Strad announced today that a proposed class action proceeding was filed on June 1, 2016.
CALGARY, ALBERTA--(Marketwired - June 2, 2016) -
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Strad Energy Services Ltd. ("Strad" or the "Company") (TSX:SDY) announced today that a proposed class action proceeding (the "Action") was filed on June 1, 2016 by Tristan Partners LP and Tristan Offshore Fund Ltd. in the Alberta Court of Queen's Bench (the "Court") against Strad and its directors (the "Directors"). The Action relates to historical communications between Strad and Total Energy Services Inc. ("Total") in 2014 and 2015. The Plaintiffs allege, among other things, that Strad and the Directors failed to act in the best interests of Strad and failed to properly consider certain overtures by Total in respect of a possible business combination transaction.
Strad and the Directors believe that the Plaintiffs' allegations are unfounded and without merit and intend to vigorously defend the Action and protect the interests of all shareholders. Strad and the Directors have at all times acted in the best interests of all of Strad's shareholders in the due exercise of their fiduciary duties. Strad believes that the Action is indicative of ulterior motives on the part of certain minority shareholders acting contrary to the best interests of all of Strad's shareholders. The Action cannot proceed as a class action unless it is first certified by the Court. The Action seeks various declarations, general damages of $18.5 million and punitive damages of $5 million, although there is no basis provided for either of these amounts. Although the outcome of this matter is not determinable at this time, the Company believes that the Action will not have a material adverse effect on the Company's financial position or results of operations as Strad and the Directors believe the allegations made against them are without merit.
Commencing in the fall of 2015 the Company, assisted by Raymond James Ltd. as financial advisor, completed a broad process to identify, examine and consider a range of strategic alternatives which may be available to the Company with a view of enhancing shareholder value. Strategic alternatives considered included, among other things, acquisitions of companies or assets, disposition of assets, the sale of the Company, either in one transaction or a combination of transactions, a merger or other business combination or continuing to pursue its current operating and growth plan. In connection with the process, Strad established a special committee of independent directors, comprised of Messrs. Hagg (Chair), Grandfield, Van der Sloot and Nodwell to supervise the process. While Strad and the Directors continue to consider and pursue various strategic alternative transactions, no definitive agreement in respect of any one proposed transaction has been reached at this time. Strad does not intend to disclose developments with respect to the strategic review process unless or until the Directors have approved a definitive transaction or other course of action or otherwise deems disclosure of developments is appropriate or otherwise required by law.
About Strad Energy Services Ltd.
Strad is a North American energy services company that focuses on providing well-site infrastructure solutions to the oil and natural gas industry. Strad focuses on providing complete customer solutions in well-site-related oilfield equipment for producers active in unconventional resource plays.
Strad is headquartered in Calgary, Alberta, Canada. Strad is listed on the Toronto Stock Exchange under the trading symbol "SDY".
The TSX has not reviewed and does not accept responsibility for the adequacy or accuracy of this news release.
This press release contains forward-looking statements relating to the Company, including with respect to the strategic review process and potential transactions the Company may pursue. Forward-looking statements typically use words suggesting future outcomes or statements that actions, events or conditions may, would, could or will be taken or occur in the future. By their nature, forward-looking statements involve numerous assumptions, known and unknown risks and uncertainties and other factors that contribute to the possibility that the predicted outcome will not occur, including, without limitation, that the exploration of strategic alternatives may not result in any definitive agreement or transaction and, if completed, that any such agreement or transaction may not be successful. There are no guarantees that the process will result in a transaction of any form or, if a transaction is entered into, as to its terms or timing. The forward-looking statements contained in this press release are made as of the date of this press release and the Company does not undertake any obligation to update publicly or to revise any of the included forward-looking statements whether as a result of new information, future events or otherwise except as may be required by applicable securities laws.