EXHIBIT 99.1
RADIAL ENERGY INC. ANNOUNCES $5 MILLION CONVERTIBLE DEBENTURE FINANCING
RADIAL ENERGY INC. (OTCBB: RENG) announces today that it has signed a $5,000,000
convertible debenture financing with Cornell Capital Partners, LP and has
received the first tranche of $2,000,000.
The debentures have a term of three years and bear interest at 7% per year. At
the option of the holder, the debentures may be converted into Radial Energy
common stock at a conversion price equal to the lower of $1.0536 or 90% of the
lowest volume weighted average daily closing price of the Company's common
stock, during the fifteen trading days immediately prior to the conversion date.
In addition, Radial Energy issued 9,166,667 warrants to Cornell Capital with
exercise prices varying from $0.75 to $1.50 per warrant. None of the shares of
common stock underlying the debentures or warrants were registered under the
Securities Act of 1933. Accordingly, such shares may not be offered or sold in
the United States, except pursuant to an effective registration statement or an
applicable exemption from the registration requirements of the Securities Act.
The company has agreed to file a registration statement covering the resale by
the investor of the shares.
The proceeds will be invested into Radial Energy's ongoing projects including
the Block 100 project in Peru, the Cherokee County prospects in Texas, and the
Bosques project in Colombia. As previously announced by Radial Energy, the
estimated spud date of the Huaya 100-1X well in Peru is October 15th, 2006 and
it is expected to take 7-10 days to reach total depth.
Radial Energy President G. Leigh Lyons stated, "We are extremely pleased with
the financial flexibility this recent financing has provided. If the first well
in Peru is successful, as we expect it to be, this financing will allow us to
immediately drill 2 additional wells, bringing Radial Energy a step closer to
the production stage."
This press release shall not constitute an offer to sell or a solicitation of an
offer to buy the Company's securities. This private placement was made by the
Company and any opportunity to participate in the private placement was
available to one accredited investor.
ABOUT CORNELL CAPITAL PARTNERS, LP
Established in January 2001, Cornell Capital Partners, LP
(http://www.cornellcapital.com) has funded numerous companies listed on the
OTCBB. Building on that solid foundation, Cornell has consummated transactions
with AMEX and NASDAQ listed companies, and continues its success in
international markets.
About Radial Energy Inc. (OTCBB: RENG)
Radial Energy identifies, acquires and develops low risk oil and natural gas
exploration and development opportunities throughout the Americas. The company's
innovative strategy involves targeting overlooked or under-developed reserves
that are under the radar of multinational oil companies and out of the reach of
small independents.
Radial Energy has rapidly assembled an impressive portfolio of oil and gas plays
including working interests in two separate oil and gas prospects located in
Cherokee County, Texas as well as in the Block 100 oil project located within
the Huaya Anticline area in the Ucayali Basin of eastern Peru. The company has
also executed a Letter of Intent to acquire rights to explore and develop oil
reserves on the Bosques Block play located in the prolific Middle Magdalena
Valley of Colombia. The Company targets prospective oil and natural gas
opportunities in historically productive regions with a primary focus on
identifying previously drilled but undeveloped exploratory wells that, due to
factors at the time of initial drilling including the absence of pipeline
infrastructure, lack of modern recovery technology, poor geological or
engineering interpretation or low oil and gas prices, were not fully exploited.
Radial Energy is led by a highly motivated team of industry veterans with proven
expertise in North, Central and South American oil and natural gas development.
Bolstered by first-rate management, farsighted acquisitions, the speed and
agility to take advantage of changing market conditions, a firm commitment to
building value for shareholders and the growing demand for energy worldwide,
Radial Energy is taking maximum advantage of a tremendous opportunity to develop
overlooked and under-developed oil and gas reserves in North and South America.
Forward-Looking Statements
Except for statements of historical fact, the information presented herein may
contain forward-looking statements. Such forward-looking statements involve
known and unknown risks, uncertainties and other factors, which may cause the
actual results, performance or achievements of the company to be materially
different from any future results, performance or achievements expressed or
implied by such forward-looking statements. Such factors include general
economic and business conditions, the ability to acquire and develop specific
projects, the ability to fund operations and changes in consumer and business
consumption habits and other factors over which Radial Energy Inc. has little or
no control.
ON BEHALF OF THE BOARD
Radial Energy Inc.
- ----------------------
G. Leigh Lyons, President
CONTACT:
Investor Relations Contact:
J & J Investor Relations Inc.
1-888-795-2874
Visit our website at http://www.radialenergyinc.com