Roadrunner Oil & Gas Inc.

December 23, 2009 15:36 ET

Roadrunner Announces Completion of Amalgamation With Bowood Energy Corp.

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Dec. 23, 2009) - Roadrunner Oil & Gas Inc. ("Roadrunner") (TSX VENTURE:ROA) is pleased to announce that it has completed its previously announced arm's length acquisition of Bowood Energy Corp. ("Bowood"), a private, junior energy company active in the exploration, development and production of oil and gas reserves in western Canada.

Pursuant to the terms of the amalgamation agreement dated November 18, 2009 (the "Amalgamation Agreement"), 1501976 Alberta Ltd., a wholly-owned subsidiary of Roadrunner, amalgamated with Bowood (the "Amalgamation") and continued as a new corporation under the name Bowood Energy Ltd. ("Amalco"). Rather than receiving shares of Amalco, the shareholders of Bowood instead received 5.667 common shares of Roadrunner (each, a "Roadrunner Share") for each issued and outstanding Class A common share of Bowood (each, a "Bowood Share") owned. The exchange ratio was based on a deemed value of $0.15 per Roadrunner Share and a deemed value of $0.85 per Bowood Share. Amlaco is now a wholly-owned subsidiary of Roadrunner and, together, the companies will continue to operate in oil and gas exploration, development and production.

In conjunction with the Amalgamation, all of the directors and officers (except for Michelle Gahagan) resigned and the following individuals were appointed to the board of directors of Roadrunner: Michael J. Kryczka, Robert Mercier, Jim Welykochy, Chris Bloomer and Richard Bonnycastle. In addition, a new management team was appointed for Roadrunner consisting of the following: (i) Robert Mercier, President and Chief Executive Officer; (ii) Michael J. Kryczka, Vice-President, Business Development and Chief Financial Officer; (iii) David Cassidy, Vice President, Exploration; and (iv) Franco Civitarese, Vice-President, Finance. Further details regarding the backgrounds and experience of the new directors and officers of Roadrunner can be found in Roadrunner's press release of November 16, 2009.

In accordance with the terms of a finder's fee agreement among Roadrunner, Bowood and Richardson GMP Limited ("Richardson"), in conjunction with the completion of the Amalgamation, Richardson received a finder's fee equal to $291,650.24, of which $218,737.68 was settled by way of a cash payment and $72,912.56 was settled by way of the issuance of 486,084 common shares of Roadrunner at a deemed price of $0.15 per share. All of such common shares are subject to a four month hold period.

Roadrunner is also pleased to announce that, concurrently with the completion of the Amalgamation, it completed its previously announced brokered private placement of common shares and flow-through shares of Roadrunner (the "Private Placement"). The Private Placement was over-subscribed and the Agent exercised its over-allotment option pursuant to the terms of an agency agreement dated effective November 20, 2009 among Roadrunner, Bowood and Richardson. In aggregate, 15,410,000 common shares were issued at a price of $0.15 per share and 13,985,117 flow-through shares were issued at a price of $0.17 per share, for aggregate gross proceeds of $4,688,969.89. Richardson was paid a cash commission equal to 7% of the gross proceeds raised under the Private Placement. All of the common shares and flow-through shares issued under the Private Placement are subject to a four month hold period. The proceeds from the Private Placement are expected to be used to carry on the business plan of Amalco.

In addition to the above, concurrently with the Amalgamation and the Private Placement, Roadrunner announces that it completed a non-brokered private placement of 780,000 common shares at a price of $0.15 per share for aggregate gross proceeds of $117,000. All of the common shares issued under the non-brokered private placement are subject to a four month hold period. The proceeds from the non-brokered private placement are also expected to be used to carry on the business plan of Amalco.

About Roadrunner Oil & Gas

Roadrunner Oil & Gas Inc. is a TSX-V Tier 2 corporation engaged in the acquisition, exploration, development and production of oil and gas resources.

Certain statements contained in this press release constitute forward-looking statements and forward looking information (the "forward-looking statements"). These statements relate to future events or our future performance. All statements other than statements of historical fact are forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "anticipate", "budget", "plan", "guidance", "continue", "estimate", "expect", "forecast", "may", "will", "project", "potential", "target", "intend", "could", "might", "should", "believe" and similar expressions. In particular, forward-looking statements in this press release include, but are not limited to, statements with respect to the proposed use of proceeds.

Although we believe that the expectations reflected in the forward-looking statements are reasonable, there can be no assurance that such expectations will prove to be correct. We cannot guarantee future results, level of activity, performance or achievements. Consequently, there is no representation that the actual results achieved will be the same, in whole or in part, as those set out in the forward-looking statements.

Some of the risks and other factors that could cause results to differ materially from those expressed in the forward- looking statements include, but are not limited to: general economic conditions in Canada, the United States and globally; industry conditions, including fluctuations in the prices of oil and natural gas; governmental regulation of the oil and gas industry, including environmental regulation; geological, technical, drilling and processing problems and other difficulties in producing reserves; unanticipated operating events or performance which can reduce production or cause production to be shut in or delayed; failure to install pipeline facilities as and when expected; failure to obtain industry partner and other third party consents and approvals, when required; competition for and/or inability to retain drilling rigs and other services; the availability of capital on acceptable terms; the need to obtain required approvals from regulatory authorities; stock market volatility; volatility in market prices for oil and natural gas; liabilities inherent in oil and natural gas operations; competition for, among other things, capital, acquisitions of reserves, undeveloped lands, skilled personnel and supplies; incorrect assessments of the value of acquisitions; changes in tax laws and incentive programs relating to the oil and gas industry; failure to realize the anticipated benefits of acquisitions and dispositions, including the Amalgamation; and the other factors described in our public filings available at Readers are cautioned that this list of risk factors should not be construed as exhaustive.

The forward-looking statements contained in this document are expressly qualified by this cautionary statement. We undertake no duty to update any of the forward-looking statement to conform such statement to actual results or to changes in our expectations except as otherwise required by applicable securities legislation.

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

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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