VANCOUVER, BRITISH COLUMBIA -- (Marketwire) -- 03/28/13 -- Huakan International Mining Inc. (TSX VENTURE: HK) (the "Company") reports that the Company has entered into an amended and restated letter agreement ("Amended Agreement") with Mineral Invest International MII AB, a company listed on Aktietorget in Sweden under the stock symbol MII ("Mineral Invest"), Gold Crown LLC ("Gold Crown") and AMT Industries Canada Inc. ("AMT"), Gold Crown's wholly owned subsidiary (collectively, the "Purchasers") to amend the terms of a letter agreement entered into by the Company, Gold Crown and AMT on August 7, 2012 in respect of the sale by the Company of the Greenwood Gold Project (see the News Release of the Company dated August 8, 2012).
Pursuant to the terms of the Amended Agreement, Mineral Invest will guarantee the performance by Gold Crown and AMT of the following:
1. pay an amount to the Company sufficient to replace the Company's reclamation bond on the Greenwood Gold Project which amount the Company shall pay to the Government of British Columbia in order to release the security (currently approximately $450,000) that was posted by the Company;2. cooperate with the Company to execute and deliver a Safekeeping Agreement with the Government of British Columbia, which relates to the reclamation security to be provided to the Government of British Columbia by Gold Crown and AMT;3. pay to the Company the amount of $4,000,000 which represents the balance of the purchase price for acquisition of the NSR; and4. pay a total of $400,000 in extension fees, consisting of a fee of $200,000 to extend certain deadlines under the third amendment (dated February 6, 2013) to the letter agreement dated August 7, 2012 among the Company, Gold Crown and AMT, and a fee of $200,000 to further extend such deadlines under the Amended Agreement.
The Purchasers must complete all of the above by no later than 3 p.m. (Pacific Standard Time) on the earlier of June 10, 2013, and the date that is five business days after either Mineral Invest or Gold Crown complete a financing of at least $11,000,000.
Despite the delay in receiving the full payment, the Company did receive $530,000 from the Purchasers in January and in addition to receiving $624,568 refund from the Canada Revenue Agency related to the 2011 Mineral and Exploration Tax Credit (METC) in March, there is sufficient cash on hand for the Company's general and administrative expenses and for advancing the J&L Gold Project metallurgy testwork planned for 2013.
CAUTIONARY STATEMENTS REGARDING FORWARD-LOOKING INFORMATION
Certain of the statements made and information contained herein may contain forward-looking statements or forward-looking information within the meaning of applicable securities laws. Such forward-looking statements or forward-looking information include, but are not limited to, statements concerning the sale of the Greenwood Gold Project assets, and statements concerning the J&L Gold Project metallurgical testwork programs. Forward-looking statements or information include statements regarding the expectations and beliefs of management. Often, but not always, forward-looking statements and forward-looking information can be identified by the use of words such as "plans", "expects", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates", or "believes" or the negatives thereof or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. Forward-looking statements or information include, but are not limited to, statements or information with respect to known or unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements or information.
Forward-looking statements or information are subject to a variety of risks and uncertainties which could cause actual events or results to differ from those reflected in the forward-looking statements or information, including, without limitation, risks and uncertainties relating to: completion of announced transactions, history of losses; requirements for additional capital; dilution; loss of its material properties; interest rates increase; global economy; limited history of production; speculative nature of exploration activities; periodic interruptions to exploration, development and mining activities; environmental hazards and liability; industrial accidents; failure of processing and mining equipment; labour disputes; supply problems; commodity price fluctuations; uncertainty of production and cost estimates; the interpretation of drill results and the estimation of mineral resources and reserves; legal and regulatory proceedings and community actions; title matters; regulatory restrictions; permitting and licensing; volatility of the market price of common shares; insurance; competition; hedging activities; currency fluctuations; and loss of key employees. Should one or more of these risks and uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described in forward-looking statements or information. Accordingly, readers are advised not to place undue reliance on forward-looking statements or information. The Company disclaims any intent or obligation to update forward-looking statements or information except as required by law, and you are referred to the full discussion of the Company's business contained in the Company's reports filed with the securities regulatory authorities in Canada.
Neither the TSX Venture Exchange nor its Regulations 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.
Huakan International Mining Inc.
Chief Financial Officer
(416) 815-0700 ext. 243