Noront Resources

Hi All,

By now many of you will have woken up to see that both FWR and Noront were busy issuing news releases into the evening and night yesterday. Noront started by delivering some excellent news concerning BlackBird 1 and Blackbird 2 resource esimates. Such a shame this will likely be cast aside from an attention point of view due to the escalating battle that is going on for FWR.

Noront released a second NR an hour later asking FWR to stand up and justify its selection of December 10, 2009 as the date of record for the January 15 special meeting at FWR whereby they vote on the deal (or arrangement) being offered by Cliffs. For some of the newbies sake, the date of record is the date for which all shareholders on that date are recorded as owning a common share and thus having a vote at the future meeting. If a shareholder was to sell their shares the day following the date of record, the original shareholder would still retain the right to vote those shares at the future meeting, even though they no longer hold the shares.

This is pretty standard stuff with corporations (that of record dates) as one must pick a date in advance of any special meeting in order to tally up who the shareholders are so that voting materials can be sent out to them. It would be impossible to communicate with and know exactly who the current shareholders were on the day of the actual meeting.

But Noront in its news release has expressed concern (for lack of a better word) of the selection of December 10 as the date of record, as Noront's tender offer is set to expire on December 11. Knowing that most shares were likely tendered at the last minute with transfers yet to be recorded until Friday, the selection of December 10 as the date of record has allowed FWR to block Noront's ability to vote those shares tendered between December 9 and 11. The voting rights of those shares do not go away - they just do not transfer to Noront unless the tender of those shares are recorded on or before the date of record (December 10). The party who tendered their shares will still have the ability to vote those shares, but as everybody knows their is strength in numbers and though Noront accumulated shares through a tender, they lose this strength as the voting rights continue to be held in 1000s of individual hands.

Noront also mentioned case law whereby a court ruled against the ability of a bid participant from using recently acquired private placement shares to assist them in a vote for a transfer of control over a company.

At this point Noront issued two very serious public challenges requiring clarification to FWR that I believe would have resulted in a few court challenges and a lawsuit or two. I believe that the FWR BOD, who seem to be scrambling at every turn, realized that they could be held personally liable for any potentially illegal or unethical actions done in the midst of a bidding situation.

Noront essentially moved its knight in place and declared "check" believing it has the King in a corner.

But late into the evening last night, FWR issued an NR that essentially saved the FWR BOD from a series of lawsuits. They announced that they had a new offer from Cliffs valued at $1 a share with a condition. The condition is this: "Specifically, should Noront become the registered owner of more than 12.5% of Freewest's currently issued and outstanding shares, Cliffs commits to make a cash offer by way of a takeover bid with no minimum tender condition for all of the issued and outstanding common shares of Freewest for consideration of CAD$1.00 per share. Under a takeover bid, if adopted, Cliffs would pay cash for any and all Freewest shares tendered. If Noront does not reach this tender level, Cliffs would proceed with the previously announced plan of arrangement, but at the new CAD$1.00 per-share price."

Let me say at this point that it would be extremely unlikely that Noront does not have 12.5% of FreeWest's currently issued and outstanding shares tendered to them, and as that percentage is very low (when looked at through the lens of a bidding war), this condition when met will have let FWR off of the hook in terms of the possible illegalities of the special meeting on January 15. With the condition met, there will be no special meeting. In its place, there will be a straight cash takeover bid by Cliffs for any FWR shares at $1 cash per share.

If Noront does not have the 12.5% of shares, then the FWR shareholder would be able to receive $1 towards a CLF share for every FWR share held.

Either way, FWR has avoided checkmate. The controversy concerning the date of record will be a moot point as the special meeting will not be held should Cliff convert this to a cash takeover bid (which has already been blessed by the FWR BOD). The ability of Cliffs to vote at the special meeting is also a moot point as there will be no meeting if Noront possesses at least 12.5% of the shares tendered to them at this time.

In chess terms this is one of those stalemate situations where one can place an opponent into a check but then there is always a repeatable way for the opponent to move the king back and forth into a non-check mate defensive position. With the ability to move between two safe exits back and forth, a check mate is never possible.

It now makes sense as to why the published articles concerning a major partnering with Cliffs makes sense. They are likely fronting the cash for the upcoming takeover bid. As Noront cannot afford to buy out FWR shareholders with cash, and as our share price does not entice anyone but the large institutions for tendering shares given the current $1 cash offer, I would be surprised if Noront was able to win this battle unless they have a majority given the current share tender that has taken place. It is only in their ability to punt the FWR board through a proxy battle that Noront will be successful in taking over FWR. Without this voting majority Noront cannot check mate the opponent and win.

But enough about FWR. What I want to quickly bring us back to is Noront. With or without FWR, we are still in a very enviable position of having excellent properties backed by real resource valuations, the largest land holdings in the Ring of Fire, constant drilling at multiple locations in the ROF, and funds in the treasury to fund the strategic plan through 2011.

FWR has some good properties but at this point I do not believe it is worth upping the bid and I do hope that Wes was telling the truth when he said that this is the final offer. While consolidating was a good strategy and it was worth taking a shot at, we still have the best properties and a much more diverse metal base from which to develop. There is a reason my wife's wedding ring was made from platinum and not from chrome. Both have their purposes but if I wed my wife with the same material that was used on the front of my car, I would have one unhappy Mrs. Misfit living with me.

FWR hit some good finds with their Big Daddy chrome discovery with their JV partners. Though it is not discussed that much on this board, both SPQ and KWG have an option to earn up to 30% each in Big Daddy as JV partners. Does Cliff know they are getting 40%?

$1 is a lot of money in the net present time to pay for a 40% share of a one metal land area with undefined resources. While synergy and consolidation have value, I do not want to see this at the price of NOT shareholders. It is bad enough to see how big the heads of FWR shareholders have become over the past month or so after the share price went from .20 cents to $1 now. You would swear they were the only ones with valuable assets in the area. To give away too much of the non-chromite treasure chest to increase the chances of NOT's pursuit of chrome at FWR at this point would be a mistake in my personal opinion. As I said before, Noront's time has not yet come, but when it does, what we have in terms of resources combined with a smaller float will make this FWR offer seem like chump change in the long run.

If Noront does not have voting control over FWR after this Friday, then I believe it is time to move on. Sell whatever is tendered to Cliff's at $1 cash and consider the proceeds as a private placement at an average of $3.50 a share from those who wanted to remain in the ROF. Then immediately return the difference in value to new Noront shareholders who tendered their FWR shares as a way to walk away from this ordeal with integrity while having a whole new set of sharehodlers excited for a future with NOT. Cliffs has gone on record saying they will buy all shares for $1. Maybe it is time to make them pay in cash while allowing the institutions a chance to transfer their holdings in FWR into Noront without penalty.

A failure in achieving this bid should not be seen as a failure for Noront should it happen, but a noble attempt to bring original area players together under one roof. I congratulate Wes for taking the higher road during the recent battle, especially in light of the ugliness it has brough out in many others within the public forum.

In the meantime, let's get back to the business of continuing to drill and prove up everything on Noront and Noront JV land. I am a NOT shareholder and still plan to make my money with NOT once again.

M1.