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AMERICAN EXPLORATION ANNOUNCES CLOSING OF $35,000,000 SUBORDINATED DEBT FINANCING

 AMERICAN EXPLORATION ANNOUNCES CLOSING OF $35,000,000
 SUBORDINATED DEBT FINANCING
 HOUSTON, Dec. 27 /PRNewswire/ -- American Exploration Company (AMEX: AX) today announced the closing of a $35,000,000 private placement of subordinated notes with warrants. Proceeds will be used to refinance short-term debt incurred by American in connection with its Conquest acquisition and to reduce other bank indebtedness.
 The notes, which mature in 2001, bear interest at 11 percent. The investors also acquired warrants to purchase 5,800,000 shares of American Exploration common stock at an exercise price of $4.50 per share. $25,000,000 of the placement was funded today with the remainder to be funded in early January 1992.
 The investors in the private placement included Textron Investment Management Company Inc., John Hancock Mutual Life Insurance Company and Massachusetts Mutual Life Insurance Company. American Exploration's financial advisor on the transaction was J.P. Morgan Securities Inc.
 Mark Andrews, American's chairman and CEO, said, "This financing strengthens our balance sheet by eliminating our short-term debt, greatly improving working capital and significantly reducing bank borrowings. It also better positions us to pursue our strategy of adding reserves through exploration and development drilling."
 American Exploration Company is an independent oil and gas company with production in the United States and Canada and exploratory activities in North America, Tunisia and the Sultanate of Oman.
 -0- 12/27/91
 /CONTACT: Frank Murphy, vice president of American Exploration Company, 212-230-0344/
 (AX) CO: American Exploration Co. ST: Texas IN: OIL SU: FNC


JT-OS -- NY013 -- 5480 12/27/91 12:49 EST
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Publication:PR Newswire
Date:Dec 27, 1991
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