December 07, 2007 16:33 ET

Arapahoe Announces New Terms for Private Placement Financing

CALGARY, ALBERTA--(Marketwire - Dec. 7, 2007) - ARAPAHOE ENERGY CORPORATION (TSX VENTURE:AAO) ("Arapahoe") announces new terms to the previously announced non-brokered private placement financing.

Arapahoe proposes to complete a non-brokered private placement of up to 112,000,000 common shares of Arapahoe ("Common Shares") issued on a "flow-through" basis under the Income Tax Act (Canada) ("Flow-Through Shares") at the price of $0.125 per Flow-Through-Share for gross proceeds of up to $14,000,000 (the "Flow-Through Private Placement"). Finder's fees may be payable on certain portions of the Flow-Through Private Placement. The proceeds of the Flow-Through Private Placement will be used by Arapahoe to incur Qualifying Expenditures, which will be renounced in favour of purchasers for the 2007 taxation year. It is anticipated that the proceeds will primarily be used for seismic programs and other exploratory activities on Arapahoe's properties including Sarcee and Campbell, and on certain properties on which Arapahoe has presently or may acquire farm-in rights.

Arapahoe also proposes to concurrently complete a non-brokered private placement of up to 64,000,000 units of the Corporation ("Units") at the price of $0.125 per Unit for gross proceeds of $8,000,0000 (the "Unit Private Placement"). Each Unit will consist of one Common Share and one Common Share purchase warrant ("Warrant"). Each Warrant will entitle the holder thereof to purchase one Common Share during the period expiring on the first anniversary of the completion of the Private Placement upon payment of the exercise price of $0.20 per Common Share. Finder's fees may be payable on certain portions of the Unit Private Placement. The proceeds of the Unit Private Placement will be used by Arapahoe to develop its oil and natural gas projects, to conduct acquisitions and for general working capital purposes.

The Flow-Through Private Placement and Unit Private Placement are subject to a number of conditions, including but not limited to, TSX Venture Exchange acceptance and, pursuant to TSX Venture Exchange requirements, majority of the minority shareholder approval.

Arapahoe is also pleased to announce it reached an agreement for the satisfaction of outstanding indebtedness owed to Avonlea Home Investments ("Avonlea") in the amount of $189,475.00 (the "Indebtedness"). Arapahoe issued 1,500,000 Common Shares to Avonlea as full payment of the Indebtedness (the "Debt Settlement").

Following the completion of the Debt Settlement, the Corporation has 56,805,432 Common Shares issued and outstanding. The Corporation has received TSX Venture Exchange approval for the Debt Settlement.


Robert J. Chenery, President & CEO

Forward-Looking Statements

This release may contain forward-looking statements. These statements are based on management's current expectations and beliefs and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. Forwardlooking statements are not guarantees of future performance. Any forward-looking statements are made as of the date hereof and Arapahoe does not undertake any obligation, except as required under applicable law, to publicly update or revise such statements to reflect new information, subsequent or otherwise.

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.

Contact Information

  • Arapahoe Energy Corporation
    Robert J. Chenery
    President & CEO
    (403) 920-0040
    (403) 920-0043 (FAX)