Terrace Energy Corp.
TSX VENTURE : TZR.P

June 22, 2011 18:14 ET

Terrace Announces Closing of Private Placement and Name Change

VANCOUVER, BRITISH COLUMBIA--(Marketwire - June 22, 2011) -Terrace Energy Corp. (formerly Terrace Resources Inc.) (TSX VENTURE:TZR.P) -

Terrace Energy Corp. ("Terrace" or the "Company") is pleased to announce that the previously announced private placement of 10 million units at $0.09 per unit and proposed name change have been completed.

Following issuance of the final bulletin by the TSX Venture Exchange, the Company's shares will re-commence trading under the symbol "TZR".

The shares, warrants and any shares issued upon exercise of the warrants are subject to a hold period and may not be traded until October 23, 2011 except as permitted by applicable securities legislation and the rules and policies of the TSX Venture Exchange ("Exchange"). In addition to hold periods under applicable securities legislation and the policies of the Exchange, the Terrace securities issued to principals of Terrace (as that term is defined in the policies of the Exchange) under the private placement and any shares issued upon exercise of the warrants held by them are subject to a Tier 2 Value Escrow Security Agreement, pursuant to which 10% of the securities are eligible for release upon completion of the Qualifying Transaction and 15% every six months thereafter. Non-principals who purchased securities in the private placement have agreed to resale restrictions on those securities similar to the release provisions of the escrowed securities.

The proceeds of the private placement will be used together with the Company's existing working capital to fund the development of the Los Patos Gas Unit and for general working capital purposes.

The Company is advised that following completion of the private placement:

William McCartney indirectly beneficially owns 3,310,570 common shares of Terrace ("shares"), representing 8.1% of the issued and outstanding shares of Terrace. Assuming exercise of the share purchase warrants forming part of the units acquired in the private placement and stock options held and no issuance of any other shares of Terrace, Mr. McCartney would hold 5,810,570 shares, which would represent 13.4% of the issued and outstanding shares following the private placement. Mr. McCartney beneficially owned 1,310,570 shares of Terrace and options exercisable to acquire a further 500,000 shares prior to his purchase of 2 million units in the private placement. Mr. McCartney has indirect beneficial ownership of and investment and voting control and direction over all of the foregoing voting securities and has advised he is not acting jointly or in concert with any other person.

Eric Boehnke, indirectly beneficially owns 3,298,814 shares of Terrace, representing 8.1% of the issued and outstanding shares of Terrace. Assuming exercise of the share purchase warrants forming part of the units acquired in the private placement and stock options held and no issuance of any other shares of Terrace, Mr. Boehnke would hold 6,298,814 shares, which would represent 14.4% of the issued and outstanding shares following the private placement. Mr. Boehnke beneficially owned 798,814 shares of Terrace and options exercisable to acquire a further 500,000 shares prior to his purchase of 2.5 million units in the private placement. Mr. Boehnke has direct beneficial ownership of and investment and voting control and direction over all of the foregoing voting securities and has advised that he is not acting jointly or in concert with any other person.

Mr. McCartney and Mr. Boehnke have each advised Terrace that he does not presently intend to make further investments in Terrace (other than a possible exercise of the convertible securities now held), but may decide to increase his ownership of the shares of Terrace in the future.

Early warning reports for the foregoing persons will be filed with the British Columbia, Alberta and Ontario Securities Commissions and may be obtained from the SEDAR website (www.sedar.com) or by contacting Murray Oliver of Terrace at (604) 687 0088.

APPROVED BY THE BOARD OF DIRECTORS

"Bill McCartney"

Bill McCartney, Director

Neither the TSX Venture Exchange nor its Regulation Services Provider accepts responsibility for the adequacy or accuracy of this release.

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