Investor Group reports conversion of convertible debentures for common shares
of High Arctic Energy Services Inc.

TORONTO, May 26 /CNW/ - Cyrus Capital Partners, L.P. ("CCP"), Cyrus Opportunities Master Fund II, Ltd. ("COMF") and FBC Holdings S.à.r.l. ("FBC" and together with CCP and COMF, the "Filing Parties") announce the conversion by FBC of $23 million in aggregate principal amount of 12% unsecured convertible subordinated debentures of High Arctic Energy Services Inc. ("High Arctic") due December 31, 2012 (the "Debentures"), and $2,491,666.67 in interest accrued and payable thereon, for 101,966,666 common shares ("Common Shares") of High Arctic.

As previously reported, on November 13, 2007, CCP acquired control or direction, direct or indirect, over $23 million in aggregate principal amount of Debentures, beneficial ownership of which was acquired on that date by way of private placement by the Issuer to each of COMF, Crescent 1, LP ("C1"), CRS Fund, Ltd. ("CRSF") and Cyrus Europe Master Fund, Ltd. ("CEMF" and together with COMF, C1 and CRSF, the "Funds"). On April 23, 2010, the Funds transferred beneficial ownership of all $23 million in aggregate principal amount of the Debentures to FBC. CCP is the investment manager of each of the Funds and exercised sole investment discretion over all Debentures held by each of them. COMF is the sole shareholder of FBC. CCP is one of two managers on the board of managers of FBC, and as the investment manager of COMF, the sole shareholder of FBC, is solely responsible for exercising investment discretion with respect to FBC.

On April 30, 2010 (i) Issuer and FBC signed in escrow an amending agreement (the "Amending Agreement") pursuant to which the Issuer and FBC agreed to amend the terms of the Debentures (A) to change the "Conversion Price" of the Debentures from $1.62 to $0.25 per Common Share, subject to adjustment from time to time, and (B) to provide that a holder of Debentures has the right at any time from the date of the Amending Agreement to April 30, 2010, or such later date as approved by the Issuer in its sole discretion, at its option to convert the principal amount plus all interest owing under the Debentures, on the basis of 4,000 Common Shares for each $1,000 principal amount of the Debentures so converted, and (ii) FBC signed in escrow a notice (the "Conversion Notice") of the conversion by FBC of all $23 million in aggregate principal amount of Debentures, and $2,491,666.67 in interest accrued and payable thereon, for 101,966,666 Common Shares.

The Amending Agreement and Conversion Notice were released from escrow and became effective on May 21, 2010. Accordingly, as a result of the amendment to the conversion ratio of Debentures for Common Shares pursuant to the Amending Agreement, and following the conversion of Debentures for Common Shares by FBC on May 21, 2010 as described above, (i) CCP may be deemed to have control or direction, direct or indirect, over 101,966,666 Common Shares (or approximately 47.48% of the Common Shares outstanding on the date hereof) and (ii) FBC, and its sole shareholder COMF, may each be deemed to beneficially own 101,966,666 Common Shares (or approximately 47.48% of the Common Shares outstanding on the date hereof).

In this press release, for purposes of calculating percentages of Common Shares beneficially owned or over which control or direction is exercised, directly or indirectly, the Filing Parties have assumed that there are 214,753,722 Common Shares outstanding as at May 21, 2010 (after giving effect to certain restructuring transactions undertaken by the Issuer and the conversion described herein) as reported by the Issuer in its Management's Discussion & Analysis for the quarter ended March 31, 2010 filed on SEDAR on May 17, 2010 and available at www.sedar.com.

Other Information

CCP acquired control or direction over, and COMF and FBC acquired beneficial ownership of, directly or indirectly, the Common Shares that are the subject of this report for investment purposes.

In connection with the investment by the Filing Parties in the Common Shares, CCP may engage in communications with members of management and the board of directors of the Issuer, other current or prospective shareholders, industry analysts, existing or potential strategic partners or competitors, investment and financing professionals, sources of credit and other investors with respect to the Issuer. CCP intends to review the Filing Parties' investment in the Issuer on a continuing basis. Depending on various factors including, without limitation, the Issuer's financial position, the price levels of the Common Shares, conditions in the securities markets and general economic and industry conditions, CCP's, COMF's or FBC's business or financial condition and other factors and conditions CCP deems appropriate, the Filing Parties may in the future take such actions with respect to the investment by the Filing Parties in the Issuer as CCP deems appropriate including, without limitation, seeking board representation (the Filing Parties have the right to nominate up to three directors to the Issuer's board of directors), making proposals to the Issuer concerning changes to the capitalization, ownership structure or operations of the Issuer, acquiring Common Shares, selling or otherwise disposing of some or all of the Common Shares. In addition, CCP may formulate other purposes, plans or proposals regarding the Issuer or any of its securities to the extent deemed advisable in light of general investment and trading policies, market conditions or other factors or may change its intention with respect to any and all matters referred to above.

Neither the issuance of this news release in connection with the matters disclosed in this news release nor the filing by the Filing Parties of the report in accordance with applicable Canadian securities laws is an admission that an entity named or otherwise referred to in this news release owns or controls any described securities or is a joint actor with another entity named or otherwise referred to in this news release.

The address for each of the Filing Parties is set out below.

For further information: including to obtain a copy of the report filed by the Filing Parties in accordance with applicable Canadian securities laws, contact CCP at the address specified below. Cyrus Capital Partners, L.P., 399 Park Avenue, 39th Floor, New York, NY, 10022, United States of America, Attn: Jennifer Pulick, Tel: [phone]; Cyrus Opportunities Master Fund II, Ltd., c/o Cyrus Capital Partners, L.P., 399 Park Avenue, 39th Floor, New York, NY, 10022, United States of America, FBC Holdings S.à.r.l., 46A, Avenue J.F. Kennedy, L-1855 Luxembourg, Grand Duchy of Luxembourg