TORONTO, ONTARIO -- (Marketwired) -- 04/09/13 -- Ferro Iron Ore Corp. (TSX VENTURE: RRO) reports that it has terminated the definitive agreement entered into with shareholders of Continent Treasure Limited to effect a business combination and obtain a 77.5% interest in Mongolian exploration license No.14491X (the "Exploration License"). Ferro has also terminated the definitive agreement to effect a business combination with Blue Eagle Trading Limited to acquire the additional 22.5% interest in the Exploration License (the business combinations with CTL and Blue Eagle together defined as the "Proposed Business Combinations"). Please see the Ferro press release dated November 6, 2012 for more details on the Proposed Business Combination.
Ferro identified several violations and breaches of covenants, representations and warranties contained in the definitive agreements (the "Definitive Agreements") related to the Proposed Business Combinations. Pursuant to the terms of the Definitive Agreements, Ferro submitted a letter to CTL and Blue Eagle identifying certain breaches of the covenants, representations and warranties contained in the Definitive Agreements and requested that they be cured. CTL and Blue Eagle failed to cure the breaches during the 10 day period allotted in the Definitive Agreements. As a result, the board of directors of Ferro determined it was necessary to terminate the Definitive Agreements, and both CTL and blue Eagle have acknowledged and accepted the termination.
Alastair Neill, Director of Ferro commented on the termination: "We are disappointed that the situation has necessitated this decision, but believe that terminating the two definitive agreements is in the best interests of all our shareholders and other stakeholders in Ferro."
Private Placement Financing
Further to the termination of the Proposed Business Combinations, Ferro also announces the termination of its $1,000,000 private placement financing previously announced on December 6, 2012. Ferro will consider a new private placement financing in the future.
Appointment of Chief Executive Officer
Ferro also reports the appointment of Alastair Neill as Chief Executive Officer, effective immediately.
Alastair Neill is the former VP/GM, Rare Earth Division and VP Business Development for AMR (now Molycorp, Inc.) and Executive Vice President of Dacha Strategic Metals Inc. Mr. Neill is one of the leading experts in rare earth elements and he has over 15 years of experience in the resources sector. He holds a Master of Business Administration from York University and a Bachelor of Engineering in material science from the University of Western Ontario.
Advance Notice Policy
Ferro has adopted a new policy that requires advance notice to the company for nominations of directors other than by management, through a requisition for a meeting or by way of a shareholder proposal.
Among other things, the policy fixes a deadline by which holders of record of common shares of Ferro must submit director nominations to the company prior to any annual or special meeting of shareholders and sets forth the information that a shareholder must include in the notice to Ferro for the notice to be in proper written form.
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