Frontera Resources Completes US$7.6 m Placement

Source: www.gulfoilandgas.com 9/18/2009, Location: Asia

Frontera Resources Corporation, an independent oil and gas exploration and production company, announced that it has completed the placement of shares of common stock (a “Common Share”) and warrants referred to in its announcement on September 4, 2009, and increased the size of the financing to approximately US$7.6 million. The resulting net proceeds will be used to fund the company’s ongoing oil and gas development programs within its Shallow Fields Production Unit, Block 12, located in the country of Georgia, and for general corporate purposes.

The Company has issued 45,186,536 units (“Units”) each comprised of one Common Share and one Common Share purchase warrant (a “Warrant”) at an issue price of 10.3 pence per Unit, for gross proceeds of approximately US$7.6 million (£4.6 million). Each Warrant will entitle the holder to purchase from the Company one Common Share for a period of two years following the transaction closing date at an exercise price of 15 pence per Common Share.

Following this issue, the enlarged issued share capital of the Company will be 120,087,464 Common Shares (excluding 5,739,855 shares held as treasury stock). The new Common Shares will rank pari passu with the existing shares.

The transaction is classified as a related party transaction for the purposes of the AIM rules for companies. Accordingly, as required by the AIM rules for companies, the directors of Frontera (with the exception of Messrs. Nicandros, Bentsen, McGregor and Karnessis, who abstained), having consulted Frontera's nominated adviser, Canaccord Adams, consider that the terms of the transaction are fair and reasonable insofar as its shareholders are concerned.

The Company’s outstanding warrants issued in 2008 exercisable for approximately 3.15 million Common Shares in the aggregate will be adjusted in accordance with their terms following the placement. Those warrants will be adjusted to approximately 6.49 million Common Shares in the aggregate at a price of $1.70 per share.

The Common Shares comprised in the Units will be admitted to trading on the AIM Market of the London Stock Exchange and dealings will commence at 8.00 a.m. London time on September 18, 2009. No application will be made for admission of the Warrants to the AIM market.


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Related Categories: Accounting, Statistics  Acquisitions and Divestitures  Asset Portfolio Management  Economics/Financial Analysis  General  Industrial Development  Insurance  Investment  Mergers and Acquisitions  Risk Management 

Related Articles: Accounting, Statistics  Acquisitions and Divestitures  Asset Portfolio Management  Economics/Financial Analysis  General  Industrial Development  Insurance  Investment  Mergers and Acquisitions  Risk Management 


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