Noront Announces Agreement for the Sale of Its Interest in the Windfall Lake Project
TORONTO, ONTARIO -- (Marketwired) -- 06/28/13 -- Noront Resources Ltd. ("Noront" or the "Company") (TSX VENTURE: NOT) today announces that it has entered into a binding letter agreement (the "Letter Agreement") with Eagle Hill Exploration Corp. ("Eagle Hill") to sell its 25% interest, all royalty interests, and all other associated rights in the Windfall Lake Project (the "Project"), on the terms and conditions contained in the Letter Agreement (the "Transaction"). In consideration for the sale of Noront's 25% interest in the Project, Eagle Hill will pay to Noront: (i) an aggregate cash payment of $5 million, and (ii) 25 million freely tradeable (subject only to such hold periods required under applicable Canadian securities laws) common shares of Eagle Hill to be issued to Noront on closing of the Transaction (the "Closing").
Paul Parisotto, Chairman, Interim President and CEO stated: "The Windfall Lake Property is a non-core asset of the Company and the Transaction provides us with both an immediate cash infusion to further the development of the Company's Eagle's Nest Project, and an equity interest in Eagle Hill which will allow us to participate in the upside potential of the Windfall Lake Project."
In addition, Eagle Hill has entered into a binding letter agreement (the "Financing Agreement") with its strategic partner Southern Arc pursuant to which Southern Arc Minerals Inc. ("Southern Arc") has agreed, subject to the terms therein, to invest, together with Dundee Corporation an aggregate of $12 million in Eagle Hill to complete the Transaction and advance the Project. Dundee Corporation has been a shareholder in Eagle Hill since February 2012 and currently owns 18.8% of the outstanding shares of Eagle Hill.
On execution of the Letter Agreement $615,000 was paid to Noront as a non-refundable deposit, with the remaining $4,385,000 of the cash payment to be paid on Closing.
The payment of the $615,000 to Noront satisfies the previously announced requirement that Eagle Hill make such payment within 90 days of entering into the amending agreement previously announced on April 19, 2013. The April 19, 2013 agreement amended the original Option Agreement between Noront and Eagle Hill dated July 20, 2009, with respect to the Project.
The completion of the Transaction will be subject to obtaining the necessary shareholder approvals of Eagle Hill and Southern Arc to the Financing Agreement and the Transaction and obtaining all required stock exchange and regulatory approvals.
If the Letter Agreement is terminated, in certain circumstances, Noront's undivided right, title and interest in and to the royalty option and the Property shall increase from 25% to 30% (the "Break Fee").
Until the Closing, all rights and obligations under the Option Agreement, as amended, continue in full force and effect. Only upon Closing will the Option Agreement be terminated.
About Noront: Noront Resources Ltd. is focused on development of the high-grade Eagle's Nest nickel, copper, platinum and palladium deposit and the high-grade Blackbird chromite deposit, both of which are located in the James Bay Lowlands of Ontario in an emerging metals camp known as the Ring of Fire.
For further information please visit Noront's website at: http://www.norontresources.com or search the Company's publically filed documents on SEDAR at: http://www.sedar.com.
FORWARD LOOKING STATEMENTS
This release contains "forward-looking statements" within the meaning of applicable Canadian securities legislation, including predictions, projections and forecasts. Forward-looking statements include, but are not limited to, statements that address activities, events or developments that the Company expects or anticipates will or may occur in the future, including such things as future business strategy, competitive strengths, goals, expansion, growth of the Company's businesses, operations, plans and with respect to exploration results, the timing and success of exploration activities generally, permitting time lines, government regulation of exploration and mining operations, environmental risks, title disputes or claims, limitations on insurance coverage, timing and possible outcome of any pending litigation and timing and results of future resource estimates or future economic studies.
Often, but not always, forward-looking statements can be identified by the use of words such as "plans", "planning", "planned", "expects" or "looking forward", "does not expect", "continues", "scheduled", "estimates", "forecasts", "intends", "potential", "anticipates", "does not anticipate", or "belief", or describes a "goal", or variation of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved.
Forward-looking statements are based on a number of material factors and assumptions, including, the result of drilling and exploration activities, that contracted parties provide goods and/or services on the agreed timeframes, that equipment necessary for exploration is available as scheduled and does not incur unforeseen break downs, that no labour shortages or delays are incurred, that plant and equipment function as specified, that no unusual geological or technical problems occur, and that laboratory and other related services are available and perform as contracted. Forward-looking statements involve known and unknown risks, future events, conditions, uncertainties and other factors which may cause the actual results, performance or achievements to be materially different from any future results, prediction, projection, forecast, performance or achievements expressed or implied by the forward-looking statements. Such factors include, among others, the interpretation and actual results of current exploration activities; changes in project parameters as plans continue to be refined; future prices of gold; possible variations in grade or recovery rates; failure of equipment or processes to operate as anticipated; the failure of contracted parties to perform; labour disputes and other risks of the mining industry; delays in obtaining governmental approvals or financing or in the completion of exploration, as well as those factors disclosed in the Company's publicly filed documents. Although Noront has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements.
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 release.
Contacts:
Noront Resources Ltd.
Paul Parisotto
Chairman and Interim CEO
(416) 367-1444
www.norontresources.com