TORONTO, ONTARIO--(Marketwire - June 24, 2011) -
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NXA INC. (TSX VENTURE:NXI) ("NXA" or the "Company") announced today that, at the annual and special meeting of shareholders held on June 20, 2011 (the "Meeting"), the shareholders of the Company approved a special resolution authorizing the Board of Directors to consolidate the common shares of the Company (the "Common Shares") on a basis of up to one (1) new Common Share for fifteen (15) old Common Shares (the "Consolidation"), with the Board of Directors authorized to determine the final consolidation basis within such range. As disclosed in its information circular sent to shareholders dated May 18, 2011, management believes that the current number of outstanding Common Shares is inconsistent with the size, assets and structure of the Company, and proposed the Consolidation in order to increase its flexibility with respect to potential business transactions, including any possible future equity financings. Furthermore, the Board of Directors believes that shareholder approval of a maximum potential Consolidation ratio (rather than a single consolidation ratio) provides the Board of Directors with maximum flexibility to achieve the desired results of the Consolidation, and to ensure that the Company remains in compliance with applicable shareholder distribution requirements of the TSX Venture Exchange.
NXA currently has 70,151,003 Common Shares issued and outstanding. Following the completion of the proposed Consolidation, the number of Common Shares of the NXA issued and outstanding will depend on the ratio selected by the Board of Directors. The following table sets out the appropriate number of Common Shares that would be outstanding as a result of the Consolidation at the ratios suggested below.
Consolidation Ratio
| Proposed Consolidation Ratio(1) | Approximate Number of Outstanding Common Shares (Post Consolidation)(2) | Approximate Number of Outstanding Common Shares (Post Consolidation, After Conversion of Convertible Debentures)(3) |
| 1 for 15 | 4,676,733 | 15,536,733 |
| 1 for 14 | 5,010,785 | 15,870,785 |
| 1 for 13 | 5,396,231 | 16,256,231 |
| 1 for 12 | 5,845,916 | 16,705,916 |
| 1 for 11 | 6,377,363 | 17,237,363 |
| 1 for 10 | 7,015,100 | 17,875,100 |
| 1 for 9 | 7,794,555 | 7,794,555(4) |
| 1 for 8 | 8,768,875 | 8,768,875(4) |
| 1 for 7 | 10,021,571 | 10,021,571(4) |
| 1 for 6 | 11,691,833 | 11,691,833(4) |
| 1 for 5 | 14,030,200 | 14,030,200(4) |
| 1 for 4 | 17,537,750 | 17,537,750(4) |
| 1 for 3 | 23,383,667 | 23,383,667(4) |
| 1 for 2 | 35,075,501 | 35,075,501(4) |
| Notes: | ||
| (1) | The ratios above are for information purposes only and are not indicative of the actual ratio that may be adopted by the Board of Directors to effect the Consolidation. | |
| (2) | Based on the number of outstanding Common Shares as at the date hereof. | |
| (3) | In December, 2010 and February, 2011, the Corporation issued convertible debentures (the "Convertible Debentures") in the aggregate principal amount of $1,086,000.The Convertible Debentures are convertible into 10,860,000 Common Shares. Upon the Consolidation of the Common Shares (provided that the Consolidation is for a minimum of 10 old Common Shares for each new Common Share), the Convertible Debentures will automatically convert the principal amount (before any accrued interest) into Common Shares at a conversion price of $0.10 per old Common Share. | |
| (4) | The Convertible Debentures will not automatically convert in the event of a consolidation of less than 10 old Common Shares for each new Common Share. | |
The Board of Directors intends to meet in the near-term future to discuss the timing and the basis of a Consolidation. Any Consolidation will be subject to the approval of the TSX Venture Exchange.
Immediately following the Meeting, the Board of Directors received the resignation of Greg Borsk as a Director and as Chief Financial Officer of the Company. Paul Van Damme was subsequently appointed as Chief Financial Officer in Mr. Borsk's place.
NXA INC.
NXA is a mineral exploration company. NXA is listed on Tier 2 of the TSX Venture Exchange.
Cautionary Statement Regarding Forward-Looking Statements:
This press release contains forward-looking statements regarding a proposed offering, including the proposed use of proceeds of the offering. Actual developments may differ materially from those contemplated by these statements depending upon, among other things, the ability of the Company to raise the funds and decisions made by regulators. The forward looking statements contained in this press release represent the Company's views and expectations as of the date of this release and should not be relied upon as representing its views and expectations at any subsequent date.
Neither 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.
Contact Information:
Paul Van Damme
Chief Financial Officer
(647) 629-0136