Mersington Capital Inc.

December 01, 2006 17:59 ET

Mersington Capital Announces Conversion of Long Term Debt in Qualifying Transaction

MONTREAL, QUEBEC--(CCNMatthews - Dec. 1, 2006) - Mersington Capital Inc. ("Mersington") (TSX VENTURE:MSG.P) announces that, further to its news release dated November 16, 2006, regarding a proposed Qualifying Transaction with Prime Meridian Resources Ltd., it wishes to clarify how it plans to deal with the shareholders' loans in Prime Meridian Resources Ltd. ("PM") disclosed in that news release. An amount of US$1,809,307 was indicated in the November 16 news release as outstanding as at June 30, 2006. Mersington and PM had agreed that all of the indebtedness of PM as at the closing date of Mersington's Qualifying Transaction with PM, except for US$400,000, would be converted to equity as part of the 30,000,000 Mersington common shares to be issued as consideration for all of the shares of PM. This would have left US$400,000 of debt in the resulting issuer. Mersington has now agreed to also convert this US$400,000 debt of PM on closing of the Qualifying Transaction at the transaction price of one common share for each C$0.50 of the remaining US$400,000 in shareholders' loans. Subject to final Exchange approval of this conversion, the resulting issuer will not have any outstanding long term debt on the closing of the Qualifying Transaction.

Completion of Mersington's Qualifying Transaction is subject to a number of conditions, including but not limited to, TSX Venture Exchange (the "Exchange") acceptance and, if applicable, pursuant to Exchange requirements, majority of the minority shareholder approval. Where applicable, the transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the transaction will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the filing statement to be prepared in connection with the transaction, any information released or received with respect to the transaction may not be accurate or complete and should not be relied upon. Trading in the securities of a capital pool company should be considered highly speculative.

The Exchange has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved the contents of this news release.

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.

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