Corridor Financing Increased
Halifax, Nova Scotia, January 22, 2005: Corridor Resources Inc. (CDH - TSX-V) (the "Corporation") is pleased to announce an increase to the "green shoe" or over allotment portion of the previously announced $10 million private placement financing. The number of Flow Through Common Shares of the Corporation available under the "green shoe" option of the financing has been increased from 1,764,706 to 2,647,059 Flow-Through Common Shares, representing an increase of gross proceeds of $1,500,000, if fully exercised. The agreement with Jennings Capital Inc. has been amended to reflect such changes to the green shoe portion of the financing.
The bought deal portion of the private placement financing remains unchanged, with 3,225,807 Units of the Corporation (the "Units") at a price of $1.55 per Unit for aggregate gross proceeds of approximately $5,000,000. Each Unit comprises one common share (the "Common Shares") and one half of one common share purchase warrant (the "Warrants"). Each full warrant is exercisable for a period of one year from Closing at a price of $1.90 per Common Share.
The over allotment or "green shoe" option, to be sold on a "best efforts" agency basis, exercisable on or prior to closing, now consists of up to 1,290,323 Units of the Corporation at a price of $1.55 per Unit and up to 2,647,059 Flow-Through Common Shares of the Corporation at a price of $1.70 per Flow-Through Common Share, which would increase the size of the financing to approximately $11,500,000 if fully exercised.
The private placement financing is scheduled to close by mid-February 2005, will be made pursuant to private placement exemptions under applicable securities legislation, and is subject to regulatory approval and completion of definitive documentation. The proceeds of the offering will be used to fund the Corporation's ongoing exploration and development programs in Eastern Canada, including further exploration and development on the McCully property in New Brunswick in 2005 and for general corporate purposes. In the event that the Corporation reaches an agreement in respect of a farmout of its McCully property, the proceeds may be used to fund exploration on the Corporation's other prospects in Eastern Canada.
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.
