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Adriana Resources Inc. ("Adriana" or the
"Company") - (TSX-V: ADI) is pleased to announce that the Company has
entered into a binding framework agreement (the "Framework
Agreement") with WISCO International Resources Development & Investment
Limited "WISCO". The parties have agreed to cooperate on the
development, construction and operation of the Lac Otelnuk Project. Pursuant
to the Framework Agreement, the Company will receive $120 million from WISCO
who in turn will receive a 60% participating interest in a Joint Venture
Company which will hold Adriana's current interests in the Company's Lac
Otelnuk and December Lake iron ore properties in Northern Quebec and that
number of common shares of the Company representing 19.9% of the issued and
outstanding shares issued under a private placement.
Under the terms of the Framework Agreement WISCO will use commercially
reasonable efforts to assist the Joint Venture Company to obtain project
financing for not less than 70% of the capital cost of the project to be
determined by a definitive feasibility study. The Framework Agreement
provides that the parties have 60 days to settle and enter into a definitive
joint venture agreement with respect to the Joint Venture. The private
placement will be at a price based off of a 20 day VWAP preceding the date of
the Framework Agreement and will close within 45 days of such date. Subject
to regulatory approval, Adriana will issue approximately 28,680,000 common
shares in connection with the private placement. . Upon closing of the
private placement, WISCO will be entitled to nominate a director to the board
of Adriana. Finders fees in the amount of $1.7 million will be paid on the
closing of the private placement, $9.5 million will be paid on the closing of
the definitive agreement and a 4% participating interest in the joint venture
will be granted to an arm's length third party in connection with the closing
of the definitive joint venture agreement.
The transactions contemplated in the Framework Agreement are subject to
approval by the Government of China, regulatory approvals, due diligence and
the settlement and execution of a definitive joint venture agreement.
There can be no assurance that the parties will be able to settle the terms
of a definitive joint venture agreement within 60 days.
Allen J. Palmiere, President & C.E.O. of the Company stated, " Adriana's primary focus for the last 18 months has
been to engage a strategic partner for the Lac Otelnuk Project. Our
partnership with WISCO, one of the largest integrated steel groups in China,
is an incredible milestone for the Company. WISCO's technical and financial
strength will result in accelerating the development of the Lac Otelnuk
project. We believe that Lac Otelnuk has the potential to be one of the
largest iron ore mines in the world and will create employment opportunities
in Quebec and value for all stakeholders".
For more information, contact:
Allen J. Palmiere, President & C.E.O (416) 363-2200 ext. 222 (apalmiere@adrianaresources.com) or Connie Dos Santos, Director,
Investor Relations (416)-363-2200 ext. 223 ( cdossantos@adrianaresources.com) or visit
the Company's website at www.adrianaresources.com
ON BEHALF OF ADRIANA RESOURCES INC.
Allen J. Palmiere
President and CEO
Certain
information regarding the Company, including the Company's plans to increase
and upgrade mineral resources and management's assessment of future plans and
operations, may constitute forward-looking statements under applicable
securities laws and necessarily involve known and unknown risks and
uncertainties. Without limitation, statements relating to potential
mineralization and resources, exploration results, mining and development,
future plans and objectives of the Company and imprecision of mineral
resources estimates, are forward-looking statements that involve various
degrees of risk. Certain important risk factors could cause the Company's
actual results to differ materially from those expressed or implied by such
forward-looking statements including, without limitation, changes in the
world-wide price of mineral commodities and currency fluctuations, general
market conditions, the uncertainty of future profitability and access to
sufficient capital, risks inherent in mineral exploration, development,
construction and mining operations, delays in obtaining or failures to obtain
required governmental, environmental or other project approvals,
environmental risks, access to labour and services and competition from other
companies. As a consequence, actual results may differ materially from those
anticipated in the forward-looking statements and caution should be exercised
on placing undue reliance on forward looking information.
Neither TSX Venture Exchange nor its Regulation Services Provider (as
that term is defined in the policies of the TSX Venture Exchange) accepts
responsibility for the adequacy or accuracy of this press release.
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