Press release from Marketwire
NWest Energy Announces Proposed Transaction
Tuesday, January 17, 2012
NWest Energy Announces Proposed Transaction08:59 EST Tuesday, January 17, 2012ST. JOHN'S, NEWFOUNDLAND--(Marketwire - Jan. 17, 2012) - NWest Energy Corp. ("NWest" or the "Corporation") (TSX VENTURE:NWN) announces that it has entered into an arm's length agreement (the "Agreement") with Shoal Point Energy Ltd. ("Shoal Point"), a public company listed on the Canadian National Stock Exchange, whereby Shoal Point will acquire up to a 100% undivided working legal and beneficial interest in and to exploration licence EL1097R dated November 23, 2011 (the "Licence") covering an area of approximately 500,000 acres located offshore of western Newfoundland and Labrador (the "Property") (the "Transaction").Pursuant to the Transaction, a fifty percent (50%) working interest in the Licence shall be transferred to Shoal Point (the "First Transfer") in consideration that Shoal Point: (i) pays a drilling deposit of $1,000,000 to the Canada Newfoundland and Labrador Offshore Petroleum Board; (ii) issues one million (1,000,000) common shares in the capital of Shoal Point to NWest ("Common Shares"); (iii) issues one million (1,000,000) Common Share purchase warrants to NWest, with each warrant entitling NWest to acquire one Common Share at a price of $0.40 for a period of two years from the date of issuance; and (iv) assumes the obligations of NWest to pay the Environmental Studies Research Fund ("ESRF"), to a maximum of $43,404.48, to the date of the Agreement and assumes all payments to the ESRF from the date thereof.The remaining fifty percent (50%) working interest in the Licence shall be transferred to Shoal Point (the "Second Transfer") upon receipt of approval of the shareholders of NWest for the Transaction on or before April 15, 2012 in consideration that Shoal Point: (i) issues one million (1,000,000) Common Shares to NWest; and (ii) issues one million (1,000,000) Common Share purchase warrants to NWest, with each warrant entitling NWest to acquire one Common Share at an exercise price equal to the 20 day weighted average price of the Common Shares prior to the date of issuance plus an additional twenty percent (20%), for a period of two years from the date of issuance.If the Second Transfer is completed and Shoal Point spuds a well on the Property, Shoal Point shall: (i) issue an additional four million (4,000,000) Common Shares to NWest; (ii) issue an additional four million (4,000,000) Common Share purchase warrants to NWest, with each warrant entitling NWest to acquire one Common Share at an exercise price equal to the 20 day weighted average price of the Common Shares prior to the date of issuance plus an additional twenty percent (20%), for a period of two years from the date of issuance; and (iii) grant to NWest a two percent (2%) gross overriding royalty (the "Royalty") on the Property. Shoal Point shall have the right to purchase 0.75% of the Royalty for two million dollars ($2,000,000) at any time after the date of grant.All securities issued pursuant to the Transaction will be subject to a four month hold period from the date of issuance.Upon the exercise of the First Transfer by Shoal Point, Shoal Point shall be appointed as the operator of the Property with responsibility to conduct all operations in a good, workmanlike and efficient manner in accordance with sound oil and gas practice, industry standards and applicable laws. The completion of the Transaction is conditional on all requisite regulatory, third party and TSX Venture Exchange and Canadian National Stock Exchange approvals. In addition, completion of the Second Transfer is conditional on the approval of the shareholders of NWest. Certain shareholders of NWest holding not less than forty-five percent (45%) of the common shares of NWest have entered into support agreements and have agreed to vote in favour of the Transaction at a meeting of the shareholders of NWest.NWest intends to hold a meeting of the shareholders of NWest on or before April 15, 2012 to consider approval of the Second Transfer.About NWest EnergyNWest Energy is a Canadian junior oil and gas company exploring off the west coast of Newfoundland and Labrador. Further information regarding the Corporation is available at www.nwestenergy.com.The statements made in this News Release may contain certain forward-looking statements. Actual events or results may differ from the Corporation's expectations. Certain risk factors may also affect the actual results achieved by the Corporation. There can be no assurance that forward-looking information will prove to be accurate. Should one or more of these risks and uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from any conclusions, forecasts or projections described in the forward-looking information. Accordingly, readers are advised not to place undue reliance on forward-looking information. Except as required under applicable securities legislation, the Corporation undertakes no obligation to publicly update or revise forward-looking information, whether as a result of new information, future events or otherwise.FOR FURTHER INFORMATION PLEASE CONTACT: Robert WebbNWest Energy Corp.President & CEO(709) firstname.lastname@example.orgNeither 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.