Potash One Exercises Its Right to Subscribe to Private Placement in a Potash Development Company
16 Junho 2008 - 4:51PM
Marketwired
VANCOUVER, BRITISH COLUMBIA (TSX VENTURE: KCL) is pleased to
announce that it has exercised its right (as previously announced
on May 13, 2008) to fully subscribe to the initial private
placement financing of Potash North Resource Corp. ("PON"). The
Company has subscribed for 27 percent of the private placement,
which equates to 6,583,850 units at $0.35 per unit, for total
consideration of $2,304,347. Each unit consists of one common share
and one common share purchase warrant, each warrant exercisable to
acquire a further common share at a price of $0.50 per share for
two years. As a result of this transaction Potash One holds
approximately 13% of PON's outstanding shares. In addition, Potash
One holds warrants which, if exercised, could result in Potash One
holding 13,167,000 shares of PON, increasing its ownership interest
to up to 23% of the outstanding shares of PON, assuming no other
dilutive securities of PON are exercised.
Paul F. Matysek, President and Chief Executive Officer of Potash
One Inc., said: "This decision provides the Company with a number
of attractive options, such as, 1) a non-dilutive source of funding
for the Company, through partial or full monetization of PON
shares; and 2) a continued exposure to the conventional mining
Potash sector while allowing Potash One to focus on developing its
large 336,343 acres of solution mining amenable potash lands with
particular emphasis on the Legacy Project."
The completion of this private placement coincided with the
completion of the acquisition of Permits KP 416 and 417 pursuant to
which PON paid the balance of the purchase price for the permits,
in the amount of $2,587,880. In connection with that transaction,
Potash One entered into an Assignment, Assumption, Release and
Consent Agreement with PON and Peninsula Merchant Syndications Inc.
(the "Assignment Agreement"). Pursuant to the Assignment Agreement,
PON has confirmed Potash One's (i) right to purchase up to 20% of
any equity securities issued by PON in financing transactions until
the earlier of such time as Potash One holds less than 5% of the
outstanding shares of PON and such time as PON has completed 3
further equity financings, and (ii) nominate a director to the
board of PON until the later of one year following closing of the
acquisition of the permits and such time as Potash One holds less
than 5% of the outstanding shares of PON. Potash One's nominee to
the board, Paul Matysek, was appointed concurrently with the
closing of the acquisition.
Potash One has acquired securities of PON for investment
purposes, and may acquire additional shares of PON pursuant to the
exercise of its rights under the Assignment Agreement.
ON BEHALF OF THE BOARD OF DIRECTORS,
Paul F. Matysek, M.Sc., P.Geo.
About Potash One Inc.
Potash One Inc. is a Canadian resource company engaged in the
identification, acquisition, exploration and development of
advanced solution mine amenable potash properties. The Company
holds an option to acquire 100% interest in a 97,240 acre Potash
Subsurface Exploration Permit ("the Legacy Project") and owns 100%
of three other Potash Subsurface Exploration Permits covering
239,103 acres that are contiguous to the Legacy Project in
Saskatchewan, Canada. The Legacy Project was previously explored by
Imperial Oil Ltd. (now Exxon) and Lumsden Potash Corporation and is
adjacent to one of the largest producing solution potash mines in
the world. The Company has a solid balance sheet and experienced
technical and corporate management to advance its current project
to the next level.
Forward Looking Statement
This release includes certain statements that may be deemed to
be "forward-looking statements" within the meaning of the U.S.
Private Securities Litigation Reform Act of 1995. All statements in
this release, other than statements of historical facts, that
address future production, reserve potential, exploration and
development activities and events or developments, including the
issuance of permits upon acceptance of permit applications, that
the Company expects, are forward-looking statements. Although
management believes the expectations expressed in such
forward-looking statements are based on reasonable assumptions such
statements are not guarantees of future performance, and actual
results or developments may differ materially from those in the
forward-looking statements. Factors that could cause actual results
to differ materially from those in forward-looking statements
include market prices, exploration and development successes,
continued availability of capital and financing, the denial of
permit applications by applicable government authorities, and
general economic, market or business conditions. Please see our
public filings at www.sedar.com for further information.
The TSX Venture Exchange has not reviewed and does not accept
responsibility for the adequacy or accuracy of this release.
Contacts: Potash One Inc. Paul F. Matysek, M.Sc., P.Geo.
President and Chief Executive Officer (604) 331-4431 (604) 608-4979
(FAX) Email: info@potash1.com Website: www.potash1.com
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