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WHD West Hawk Development Corp.

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Share Name Share Symbol Market Type
West Hawk Development Corp. TSXV:WHD TSX Venture Common Stock
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  0.00 0.00% 0 -

West Hawk Announces $2.5 Million Brokered Private Placement; Shares for Debt Settlement With Officers and Employees

25/08/2009 7:28pm

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West Hawk Development Corp. (TSXV:WHD)
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West Hawk Development Corp. (TSX VENTURE: WHD) ("West Hawk" or the "Company") is pleased to announce that it has entered into an agreement with Union Securities Ltd. (the "Agent") to act as the Company's exclusive agent on a commercially reasonable efforts basis in connection with a private placement (the "Offering") of up to 166,666,667 units (the "Units") for aggregate gross proceeds of up to $2,500,000. The Company is also proposing to settle an aggregate of $332,589.50 in outstanding salaries payable to its officers and employees through the issuance of an aggregate of 6,651,790 shares at a deemed price of $0.05 per share. Both transactions are subject to the approval of the TSX Venture Exchange.

Terms of the Proposed Offering

Each Unit sold in the Offering will be issued at $0.015 per Unit, and consist of one common share of the Company (a "Share") and one-half of one common share purchase warrant (each whole warrant, a "Warrant"). Each Warrant is exercisable into one common share (a "Warrant Share") of the Company for 24 months from closing at an exercise price of $0.07 per Warrant Share during the first 12 months and $0.10 per Warrant Share thereafter for the balance of the term.

The Company will grant to the Agent an over-allotment option (the "Over-Allotment Option") to purchase up to an additional 10% of the number of Units issued pursuant to the Offering at a price equal to the issue price per Unit. If exercised, the Over-Allotment Option must be executed within 15 business days of the final closing date and completed within 30 business days of the final closing date of the Offering. Assuming full exercise of the Over-Allotment Option, the Company would issue an aggregate of 183,333,334 Units and raise aggregate gross proceeds of $2,750,000.

The Agent will receive a cash commission equal to 10% of the aggregate gross proceeds of the Offering, including proceeds raised pursuant to the Over-Allotment Option. The Agent will also receive compensation options equal to 10% of the aggregate number of Units sold under the Offering, including pursuant to the Over-Allotment Option. Each compensation option will entitle the holder to acquire, for a period of 24 months, one unit (an "Agent's Unit") at a price of $0.05 per Agent's Unit. Each Agent's Unit will consist of one common share and one-half of one common share purchase warrant (each whole warrant, an "Agent's Warrant"), with each Agent's Warrant exercisable into one common share of the Company for 24 months from closing at a price of $0.10 per share.

The Offering is scheduled to close within approximately 30 days and is subject to the Company receiving all necessary TSX Venture Exchange approvals. Proceeds from the Offering will be used to fund planned exploration and assessment work on the Company's Groundhog Coal Project in northwestern British Columbia and for general working capital purposes. The Company's current focus for its Groundhog property is to test the core samples obtained during the Company's October 2008 drill program and, if warranted based on the results of the core samples, commission a current technical report, build a geological model, determine the right business structure to develop the Groundhog property, and prepare a business plan.

"For the Company this is an important step forward in the development of the Groundhog Coal Project. It is a pleasure to have Union Securities supporting this equity raising," said Gonzalo Torres Macchiavello, West Hawk Development President & CEO.

On behalf of the Board of Directors,

Gonzalo Torres Macchiavello, President and Chief Executive Officer

About the Company: West Hawk Development Corp. is focused on providing valuable, high-demand energy products from a variety of sources. Assets include the Figure Four natural gas property located in the Piceance Basin, Colorado, being developed under a drilling and development agreement and the Groundhog coal property located in northwest British Columbia.

Cautionary Note: This news release contains forward looking statements, particularly those regarding completion of the proposed offering and future development of the Company's Groundhog coal project in northwest British Columbia. The Company has filed a National Instrument 51-101 Report on its Figure Four property. Resource estimates in this report, unless specially noted, are considered speculative. Any and all other resource or reserve estimates are historical in nature, and should not be relied upon. By their nature, forward looking statements involve risk and uncertainties because they relate to events and depend on factors that will or may occur in the future and in many circumstances are beyond the control of the Company. These risks and uncertainties include, without limitation, receipt of required regulatory approvals for the proposed offering and debt settlement, satisfaction of all other conditions precedent to completion of the offering, including completion of satisfactory due diligence by the Agent, and the ability of the Company to raise sufficient funds pursuant to the offering to complete its proposed program on the Groundhog Project. Actual results may vary depending upon, among other factors, the favorable outcome of the foregoing risks and uncertainties, favorable results from proposed exploration and assessment activities, industry production, commodity demand and pricing, currency exchange rates and general economic factors.

Cautionary note to U.S. investors: The U.S. Securities and Exchange Commission specifically prohibits the use of certain terms, such as "reserves" unless such figures are based upon actual production or formation tests and can be shown to be economically and legally producible under existing economic and operating conditions.

The TSX Venture Exchange has not yet reviewed and does not take responsibility for the adequacy or accuracy of the content of this news release.

Contacts: West Hawk Development Corp. Gonzalo Torres Macchiavello President and Chief Executive Officer 1-800-830-0988 www.westhawkdevelopment.com

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