Cornwall Investments LLC

August 10, 2011 19:45 ET

Cornwall Investments LLC To Acquire Additional Securities of Viridis Energy Inc.

SOMERSET, NEW JERSEY--(Marketwire - Aug. 10, 2011) - Cornwall Investments LLC ("Cornwall") will acquire, pursuant to a non-brokered private placement, transferable convertible promissory notes (the "Convertible Notes") of Viridis Energy Inc. ("Viridis") in the aggregate principal amount of $3,922,000 evidencing a loan to be advanced by Cornwall. The Convertible Notes will bear interest at a fixed rate of 6% per annum and will be repayable on or before that date which is two years from the date of issuance. Viridis and Cornwall each will have the right at any time to convert any or all of the principal and interest owing under the Convertible Notes into units ("Units") of Viridis at a rate of one Unit for every $0.25 owing to a maximum, including Units issuable on conversion of interest owing, of 17,627,036 Units. These conversion rights cannot be exercised by either party without the prior approval of the TSX Venture Exchange if, upon such exercise, Cornwall would hold, directly or indirectly, legally or beneficially, 20% or more of Viridis' issued and outstanding voting securities. Each Unit issuable upon conversion of the Convertible Notes will comprise one common share of Viridis and one-half of one common share purchase warrant (the "Warrant"). Each whole Warrant will entitle the holder to acquire one common share of Viridis at a price of $0.40 per share for a period of 24 months from issuance, subject to certain acceleration provisions. The Convertible Notes will be secured by a general security interest in all of Viridis' assets which will be subordinated to the existing security interests granted by Viridis. The transaction is subject to the approval of the TSX Venture Exchange.

If the conversion rights attached to the Convertible Notes were exercised in full in accordance with the above-noted restriction, it would result in the issue to Cornwall of that number of common shares of Viridis which, when added to the number of common shares already held directly or indirectly, legally or beneficially, by Cornwall would equal 19.99% of Viridis' issued and outstanding common shares on the date of exercise.

After issuance of the Convertible Notes, Cornwall will own and control 7,314,404 common shares of Viridis representing approximately 17.17% of the issued and outstanding common shares of Viridis as of August 9, 2011 together with: (a) warrants to purchase 5,514,404 common shares of Viridis at a price of $0.75 per share on or before May 14, 2012; and (b) warrants to purchase 900,000 common shares of Viridis at a price of $0.40 per share on or before July 25, 2013, in each case, subject to certain acceleration provisions. The convertible promissory note previously issued by Viridis to Cornwall in the principal amount of $780,460 will be repaid concurrently with the closing of the issuance of the Convertible Notes.

Cornwall will advance the loan proceeds pursuant to the Convertible Note to fund Viridis' general corporate purposes. Cornwall may or may not purchase or sell securities of Viridis in the future on the open market or in private transactions, depending on market conditions and other factors material to Cornwall's investment decisions, and reserves the right to dispose of any or all of its securities in the open market or otherwise, at any time and from time to time, and to engage in any hedging or similar transactions with respect to the securities.

Cornwall may seek to influence the strategic direction of Viridis, which may occur through discussions with representatives of Viridis or by influencing control of Viridis' board of directors.

Cornwall has filed an early warning acquisition report on SEDAR. A copy of the report may be obtained by contacting Robert Aaron at (732) 309-5000.

Contact Information

  • Cornwall Investments LLC
    Robert Aaron
    (732) 309-5000