Longbow Resources Inc.
TSX VENTURE : LBR

Longbow Resources Inc.

December 04, 2007 17:39 ET

Longbow Resources Announces Second Closing of $6 Million Financing and Granting of Options

CALGARY, ALBERTA--(Marketwire - Dec. 4, 2007) - Longbow Resources Inc. (TSX VENTURE:LBR) ("Longbow" or the "Company") is pleased to announce the closing yesterday of the second part of its previously announced (news release dated October 15, 2007) non-brokered two-part private placement of securities (the "Offering") pursuant to the conditional approval of the TSX Venture Exchange (the "Exchange"). In the second closing, the Company issued 7,894,737 common shares at $0.38 per share, a $1.3 million convertible debenture ("Debenture") and 1,559,211 common share purchase warrants ("Warrants") to Kisco LBR LLC. The Debenture will mature on December 3, 2009, will pay no interest, will vote on an "as if converted" basis and will be convertible to common shares of the Company at $0.40 per common share. The Debenture will be secured by a floating charge against the assets of Longbow and contains standard and certain performance related events of default. In addition, in certain circumstances, the Company will have the right to require that a certain percentage of the Debenture be converted to common shares at the conversion price. Each Warrant will entitle the holder thereof to purchase one additional common share of Longbow at a price of $0.40 until December 3, 2009. Assuming full conversion of the Debenture and full exercise of the Warrants (as well as conversion and exercise of all securities previously issued to Kisco), Kisco would own approximately 65% of Longbow's issued and outstanding shares.

The second part of the Offering was subject, among other things, to disinterested shareholder approval at a special meeting (the "Meeting") of shareholders of the Company held on December 3, 2007. At the Meeting, Longbow's shareholders approved the Offering with almost 99% of the shares cast at the Meeting voting in favour of the Offering.

All securities issued pursuant to the second closing of the Offering, including any securities issued on exercise of the Warrants or conversion of the Debenture will be subject to a four (4) month hold period which expires on April 4, 2008.

The proceeds from these private placements will be used to finance continuing exploration and development activities at Longbow's Alberta properties in Lone Pine, Elmworth, Thorsby and Taber/Turin. For further details see (www.longbowresources.com).

Longbow is a junior oil and natural gas company based in Calgary, Alberta with properties located in Alberta, British Columbia and Saskatchewan. Currently, the Company has 33,065,539 common shares issued and outstanding.

On November 28, 2007, the board of directors of the Company approved the granting of an aggregate of 340,000 common share purchase options to five eligible individuals under Longbow's rolling stock option plan, previously approved by shareholders at the annual meeting of shareholders held on September 28, 2007 (the "Plan"). The options granted vest over a period of two years from the date of grant and are exercisable at $0.38 per share. The Company now has an aggregate of 2,285,000 options outstanding under the Plan.

The Company also wishes to announce that its previously announced normal course issuer bid (news release dated November 13, 2007) has received all necessary Exchange approvals and the bid will be in effect from November 19, 2007 until November 18, 2008.

Certain statements contained herein may constitute forward-looking statements. These statements relate to future events or our future performance. All statements other than statements of historical fact may be forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", "plan", "continue", "estimate", "expect", "may", "will", "project", "predict", "potential", "targeting", "intend", "could", "might", "should", "believe" and similar expressions. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. We believe that the expectations reflected in the forward-looking statements are reasonable based upon management's current views but no assurance can be given that these expectations will prove to be correct and such forward-looking statements should not be unduly relied upon. No assurance can be given that actual results, performance or achievement expressed in, or implied by these forward-looking statements will occur, or if they do, that any benefits may be derived from them. Past results have been applied in drawing a conclusion or making a forecast or projection set out in the forward-looking information. The term barrels of oil equivalent ("boe") may be misleading, particularly if used in isolation. A boe conversion ratio of six thousand cubic fee per barrel (6mcf/bbl) of natural gas to barrels of oil equivalence is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. All boe conversions herein are derived from converting gas to oil in the ratio mix of six thousand cubic feet of gas to one barrel of oil.

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this press release.

Contact Information