Mogul Energy International, Inc. announced that, on April 24, 2008, it closed an Agreement of Purchase and Sale (the "Agreement") with Egypt Oil Holdings Ltd. ("Egypt Oil"), Sea Dragon Energy Inc. ("Sea Dragon"), and Dover Investments Limited ("Dover"), and a related Share Exchange Agreement. Under the Agreement, Mogul agrees to sell its 20% working interest in the East Wadi Araba (EWA) Concession in the Gulf of Suez, Egypt in exchange for satisfaction of its outstanding liabilities (the "Debt Obligation") relating to the Company's drill program on the EWA Concession, and a cash payment of US$100,000 and equity participation in Sea Dragon in the amount of 4 million (4,000,000) shares. The Company estimates that the Debt Obligation to be covered by the Agreement will be at least US$650,000. The Company will be seeking shareholder approval of the Agreement.
The Company also announced that it intends to make two new offerings ("Offerings") of its common stock to investors in Canada: one offering on a flow-through basis, pursuant to the Income Tax Act (Canada), and another non-flow-through offering. The Company expects to raise approximately $1.9 million through the private placements. The flow-through is priced at $0.25 per share and the non-flow-through offering is priced at $0.20 per share. The proceeds of the flow-through will be used to fund exploration on Mogul's freehold oil and gas exploration leases in Saskatchewan, Canada. Completion of the private placements is expected to occur prior to May 31, 2008.
The shares ("Shares") to be issued under the Offerings have not been registered under the United States Securities Act of 1933, as amended (the "Securities Act"), and may not be offered or sold directly or indirectly within the United States or to or for the account or benefit of U.S. Persons (as such term is defined in Regulation S, as promulgated under the Securities Act) absent registration or an applicable exemption from registration. The Shares will be sold only to persons who are not U.S. Persons and who otherwise satisfy the requirements of the applicable securities laws of the jurisdiction of their residency. As such, the Company believes that the Offerings are exempt from registration under Regulation S, as promulgated under the Securities Act.
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