Northern Continental Resources Inc.
TSX VENTURE : NCR

Northern Continental Resources Inc.

December 04, 2007 16:26 ET

Northern Continental President Tells Shareholders Why He Is Not Accepting Hathor's Hostile Bid

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Dec. 4, 2007) - Alan Crawford, the president of Northern Continental Resources Inc. (TSX VENTURE:NCR) has written a letter to the company's shareholders telling them why he, his family and friends are not accepting the hostile takeover bid proposed by Hathor Exploration Ltd. (TSX VENTURE:HAT).

The following letter has been mailed to all the shareholders of Northern Continental:

Alan Crawford, MBA

President & CEO

December 1, 2007

Dear fellow shareholder,

You and I, along with all shareholders of Northern Continental have received a hostile take-over bid from Hathor Exploration. It is a long legal document that offers us 0.4 of one share of Hathor's stock (TSX VENTURE:HAT) for one share of our NCR stock.

The Board of Directors of Northern Continental is required by law to send to you a Directors' Circular with its advice and recommendations. The Board has carefully considered the Hathor bid, received a fairness opinion from a Certified Financial Analyst, and is unanimously recommending that you reject Hathor's hostile bid.

I would also like to share with you my personal opinion of the bid. My family, friends and I own a significant amount of Northern Continental shares. Let me tell you why we are not accepting Hathor's hostile bid to take over control of Northern Continental.

The management and board of Northern Continental have believed in the uranium sector since we first acquired the Russell Lake Property in 1999. I was a shareholder and independent director of Northern Continental at that time. Northern Continental was one of the first exploration companies in the Athabasca Uranium Basin, and had an almost unlimited choice of much of the exploration property which was later acquired by other uranium mining companies like Hathor. We picked the Russell Lake Property.

On page 34 of Hathor's take-over circular, it makes a most revealing statement - "Hathor anticipates that the primary purpose of the combined company will be to continue to advance the exploration and development of the Russell Lake Property." I certainly agree with that purpose, since our Russell Lake Property is adjacent to the richest uranium deposits in the world, and has historically shown some of the most encouraging drill results of any exploration property in the Basin. Hathor, of course, knows this too, as it has been responsible for the exploration and drilling on the property since 2003 under our Joint Venture Agreement.

This endorsement by Hathor of the Russell Lake Property is very important to me because it validates our position since 1999 - "that the Russell Lake Property is the premier uranium exploration property in the Basin."

More importantly, Northern Continental shareholders own 60%. This 60% controlling ownership position is crucial because only Northern Continental can deliver the Russell Lake Property to a major mining company, if we are successful in discovering a new uranium deposit. But, if Northern Continental shareholders accept Hathor's takeover bid, it will result in reducing your ownership of the Russell Lake Property from 60% to 17%.

Since Northern Continental acquired the Russell Lake Property in 1999 it has been unable to do much drilling on the property due to the low price of uranium that, for a long time, was below $10.00 per pound. Drilling was then delayed even further, while we waited for Hathor to complete its earn-in requirement. Only after that was done did Hathor begin managing the first-year drilling program in 2007. However, Hathor completed only six holes of a proposed fourteen-hole drill program in the summer and missed the winter drilling completely.

Northern Continental assumed management of the Russell Lake exploration and drilling program at the end of October 2007. In the last thirty days we have accomplished the following: (1) arranged a 21- hole drill program to begin this winter; (2) secured two drilling rigs under contract which will be mobilized on the property within weeks; (3) signed a contract with the reputable and experienced geological engineering firm, Aurora Geosciences, to supervise the drilling and follow-up results; and (4) announced a non-brokered financing of $3,500,000, to completely cover our exploration and working capital budget.

To me this clearly demonstrates Northern Continental's commitment to the Russell Lake Property and our capability to avoid the ineffective progress made when Hathor managed the drilling program. I firmly believe Northern Continental shareholders should not be prevented from enjoying the full future benefits from the upcoming comprehensive drilling program on the Russell Lake Property.

I personally urge you not to accept the excessive dilution of your rights and interest that will result if you accept Hathor's bid. I consider the Hathor offer to be totally inadequate, as does our independent financial advisor. I think it is an insult to all Northern Continental shareholders. Neither my family nor I, nor my friends, will tender our Northern Continental shares to Hathor. Please read the attached Directors' Circular. It explains clearly and completely why I strongly urge you, and sincerely recommend, that you do the same.

If you agree with me, you don't have to do anything. Just throw away Hathor's offer.

Very truly yours,

Alan Crawford, President and CEO

Northern Continental Resources Inc.

Shareholders are urged to read the Directors' Circular posted on the company's website at www.northerncontinental.ca. It is also available on SEDAR's website at www.sedar.com.

NORTHERN CONTINENTAL RESOURCES INC.

Alan Crawford, President

The TSX Venture Exchange has not reviewed, and does not accept responsibility for the adequacy or accuracy of the contents of this news release.

Contact Information

  • Northern Continental Resources Inc.
    Douglas Hickey
    VP Corporate Communications
    (604) 685-9255 or Toll Free: 1-800-449-4435
    Website: www.northerncontinental.ca