Groundstar Resources Limited News Release
December 04 2013 - 9:31PM
Access Wire
Calgary, December 4,
2013 -Groundstar Resources Limited ("Groundstar", "the "Company",
"we", "us", or "our") (TSXV: GSA US: GRDSF symbol) (the
"Company") is pleased to announce that is has entered into an engagement
agreement whereby PI Financial Corp. and Canaccord Genuity Corp.
will act as co-lead agents with respect
to a proposed
offering of up to 5,000,000 common shares in the capital of
the Company to be issued on a "flow-through" basis within the
meaning of the Income Tax Act (Canada) (the "Flow-Through Shares")
at a price of $0.20 per Flow-Through Share by way of a brokered
private placement and up to 2,777,800 units of the
Company (the "Units") at
a price of $0.18 per Unit
for total gross proceeds of up to $1.5
million. Each Unit will consist of one common
share in the capital of the Company (a "Common Share") and one half
of one common share purchase warrant ("Warrant"). Each whole
Warrant will entitle the holder thereof to purchase one Common
Share ("Warrant Share") at a price of $0.30 each prior to the date
that is 18 months from a closing date of the Offering. The Company
may offer the Units to purchasers in the United States pursuant to
exemptions from the registration requirements under applicable U.S.
securities laws.
The Company expects
to use the net proceeds from the offering primarily to accelerate
exploration and development activities of its North American oil
and gas properties. The proceeds received by the Company from the
sale of the Flow-Through Shares will be used to incur eligible
Canadian Exploration Expenses ("CEE") which will be
renounced in favour of subscribers for the 2013 taxation year. The
flow-through funds will be used to fund additional Mannville,
vertical oil well(s) in the Neilburg area, expected follow up to
3-13 at 4-13, and W3/W4 drilling locations; the drilling of a
vertical light oil Viking well in the Chigwell unit, and an
expected high impact Leduc exploration play. Additionally, some
seismic acquisition work may be conducted in Groundstar's key
growth areas in Saskatchewan and Alberta.
Groundstar, due to
its taxable capital amount may on an annual basis be eligible to
incur and renounce up to $1.0 million of certain eligible Canadian
development expenses (CDE) which is deemed to be Canadian
exploration expenses (CEE). Groundstar currently has no debt and
18.9 million shares outstanding.
The Units and
Flow-Through Shares will be issued on a private placement basis in
the Provinces of Alberta, British Columbia, Ontario and such other
jurisdictions as the Agents and the Company may agree and will be
subject to a statutory hold period of four months and a day from
the closing date of the Offering, expected to be on or about
December 23, 2013. Closing of the Offering and the issuance of the
Units and the Flow-Through Shares are subject to approval of the
TSX Venture Exchange.
This news
release does not
constitute an offer
to sell or
a solicitation of an
offer to buy
any of
the securities in
the United States. The
securities have not
been and will not
be registered under the
United States Securities Act of
1933, as
amended (the "U.S. Securities Act") or
any state securities laws and
may not be
offered or sold within
the United States
or to U.S.
Persons unless registered
under the U.S. Securities Act and
applicable state securities laws or
an exemption from such registration is
available.
About Groundstar Resources Limited
Incorporated in 1968, Groundstar Resources Limited is a
diversified publicly traded oil and gas company with exposure to
7.3 million gross acres of resource assets. The Company is actively
growing a portfolio targeting producing oil and gas assets with
development opportunities and exploration upside. The Company's
current portfolio of resources assets provides both near term and
longer term potential. Groundstar is quoted and trades under the
ticker symbol "GSA" in Canada and "GRDSF" in the United States.
Neither the TSX
Venture Exchange nor its Regulation Services Provider (as that term
is defined in the policies of the TSX Venture Exchange) accepts
responsibility for the adequacy or accuracy of this release.
This press release contains forward-looking
statements within the meaning of applicable securities laws,
including expectations regarding the anticipated closing of the
Offering, the gross proceeds expected to be received in connection
therewith and the anticipated use of proceeds from the Offering.
Although the Company believes that the expectations reflected in
such forward-looking statements are reasonable, it can give no
assurance that such expectations will prove to be correct. These
statements are subject to certain risks and uncertainties and may
be based on assumptions that could cause actual results to differ
materially from those anticipated or implied in the forward-looking
statements. These risks include, but are not limited to: the risks
associated with the oil and gas industry (e.g. operational risks in
development, exploration and production; delays or changes in plans
with respect to exploration
or development projects or capital expenditures; the uncertainty of
reserve and resource estimates; the uncertainty of estimates and
projections relating to production, costs and expenses and health,
safety and environmental risks), commodity price and exchange rate
fluctuation, uncertainties resulting from potential delays or
changes in plans with respect to exploration or development
projects or capital expenditures and uncertainties regarding
whether regulatory approval for the Offering will be received and
if received, on the timelines expected, as well as the intended use
of the net proceeds of the Offering. The Company's forward-looking
statements are expressly qualified in their entirety by this
cautionary statement. The forward-looking statements contained in
this press release are made as of the date hereof and the Company
undertakes no obligations to update publicly or revise any
forward-looking statements or information, whether as a result of
new information, future events or otherwise, unless so required by
applicable securities laws.
Contact
Information: Contact
Information:
Groundstar Resources
Limited, Suite 2300, 144 4th Avenue SW, Calgary, Alberta T2P
3N4
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|Groundstar Resources Limited |www.groundstarresources.com |
|---------------------------------------------------------------|
|Chad Dust 403 608 6505 or 403|Tyron Pfeifer 403 614 9902 |
|265 2549 |tpfeifer@groundstarresources.com|
|cdust@groundstarresources.com | |
| | |
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