| Fri 19 Dec 2008, 7:05 | | SIM - Simmers - First Uranium Receives Us$50 Million From Gold Wheaton Barbados |
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SIM FUM
SIIF
SIM - Simmers - First Uranium Receives Us$50 Million From Gold Wheaton Barbados
Corporation As The First Tranche Payment Of A Gold Stream Transaction
Simmer & Jack Mines, Limited
(Incorporated in the Republic of South Africa)
(Registration number 1924/007778/06)
Share code: SIM ISIN Code: ZAE00006722
("Simmers" or "the Company")
FIRST URANIUM RECEIVES US$50 MILLION FROM GOLD WHEATON BARBADOS CORPORATION AS
THE FIRST TRANCHE PAYMENT OF A GOLD STREAM TRANSACTION
Johannesburg - Simmer & Jack Mines, Limited ("Simmers") (JSE:SIM ZAE00006722)
announced today that its 62.3% held subsidiary, First Uranium Corporation
(TSX:FIU, JSE:FUM, CA33744R1029:ISIN) ("First Uranium") has received the initial
US$50 million from Gold Wheaton (Barbados) Corporation ("GW"), a wholly-owned
subsidiary of Gold Wheaton Gold Corp., in respect of the previously announced
transaction, whereby GW will purchase 25 percent of the estimated 2.1 million
ounces of life-of-mine gold production from First Uranium`s Mine Waste Solutions
tailings recovery operation ("MWS") in South Africa.
Under the terms of the transaction, in addition to the US$50 million (the "First
Payment"), GW shall pay First Uranium:
- Subject to financing, a further US$75 million (the "Second Payment") three
months from December 12, 2008, the effective closing date of the Transaction.
- An ongoing payment equal to the lesser of US$400 per ounce (subject to an
annual inflation adjustment of 1.01 percent, starting in the fourth year after
the First Payment) and the prevailing spot price at the time of such payment,
for each ounce of gold delivered under the contract.
- If the Second Payment is not paid, the gold stream transaction shall be
reduced to 10% and appropriate credits made.
Gordon Miller, the CEO of Simmers and the President and CEO of First Uranium
commented "This transaction highlights the value of First Uranium`s substantial
co-product gold production and strengthens our balance sheet as we complete
construction of the uranium plants at First Uranium`s Ezulwini and MWS
operations. With extensive experience in mining, including tailings recovery
operations, David Cohen and his team at Gold Wheaton are an excellent fit to
partner with us at our MWS operation, which is performing very well against
plan."
First Uranium has agreed to deliver a minimum of 20,000 ounces of gold into the
transaction during calendar year 2009. GW will not be required to contribute to
any capital or exploration expenditures in respect of MWS`s tailings recovery
operation. Provided that the Second Payment is paid, GW will be granted a right
of first refusal on any future gold stream agreements or similar arrangements
proposed to be entered into by First Uranium or its subsidiaries in respect of
MWS and First Uranium`s Ezulwini Mine.
Simmers shareholders are referred to First Uranium`s SENS announcement dated 17
December 2008 or the First Uranium website for further details -
www.firsturanium.com
Johannesburg
19 December 2008
SPONSOR
Sasfin Capital
a division of Sasfin Bank Limited
Date: 19/12/2008 07:05:27 Produced by the JSE SENS Department.
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