, and are eligible for
discretionary dividends to be determined by the Board of Directors
of Amalco from time to time. Although the payment and the
amount of dividends declared will be subject to the discretion of
the Board of Directors it is the Board of Directors intention to
exercise its discretion in favour of paying dividends on the Amalco
Special Shares, subject to commodity prices and the overall
financial performance of Amalco, on a quarterly basis.
QDCC still intends to, but is not obligated to,
complete an offering of QDCC Special Shares under an offering
memorandum, of up to $700,000 at
$10.00 per QDCC Special Share (the
"QDCC Special Share Offering") prior to the
Arrangement. The Arrangement is not conditional on the
completion of the QDCC Special Share Offering. Each QDCC
Special Share, if any, shall be exchanged for one (1) Amalco
Special Share under the Amalgamation. Amalco does not
intend to list the Amalco Special Shares on the TSX Venture
Exchange or any other exchange in the near future.
As at the date hereof there are 23,684,045 RIA Shares issued and
outstanding; 880,000 options to purchase RIA Shares ("RIA
Options"); 1,300,000 common share purchase warrants
("Warrants"); and a debenture convertible into 1,704,348 RIA
Shares ("Convertible Debenture"), all as more fully detailed
within RIA's October 31, 2012
Financial Statements. Also consistent with the time of the original
arrangement agreement, RIA covenanted in the Amended and Restated
Arrangement Agreement to cause the holders of outstanding,
unexercised RIA Options to enter into agreements (prior to the
Effective Date) to convert RIA Options with an exercise price of
less than $0.14 into 0.004 of an
Amalco Special Share up to a maximum of 3,550 Amalco Special Shares
immediately following the completion of the Arrangement, and to
cause the holder of the outstanding, unexercised Warrants to enter
into an agreement (prior to the Effective Date) for the
cancellation of the Warrants for nominal consideration immediately
following the completion of the Arrangement.
A special meeting of RIA Shareholders to approve the Arrangement
is to be held on or before June 15,
2013. After considering strategic alternatives for
RIA, RIA's board of directors has determined that the Arrangement
is in the best interests of holders of RIA Shares, offers fair
consideration to holders of RIA Shares and recommends that holders
of RIA shares vote in favor of the Arrangement. RIA's board
of directors has unanimously approved the Arrangement and the
Arrangement Agreement.
About QDCC
QDCC is a wholly-owned subsidiary of Qwest Development Holdings
Corp., a corporation controlled by Qwest Investment Management
Corp. QDCC's objectives are to invest in and acquire junior
oil and gas companies and other oil and gas assets. The
proposed acquisition of RIA pursuant to the Arrangement will be the
first acquisition by QDCC.
About RIA
RIA is a company listed and trading on the TSX Venture Exchange,
symbol: RIA. RIA's principal business is the exploration,
development and production of oil, natural gas and associated
liquids in Western Canada,
principally in the Province of Alberta.
Forward Looking Statements
Certain statements contained in this news
release constitute forward-looking statements. These statements
relate to future events contemplated under the Arrangement
Agreement and the objectives and intentions of QDCC following the
Arrangement. All statements other than statements of historical
fact are forward-looking statements. The use of any of the words
''anticipate'', ''plan'', ''contemplate'', ''continue'',
''estimate'', ''expect'', ''intend'', ''propose'', ''might'',
''may'', ''will'', ''shall'', ''project'', ''should'', ''could'',
''would'', ''believe'', ''predict'', ''forecast'', ''pursue'',
''potential'' and ''capable'' and similar expressions are
intended to identify forward-looking statements. These statements
involve known and unknown risks, uncertainties and other factors
that may cause actual results or events to differ materially from
those anticipated in such forward-looking statements. Although RIA
believes these statements to be reasonable, no assurance can be
given that these expectations will prove to be correct and such
forward-looking statements included in this news release should not
be unduly relied upon. Such statements include the closing of the
proposed Arrangement on the terms and conditions set out above, the
anticipated timing for stated events, and QDCC's intentions to
complete the QDCC Special Shares Offering, to not list the Amalco
Special Shares on the TSX Venture Exchange or any other exchange
and the plan to pay dividends. Actual results could differ
materially from those anticipated in these forward-looking
statements as a result of the proposed Arrangement not closing when
planned, not closing on the terms and conditions set out above, or
if a closing occurs at all; the failure of RIA to obtain the
necessary regulatory, shareholder and other third party approvals
required in order to proceed with the proposed Arrangement;
regulatory decisions, competitive factors in the industries in
which RIA and QDCC operate, prevailing economic conditions, the
impact of general economic conditions; volatility in market prices
for oil and natural gas; industry conditions; volatility of
commodity prices; currency fluctuation; imprecision of reserve
estimates; liabilities inherent in crude oil and natural gas
operations; environmental risks; incorrect assessments of the value
of acquisitions and exploration and development programs;
competition from other producers; the lack of availability of
qualified personnel or management; changes in income tax laws or
changes in tax laws and incentive programs relating to the oil and
gas industry; hazards such as fire, explosion, blowouts, cratering,
and spills, each of which could result in substantial damage to
wells, production facilities, other property and the environment or
in personal injury; ability to access sufficient capital from
internal and external sources; and other factors, many of which are
beyond the control of RIA and QDCC. The forward-looking statements
contained in this news release represent RIA's expectations as of
the date hereof, and are subject to change after such date.
RIA 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 may be required by applicable
securities regulations.
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 Ria Resources Corp.