TORONTO, July 14 /CNW/ - Advanced Explorations Inc. (the "Company" or
"AEI") is pleased to announce that it has amended its Farm In Agreement with
Roche Bay Plc ("RB") that will allow AEI to earn up to a 70% interest (up from
50.1%) in the Roche Bay magnetite project in Nunavut. Pursuant to the
amendments, on or before September 1st, 2008 AEI may give notice to exercise
an option to acquire an additional 19.9% interest in the project for
$19,500,000, consisting of $3,500,000 in cash and the issuance of 6 million
AEI shares priced at $2.50 per share, all net of applicable Canadian
withholding tax which the Company anticipates, based on the information
provided by RB, should be $5,500,000.
John Gingerich, President and CEO of AEI, commented;
"The ability of AEI to acquire a substantial majority of the Roche Bay
project is a significant step forward for the AEI shareholders. The simpler
clear majority structure will impact our ongoing negotiations with members of
the mining and steel communities. The resource and economic studies are in the
pipeline and we expect to be in a position to announce the results of these
studies later this summer."
The notional price of $2.50 per share represents a 77% premium ($1.09)
over the current market price of the AEI shares. Roche Bay Plc has provided a
significant period of time for AEI to initiate the option and conclude the
transaction. The transaction is subject to the approval of the TSX Venture
Exchange and, if required, pursuant to applicable securities laws, to the
approval of the shareholders of AEI.
Benjamin Cox, President and CEO of Roche Bay plc, stated;
"We have been extremely pleased with the progress made by AEI and
providing a flexible option from which to earn in to a greater share of the
project demonstrates the confidence our company has that AEI will successfully
advance this project to a production decision. We at Roche Bay, due to our
economic view of the project, are willing to give up some of our ownership
stake in exchange for a financing model under the current terms that takes us
up to a 16 million tonnes per year project in the longer term"
In addition, the Company also announces that China Steel Resources
Investment ("CSRI") has failed to meet its previously announced financing
commitments. AEI has given notice to CSRI and Melville Capital Corporation
("MCC") that they are in breach, and all parties are working in best efforts
to cure the breach. MCC has stated it remains committed to the AEI agreement.
AEI has also received proposals from other interested parties to independently
address its project requirements. In the long term AEI and MCC remain
committed to the Aboriginal community development plans. AEI will release
further details when it makes a decision with respect to MCC and/or
alternatives sources. The beneficial restructuring and simplifying of the
joint venture gives AEI more flexibility to consider alternative proposals and
ON BEHALF OF THE BOARD
John Gingerich, President & CEO
ABOUT Advanced Explorations Inc.
AEI, based in Toronto, Canada, is exclusively focused on developing high
quality iron ore opportunities. In early 2007 the Company expanded its
capabilities in iron ore exploration and development with the acquisition of
strategic management personnel. AEI has the management, technical and
exploration expertise and experience to rapidly advance the Roche Bay
magnetite project, which was acquired in June 2007, as well as, to develop new
opportunities in the area and globally. The Roche Bay magnetite project is
located proximal to a natural harbour which makes it potentially one of the
world's premier iron ore opportunities. Shares of the company trade on the
TSX Venture Exchange under the symbol AXI. For more information please visit
THE TSX VENTURE EXCHANGE HAS NEITHER APPROVED OR DISAPPROVED OF THE
This news release also includes forward-looking statements that involve a
number of risks and uncertainties. The information reflects numerous
assumptions as to industry performance, general business and economic
conditions, regulatory and legal requirements, taxes and other matters, many
of which are beyond the control of the company. Similarly, this information
assumes certain future business decisions that are subject to change. There
can be no assurance that the results predicted here will be realized. Actual
results may vary from those represented, and those variations may be material.
This news release does not constitute an offer to sell or a solicitation
of an offer to sell any of 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.
For further information:
For further information: (416) 203-0057 x226