Pacific Asia Petroleum has entered into definitive agreements dated March 2, 2010 with certain accredited investors to sell in a registered direct offering an aggregate of 4,146,922 shares of its common stock at a price of $4.22 per share for aggregate gross proceeds of $17.5 million.
In addition, the Company will, at closing, issue to the Investors two series of warrants. The Series C Warrants shall provide the Investors the right to purchase up to an additional 1,658,769 million shares of common stock, in the aggregate, with an exercise price per share equal to $4.50, which warrants shall be immediately exercisable following the closing for a period of 42 months from closing. The Series D Warrants shall provide the Investors the right to purchase up to an additional 1,658,769 million shares of common stock, in the aggregate, with an exercise price per share equal to $4.12, which warrants shall be immediately exercisable until December 5, 2010. If fully exercised, the Series C Warrants and Series D Warrants would result in additional gross proceeds to the Company of approximately $14.3 million.
On the conclusion of the direct offering, President and CEO, Frank C. Ingriselli, commented, "We are very pleased to announce the entry into agreements with investors for this offering, the closing of which will provide our Company with sufficient cash to finalize the pending acquisition of rights in the Oyo oil field, subject to shareholder approval which will be solicited in a forthcoming shareholder proxy. The participation of major institutional investors in this offering highlights the confidence the investor community has put in our business strategy and the Company's future growth through this major acquisition. We look forward to closing this offering and completing the acquisition of rights in the Oyo oil field as planned and continuing our goal of delivering shareholder value."
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