Corridor Announces Private Placement Of 10% Convertible Notes
Halifax, Nova Scotia, September 17, 2002: Corridor Resources Inc. (CDH - TSX Venture Exchange) announced today that it is proceeding with a private placement of up to $3 million principal amount of 10% Unsecured Convertible Subordinated Notes. The Notes are being offered to accredited investors in Alberta, Ontario and British Columbia ("Selling Jurisdictions") pursuant to accredited investor exemptions and elsewhere in Canada where they may lawfully be sold. The offering is expected to close on or about September 30, 2002. The private placement is subject to approval by the TSX Venture Exchange. Jennings Capital Inc. has been retained as agent by Corridor in connection with the financing.
Interest on the Notes will be payable on April 1 and October 1 in each year. The Notes will mature on October 1, 2007 unless earlier redeemed or converted. The principal amount of each Note will be convertible into Common Shares of Corridor at the option of the holder at any time on or prior to October 1, 2004 at a conversion price of $1.35 per share and at any time thereafter and prior to maturity or redemption at a conversion price of $1.80 per share. The conversion right shall be subject to standard anti-dilution provisions. The Notes may be redeemed by the Corporation on 30 days notice given by Corridor at any time after October 1, 2005.
Proceeds from the private placement will be used to pay Corridor's share of the costs of Corridor's 50% interest in the pipeline and processing facilities currently under construction to deliver natural gas from the McCully #1 and #2 gas wells to the potash mill of Potash Corporation of Saskatchewan, located near Sussex, New Brunswick. Corridor anticipates that construction of the pipeline and facilities will be completed and gas delivery to the potash mill will commence in February, 2003.
Corridor is a junior oil and gas exploration company, headquartered in Halifax, Nova Scotia, with interests onshore in New Brunswick, Prince Edward Island and Quebec and offshore in the Gulf of St. Lawrence.
This press release contains certain forward looking statements relating to, but not limited to, Corridor's operations, anticipated financial performance, business prospects and strategies, including expectations relating to production levels; capital expenditure programs; the quantity of natural gas reserves; projections of market prices; projections of costs; supply and demand for natural gas; expectations regarding the ability to raise capital and to continually add to reserves through exploration and development; and treatment under governmental regulatory regimes. These statements are based on current expectations that involve numerous assumptions regarding factors and risks that could cause actual results to vary materially, including, without limitation to, the following factors: risks associated with oil and gas exploration, financial risks, substantial capital requirements, bank financing, government regulation, environmental, prices, markets and marketing, dependence on key personnel, dependence on Potash Corporation of Saskatchewan, Inc., availability of drilling equipment and access, risks may not be insurable, management of growth, expiration of licenses and leases, reserves estimates, seasonality, competition, conflicts of interest, Kyoto Protocol, issuance of debt, title to properties and hedging. There is no representation by Corridor that actual results achieved will be the same in whole or in part as those set out in the forward looking information. Furthermore, the forward looking statements contained in this press release are made as of the date hereof, and Corridor undertakes no obligation, except as required by applicable securities legislation, to update publicly or to revise any of the included forward looking statements, whether as a result of new information, future events or otherwise.
