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MONTREAL,
QUEBEC, CANADA--(Marketwire
- Oct. 9, 2007) - Freewest Resources Canada Inc. (TSX VENTURE:FWR)
announces that it and Quest Uranium Corporation, a wholly-owned
subsidiary of Freewest, have filed a preliminary prospectus with the
securities commissions of each of the provinces of Canada.
The prospectus will qualify the distribution by Freewest of 6,000,000
common shares of Quest to the shareholders of Freewest, who will
receive one common share of Quest for approximately every 25 issued and
outstanding Freewest shares on the distribution record date.
The record date for the distribution of the Quest Uranium shares will
be set by the Board of Directors of Freewest in accordance with the
policies of the TSX Venture Exchange. Freewest will issue a press
release announcing the record date.
Quest Uranium Corporation was incorporated in June 2007 as a
wholly-owned subsidiary of Freewest, with the intention of taking over
the uranium assets and exploration activities currently carried on by
Freewest, so that Freewest can devote itself solely to exploration for
precious and base metals. Prior to the distribution record date, Quest
Uranium will acquire the George River property from Freewest, as well
as five uranium properties in Ontario
and one uranium property in New
Brunswick. The properties to be transferred
by Freewest to Quest Uranium comprise Freewest's portfolio of uranium
exploration properties and after the transfer, Freewest does not intend
to be directly involved in uranium exploration. Freewest will retain
rights to precious metals and base metals with respect to the George River property and the six other uranium
properties.
The prospectus will also qualify a rights offering by Quest Uranium to
its shareholders, under which each shareholder will receive one right
for each issued and outstanding common share. Each right will give the
holder the right to subscribe for one additional common share of Quest
Uranium at a price of $0.15 per share. If the rights offering is fully
subscribed, Quest Uranium will issue 6,000,000 common shares for gross
proceeds of $900,000.
In connection with the rights offering, three senior officers and/or
directors of Quest Uranium will enter into a standby purchase agreement
with the company, under which they will agree to purchase, at the
subscription price of $0.15, a number of common shares that is equal to
the difference between 3,500,000 common shares ($525,000) and the
number of common shares otherwise purchased under the rights offering.
As a result of the standby purchase agreement, Quest Uranium will raise
a minimum of $525,000 under the rights offering.
Quest Uranium also intends to effect a private placement of 4,750,000
"flow-through" shares and 250,000 common shares at a price of
$0.30 per share, for gross proceeds to Quest Uranium of $1.5 million.
The net proceeds from the private placement will be used to fund
exploration on the George River
property.
If the rights offering and private placement are fully subscribed,
there will be 21 million issued and outstanding common shares of Quest.
Of these, Freewest's shareholders will hold an aggregate of six million
shares (28.6%), Freewest will hold four million shares (19%),
subscribers in the rights offering will hold an aggregate of six
million shares (28.6%), and subscribers in the private placement will
hold an aggregate of five million shares (23.8%).
The rights offering by Quest Uranium, the distribution by Freewest of
6,000,000 Quest Uranium common shares to the shareholders of Freewest,
and the proposed private placement by Quest Uranium are subject to
regulatory approval, including that of the TSX Venture Exchange.
In response to inquiries from shareholders, Freewest also wishes to
announce that its Board of Directors is not currently considering any
changes to Freewest's outstanding share capital, whether by share
consolidation or otherwise.
About Freewest Resources Canada Inc.
Freewest Resources Canada Inc. is a Canadian-based mineral exploration
company focused on acquiring, exploring and developing quality gold,
base-metal and uranium properties. Exploration is focused on these
commodities in classical geological settings with established mineral
endowment within Eastern Canada.
This press release shall not constitute an offer to sell or the
solicitation of an offer to buy any securities in any jurisdiction. The
common shares being offered have not been and will not be registered
under the U.S. Securities Act of 1933 and state securities laws.
Accordingly, the common shares may not be offered or sold to U.S.
persons except pursuant to applicable exemptions from registration.
Forward-Looking Statements
This press release may contain information and statements of a
forward-looking nature concerning the future performance of Freewest
Resources Canada Inc. and Quest Uranium Corporation. These statements
are based on suppositions and uncertainties as well as on management's
best possible evaluation of future events. As a result, readers are
advised that actual results may differ from expected results.
The TSX Venture Exchange has not reviewed and does not accept
responsibility for the adequacy or accuracy of this press release.
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