CALGARY, Sept. 19 /CNW/ - Result Energy Inc. ("Result", TSX Venture:RTE)
is pleased to announce that it has closed a private placement offering of
convertible debentures (the "Financing") for gross proceeds of $3.275 million
($3,127,500 net of commissions). Completion of the Financing is subject to
receipt of final regulatory and stock exchange approvals, and the securities
issued will be subject to a hold period until January 14, 2007. Finders fee
commissions totalling $147,500 were paid at closing to four broker agents who
were involved in the Financing, in which directors and officers of Result
subscribed for $225,000 of the proceeds. Proceeds from the Financing will be
used for general corporate purposes, and to supplement working capital.
The convertible debentures will bear interest at prime + 3%, are due
February 28, 2008, and are convertible at the option of the holder into Result
common shares at $1.15 per common share. Commencing 12 months after Closing,
the convertible debentures will be (1) repayable in cash at Result's option,
subject to the Debenture holder's prior right to convert, and (2) in the event
that Result's common shares trade at $1.35 or above for a period of
20 consecutive trading days, Result shall have the option to require
conversion to common shares of Result at the Conversion Price.
After much longer than expected non-controllable delays, in the month of
August Result brought two shut-in gas well projects at Pembina and Clear Hills
on-stream. Although production from these projects has not yet been brought up
to full capacity, field estimated production levels, net to Result, are
currently at approximately 1,020 boe/d, with estimated additonal production
capacity of approximately 350 boe/d not yet on stream from these two projects.
Result is a publicly traded Canadian energy company involved in the
exploration and development of oil and gas properties in western Canada.
Result's three core areas are in the Peace River Arch region of Alberta, the
Pembina area in central Alberta, and south-west Saskatchewan.
Investors are cautioned that this news release may contain forward
looking information. Such information is subject to known and unknown risks,
uncertainties and other factors that could influence actual results or events
and cause actual results or events to differ materially from those stated,
anticipated or implied in the forward-looking information. Readers are
cautioned not to place undue reliance on forward-looking information, as no
assurances can be given as to future results, levels of activity or
achievements.
The term barrels of oil equivalent ("boe") may be misleading,
particularly if used in isolation. A boe conversion ratio of six thousand
cubic feet per barrel (6mcf/bbl) of natural gas to barrels of oil equivalence
is based on an energy equivalency conversion method primarily applicable at
the burner tip and does not represent a value equivalency at the wellhead. All
boe conversions herein are derived from converting gas to oil in the ratio mix
of six thousand cubic feet of gas to one barrel of oil.
The TSX Venture Exchange does not accept responsibility for the adequacy
and accuracy of this release.
