Australia Energy plans C$25 million placement of subscription receipts

Receipts convert to common shares of soon-to-be-formed PetroFrontier

By Devika Patel

Knoxville, Tenn., Nov. 17 - Australia Energy Corp. will conduct a private placement of subscription receipts, according to a press release from Pendulum Capital Corp. Pendulum plans a business combination with the company and said the best-efforts placement is expected to raise more than C$25 million.

Macquarie Capital Markets Canada Ltd., the lead agent, has a 15% greenshoe. The price per receipt will be determined in the context of the market, Pendulum said in the release.

Each subscription receipt will convert into one Australia Energy share immediately prior to the combination and that share will be exchanged for a common share of the newly formed company, which is to be called PetroFrontier Corp.

Settlement of the placement is expected Dec. 2.

Proceeds will be deposited in escrow and released after the business combination is completed. They will then be used for oil and gas exploration projects in the Southern Georgina Basin of Australia.

Pendulum Capital is a capital pool company based in Calgary, Alta. Australia Energy is a private oil and gas exploration company headquartered in Calgary.

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