Potash North Resource Corporation
TSX VENTURE : PON

Potash North Resource Corporation

June 10, 2008 12:04 ET

Potash North Resource Corporation Announces $25 Million Private Placement of Units at $2.50

VANCOUVER, BRITISH COLUMBIA--(Marketwire - June 10, 2008) -

NOT FOR DISSEMINATION IN THE UNITED STATES OR THROUGH U.S. NEWSWIRES

Potash North Resource Corporation (TSX VENTURE:PON) (the "Company") is pleased to announce that further to its press release dated June 9, 2008, it has entered into an agreement with a syndicate of agents led by Canaccord Capital Corp. and including GMP Securities L.P., National Bank Financial Inc., Wellington West Capital Markets Inc., Genuity Capital Markets and Salman Partners Inc. (collectively, the "Agents") whereby the Agents agree to act as the Company's agent on a "reasonable best efforts" basis to complete a private placement offering of 10,000,000 units (the "Units") at a price of $2.50 per Unit for gross proceeds of approximately $25,000,000. Each Unit is comprised of one common share and one common share purchase warrant, with each warrant entitling the holder to acquire one common share of the Company at $4.00 per share for a period of 24 months. The Company has granted the Agents an over-allotment option to solicit an additional 2,000,000 Units, for additional proceeds of up to $5,000,000, exercisable 48 hours prior to closing. In addition, Potash One Inc. (TSX VENTURE:KCL) has rights to subscribe for up to 20% of the Units sold under the offering, which would entitle them to acquire up to a further 3,000,000 Units for further proceeds of up to $7,500,000.

The offering is expected to close on or about July 7, 2008 and is subject to certain conditions, including regulatory approval.

Net proceeds from the offering will be used to fund the exploration, evaluation and potential development of the Company's KP416 and KP417 potash permits in Saskatchewan and for general corporate purposes.

The Agents will be paid a cash commission of 6% and warrants to purchase the number of Units equal to 6% of the number of Units sold in the offering. In addition, a financial advisory fee of up to $600,000 will be paid to Peninsula Merchant Syndications Corp., a company controlled by Sam Magid, for investment and consulting services related to the offering.

The securities being offered have not, 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 release does not constitute an offer for sale of securities in the United States.

ON BEHALF OF THE BOARD

Potash North Resource Corporation

David Baker, President

This news release does not constitute an offer to sell or solicitation of an offer to sell any securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.

Cautionary Statement Regarding Forward-Looking Information

All statements, trend analysis and other information contained in this press release relative to markets about anticipated future events or results constitute forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", "believe", "plan", "estimate", "expect" and "intend" and statements that an event or result "may", "will", "should", "could" or "might" occur or be achieved and other similar expressions. Forward-looking statements are subject to business and economic risks and uncertainties and other factors that could cause actual results of operations to differ materially from those contained in the forward-looking statements. Forward-looking statements are based on estimates and opinions of management at the date the statements are made. The Company does not undertake any obligation to update forward-looking statements even if circumstances or management's estimates or opinions should change. Investors should not place undue reliance on forward-looking statements.

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

Contact Information

  • Potash North Resource Corporation
    David Baker
    President
    (604) 685-3317
    Website: www.potashnorth.com