newsWenzel Downhole Tools Enters Into an
Agreement With Dominick & Dominick Securities
Inc.
16:14 EST Wednesday, May 24, 2000
CALGARY, ALBERTA--Wenzel Downhole Tools Ltd. (the +Corporation+) is
pleased to announce that the Corporation has entered into an agreement (the
+Agreement+) dated May 24, 2000 with Dominick & Dominick Securities Inc. (the
+Agent+).
Under the terms of the Agreement, the Agent has been retained as exclusive agent,
fiscal advisor and lead manager to use its best efforts to complete an offering in the
province of Ontario, or such other jurisdictions agreed to by the Corporation and the
Agent, of up to $5,250,000 or 2,571,429 Special Warrants at $1.75 per Special
Warrant (the +Offering+). In addition, the Agent will arrange, on a best effort basis,
for the private secondary sale by two existing shareholders of the Corporation of up
to 1.5 million preferred shares at $1.60 per preferred (the +Secondary Sale+). The
Agreement contemplates the execution of a formal agency agreement to be entered
into between the Corporation and the Agent and is subject to regulatory approval,
including but not limited to, the approval of the Toronto Stock Exchange and
conditions imposed by the preferred shareholders on the Secondary Sale.
Each Special Warrant is exercisable, without additional payment, into one Common
Share of the Corporation and 1/2 warrant of the Corporation (the +Warrant+). Each
full Warrant entitles the holder to purchase one Common Share of the Corporation at
a price of $2.00 per share for a period of 24 months from the date of closing of this
Offering (the +Closing+).
The Special Warrants will be qualified by a prospectus within 145 days of the
Closing of the private placement, or in the event such qualification has not been
obtained, then each subscriber shall be entitled to receive upon the exercise of the
Special Warrants, 1.1 Common Shares plus 1/2 warrant at no additional
consideration.
The Agent will be paid a commission of 7% of the gross proceeds of the Offering and
will receive from the Corporation warrants (+Broker Warrants+) equal to 7% of the
subscribed number of Special Warrants. The Broker Warrants entitle the holder to
purchase one Common Share plus 1/2 Warrant, each full Warrant exercisable into
one Common Share of the Corporation at a price of $2.00 per share for a period of
24 months from the date of Closing.
The Agent will also be paid a commission of 5% of the gross proceeds of the sale of
the Preferred Shares.
The Corporation will use the proceeds for building rental equipment and for general
working capital.