Saxon Oil Company announced a non-brokered private placement, which will provide the Company with sufficient capital to further develop the potential of its international and domestic oil and gas projects. The Company has agreed to issue 95,559,452 shares at a price of C$.10 per share for gross proceeds of C$9.56mm. Each Unit will consist of one common share of Saxon at a price of C$0.10 per unit and one share purchase warrant. Each Warrant shall be exercisable into one common share at a price of C$0.15 for a period of two years from the completion of the placement.
Funds have been advanced to Saxon under a loan agreement with Amigo Oil and Gas Holdings LLC in the amount of US$1.5 million at an annual rate of 6 percent. The Loan will be evidenced by a promissory note from Saxon, and these funds will be converted into equity upon completion of the Private Placement.
Amigo unconditionally agrees to purchase all units not subscribed by other parties under the financing up to a maximum to 95,559,452 units. Amigo is controlled by Hank Swartout. From 1985 through 2006 on his retirement, Mr. Swartout held the position of Chairman and Chief Executive Officer of Precision Drilling Ltd., Canada's largest independent drilling rig and service company. In June 2009, Mr. Swartout became Chairman of BlackWatch Energy Services Corp.
The proceeds from the Private Placement will be used to reduce corporate debt, advance the Company's projects and ensure sufficient working capital for future growth. The Company will evaluate its assets and identify where to deploy capital to increase project values, which will result in increased shareholder value. Steven D Saxon, Interim CEO of Saxon commented "Saxon looks forward to the opportunity to work with Mr. Swartout. His team has extensive international and domestic experience which will create growth and help develop Saxon's existing assets to their full potential."
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