Canadian Oil

[Tackler]

Arctos closes $1.7-million debenture financing

2007-07-04 17:57 MT - News Release

Mr. William Ward reports

ARCTOS CLOSES $1.7 MILLION DEBENTURE FINANCING, ANNOUNCES CLOSING OF DEBT SETTLEMENT

Arctos Petroleum Corp. has closed a debenture financing raising gross funds of $1.7-million. It has also closed the settlement of the debts reported in Stockwatch news May 7 and June 11, 2007.

Arctos has completed a non-brokered private placement of non-convertible debentures in the principal amount of $1.7-million. The debentures will have a 12-month term and shall bear interest at 10 per cent per year, calculated and paid quarterly. Any principal or interest outstanding under the debentures shall be secured against the general assets of the company. Insiders of the company purchased convertible debentures in the principal sum of $150,000.

Net proceeds from the private placement have been used in part to pay the cash portion of the debt settlement reported in Stockwatch news May 7 and June 11, 2007, with the remaining amount being applied to general working capital.

Arctos will settle $4,575,948 in outstanding net debt through the payment of $1,220,235 in cash and the issuance of 31,846,265 common shares of the company. One creditor, with debt owed of $2,483,146, has been settled in full by the payment of $1,171,485 in cash and the issuance of 11,405,745 common shares of the company. Ten creditors, with net debt owed of $2,092,802, have been settled in full by the payment of $48,750 in cash and the issuance of 20,440,520 common shares of the company. The TSX Venture Exchange has conditionally approved all of the transactions described herein. The company is now positioned to move forward with an active business plan that will be focussed on acquiring oil and gas assets together with a selective drilling program.