RedWater Energy Corp. (TSXV: RED) closed a non-brokered private placement of some 5.4 million common shares at a C $0.10 per share.
Redwater received gross proceeds of $538,310. All common shares issued pursuant to the offering are subject to a four-month hold period. Including the issuance of shares, there will be some 40.2 million common shares of RedWater issued and outstanding. The offering remains subject to final acceptance by the TSX Venture Exchange. Proceeds will be used to fund ongoing exploration and development activities.
RedWater also renewed its financing agreement with its senior lender, Alberta Treasury Branches, until April 30, 2014. Additionally RedWater has borrowed an additional $538,310 from a private lender pursuant to a secured subordinated non-convertible debenture with a two year term at 8% interest per annum.
RedWater has also renegotiated a joint venture agreement, previously announced on March 12. Pursuant to the new joint venture agreement, the joint venture partner will participate in a one well Mannville light oil drilling program at Redwater, Alberta. RedWater will be the project operator on the well and each party is responsible for 50% of the actual costs of drilling the well. The joint venture partner has agreed to loan RedWater $374,383.98 to pay for RedWater's 50% share of the $748,767.96 drilling program. The secured loan of $374,383.98 is fully open and bears interest at 10% per annum.
RedWater Energy Corp. is engaged in the acquisition, enhancement and exploration of conventional oil and gas projects. The company is based in Okotoks, Alberta.