European Uranium Announces Joint Venture with Forte Energy on Slovak Uranium Properties
16.06.2014 | FSCwire
Vancouver, British Columbia CANADA, June 16, 2014 /FSC/ - European Uranium Resources Ltd. (EUU - TSX Venture, EUUNF - OTCBB, TGPN - FWB), (the "Company") announces that it has signed a binding Letter of Intent with ASX and AIM listed Forte Energy NL ("Forte") whereby Forte will earn a 50% interest in the Company's Slovakia uranium projects. The interest will be held through ownership of 50% of EUU's currently wholly-owned Slovak subsidiaries, Ludovika Energy and Ludovika Mining, which hold the mineral licenses comprising the Kuriskova and Novoveska Huta uranium projects. "The agreement with Forte Energy provides EUU with its necessary short-term cash infusion and allows EUU to maintain a 50% interest in the Kuriskova project without needing to contribute cash until $3,500,000 million has been spent on the project by Forte. The transaction preserves value for EUU shareholders while allowing participation in the project's upside if the uranium market improves and development or sale of the project is warranted. EUU will work closely with Forte on the advancement of the Slovak uranium properties while also advancing its recently optioned Deli Jovan North copper-gold project in Serbia (see news release dated June 2, 2014) and possibly pursuing other mineral exploration and development opportunities," said Dorian (Dusty) Nicol, the Company's President and CEO.
The principal terms of the earn-in agreement are:
* The Company will transfer 50% of the shares of each of the two Slovak companies to Forte, the ownership of which will be governed by a shareholder's agreement and subject to forfeiture. If Forte does not make the required expenditures on the Kuriskova and Novoveska Huta uranium projects, it must transfer the shares of the Slovak companies back to the Company.
* To acquire its 50% interest in the projects, Forte must expend a total of $4,000,000 on the following schedule:
Cash Payments to European Uranium:
No later than June 20, 2014 $25,000
On signing a definitive agreement, but not
later than July 31, 2014 $475,000
Total cash to European Uranium $500,000
Work Commitments:
Year 1 (firm obligation) $350,000
Years 2 - 10, minimum annual expenditures
$350,000 / year unless higher amounts are
required to keep licenses in good standing $3,150,000
Total work commitments $3,500,000
Total earn-in expenditure commitment $4,000,000
* The expenditures can be accelerated by Forte at Forte's election. If the parties each agree to sell their 50% interest to a third party, then Forte will pay EUU the difference between $3,500,000 and expenditures made to date.
* Forte can forfeit its 50% interest to EUU with no further obligation any time after it has paid EUU $500,000 and funded the first year minimum work commitment of $350,000.
* Prior to Forte completing the earn-in of its 50% interest, exploration and development activities on the projects will be governed by a Management Committee on which EUU will have the casting vote until Forte has funded the full $4,000,000. Forte will be the operator during this period.
The transaction is subject to receipt of applicable regulatory approvals, including without limitation the approval of the TSX Venture Exchange. Shareholder approval is not required.
European Uranium Resources Ltd.
"Dusty Nicol"
Dorian L. (Dusty) Nicol, President and CEO
For further information please contact: Dorian (Dusty) Nicol, at (604) 536-2711, or visit www.euresources.com.
Neither the 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.
To view this press release as a PDF file, click onto the following link:
http://www.fscwire.com/sites/default/files/news_release_pdf/EuropeanUraniumJune162014.pdf
Source: European Uranium Resources Ltd. (EUU - TSX-V) (TGPN - FWB) (OTCQB - EUUNF)http://www.euuranium.com
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