Centillion Industries Inc.
NEX BOARD : CID.H

Centillion Industries Inc.

March 21, 2007 13:39 ET

Centillion Industries Inc. Closes Private Placement Financing

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - March 21, 2007) -

NOT FOR DISSEMINATION IN THE UNITED STATES OR TO US PERSONS OR FOR DISTRIBUTION TO OR THROUGH U.S. NEWSWIRE SERVICES

Centillion Industries Inc. (the "Company") (NEX:CID.H) announced today that it has closed its previously announced private placement (the "Private Placement"). The Private Placement, led by Canaccord Capital Corporation and including Salman Partners Inc., Haywood Securities Inc. and PowerOne Capital Markets Limited (collectively, the "Agents"), consisted of 112,503,000 subscription receipts (the "Subscription Receipts") at a price of $0.35 per Subscription Receipt, for aggregate gross proceeds to the Company of $39,376,050.

Proceeds of $39,311,050, representing the aggregate gross proceeds from the sale of the Subscription Receipts less the Agents' initial expenses have been deposited in escrow and will be released to the Company upon the satisfaction by the Company of certain conditions relating to the completion of the acquisition by the Company from Bankers Petroleum (US) Inc. ("Bankers US"), a wholly-owned subsidiary of Bankers Petroleum Ltd., of 27% of the working interest of Bankers US in certain oil and gas properties in the Palo Duro Basin, Texas, pursuant to a purchase and sale agreement effective as of January 1, 2007 among the Company, its subsidiary Palo Duro Operating (US), Inc. and Bankers US (the "Acquisition"). The acquisition of a 27% working interest equates to an approximate net revenue interest in the Palo Duro Basin of 20.25%, after accounting for applicable landowner royalty and over-riding royalty interest burdens that range from 22% to 25%.

Each Subscription Receipt will be automatically exercised for one unit (a "Unit") of the Company, without payment of additional consideration, on the satisfaction of certain escrow release conditions, including the closing of the Acquisition and the receipt of all required approvals of the TSX Venture Exchange in respect of the listing of the securities underlying the Units on Tier 1 or Tier 2 of the Exchange. Each Unit will consist of one common share of the Company and one-half of one common share purchase warrant, each whole warrant being exercisable to acquire an additional common share of the Company at a price of $0.50 per share for a period of 24 months following the closing date of the Private Placement (the "Closing Date"). The Subscription Receipts and underlying securities issued pursuant to the Private Placement are subject to a four-month hold period, commencing on the Closing Date.

Net proceeds from the Private Placement will be used to finance the Acquisition and the initial capital expenditure requirements pursuant to the Acquisition, which is subject to a number of conditions. More details in respect of the use of proceeds from the Private Placement and the conditions to the completion of the Acquisition are contained in the Company's March 16, 2007 press release.
The TSX Venture Exchange Inc. has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved the contents of this press release.

This news release may contain forward-looking statements based on assumptions and judgments of management of the Company regarding future events or results. Such statements are subject to a variety of risks and uncertainties which could cause actual events or results to differ materially from those reflected in the forward-looking statements. The Company disclaims any intention or obligation to revise or update such statements except as may be required by law.

This news release shall not constitute an offer to sell or the solicitation of an offer to buy the securities in any jurisdiction. The securities offered have not 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 many not be offered or sold in the United States except in certain transactions exempt from the registration requirements of the U.S. Securities Act and applicable states securities laws.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.

Contact Information

  • Centillion Industries Inc.
    Stephen Barley
    President
    (604) 926-4300
    Email: sbarley@shaw.ca