Royal Capital Corp.

May 01, 2009 12:35 ET

DeeThree Exploration Ltd. Completes Initial Tranche of Brokered Private Placement for $5,000,086

CALGARY, ALBERTA--(Marketwire - May 1, 2009) -


ROYAL CAPITAL CORP. ("Royal") (TSX VENTURE:RCX.P) and DEETHREE EXPLORATION LTD. ("DeeThree") are pleased to announce that yesterday, April 30, 2009, DeeThree completed the initial tranche of its brokered private placement (the "Private Placement") for aggregate gross proceeds of $5,000,086. At this initial closing, DeeThree issued 1,675,050 subscription receipts ("Subscription Receipts") at a price of $2.00 per Subscription Receipt for gross proceeds of $3,350,100 and 687,494 common shares issued on a flow-through basis ("Flow-Through Common Shares") at a price of $2.40 per Flow-Through Common Share for gross proceeds of $1,649,986. DeeThree anticipates completing one or more additional tranches of the Private Placement.

Clarus Securities Inc. acted as agent for the Private Placement on a commercially reasonable best efforts basis.

As announced on March 30, 2009, DeeThree and Royal entered into a letter of intent dated March 23, 2009 that sets out the basic terms and conditions pursuant to which it is intended that Royal and DeeThree will complete a business combination (the "Proposed Transaction"). The Proposed Transaction is intended to be the Qualifying Transaction of Royal pursuant to the Policies of the TSX Venture Exchange (the "Exchange") and is subject to the acceptance of the Exchange. The Proposed Transaction is also subject to there being no material adverse change in the business, results of operations, assets, liabilities, financial conditions or affairs of either Royal or DeeThree from March 23, 2009 through to the completion of the Proposed Transaction and the approval of the shareholders of DeeThree. In addition, the Proposed Transaction is subject to the shareholders of Royal approving the consolidation ("Consolidation") of the common shares of Royal (the "Royal Shares") on the basis of one (1) post-Consolidation Royal Share (a "Resulting Issuer Share") for twelve (12) Royal Shares outstanding prior to the Consolidation and the name change of Royal to "DeeThree Exploration Ltd." or similar name. Please refer to Royal's news release dated March 30, 2009 for additional information regarding DeeThree and the Proposed Transaction.

Upon the satisfaction or waiver of all conditions precedent with respect to the Proposed Transaction, including the execution of a definitive agreement (the "Agreement") providing for the Proposed Transaction, each Subscription Receipt will entitle the holder to receive one common share in the capital of DeeThree without payment of additional consideration immediately preceding the closing of the Proposed Transaction. It is anticipated that the Agreement will provide that the outstanding DeeThree common shares, including those underlying the Subscription Receipts and the Flow-Through Common Shares, will be exchanged for Resulting Issuer Shares as part of the Proposed Transaction on a one for one basis. If the conditions are not met on or before June 30, 2009, each holder of Subscription Receipts will be reimbursed the original subscription price, plus such holder's pro rata portion of any interest earned thereon.

The proceeds of the Private Placement will be used to explore and develop DeeThree's oil and gas prospects in the Lethbridge and Peace River Arch regions in Alberta, and for working capital and general corporate purposes.

Neither 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.

Contact Information

  • Royal Capital Corp.
    Dennis Nerland
    President, CEO and a director
    (403) 299-9605