Altima Resources Ltd.

Altima Resources Ltd.

November 01, 2011 18:31 ET

Altima Negotiates Financing to Complete Drilling of Oil Development Well

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Nov. 1, 2011) -


Altima Resources Ltd. (TSX VENTURE:ARH)(FRANKFURT:AKC) announces that the Company has negotiated with certain investors to raise funds by way of a private placement (Private Placement) by creating, issuing and selling $1,050,000 (Principal Amount) of notes payable of the Company (the Notes). The subscribers will also receive common shares of the Company (the Bonus Shares) equal to 20% of the Principal Amount divided by $0.05 (i.e., 4,200,000 Bonus Shares). The funds will be used for the Company's portion of costs for completion of the BLZ etal Rainbow 14-11-111-5W6 (the Well) in Alberta (see news release dated August 23, 2011).

The Notes will bear interest at 12% per annum and mature December 31, 2012. The outstanding Principal Amount of the Notes and any accrued but unpaid interest will be payable quarterly, with the first payment due on January 3, 2012, from (but only to the extent of) 60% of the Company's portion of net operating income from the Well, until the outstanding Principal Amount of the Notes and any accrued interest have been repaid. Any outstanding Principal Amount and accrued interest will be due and payable on December 31, 2012, the maturity date of the Notes. The Notes will be secured by a first charge on the Company's interests in the Well, which will be registered in favour of subscribers under the Private Placement, and will be subject to prepayment, in whole or in part, upon payment of the outstanding Principal Amount of the Notes and any accrued but unpaid interest.

Simco Services Inc. (Simco), a private company controlled by Joe DeVries, a director of the Company, has agreed to provide funds to the Company to secure the Principal Amount (the Guarantee/Loan) by October 31, 2011, while the Company works to complete the Private Placement. Any shortfall in subscriptions for the Principal Amount will be subscribed for by Simco from such funds, with any excess funds returned to Simco on completion of the Private Placement. As consideration for this Guarantee/Loan, Simco shall be granted a 5% working interest in the Well by the Company. Mr. DeVries will increase his holdings of securities of the Company to the extent any shortfall in subscriptions for the Principal Amount will be subscribed for by Simco from the Guarantee/Loan funds.

The transactions were approved by the independent directors of the Company. The transactions are subject to the acceptance of the TSX Venture Exchange.


Richard Barnett, CFO and Secretary

The securities referred to in this news release have not been, 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 news release does not constitute an offer for sale of securities for sale, nor a solicitation for offers to buy any securities. Any public offering of securities in the United States must be made by means of a prospectus containing detailed information about the company and management, as well as financial statements.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION: This news release includes certain forward-looking statements or forward-looking information within the meaning of the U.S. Private Securities Litigation Reform Act of 1995 and applicable Canadian provincial securities legislation (together, "forward-looking statements"). Forward-looking statements include, but are not limited to, statements with respect to the terms and conditions of, the completion of and the use of proceeds of the proposed transactions. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking statements. Such factors include, but are not limited to: general business, economic, competitive, political and social uncertainties; and delay or failure to receive board, shareholder or regulatory approvals. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. Altima disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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