Westcore Energy Ltd.
TSX VENTURE : WTR

February 04, 2011 13:43 ET

Westcore Announces Brokered Financing

CALGARY, ALBERTA--(Marketwire - Feb. 4, 2011) -

NOT FOR DISTRIBUTION TO UNITED STATES NEWS WIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES

Westcore Energy Ltd. ("Westcore" or the "Corporation") (TSX VENTURE:WTR) is pleased to announce that it has entered into an engagement letter with MGI Securities Inc. ("MGI") pursuant to which MGI has agreed to act as lead agent on a best efforts basis for an offering of up to $2,000,000 of units ("Units") and up to $2,000,000 of common shares of the Corporation that are to be issued as "flow-through shares" ("Flow-Through Shares") for aggregate gross proceeds of up to $4 million (the "Offering"). Each Unit will be offered at a price of $0.55 and will be comprised of one common share in the capital of Westcore (each, a "Common Share") and one common share purchase warrant (each, a "Warrant"). Each Warrant will entitle the holder to purchase one additional Common Share at a price of $1.00 per share for a period of 12 months from the closing of the Offering. The Flow-Through Shares will be offered at a price of $0.60 and will be incurred for expenditures that are to be renounced in respect of the 2011 taxation year. Pursuant to the engagement letter, the Corporation has also granted MGI an over-allotment option entitling MGI to call upon the Corporation to issue up to an additional $1,000,000 in Units and/or $1,000,000 in Flow-Through Shares, if mutually agreed by MGI and the Corporation. MGI will have 10 business days following the closing of the Offering to notify the Corporation of its exercise of the over-allotment option.

Upon closing of the Offering, Westcore will pay MGI a cash commission of 8.0% of the gross proceeds of the Offering and will issue to MGI a number of purchase warrants as is equal to 8.0 % of the number of Units and Flow-Through Shares sold under the Offering, each of which shall be exercisable for a period of twelve (12) months following closing of the Offering into one Common Share at a price of $0.55 per share. A work fee shall also be payable through the issuance to MGI of 50,000 Common Shares at an ascribed price of $0.55 per share.

Proceeds from this Offering will be used in connection with Westcore's ongoing winter drilling program and its previously announced Coal to Liquids sampling process. In accordance with applicable securities laws, the securities issued under this Offering will be subject to a four-month hold period. This Offering is subject to approval by the TSX Venture Exchange.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy any securities nor shall there be any sale of securities in any state in the United States in which such offer, solicitation or sale would be unlawful. The securities offered will not be and have not been registered under the United States Securities Act of 1933 and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.

Forward Looking Statements

Except for statements of historical fact relating to the Corporation, certain information contained herein constitutes forward-looking statements. Forward-looking statements are based on the opinions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking statements. Except as required by applicable securities requirements, the Corporation undertakes no obligation to update forward-looking statements if circumstances or management's estimates or opinions should change. The reader is cautioned not to place undue reliance on forward-looking statements.

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 the release.

Contact Information

  • Westcore Energy Ltd.
    Paul Conroy
    President and Chief Executive Officer
    (403) 237-6122
    (403) 237-6144 (FAX)