Arapaho Capital Corp.
TSX VENTURE : AHO

Arapaho Capital Corp.

May 25, 2006 13:08 ET

Arapaho Capital Corp. Announces Termination of Pre-Arrangement Financing Engagement

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - May 25, 2006) -

NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES

Arapaho Capital Corp. (the "Company" or "Arapaho") (TSX VENTURE:AHO) announces that the engagement letter between Arapaho and Gynia Holdings Ltd., and Jones, Gable & Company Limited, pursuant to which Jones Gable was appointed as agent to carry out a $25.0 million placement of subscription receipts (the "Pre-Arrangement Financing"), has been terminated.

The Pre-Arrangement Financing relates to a proposed arrangement transaction whereby Arapaho would have acquired from the shareholders of INXOil (Cyprus) Ltd. ("XOil") all of the issued and outstanding shares of XOil in consideration for the issuance of 42,383,333 common shares of Arapaho, such that XOil would have become a wholly-owned subsidiary of Arapaho (the "Arrangement"). It is a condition precedent to the completion of the Arrangement that the Pre-Arrangement financing complete by June 30, 2006. The Arrangement is more particularly described in the notice and management information circular prepared in connection with the Arrangement, copies of which were mailed to shareholders and are available electronically at www.sedar.com.

At a Special Meeting held on May 19, 2006, the Arapaho shareholders approved the Arrangement. However, in order to allow more time for the fulfilment of the conditions precedent to the completion of the Arrangement, the meeting was adjourned to June 15, 2006. As it is now unlikely that the Pre-Arrangement Financing will be completed by June 30, 3006, the Company is taking suitable steps with XOil to mutually terminate the Arrangement Agreement.

Investors are cautioned that, except as disclosed in the management information circular prepared in connection with the Arrangement, any information released or received with respect to the Arrangement may not be accurate or complete and should not be relied upon. Trading in the securities of Arapaho should be considered highly speculative.

The TSX Venture Exchange has in no way passed upon the merits of the proposed Arrangement and has neither approved nor disapproved the contents of this press release.

This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.

THE TSX VENTURE EXCHANGE DOES NOT ACCEPT RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.

Contact Information

  • Arapaho Capital Corp.
    Brian E. Bayley
    (604) 689-1428
    (604) 681-4692 (FAX)