Excelsior Energy Limited

Excelsior Energy Limited

April 16, 2010 19:32 ET

Excelsior Energy Announces Non-Brokered Private Placements for Up to $20 Million

CALGARY, ALBERTA--(Marketwire - April 16, 2010) -


Excelsior Energy Limited (TSX VENTURE:ELE) ("Excelsior" or the "Corporation") is pleased to announce that it has entered into a binding letter agreement with Frank Giustra, Peninsula Merchant Syndications Corp. and Jeff Scott (collectively, the "Subscribers") to arrange for subscriptions of up to 41,666,667 units of Excelsior ("Units") at a price of $0.36 per Unit (the "Unit Financing") for aggregate gross proceeds of up to $15,000,000. Each Unit will consist of one (1) common share ("Common Share") at an issue price of $0.18 per Common Share, one (1) Common Share issued on a "flow-through" basis pursuant to the provisions of the Income Tax Act (Canada) ("Flow-Through Share") at an issue price of $0.18 per Flow-Through Share and two (2) Common Share purchase warrants (each, a "Warrant") each Warrant entitling the holder thereof to purchase one Common Share at an exercise price of $0.30 at any time within 36 months from the closing of the Unit Financing. Closing of the Unit Financing and the Common Share Financing is subject to, among other things, regulatory approval. Furthermore, the Unit Financing is further subject to Excelsior receiving subscriptions for not less than $12,000,000 of Units. In furtherance of such, the parties intend to enter into a definitive agreement (the "Agreement") that shall contain customary representations and warranties by each of Excelsior and the Subscribers in favour of the other, and such other customary terms, covenants and conditions as would be customary for a transaction of this nature on the terms contained in the letter agreement.

Additionally, Excelsior intends to complete a non-brokered equity financing of up to 27,777,778 Common Shares at a price of $0.18 per Common Share for aggregate gross proceeds of up to $5,000,000 (the "Common Share Financing").

Proceeds from the Unit Financing and the Common Share Financing are intended to be used for further delineation of the Corporation's property in the Hangingstone area of Alberta and for general corporate purposes.

In connection with the Unit Financing, Excelsior has agreed, subject to regulatory approval and closing of the Unit Financing, to appoint three (3) nominees of the Subscribers to the Board of Directors of Excelsior. At closing of the Unit Financing, three current members of Excelsior's Board of Directors will resign from the Board of Directors. Additionally, Excelsior has agreed to use its reasonable best efforts to enter into option cancellation agreements with certain option holders to cancel all currently outstanding options at exercise prices above $0.20 per share.

Raymond James Ltd. has agreed to act as exclusive financial advisor to the Subscribers in connection with the Unit Financing and the Common Share Financing.

Note Regarding Forward Looking Statements

This document contains forward-looking statements. More particularly, this document contains statements concerning: the completion of the transactions contemplated by the Agreement, including both completion of the Unit Financing, the entering into of option cancellation agreement and the future directors of Excelsior; as well as statements regarding the completion of the Common Share Financing; and the use of proceeds from the Unit Financing and the Common Share Financing.

The forward-looking statements are based on certain key expectations and assumptions made by Excelsior, including expectations and assumptions concerning: timing of receipt of regulatory approvals and third party consents and the satisfaction of other conditions to the completion of the transactions.

Although Excelsior believes that the expectations and assumptions on which the forward-looking statements made by such party are based are reasonable, undue reliance should not be placed on the forward-looking statements because no assurance can be provided 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 unforeseen approvals may be required, that regulatory and third party approvals and consents are not obtained on terms satisfactory to the parties within the timelines provided for in the Agreement, or at all, and risks that other conditions to the completion of the transactions are not satisfied on the timelines set forth in the Agreement or at all; the risks associated with the oil and gas industry in general such as operational risks in development, exploration and production; delays or changes in plans with respect to exploration or development projects or capital expenditures; ability to access sufficient capital from internal and external sources and changes in legislation, including but not limited to tax laws, royalties and environmental regulations.

The forward-looking statements contained in this press release are made as of the date hereof and Excelsior 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 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.

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