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Inspiration Mining Corporation ("Inspiration" or the
"Corporation") (TSX:ISM - News; FRANKFURT:OI8 - News) responded today to the
January 26 press release issued by Ursa Major
Minerals Incorporated ("Ursa") announcing
a proposed private placement of $2,580,000. Based on publicly available
information, Ursa has 66,007,534 issued shares and
the proposed private placement if completed would result in the issue of
13,500,000 shares and 3,945,000 warrants and broker warrants.
Inspiration
owns 13,000,000 shares or 19.7% of Ursa's current
issued and outstanding shares and requisitioned a meeting of shareholders of Ursa on November 1, 2010 to elect a new slate of
directors. Pursuant to Inspiration's requisition, Ursa
has called a meeting of shareholders for March 3 with a record date for
voting of February 1.
Ursa
has been very secretive about the Inspiration requisition by not issuing any
press release stating that Inspiration requisitioned the meeting or that it
is for the purpose of removing the current directors of Ursa.
Indeed the first time Ursa mentions the need for a
shareholders meeting is nearly three months after receiving the requisition
and at the bottom of its January 26 press release announcing the proposed
private placement by stating:
"In
response to a request for a shareholder meeting, URSA Major has
scheduled a
special meeting of shareholders for March 3, 2010".
What
URSA has failed to state is that the request is in fact a requisition by
Inspiration, its largest shareholder, to remove the Ursa
directors and elect a new slate of Ursa directors.
There is no public disclosure anywhere by Ursa that
its largest shareholder is seeking to remove the current Ursa
directors.
It
is plainly obvious that the proposed private placement is designed by
management and the directors of Ursa to entrench
themselves by securing friendly votes from the private placement investors in
the upcoming shareholders meeting. Inspiration believes that closing an Ursa private placement on or before the February 1 record
date would be a breach of the fiduciary obligation of management and the
directors and would represent oppressive conduct towards all Ursa shareholders including Inspiration.
In
particular, the proposed issuance of 13,500,000 shares and 3,945,000 warrants
and broker warrants has been designed to nullify the share voting power of
Inspiration which owns 13,000,000 Ursa shares. If
the private placement is completed, there would be a material effect on
control of Ursa because the new investors would own
17% of the issued Ursa shares and the 19.7%
ownership position of Inspiration would drop to 16.4% or lower.
The
proposed issuance of 13,500,000 shares and 3,000,000 warrants represents in
the aggregate 25% of the currently issued shares, which is the maximum number
of shares that may be issued without shareholder approval under the rules of
the Toronto Stock Exchange.
Randy
Miller, the Chief Executive Officer of Inspiration, stated: "The
proposed private placement is unquestionably tied to maintaining control of Ursa by placing the maximum shares possible in the hands
of friendly investors right before the record date
for the Ursa shareholders meeting called to remove
the Ursa directors."
Inspiration
intends to take all appropriate action against Ursa,
its management and directors for their oppressive conduct in connection with
the proposed private placement.
Forward
Looking Statements
This
news release contains "forward-looking statements" within the
meaning of the United States Private Securities Litigation Reform Act of 1995
and applicable Canadian securities legislation. Generally, these
forward-looking statements can be identified by the use of forward-looking
terminology such as "plans", "anticipated", "expects"
or "does not expect", "is expected", "budget",
"scheduled", "estimates", "forecasts",
"intends", "anticipates" or "does not
anticipate", or "believes", or variations of such words and phrases
or state that certain actions, events or results "may",
"could", "would", "might" or "will be
taken", "occur" or "be achieved". Inspiration is
subject to significant risks and uncertainties which may cause the actual
results, performance or achievements to be materially different from any
future results, performance or achievements expressed or implied by the
forward looking statements contained in this release. Inspiration cannot
assure investors that actual results will be consistent with these forward
looking statements and Inspiration assumes no obligation to update or revise
the forward looking statements contained in this release to reflect actual
events or new circumstances.
The
TSX has not reviewed and does not accept responsibility for the adequacy or
accuracy of this release.
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