Each Unit is comprised of one common share and one half of one warrant. One full Warrant entitles the holder to purchase one additional common share for US$9.00, for a term of two years expiring on September 9, 2007. The warrants are subject to accelerated expiration in the event that the price of the Company's common shares on the American Stock Exchange is US$12.00 or more for 20 consecutive trading days, the resale of the shares included in the Units and issuable on exercise of the warrants has been registered under the Act, and the hold period for Canadian subscribers has expired. In such events, the warrant term will be reduced to 30 days from the date of issuance of a news release announcing such accelerated expiration of the warrant term.
In the event the Company fails to file on or before November 8, 2005 a registration statement with the US Securities and Exchange Commission for the purpose of registering under the Act the resale of the shares included in the Units and issuable on exercise of the warrants, each purchaser of the Units will receive for nominal consideration an additional 0.10 of one Unit.
A fee of 6% was paid with respect to the sale of 3,252,400 Units and, in addition, compensation options were issued entitling the holder to purchase 195,144 Units at an exercise price of US$6.50 per Unit.
The proceeds from the transaction will be used to further the Company's oil and gas exploration activities in India and for general corporate and administrative purposes.
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