| Mon 2 Apr 2012, 8:24 | | FUM - First Uranium Corporation - First Uranium and Gold One execute |
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FUM
FIU
FUM - First Uranium Corporation - First Uranium and Gold One execute
definitive agreement for sale of Ezulwini Mine
First Uranium Corporation
(Continued under the laws of British Columbia, Canada)
(Registration number C0777384)
(South African registration number 2007/009016/10)
Share code: FUM ISIN: CA33744R1029
2 April 2012
FIRST URANIUM AND GOLD ONE EXECUTE DEFINITIVE AGREEMENT FOR SALE OF EZULWINI
MINE
TORONTO AND JOHANNESBURG - First Uranium Corporation (TSX: FIU; JSE:
FUM)(ISIN: CA33744R1029) ("FIU" or the "Company") announced that the Company
has signed a binding Sale of Shares and Claims Agreement (the "Gold One
Agreement") for the sale of 100% of the issued shares of, and all
shareholders` claims against, First Uranium Limited (Cyprus) ("FUL"), which
holds all of the issued shares of the Ezulwini Mining Company (Proprietary)
Limited ("EMC"), for a total consideration of US$ 70 million to Gold One
International Limited ("Gold One") (the "Gold One Transaction").
The Gold One Agreement reflects the material terms and conditions outlined in
the Letter Agreement entered into by the Company and Gold One on March 2,
2012 and detailed in the Company`s announcement released on the same day.
As previously announced, the Gold One Transaction is subject to fulfillment
of a number of conditions precedent including, inter alia, and to the extent
required: (a) release of the security against the assets of EMC relating to
the Secured Convertible Cdn $110 million Notes due March 31, 2013, the
Secured Convertible ZAR 418.6 million Notes due March 31, 2013, and the US$10
million loan facility made available to the Company by Gold One; (b) receipt
of all necessary consents, rulings or directives from the Minister of the
Department of Mineral Resources; (c) FUL and/or EMC shall have no liability
to the Company or any of its other affiliates; (d) approval of the Gold One
Transaction by all applicable regulatory authorities including the
Competition Authorities (the "Competition Act Approval"), the South African
Reserve Bank, the Toronto Stock Exchange, the JSE Limited and the Australian
Stock Exchange; (e) Nuclear Fuels Corporation of South Africa (Nufcor)
consents in writing to the cession and delegation of certain of the rights
and obligations of FIU for 50% of the capacity to which the Company is
entitled under the existing Toll Treatment Agreement between the Company and
Nufcor; (f) the approval of the Gold One Transaction by no less than 66 2/3%
of the votes cast in person or by proxy, by the Company`s shareholders, at a
duly called and properly constituted meeting of the Company; (g) no material
adverse change with regard to FUL and EMC and/or their businesses; and, (h)
concluding the indirect sale of all of the shares of the MWS tailings
recovery project to AngloGold Ashanti Limited.
During the period from March 2, 2012 to the closing of the Gold One
Transaction, EMC will continue to carry on business in the ordinary course
and with reasonable diligence in accordance with international mining
industry practices, and with the exception of requisite discretionary capital
expenditures, substantially in accordance with its existing budget. In
addition, the Company has given a number of representations, warranties and
indemnities which are customary in transactions of this nature. In order to
protect Gold One in the event of any breach of any representation, warranty,
indemnity or any other provision of the Gold One Agreement, the parties have
agreed that at closing US$5 million of the Purchase Price will be placed in
escrow for a period ending on the later of: (i) six (6) months from the
earlier of the date that Gold One assumes the day-to-day management control
of the business of EMC and the date the Gold One Transaction is implemented,
and (ii) December 31, 2012 (the "Gold One Escrow"). If there are claims for
loss or liability, which in the aggregate are less than US$500,000, Gold One
will have no claim on the Gold One Escrow. If the aggregate claims exceed
US$500,000, Gold One may claim its entire loss up to the limit of US$5
million but FIU will have no further liability to Gold One under the Gold One
Agreement.
The Gold One Agreement provides that completion of the Gold One Transaction
will occur no later than June 29, 2012 (the "Long Stop Date"). However if
the Competition Act Approval has not been obtained by the Long Stop Date,
then the date for fulfillment of that condition precedent shall, by either
FIU or Gold One giving the other written notice thereof, automatically extend
to August 31, 2012.
The Gold One Agreement provides for a management agreement (the "Management
Agreement") to be concluded, if agreed to, among Gold One and EMC, pursuant
to which Gold One, during the management period, assumes day-to-day
management control of the business of EMC. The implementation of the
Management Agreement would commence on receipt by Gold One of the Competition
Act Approval. If the Management Agreement is implemented, its application
would terminate on the earlier of the date that the Gold One Agreement
terminates for any reason, and the date the Gold One Transaction is
implemented. The performance and operational risk in respect of the
business, affairs and operations of EMC will pass to Gold One on the earlier
of the date that Gold One assumes management of EMC under the terms of the
Management Agreement and the date upon which the Gold One Transaction is
implemented.
For further information, please contact:
John Hick or Mary Batoff
(416) 306-3072
mary@firsturanium.ca
Cautionary Language Regarding Forward-Looking Information
This news release contains and refers to forward-looking information based on
current expectations. All other statements other than statements of
historical fact included in this release are forward-looking statements (or
forward-looking information). The Company`s plans involve various estimates
and assumptions and its business and operations are subject to various risks
and uncertainties. For more details on these estimates, assumptions, risks
and uncertainties, see the Company`s most recent Annual Information Form and
most recent Management Discussion and Analysis on file with the Canadian
provincial securities regulatory authorities on SEDAR at www.sedar.com. These
forward-looking statements are made as of the date hereof and there can be no
assurance that such statements will prove to be accurate, such statements are
subject to significant risks and uncertainties, and actual results and future
events could differ materially from those anticipated in such statements,
including without limitation, the statements regarding the proposed
transactions with Gold One International Limited and AngloGold Ashanti
Limited. No assurance can be given that the Company will be successful in
concluding the proposed transactions and achieve the desired results.
Accordingly, readers should not place undue reliance on forward-looking
statements that are included herein, except in accordance with applicable
securities laws.
Sponsor:
Investec Bank Limited
Date: 02/04/2012 08:24:01 Produced by the JSE SENS Department.
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