As a consequence of the foregoing, Samson has formally withdrawn its prior $1.23 per share acquisition proposal submitted by Samson to PYR on January 29, 2007. Samson said that the reasons for the reduction in the offer price from $1.23 to $1.21 per share are as follows:
--The ongoing excessive level of PYR's overhead. --The unnecessary incremental fees and expenses being incurred by PYR as a result of its failure to conduct an efficient sale process. --Additional dilutive stock options issued by PYR. --The sale of PYR's Ryckman Creek properties at a price substantially below the value used by Samson in its initial offer to acquire PYR's stock.
Samson's $1.21 per share offer includes a value for PYR's interest in the currently-drilling Nome-Harder No. 1 well, operated by Samson in Jefferson County, Texas. To the extent that actual data for the well differs from Samson's estimates, Samson's $1.21 per share offer for PYR's stock will be revised.
C. Philip Tholen, Executive Vice President of Samson, said "In light of our inability to make meaningful progress with the PYR board of directors over the past 50 days, we have concluded that both our interests and the interests of PYR's stockholders would be better served by the submission of our offer directly to PYR's stockholders. We believe that the PYR stockholders should have the option to choose a transaction providing them with the greatest value and this offer will provide them the opportunity to make their views known."
The offer, when commenced, will be subject to various conditions, including (i) that the PYR shares tendered and not withdrawn, together with PYR shares already owned by Samson and its subsidiaries, represent not less than two thirds of the outstanding PYR shares, determined on a fully diluted basis, (ii) that the PYR board of directors has taken all actions necessary to render the PYR shareholder rights plan inapplicable to the transaction, (iii) that Samson nominees constitute a majority of the PYR board of directors upon consummation of the offer, (iv) that the PYR board of directors has taken all actions necessary to exempt the transaction from the applicable provisions of the Maryland anti-takeover statutes, (v) the acceleration of the maturity date of PYR's convertible promissory notes in the approximate principal amount of $7.3 million to the date immediately preceding the contemplated second-step merger, and (vi) other customary conditions. The offer will not be subject to receipt of financing. The offer price will be funded from Samson's cash on hand. No material regulatory requirements are anticipated.
Following consummation of the tender offer, Samson intends to consummate a second-step merger in which all remaining PYR stockholders would receive the same cash price paid in the tender offer.
The complete terms and conditions of the tender offer will be contained in the Offer to Purchase included in the tender offer statement that Samson will file with the United States Securities and Exchange Commission. The Offer to Purchase will also be mailed to PYR's stockholders.
Samson Investment Company, headquartered in Tulsa, Oklahoma, is a large privately held corporation engaged in oil and gas exploration, acquisition and production operations in 18 states in the United States, Canada, and the North Sea.
Weil, Gotshal & Manges LLP and Hogan & Hartson LLP are acting as legal counsel to Samson. Innisfree M&A Incorporated is acting as Information Agent.
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