B.C. Securities Commission Agrees to Hear Geosam Appeal of Cordy Private

TORONTO, Nov. 5 /CNW/ - Geosam Investments Limited ("Geosam") announces that the British Columbia Securities Commission (the "Commission") has agreed to hear Geosam's application to reverse the decision of the TSX Venture Exchange (the "Exchange") to approve Cordy Oilfield Services Inc.'s ("Cordy") $4.8 million private placement (the "Private Placement") without requiring independent shareholder approval. On November 4, 2009, the Commission denied Cordy's request (and the request of the Exchange) that the Commission should decline to hear the case. On November 9, 2009, the Commission will hear Geosam's application for the Commission to grant a stay to prevent Cordy from using the proceeds of the Private Placement or, in the alternative, to expedite the requested hearing. Geosam announced its intention to file an application to the Commission in a press release dated October 26, 2009. Cordy announced the closing of the Private Placement on October 21, 2009.

Geosam remains troubled by the structure of the Private Placement, which overwhelmingly favoured the interests of certain insiders, and by the decision of Cordy's Board of Directors (the "Board") not to respond to Geosam's offer to subscribe for 50% of the Private Placement at a 12.5% premium to the proposed subscription price (the "Geosam Offer").

Cordy attempted to justify its actions in its press release of October 30, 2009. Geosam is alarmed by a number of the assertions made by Cordy in its press release which are misleading. First, Cordy states that, as a result of the Private Placement, the percentage ownership of Lyncorp International Ltd., a company controlled by David Mullen, CEO and Chairman of Cordy, will decrease. It should be noted, however, that the decrease is de minimis, 0.7% (from 19.4 % to 18.7%), and that, pursuant to the Private Placement, the Mullen family will increase its interest in Cordy from 27.3% to a minimum of 37.7%. Assuming the exercise of all warrants issued under the Private Placement, the Mullen family would control a minimum of 44%.

Second, Cordy states that the issue price of the units (the "Units") sold under the Private Placement was greater than the volume weighted average price of Cordy's common shares (the "Common Shares") on the TSX Venture Exchange for the five and ten-day periods ending on September 30, 2009; i.e., the day before Cordy announced the Private Placement. This statement is misleading in that it compares the subscription price of a Unit, which includes both a Common Share and a warrant for a Common Share, to the market price of a Common Share. Cordy's statement is flawed in that it ignores the intrinsic value of the warrant.

Third, Cordy argues that it could not have unilaterally accepted the Geosam Offer as shareholder approval would have been required. Geosam is of the view that a highly dilutive private placement, which has a high degree of insider participation should, as a matter of good governance, be subject to a shareholder vote. That said, Cordy could have asked Geosam to participate at a lower level. We note that Geosam could have participated at a level of 39% without requiring a shareholder vote under current TSX Venture rules. This would have resulted in additional proceeds to Cordy of approximately $235,000 without any further dilution to Cordy shareholders. Cordy never contacted Geosam regarding the Geosam Offer.

Finally, we are disappointed by the Board's statement that it intends to use the proceeds of the Private Placement notwithstanding Geosam's request not to do so and the pending application before the Commission. On October 27, 2009, Cordy announced its acquisition of Tawow Resources Inc. in exchange for $160,000, a promissory note for $250,000 (due in January 2010) and 420,000 Common Shares.

Since we publicly voiced our concern regarding the Private Placement, we have heard from a number of other shareholders who, like us, are shocked by Cordy's treatment of minority shareholders. Geosam feels very strongly about the interests of minority shareholders and, accordingly, has challenged the propriety of the Private Placement. We look forward to our application being heard by the Commission.

Cautionary Information regarding forward-looking statements:

Statements about the intentions of Geosam and all other statements in this release other than historical facts constitute forward-looking statements. The statements are not a guarantee as to future performance and involve risks and uncertainties that are difficult to predict. The statements are based upon Geosam's current expectations and beliefs and are subject to a number of known and unknown risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. Geosam disclaims any obligation to update or revise information in this news release based on new information or otherwise, unless required by law.


For further information: For further information: Garen Mikirditsian, Investment Manager, Geosam Investments Limited, (416) 855-1928

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