COLONIA CORPORATION
NEX BOARD : CRP.H

September 15, 2005 13:59 ET

Colonia Announces Private Placement

CALGARY, ALBERTA--(CCNMatthews - Sept. 15, 2005) -

(Not for dissemination in the United States of America)

COLONIA CORPORATION (the "Corporation") (NEX:CRP.H) is pleased to announce that it has entered into an engagement letter with Leede Financial Markets Inc. ("Leede") dated September 7, 2005, pursuant to which Leede has agreed to act as agent, on a best efforts basis, in connection with the private placement (the "Private Placement") of up to 20,000,000 units of the Corporation (the "Units") at a price of $0.15 per Unit, each Unit consisting of one common share of the Corporation (the "Common Shares") and one-half of one share purchase warrant (the "Warrants"). Each whole Warrant will entitle the holder to purchase one Common Share at any time for a period of one year at a price of $0.20 per share.

Leede will be paid a cash commission, a corporate finance fee and will be granted agent's options (the "Agent's Options") to purchase up to 10% of the number of Units sold pursuant to the Private Placement for 18 months at a price of $0.15 per Unit.

The Corporation intends to use the proceeds from the Private Placement as general working capital to pursue oil and natural gas exploration, development, production, exploration and acquisition opportunities primarily in the Western Canadian Sedimentary Basin.

Directors, officers and other insiders of the Corporation intend to subscribe for Units pursuant to the Private Placement.

The Corporation has reserved a price of $0.15 per share for the Common Shares to be issued pursuant to the Private Placement. The Corporation has also reserved a price of $0.20 per share for the Common Shares to be issued upon exercise of the Warrants.

The completion of the Private Placement is subject to the approval of NEX, TSX Venture Exchange Inc. and all other necessary regulatory approval.

The Corporation also announces it has reserved a price of $0.15 per share for the grant of stock options to acquire up to 2,000,000 Common Shares (the "Stock Options") in the event the Private Placement is completed, subject to regulatory approval. The Stock Options will be granted to directors, officers, employees and/or consultants of the Corporation, subject to regulatory approval.

Except for historical information contained herein, this news release contains forward-looking statements that involve risks and uncertainties. Actual results may differ materially. Factors that might cause a difference include, but are not limited to, market acceptance of principal products, the impact of competitive products and technologies, the possibility of products infringing patents and other intellectual property of fourth parties, and costs of product development. Colonia will not update these forward-looking statements to reflect events or circumstances after the date hereof. More detailed information about potential factors that could affect financial results is included in the documents filed from time to time with the Canadian securities regulatory authorities by Colonia.

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

Contact Information

  • Colonia Corporation
    Donald G. Campbell
    President
    (403) 540-2003
    or
    Colonia Corporation
    George Bowley
    Director
    (403) 540-2113