PRESS RELEASE
NOT FOR DISSEMINATION IN THE U.S. OR THROUGH
U.S. NEWS WIRE SERVICES
Symbol: "NAC" Toronto Stock Exchange
NORTH ATLANTIC ANNOUNCES INCREASE IN PROPOSED PRIVATE
PLACEMENT AND INCREASED INSIDER PARTICIPATION
Toronto, Canada, August 14, 2009
North Atlantic Resources Ltd. ("the
Company") announces that it has increased the size of its proposed private
placement described in the press release issued on August 13, 2009. The maximum
number of units issuable pursuant to the private placement has been increased
to 10,000,000 units, which would result in gross proceeds of $500,000. As
described in the August 13 press release, the Company may pay finder's fees to
registered dealers who introduce subscribers to the Company, comprised of a
cash payment of 8% of the proceeds received from introduced subscribers and a
number of warrants (having terms identical to the warrants included in the
units) equal to 8% of the number of units issued to introduced subscribers.
The Company has also agreed to amend the terms of the warrants included in the
units, such that the Company will not have the right to accelerate the expiry
date of the warrants.
The Company currently has 25,723,741 issued
and outstanding common shares. If the maximum offering is completed, 10,000,000
common shares would be issued, and 10,800,000 warrants would be issued pursuant
to the maximum offering (including the maximum number of warrants issuable in
connection with the finder's fees). If all warrants are exercised, an aggregate
of 20,800,000 shares would be issued in connection with the private placement,
representing 80.9% of the number of currently outstanding shares.
In addition, Anthony Lloyd, a director of the
Company who currently holds 628,607 common shares of the Company (representing
2.4% of the 25,723,741 currently outstanding shares) intends to subscribe for
300,000 units pursuant to the private placement (being 3% of the maximum
offering of 10,000,000 units). Following completion of the maximum offering Mr.
Lloyd will hold 928,607 shares, which will represent 2.6% of the 35,723,741
shares which will be outstanding following completion of the maximum offering
(before giving effect to the issuance of any warrants). If Mr. Lloyd exercises
all of his warrants he would hold 1,228,607 shares, representing 3.4% of the
36,023,741 shares which would then be outstanding (without giving effect to the
exercise of warrants held by other subscribers).
In total, it is expected that insiders of the
Company will subscribe for an aggregate of 1,350,000 units, such that the
maximum number of shares which may be acquired by insiders pursuant to the
placement (including shares issuable upon exercise of warrants) is 2,700,000,
being 10.5% of the currently outstanding shares. In
accordance with the rules of the Toronto Stock Exchange (TSX), shareholder
approval is generally required when the number of common shares issued or made
issuable pursuant to a private placement exceeds 25% of the number of currently
issued and outstanding shares of the Company, and also when the number of
common shares issued or made issuable to insiders during any six month period
exceeds 10% of the number of currently issued and outstanding shares of the
Company. The Company has applied to the TSX under the provisions of subsection
604(e) of the TSX Company Manual for an exemption from the shareholder approval
requirement on the basis that the Company is in financial difficulty and does
not have sufficient time to obtain shareholder approval. A special committee of
independent directors of the Company has reviewed the amended terms of the
proposed private placement, and determined that the terms are reasonable for
the Company in the circumstances. The Company is confident that, upon
completion of the proposed private placement, the financial position of the
Company will be substantially improved. Use of the exemption under subsection
604(e) of the TSX Company Manual is subject to TSX approval.
This
news release is intended for distribution in Canada only and is not intended
for distribution to United States newswire services or dissemination in the
United States. The securities being offered have not, nor will they be
registered under the United States Securities Act of 1933, as amended, and may
not be offered or sold within the United States or to, or for the account or
benefit of, U.S. persons absent U.S. registration or an applicable exemption
from the U.S. registration requirements. This release does not constitute an
offer for sale of securities in the United States.
Please visit the Company's
website www.nac-tsx.com to view project details and planned exploration
programs.
FOR FURTHER
INFORMATION PLEASE CONTACT:
ph.: 416-703-6348, fax 416-703-6507, email: info@nac-tsx.com website www.nac-tsx.com