Eagle Rock Exploration Ltd.
TSX VENTURE : ERX

Eagle Rock Exploration Ltd.

October 13, 2009 19:51 ET

Eagle Rock Exploration Announces Closing of Common Share Private Placement and Early Warning

CALGARY, ALBERTA--(Marketwire - Oct. 13, 2009) -

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

Eagle Rock Exploration Ltd. ("Eagle Rock" or the "Corporation") (TSX VENTURE:ERX) is pleased to announce that it has closed its non-brokered private placement of common shares ("Common Shares") of the Corporation (the "Private Placement"). Pursuant to the Private Placement, the Corporation issued 95 million Common Shares at a price of $0.045 per Common Share for gross proceeds of $4.3 million.

Securities purchased by insiders pursuant to the Private Placement will be subject to an thirty-six month escrow under TSXV policies, unless Eagle Rock qualifies as a Tier 1 Issuer, then such securities will be subject to an eighteen month escrow under TSXV policies. All securities issued under the Private Placement are subject to a four-month hold period from the date of issuance, in accordance with TSXV policies and applicable securities laws. The proceeds of the Private Placement will be applied to the reduction of bank debt and other debt of Eagle Rock.

In accordance with Multilateral Instrument 62-104 – Take-Over Bids and Issuer Bids and National Instrument 62-103 – The Early Warning System and Related Take-Over Bid and Insider Reporting Issues, pursuant to the Private Placement, Mr. Neil Roszell of 710, 400 - 5 Avenue SW, Calgary, Alberta, T2P 2V6, directly acquired ownership of an aggregate of 6,439,500 Common Shares of Eagle Rock, representing approximately 1.70% of the total issued and outstanding Common Shares of Eagle Rock. Mr. Roszell now owns directly 30,883,500 Common Shares and 24,444,000 warrants (the "Warrants") of Eagle Rock, representing approximately 13.7% of the total issued and outstanding Common Shares of Eagle Rock, assuming all of the Warrants held by Mr. Roszell are exercised into Common Shares of the Corporation. In addition, Mr. Roszell now controls, through members of his immediate family with whom he resides, including his wife Larissa Roszell, 26,667,000 Common Shares and 26,667,000 Warrants of Eagle Rock, representing approximately 13.1% of the total issued and outstanding Common Shares of Eagle Rock, assuming all of the Warrants controlled by Mr. Roszell are exercised into Common Shares of the Corporation.

The Common Shares were acquired for investment purposes. Each of Mr. Roszell and his family members, as applicable, may from time to time acquire additional Common Shares, dispose of some or all of the existing or additional Common Shares, or continue to hold the Common Shares in the normal course of their investment activities, subject to applicable laws.

All of the securities purchased were acquired in reliance on the accredited investor or the family, friends and business associate exemptions of National Instrument 45-106 – Prospectus and Registration Exemptions. A copy of the early warning report for Mr. Roszell will be filed on SEDAR and may also be obtained by contacting the individual listed below.

Note Regarding Forward Looking Statements

This document contains forward-looking statements. More particularly, this document contains statements concerning the use of proceeds of the Private Placement.

Although Eagle Rock believes that the expectations and assumptions on which the forward-looking statements are based are reasonable, undue reliance should not be placed on the forward-looking statements because Eagle Rock can give no assurance that they will prove to be correct. Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to, risks that required regulatory and third party approvals and consents are not obtained on terms satisfactory to the parties or the board of directors of Eagle Rock determines that it would be in the best interests of Eagle Rock to deploy the proceeds for some other purpose.

The forward-looking statements contained in this press release are made as of the date hereof and Eagle Rock undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

Neither the 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 this release.

Contact Information

  • Eagle Rock Exploration Ltd.
    Neil Roszell
    President & CEO
    (403) 213-4501 (FAX)
    or
    Eagle Rock Exploration Ltd.
    Jerry Sapieha
    Vice President, Finance & CFO
    (403) 213-4501 (FAX)
    or
    Eagle Rock Exploration Ltd.
    Suite 710, 400 - 5th Avenue S.W.
    Calgary, AB T2P 0L6