Saturn Oil & Gas Inc. Announces Closing of $125 Million Bought Deal Offering

/NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR RELEASE, PUBLICATION, DISTRIBUTION OR DISSEMINATION DIRECTLY, OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES./

CALGARY, AB, Jan. 31, 2023 /CNW/ - Saturn Oil & Gas Inc. (TSXV: SOIL) (FSE: SMKA) ("Saturn" or the "Company") is pleased to announce that, further to the Company's January 20, 2023 press release, it has closed its previously announced bought deal offering (the "Bought Deal Offering").  Pursuant to the Bought Deal Offering, the Company issued a total of 59,242,000 subscription receipts ("Subscription Receipts") at a price of $2.11 per Subscription Receipt for gross proceeds of $125,000,620. The Bought Deal Offering was completed by way of a prospectus supplement to the Company's base shelf prospectus and was underwritten by Echelon Capital Markets ("Echelon"), as sole bookrunner and co-lead, Canaccord Genuity Corp., as co-lead, and with syndicate underwriters including Eight Capital, Beacon Securities Limited and Paradigm Capital Inc. (collectively, the "Underwriters"). The Underwriters received a cash commission of 5.0% of the gross proceeds  of the Bought Deal Offering.  As previously indicated, the Company has received more than $110 million in strategic equity commitments from GMT Capital Corp., Libra Advisors, LLC, and two other lead institutional investors.

Each Subscription Receipt represents the right of the holder to receive, upon closing of the Company's previously announced arrangement to acquire Ridgeback Resources Inc. by way of statutory plan of arrangement (the "Ridgeback Acquisition") (expected to close in Q1 2023), without payment of additional consideration, one common share of the Company. 

If the Ridgeback Acquisition is not completed by May 31, 2023 (being 120 days from the closing date of the Bought Deal Offering) or if the Ridgeback Acquisition is terminated at an earlier time, the gross proceeds of the Bought Deal Offering and pro rata entitlement to interest earned or deemed to be earned on the gross proceeds of the Bought Deal Offering, net of any applicable withholding taxes, will be paid to holders of the Subscription Receipts and the Subscription Receipts will be cancelled.

The Company will use the net proceeds of the Bought Deal Offering to pay for a portion of the cash consideration of the Ridgeback Acquisition and for general working capital purposes, as further described in the Company's prospectus supplement dated January 24, 2023 to the Company's final base shelf prospectus dated May 19, 2022 (collectively, the "Prospectus").

The TSX Venture Exchange ("TSXV") has conditionally accepted for listing the 59,242,000 Subscription Receipts, subject to receipt of final approval.

Related Party Transaction

Certain insiders of the Company (the "Participating Insiders") participated in the Bought Deal Offering and acquired an aggregate of 272,500 Subscription Receipts. The participation of the Participating Insiders constitutes a "related party transaction", as such term is defined in Multilateral Instrument 61-101 – Protection of Minority Shareholders in Special Transaction ("MI 61-101"). The Company is relying on exemptions from the formal valuation and minority shareholder approval requirements provided under sections 5.5(a) and 5.7(1)(a) of MI 61-101 on the basis that the fair market value of the Participating Insiders' participation in the Bought Deal Offering does not exceed 25% of the market capitalization of the Company, as determined in accordance with MI 61-101. The Company did not file a material change report more than 21 days before the closing date of the Bought Deal Offering due to the limited time between the launch and closing date.

About Saturn Oil & Gas Inc.

Saturn Oil & Gas Inc. is a growing Canadian energy company focused on generating positive shareholder returns through the continued responsible development of high-quality, light oil weighted assets, supported by an acquisition strategy that targets highly accretive, complementary opportunities. Saturn has assembled an attractive portfolio of free-cash flowing, low-decline operated assets in Southeastern Saskatchewan and West Central Saskatchewan that provide a deep inventory of long-term economic drilling opportunities across multiple zones. With an unwavering commitment to building an ESG-focused culture, Saturn's goal is to increase reserves, production and cash flows at an attractive return on invested capital. Saturn's shares are listed for trading on the TSXV under ticker 'SOIL' and on the Frankfurt Stock Exchange under symbol 'SMKA'.

Further information and a corporate presentation is available on Saturn's website at www.saturnoil.com.

Reader Advisory

FORWARD-LOOKING INFORMATION AND STATEMENTS.

Certain information included in this press release constitutes forward-looking information under applicable securities legislation. Forward-looking information typically contains statements with words such as "anticipate", "believe", "expect", "plan", "intend", "estimate", "propose", "project", "scheduled", "will" or similar words suggesting future outcomes or statements regarding an outlook. Forward-looking information in this press release includes, but is not limited to, the use of proceeds of the Bought Deal Offering, completion of the Ridgeback Acquisition and the conversion of the Subscription Receipts.

The forward-looking statements contained in this press release are based on certain key expectations and assumptions made by Saturn, including expectations and assumptions concerning: the timing of closing of the Ridgeback Acquisition and access to and sufficiency of capital. Readers are cautioned that the foregoing list is not exhaustive of all factors and assumptions which have been used.

Although Saturn believes that the expectations and assumptions on which the forward-looking statements are based are reasonable, undue reliance should not be placed on the forward-looking statements because Saturn can give no assurance that they will prove to be correct. Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to, the ability to close the Ridgeback Acquisition in the timeframe expected, or at all, ability to accelerate capital expenditure programs, risks associated with the oil and gas industry in general (e.g., operational risks in development, exploration and production; the uncertainty of reserve estimates; the uncertainty of estimates and projections relating to production, costs and expenses, and health, safety and environmental risks), constraint in the availability of services, commodity price and exchange rate fluctuations, the current COVID-19 pandemic, changes in legislation impacting the oil and gas industry, adverse weather conditions and uncertainties resulting from potential delays or changes in plans with respect to exploration or development projects or capital expenditures.  These and other risks are set out in more detail in Saturn's amended and restated Annual Information Form for the year ended December 31, 2021.

The forward-looking information contained in this press release is made as of the date hereof and Saturn undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, unless required by applicable securities laws. The forward-looking information contained in this press release is expressly qualified by this cautionary statement.

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 press release.

All dollar figures included herein are presented in Canadian dollars, unless otherwise noted.

SOURCE Saturn Oil & Gas Inc.

Saturn Oil & Gas Investor & Media Contacts: John Jeffrey, MBA - Chief Executive Officer, Tel: [phone], www.saturnoil.com; Kevin Smith, MBA - VP Corporate Development, Tel: [phone], [email protected]