SOURCE: Cardinal Energy Group, Inc.

April 22, 2014 05:45 ET

Cardinal Energy Group, Inc. Raises $3.5 Million in Private Placement Financing; Increases Placement to $5 Million

Financing Oversubscribed by $1.5 Million

DUBLIN, OH--(Marketwired - Apr 22, 2014) - Cardinal Energy Group, Inc. ("Cardinal Energy" or "the Company") (OTCQB: CEGX) announced that the Company sold $3.5 million of 12% senior secured convertible notes maturing December 31, 2015 to accredited investors. Due to the placement being oversubscribed, the Company will be placing an additional $1.5 million with accredited investors, bringing the total amount to $5 million. The additional notes will be issued at the same terms. Proceeds will be used to re-work and recomplete its 78 wells located in Texas, fund strategic acquisitions, and for working capital.

The Senior Secured Convertible Notes bear interest at a rate of 12.0% per year, payable on July 31st and January 31st until they mature on December 31, 2015 (the "Maturity Date") or are converted. In addition, holders of the Senior Secured Convertible Notes will be paid on or prior to the 10th day of each month following the close of a calendar quarter a "Net Revenue Interest" payment equal to 2% of the net proceeds from the operation of the projects as determined by the Company. Each individual holder will receive their proportional share of such payments in the same ratio as their share of principal bears to the initial maximum amount of the Offering. Cardinal Energy will make the Net Proceeds payments in cash. The Conversion Price of the Senior Secured Convertible Notes is $1.00 per share at which price each $1.00 of principal and unpaid interest can be converted into one share of our common stock. The outstanding principal and associated unpaid interest on the Senior Secured Convertible Notes may be converted, in whole or in part, into our common stock at any time. The Conversion Price is subject to adjustment for stock splits, dividends and combinations.

Timothy Crawford, CEO of Cardinal Energy, stated, "We are encouraged with the strong investor interest we received for our convertible preferred offering. With rising production and a number of new wells expected to come online throughout 2014, we expect to generate attractive returns with this additional capital."

Syndicated Capital acted as the sole placement agent for the private placement of the Notes.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy securities. The securities offered and sold in the private placement have not been registered under the Securities Act of 1933, as amended (the "Securities Act"), or any state securities laws, and may not be offered or sold in the United States absent registration, or an applicable exemption from registration under the Securities Act and applicable state securities laws.

Forward Looking Statements
In connection with the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, Cardinal Energy Group, Inc., is hereby providing cautionary statements identifying important factors that could cause our actual results to differ materially from those projected in forward-looking statements (as defined in such act). Any statements that are not historical facts and that express, or involve discussions as to, expectations, beliefs, plans, objectives, assumptions or future events or performance (often, but not always, indicated through the use of words or phrases such as "will likely result," "are expected to," "will continue," "is anticipated," "estimated," "intends," "plans," "believes" and "projects") may be forward-looking and may involve estimates and uncertainties which could cause actual results to differ materially from those expressed in the forward-looking statements. These statements include, but are not limited to, our expectations concerning our ability to obtain financing and close on the acquisition of the oil and gas leases and property, our beliefs concerning our ability to increase the rate of oil and gas production, and the expected demand, pricing and operating results for our oil and gas operations.

About Cardinal Energy Group, Inc.
Cardinal Energy Group, Inc. is a U.S. producer of oil and natural gas within the United States. The Company is based in Dublin, Ohio. Cardinal focuses on known formations that have significant proven reserves remaining that can be produced economically. Cardinal targets fields with wells that may need remediation due to neglect or undercapitalization. We select prospects that offer a strong up-side for production. The upside we seek in a prospect is twofold -- it must have the potential to be restarted or have its current production increased using newer technology and remediation methods and; it must also have additional lease acreage which can be further developed by completing development wells adjacent to existing producing wells. Cardinal exploits these undervalued assets by acquiring a majority working interest in the prospect and then applies the Company's calculated development plan. Cardinal also seeks acquisitions of over-leveraged companies when there is a clear upside from their purchase based on strong commodity prices. The Company operates throughout the Continental United States. More information on Cardinal Energy Group, Inc. is available at www.cegx.us.

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