Arrow Energy Closes $0.5 Million Private Placement
Arrow Energy announced that on December 31, 2007, it completed a non-brokered private placement of common shares that consisted of 1,250,000 common shares issued on a flow-through basis (the "Common Shares") for income tax purposes at $0.40 per share (the "Placement"). The gross proceeds of $500,000 are intended to be used to finance exploration and development activities and for general corporate purposes.
Arrow is required to incur qualifying expenditures totaling $500,000 by December 31, 2008 and has renounced this amount of Canadian Exploration Expenses ("CEE") to subscribers effective December 31, 2007. The securities issued will be subject to a four-month hold period from the date of closing. Following completion of this placement, Arrow has 28,483,727 common shares outstanding.
In conjunction with the Placement, Arrow paid a finder's fee in the amount of $20,000 to Northern Securities Inc. Pursuant to Policy 5.9 of the Exchange and Ontario Securities Commission Rule 61-501 ("Rule 61-501"), the Placement may be classified as a related-party transaction as a member of the Company's board of directors (the "Related Party") subscribed for Common Shares. Arrow has determined, however, that certain exemptions from the formal valuation and minority shareholder approval requirements under Rule 61-501 are applicable.