Mr. Arthur Millholland reports
CANADIAN OVERSEAS PETROLEUM FILES PRELIMINARY PROSPECTUS
Canadian Overseas Petroleum Ltd. has filed a preliminary prospectus with the securities regulatory authorities in each of the provinces of Canada other than Quebec in connection with a best-efforts offering of a minimum of $60-million of subscription receipts of the company. When the company has met specified release conditions, the proceeds of the offering will be released to the company, and each subscription receipt will be automatically converted into one common share and one-half of one common share purchase warrant. The warrants will be priced at a 30-per-cent premium to the offering price, and each whole warrant will entitle the holder to acquire one common share until the date that is three years after the closing date.
Canaccord Genuity Corp. will act as the selling agent. The maximum size of the offering and price of the subscription receipts will be determined once the company and the agent conclude marketing activities, with closing currently anticipated to occur on or about Dec. 7, 2010. The company has applied to list the subscription receipts on the TSX Venture Exchange and expects that the subscription receipts will be listed and posted for trading at closing subject to obtaining any requisite approvals.
The funds will be used to fulfill the terms of farm-in agreements in conjunction with the previously announced letters of intent and an exclusivity letter made by COPL's wholly owned subsidiary, Canadian Overseas Petroleum (U.K.) Limited. The LOIs and the exclusivity letter are for exploration and appraisal properties in the U.K. North Sea. One LOI would allow the company to earn a 50-per-cent equity interest in two blocks; the other LOI would allow the company to earn a 40-per-cent equity interest in the Bluebell prospect in blocks 15/24c and 15/25f; and the exclusivity letter is for several prospects in block 23/21 and prospects in block 22/15. The LOIs and the exclusivity letter are subject to certain conditions precedent including financing and regulatory approvals in Canada and the United Kingdom.
The offering is subject to certain conditions including, but not limited to, the execution of a definitive agency agreement with the agent and the receipt of all necessary approvals, including the approval of the TSX-V and the applicable securities regulatory authorities. The filed preliminary prospectus can be viewed on SEDAR under the COPL listing.
We seek Safe Harbor.