Hali Capital Corporation

May 31, 2006 11:55 ET

Hali Capital Corporation Announces Revised Terms of Qualifying Transaction

CALGARY, ALBERTA--(CCNMatthews - May 31, 2006) -

(Not for dissemination in the United States of America)

Hali Capital Corporation ("Hali" or the "Corporation") (TSX VENTURE:HS.P) today announced amendements to its proposed qualifying transaction with Athabasca Minerals Inc. ("Athabasca") pursuant to an amending letter agreement entered into on May 30, 2006 (the "Hali Letter Agreement").

Summary of the Amendments to the Proposed Qualifying Transaction

As previously announced in the Corporation's press release dated May 9, 2006, Hali entered into an arm's length letter agreement dated April 11, 2006 with Athabasca and the principal shareholders of Athabasca, pursuant to which the Corporation and Athabasca have agreed to complete a business combination (the "Business Combination") to form a new company called Athabasca Minerals Inc. ("NewCo"). The Business Combination is expected to constitute a Qualifying Transaction of the Corporation as defined in the policies of TSX Venture Exchange Inc. ("TSX Venture").

Pursuant to the Hali Letter Agreement, the Business Combination will be completed after Athabasca has completed a private placement (the "Athabasca Private Placement") in one or more closings as previously announced, but the amount of the offering has been increased from up to 4,000,000 units ("Athabsaca Units") at a price of $0.40 per Athabasca Unit to up to 4,375,000 Athabasca Units at a price of $0.40 per Athabasca Unit, for new gross proceeds of up to $1,750,000. Each Athabasca Unit will consist of one Athabasca Common Share to be issued on a "flow-through" basis (an "Athabasca FT Share") and one common share purchase warrant (a "Athabasca Warrant"), with each Athabasca Warrant entitling the holder to acquire one additional Athabasca Common Share at a price of $0.60 for a period of 24 months from the date of issuance, but which warrants shall be required to be exercised in the event that the Athabasca Common Shares or NewCo Common Shares (defined below) trade on a recognized stock exchange at a closing trading price of $0.80 per share or more for any twenty business day period following which they will expire.

Athabasca may engage registered dealers to act as agent (the "Agents") of Athabasca on a "best efforts" basis for the Athabasca Private Placement and in connection therewith may pay a cash commission of up to 10% of the gross proceeds of the Athabasca Private Placement. The Agents may also be granted agent's options (the "Athabasca Agent's Options") to purchase up to 10% of the number Athabasca Units sold under the Athabasca Private Placement, with each Athabasca Agent's Option entitling the holder to purchase one Athabasca Unit at a price of $0.40 per unit for a period of 12 months from the initial closing date of the Athabasca Private Placement.

As amended by the terms of the Hali Letter Agreement, after completion of the maximum Athabasca Private Placement, Athabasca will have 13,375,000 Athabasca Common Shares, 437,500 Athabasca Agent's Options and 4,375,000 Athabasca Warrants outstanding.

As indicated above, completion of the Business Combination is subject to a number of conditions, including but not limited to, TSX Venture acceptance and shareholder approval. The Business Combination cannot close until the required shareholder approval is obtained. There can be no assurance that the Business Combination will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the Information Circular of the Corporation to be prepared in connection with the Business Combination, any information released or received with respect to the Business Combination may not be accurate or complete and should not be relied upon. Trading in the securities of the Corporation should be considered highly speculative.

The TSX Venture Exchange Inc. has in no way passed upon the merits of the Business Combination and has neither approved nor disapproved the contents of this press release.

Except for historical information contained herein, this news release contains forward-looking statements that involve risks and uncertainties. Actual results may differ materially. Neither Athabasca nor Hali will update these forward-looking statements to reflect events or circumstances after the date hereof. More detailed information about potential factors that could affect financial results is included in the documents filed from time to time with the Canadian securities regulatory authorities by Hali and Athabasca.

The TSX Venture Exchange Inc. has in no way passed upon the merits of the Business Combination and has neither approved nor disapproved the contents of this press release.

Contact Information

  • Hali Capital Corporation
    Theodore J.A. Rousseau
    (780) 489-8334
    Athabasca Minerals Inc.
    Udomdej (Dom) Kriangkum
    (780) 465-5696