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Gold/Mining/Energy : Canadian REITS, Trusts & Dividend Stocks -- Ignore unavailable to you. Want to Upgrade?

To: David Culver who wrote (608)	11/20/2000 12:55:24 PM
From: Scott Mc	Respond to of 11633

Yup, very bad news as far as I'm concerned, Maximum Energy to recommence distributions Maximum Energy Trust MXT.UN Shares issued 12,000,000 Nov 17 close $3.80 Mon 20 Nov 2000 News Release Mr. Glenn Proudfoot reports Maximum Energy Trust will recommence distributions to unitholders in January, 2001, in respect of the month of December, 2000. The amount of the initial monthly distribution will be announced once it has been determined by the directors of the trust in the context of the effect of a proposed major acquisition has on the trust. The trust also announced that its directors have approved the acquisition of a 92-per-cent interest in a limited partnership that owns a net royalty interest in a long-life oil producing property. The trust will contribute its Plato property, which produces approximately 185 barrels per day, to the partnership in exchange for the 92-per-cent limited partnership interest. Upon closing of this transaction, the partnership's assets will then consist of the Plato property, the net royalty interest and other minor properties. The partnership will have debt of approximately $77.8-million, but recourse under the debt will be limited to the partnership's assets. There will be no recourse to the trust's other assets. The value of the partnership's assets will be approximately $83-million. Maximum anticipates that the proposed acquisition will permit accretive distributable cash to Maximum's unitholders. However, it is also expected that the additional cash flows and structure of the acquisition will cause future cash distributions to unitholders to be significantly less tax deferred than the current status quo. As part of this transaction, a new executive team will assume the role of manager for the trust and the partnership. Closing is subject to completion of formal documentation. Additional details regarding this potential acquisition and the composition of the new management team for the trust will be provided subsequent to closing, which is expected to occur prior to Nov. 30, 2000. Coincidental with the closing of this major acquisition, the trust has also arranged for the issuance of $10-million of units on a private placement basis at a price equal to $3.50 per unit. The entire net proceeds of $10-million will be applied toward Maximum's existing credit facility, providing the trust with greater financial flexibility to do other acquisition and/or further development. In the interim, this equity financing will reduce the trust's bank interest costs relating to Maximum's outstanding bank debt that is currently well balanced at a ratio of 1:1 relative to the trust's current cash flow. Glenn C. Proudfoot, the president and chief executive officer of Maximum, stated: "The closing of this transaction will coincide with Maximum Energy Trust's previously announced of return to normal operating status and being on target to recommence regular monthly cash distributions to its unitholders. "The producing property that relates to this transaction is a premium long-life asset ideally suited for ownership within a trust. This acquisition will have the effect of favourably diversifying Maximum's existing asset base. The acquisition will also strengthen the trust's resilience to weak commodity price environments by significantly average down Maximum's operational and administrative costs on a per unit of production basis. Moving forward, Maximum unitholders are now very well positioned to capture the benefit of the return to regular monthly cash distributions in a trust that is financially poised to capture further growth opportunities. "Consistent with regulatory guidelines and Maximum's policy of universal disclosure of material events into the public domain, no further information will be released until this transaction has been completed, at which time, a full and complete public disclosure will be made that outlines the basic terms and the resulting commercial benefits for Maximum unitholders."