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American Eagle Energy completes USD4m private equity placement

American Eagle Energy has sold four million shares of its restricted common stock to Power Energy Holdings.

The purchase price was USD1.00 per share and the transaction closed on 4 January 2013.

The per-share sale price represents an approximate 22 per cent premium to the 31 December 2012 closing price of American Eagle's common stock.

In two other separate agreements, American Eagle granted options to Power Energy Partners, an affiliate of Power Energy Holdings, to purchase 10 per cent of either or both of the two Spyglass Property acquisitions, one of which was announced on 3 January and the other of which was announced on 7 January. Each option expires on 29 March and each contains the same pricing and proportionate ownership terms and conditions of the acquisitions to which the company is subject. If Power Energy Partners exercises each option, American Eagle will retain 90 per cent of the assets that it acquired on 28 December (and announced on 3 January), and 45 per cent of the total assets acquired on 4 January (and announced on 7 January), with the remainder being owned by the company's Spyglass Property area non-operating joint venture partner, who acquired that 45 per cent interest in the 4 January transaction.

"I am delighted that Power Energy has invested directly into American Eagle, especially at a price that represents a premium to the market. Their actions both strengthen our balance sheet and underscore management's belief that our stock has been undervalued for a significant period of time," says Brad Colby, American Eagle's president. "We are also pleased that Power Energy's acceptance of the 10 per cent acquisition options reinforces our valuation of the two recently announced acquisitions in a group of derisked properties."

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