Platino Reaches Agreement Regarding Reimbursement by Pacific

Source: www.gulfoilandgas.com 12/5/2013, Location: South America

Platino Energy Corp announces that it has reached an agreement with Pacific Rubiales Energy Corp. ("Pacific Rubiales") to settle Pacific Rubiales' claim under a reimbursement agreement (the "Reimbursement Agreement") between Platino and C&C Energia Ltd. ("C&C") entered into in connection with the plan of arrangement under which Pacific Rubiales acquired C&C and Platino was spun off to the former shareholders of C&C.

As Platino has disclosed previously, the Reimbursement Agreement required Platino to reimburse C&C (now part of Pacific Rubiales) for the amount of any C&C working capital deficiency on the effective date of the plan of arrangement if an adjusted net working capital statement to be prepared by C&C indicted such a deficiency. Pacific Rubiales and Platino disagreed on whether a reimbursement obligation existed if the appropriate contractual principles under the Reimbursement Agreement were applied. Following discussions between Pacific Rubiales and Platino regarding the nature of this obligation, Pacific Rubiales filed a claim for approximately C$12.8 million against Platino with the Alberta Court of Queen's Bench to protect its interests under the Reimbursement Agreement.

Platino and Pacific Rubiales have entered into a settlement agreement pursuant to which Pacific Rubiales agreed to discontinue its action against Platino and release Platino from further obligations in respect of the working capital reimbursement provisions of the Reimbursement Agreement, and Platino agreed to pay to Pacific Rubiales C$3,000,000 and an amount of Colombian pesos equivalent to approximately C$165,000, and to issue to Pacific Rubiales 1,000,000 newly issued common shares. Issuance of the common shares is subject to approval of the TSX Venture Exchange.

Based on current cash and cash equivalents (including short-term investments), settlement with Pacific Rubiales and activities projected for the remainder of 2013, the Company estimates it will exit 2013 with approximately US$54 million (or US$0.78 per undiluted common share) in available funds.


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