SHARES OUTSTANDING: 27.3 MILLION
SYMBOL & EXCHANGE: FGE-V
MONTREAL, Feb. 18 /CNW Telbec/ - Forest Gate Energy Inc. ("Forest Gate" or the "Company") reports that it has completed a non-brokered private placement, announced on February 2, 2010, and has issued 2,364,960 units ("Unit") at a price of $0.13 per Unit, for total gross proceeds of $307,444 Total shares outstanding following this private placement will be 27,327,020.
Each Unit consists of one common share ("Share") and one half common share purchase warrant allowing the holder to subscribe for one Share at a price of $0.25 for a period of two years from the subscription date ("Warrant"). The Units will be subject to a four-month hold period.
Insiders of the Company subscribed for 230,000 Units, for total net proceeds of $29,900. These subscriptions are exempt from the valuation and minority shareholder approval requirements of Regulation 61-101 respecting Protection of Minority Security Holders in Special Transactions (the "Regulation") under paragraphs 5.5(b) and 5.7(1)(a) of the Regulation, as the Company is not listed on any market specified in the Regulation and the fair market value of the Units issued to insiders does not exceed 25% of the Company's market capitalization.
The Company paid $8,378.50 in commissions and finder's fees, and issued 64,450 broker Warrants in connection with this private placement, in accordance with the rules and regulations of the TSXV.
The Company intends to utilize the proceeds from the private placement to finance the Company's operations in Utah and for working capital purposes.
In other news, the Company wishes to clarify the terms of a convertible debenture issued to Jones, Gable & Company Limited (the "Investor") under a private placement announced on January 15, 2010. The Investor is entitled to convert into common shares of the Company the amount disbursed to Forest Gate in payment of the debenture, being $625,000. A maximum of 5,000,000 common shares are issuable upon such conversion, at a price of $0.125 per share. As compensation to the Investor, an additional $50,675 (the "Additional Amount") was added to the principal amount of the debenture, which bears interest at an annual rate of 10%. Any conversion of the Additional Amount or of interest is subject to the prior approval of the TSX Venture Exchange.
About Forest Gate Energy
Forest Gate Energy Inc. is a publicly listed oil & gas exploration and production company trading on the TSX Venture Exchange under the symbol FGE with 27.3 million shares outstanding. The Company is seeking to increase shareholder value through participation and development of oil & gas exploration and production projects in Canada and internationally.
Certain statements regarding Forest Gate, including management's assessments of future plans and operations and Forest Gate's anticipated financial performance, may constitute forward-looking statements under applicable securities laws and necessarily involve known and unknown risks and uncertainties, most of which are beyond Forest Gate's control. These risks may cause actual financial and operating results, performance, levels of activity and achievements to differ materially from those expressed in, or implied by, such forward-looking statements.
Such factors include, but are not limited to: the impact of general economic conditions in Canada and the United States; industry conditions including changes in laws and regulations including adoption of new environmental laws and regulations, and changes in how they are interpreted and enforced; competition; the lack of availability of qualified personnel; fluctuations in commodity prices; the results of exploration and development drilling and related activities; imprecision in reserve estimates; the production and growth potential of Forest Gate's various assets; fluctuations in foreign exchange or interest rates; the ability to access sufficient capital from internal and external sources; and obtaining required approvals of regulatory authorities.
Neither TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or the accuracy of this release. This transaction is subject to TSX Venture Exchange Approval.
SOURCE Forest Gate Energy Inc.
For further information: For further information: Robert Kramberger, V-P, Investor Relations, 1-866-666-3040, firstname.lastname@example.org; www.forestgate.ca