Westar Oil To Purchase Terax Energy; Share Exchange Agreement To Value Terax At $6.75 Per Share And Westar At $24.50 - Update [TEXG.OB]
6/8/2007 8:15:25 AM Friday morning, Terax Energy (TEXG.OB), an independent oil exploration and production company, said that it has agreed to be acquired by Westar Oil Inc. with share exchange agreement to value Terax Energy at $6.75 per share and Westar at $24.50.
The Austin, Texas headquartered Terax said that Westar Oil Inc has acquired the senior debt position in the amount of $3 million held by third party creditors and intends to convert the debt into stock of Terax at $6.75 per share.
Terax said it would extend its leasehold interests in the 6 wells as well as bring back online the wells located in Erath County. It is expected that production will be established in the next 30 days. Net cash flow from the rework of these six wells is expected to be more than $750 thousand per month.
Upon conclusion of the exchange and upon completion of certain purchase contracts, the combination, to be named Westar Oil and Gas Inc., is expected have net cash flow in excess of $12 million per year and reserves in excess of $150 million. The assets will consist of properties located in Texas, Nevada, Arkansas, Mississippi, and Oklahoma.
The company said the exchange will be effective for all shareholders of record as of June 21, 2007.The closing of the deal would be subject to certain closing conditions, including, receipt of all applicable permits, authorizations, consents, or approvals required consummating the exchange; neither the companies having suffered any material adverse effect.
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