Sawtooth also announces that it has signed a letter agreement with Haywood Securities Inc. in which Haywood has agreed, on a partial bought deal basis, to place a common and flow-through share offering.
The private placement will consist of 750,000 common shares of Sawtooth and 1,500,000 flow-through Common Shares at $0.85 per share and $1.00 per share, respectively. If the Offering is fully subscribed, Sawtooth will receive gross proceeds of $2,137,500, which will be used to fund the current development and drilling program in the Redwater/Fort Saskatchewan area of Alberta. Haywood has an option to sell an additional $315,000 of flow- through shares and common shares subject to a maximum of $225,000 of flow- through shares. Insiders, friends and business associates may participate for up to 20% of the total offering.
On June 23, 2004 Sawtooth completed the purchase of all of the shares of Boom Investments Ltd. for the sum of $375,000 before adjustments. Boom owns properties at Fort Saskatchewan, Alberta an area in which Sawtooth already has a significant interest. The purchase gives Sawtooth a 76 % working interest in these properties which Sawtooth views as a core area.
The Company has completed pipeline construction and the tie-in of several wells in the Redwater area. Current Company production has doubled from year end to approximately 600 barrels of oil equivalent per day.
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