TORONTO, Sept. 27 /CNW/ - Nick Tsimidis, CEO and a director of DVD
Investments Limited (TSX Venture Exchange (NEX): DVD.H) ("DVD") is pleased to
provide this Press Release to its shareholders and members of the public to
update shareholders and others with respect to its proposed reverse take-over
transaction (the "Transaction") with Mooncor Energy Inc. ("Mooncor"), a
private oil and gas company, which was originally announced on November 21,
The Transaction and concurrent private placement financing (the
"Financing") is scheduled to close on September 28, 2007. The Financing terms
have been amended so that it is now expected that the Financing will consist
of a minimum of $2,000,000 of non flow-through units (the "Units") at a
subscription price of $0.50 per Unit and flow-through units (the "FT Units")
at a subscription price of $0.60 per FT Unit and a minimum of $2,000,000 of a
30 month convertible subordinated secured debenture (the "Debenture"). As a
result it is expected that a minimum of 4,000,000 Common Shares will be issued
in connection with the Financing.
Each Unit shall consist of one common share in the capital of DVD (a
"Common Share") and one-half of one purchase warrant (a "Warrant"). Each whole
Warrant shall entitle the holder to purchase one additional Common Share at a
price of $0.83 per share for a period of 18 months from the closing of the
Financing. Each FT Unit shall consist of one flow-through common share (a
"Flow-Through Share") in the capital of DVD, on a flow-through basis, and
one-half of one Warrant. Each Flow-Through Share will qualify as a
flow-through share for the purposes of the Income Tax Act (Canada).
The Debenture will accrue interest at 8%, payable on conversion or
maturity. During the first 24 months of the term of the Debenture, the
Debenture may be converted into Units at $0.50 per Unit and during the last
six months of the term of the Debenture into Common Shares at $0.55 per share,
at the option of the holder. The Debenture is redeemable at the option of DVD
at any time and is redeemable at the option of the holder in the event DVD
completes prior to maturity one or more private placements in any six month
period resulting in aggregate gross proceeds to DVD of not less than
$5,000,000. A work fee of 8% will be payable by DVD to First Canadian Capital
Markets Limited in connection with the Debenture portion of the financing.
The net proceeds of the Financing will be employed by DVD (i) to fund
Mooncor's drilling program at each of its Woodbend, Lonestar, Crossfield
projects in Alberta and Mooncor's Whitehill Lakes and Foam Lake projects in
Saskatchewan, (ii) to acquire additional lands in new project areas, and (iii)
for general operating expenses.
Following completion of the Transaction and Financing, 57,006,809 Common
Shares will be outstanding (assuming the minimum offering is subscribed),
without giving effect to (i) existing DVD options to purchase 336,000 Common
Shares, (ii) options to purchase 2,550,000 Common Shares pursuant to existing
Mooncor options, (iii) warrants to purchase 17,765,417 Common Shares pursuant
to existing Mooncor warrants (iv) 500,000 options to be issued upon closing of
the Transaction, (v) warrants to purchase 2,000,000 Common Shares pursuant to
the Financing (assuming the minimum offering is subscribed), and (vi) broker's
warrants to purchase up to 540,000 Common Shares which may be issued pursuant
to the Financing (assuming the minimum offering is subscribed).
The former Mooncor shareholders will own approximately 85% of the Common
Shares, current DVD shareholders will hold approximately 8% of the Common
Shares and purchasers under the Financing will hold approximately 7% of the
Common Shares (assuming the minimum offering is subscribed).
Since the date of DVD's Filing Statement, the disclosure document filed
on SEDAR in connection with the Transaction, dated May 25, 2007, the following
work has been accomplished on Mooncor's properties:
- commenced field work in preparation of submission of a drilling
application at a cost to date of $58,859.82
- drill second well (completed by Mooncor's partner)
- stimulate and test Crossfield 8-29 (completed by Mooncor's partner)
- Mooncor successfully acquired two sections (1,024 acres) of Petroleum
and Natural Gas Rights on September 5, 2007 for a net cost of
Whitehill Lakes, Saskatchewan
- Incurred costs of $96,250 to perf and test intervals in each of the
five test wells
Foam Lake Area, Saskatchewan
- drill test well at a pro-rata cost to Mooncor of $230,062.98
Except for drilling and completing Woodbend 12-11-51-26W4 in the first
quarter of 2008 (instead of the second quarter of 2007) the proposed
exploration and development program to be carried out by DVD following the
closing of the Transaction and Financing remains unchanged from the summary of
the use of available funds described in DVD's Filing Statement filed on Sedar
on May 29, 2007.
The Filing Statement is the disclosure document that outlines the details
of the Transaction, the Financing, information about DVD and information about
the target company, Mooncor, and its business, including financial statements
of DVD, Mooncor and pro forma financial statements. Readers of this release
are encouraged to review the information in the Filing Statement.
Mooncor is a junior oil and gas exploration and production company based
in Calgary. Mooncor plans to specialize in the exploration and development of
unconventional gas projects most particularly in the Colorado shales in
western Canada. Mooncor also has a CBM project in Alberta and two conventional
oil and gas projects in Alberta. Mooncor has drilled 9 wells to date and
Mooncor's assets consist of rights to earn working interests in Mooncor's five
separate properties consisting of 263,511 gross acres (126,625 net acres) of
petroleum and natural gas Crown leases in Alberta and Saskatchewan.
Completion of the Transaction remains conditional on obtaining all
necessary regulatory approvals, including the approval of the TSX Venture
Exchange, and other conditions which are typical for a business combination
transaction of this type. There can be no assurance that the transaction will
be completed as proposed or at all.
The information in this press release related to Mooncor was provided to
DVD by Mooncor.
Investors are cautioned that, except as disclosed in the management
information circular or filing statement to be prepared in connection
with the transaction, any information released or received with respect
to the transaction may not be accurate or complete and should not be
relied upon. Trading in the securities of a capital pool company should
be considered highly speculative.
The TSX Venture Exchange has not reviewed and does not accept
responsibility for the adequacy or accuracy of this press release.
For further information:
For further information: Nick Tsimidis, Chief Executive Officer, Tel: