CALGARY, May 23, 2012 /CNW/ - CanRock Energy Corp. ("CanRock")(TSXV: CNK) and Alston Energy Inc. ("Alston")(TSXV: ALO) are pleased to announce that they have entered into a
definitive arrangement agreement effective May 22, 2012 (the "Arrangement Agreement") to effect a strategic business combination (the "Transaction") resulting in the formation of a light oil focused, growth oriented
junior exploration and production company.
Alston and CanRock are at arm's length with each other and the
Transaction will not result in the creation of any new control person
or a "change of control" as that term is defined under TSX Venture
Exchange ("TSXV") policies. Once the Arrangement is completed, the resulting entity
will continue under the name Alston Energy Inc.
An information circular is anticipated to be mailed to the shareholders
of CanRock in early June 2012 in connection with a meeting of such
shareholders expected to be held in early July 2012, with closing of
the Transaction expected to take place shortly thereafter. The
Transaction will be completed by way of a Plan of Arrangement (the "Arrangement") whereby CanRock shareholders will exchange all of their issued and
outstanding common shares ("CanRock Common Shares") for common shares of Alston ("Alston Common Shares) on a basis of 2.321 Alston Common Shares for each CanRock Common
Share. The vesting of the outstanding CanRock stock options will be
accelerated and such options will be exercisable until the earlier of
the expiry date of such option and the date that is 90 days following
the effective date of the Arrangement. Outstanding CanRock warrants
will be adjusted in accordance with their terms such that CanRock
warrants will be exercisable into Alston Common Shares instead of
CanRock Common Shares and into such number of Alston Common Shares as a
holder of CanRock Common Shares is entitled to receive pursuant to the
Arrangement. As a result of the Transaction, CanRock will be a
wholly-owned subsidiary of Alston.
The Arrangement requires the approval of the holders of CanRock Common
Shares. The Arrangement Agreement provides that CanRock must call a
shareholder meeting to approve the Arrangement and that the Arrangement
must be approved by no later than July 5, 2012. The Arrangement is
subject to the approval of the TSXV and all applicable regulatory
authorities. Completion of the Arrangement is also subject to a number
of additional conditions set out in the Arrangement Agreement. Under
the Arrangement Agreement, subject to certain exceptions, CanRock and
Alston have each agreed that they will not solicit or initiate any
discussions concerning any business combination or the sale of material
assets.