ENP Newswire - 05 February 2014 Release date- 04022014 - Alexander is delighted to announce that, further to its announcement of 21 October 2013 regarding a strategic technical partnership with Ebullio Commodities Limited , the two companies have now signed conditional licence, consultancy and financing agreements which will complement this beneficial relationship. The Ebullio Group has entered into a conditional agreement to acquire all the assets of Red Crescent Resources Limited ('RCR') and its subsidiaries, a Toronto and Frankfurt listed specialist mining group with significant base metals assets in Turkey (the 'RCR Assets'). The sale and purchase agreement (the 'SPA') for the transaction was signed by Ebullio on 31 January 2014 , with completion scheduled for on or about 26 March 2014 . The acquisition by the Ebullio Group will be satisfied in cash and shares which, together with the assumption of certain debt, values the RCR Assets transaction at US$14.2 million . The acquisition is subject to various conditions being satisfied, including obtaining certain third party consents and the entering into of definitive agreements. These arrangements should significantly accelerate the first commercial adoption of Alexander's proprietary leaching technology (the 'Leaching Technologies') in Turkey and later in other countries. Ebullio Resources Fund , also part of the Ebullio Group , currently owns a 11.85% shareholding in Alexander . Martin Rosser , Chief Executive Officer, said: 'We have previously highlighted Ebullio's expected acquisition of the mining property assets of Red Crescent Resources Limited as a transformational opportunity for Alexander . The Agreement now signed with Ebullio is a major step towards achieving the commercial adoption of the Company's technology, together with a strong royalty stream. We are delighted to see Ebullio strengthen its relationship with and interest in Alexander and to support its growth plans in Turkey and elsewhere.' Lars H Steffensen, Executive Managing Partner, Ebullio Capital Management LLP said of the Agreement: 'I am delighted to announce this landmark commercial partnership between Alexander and Ebullio, which represents a huge boost for both companies and a furthering of the strategic partnership announced in October last year. The commercialisation of Alexander's AmmLeach technology in Turkey will be a great milestone for Alexander Mining and Ebullio is excited to be a partner in this ground breaking mining technology'. The Agreement is a potential catalyst based on past commercialisation efforts and those planned in future, for building production royalties using Alexander's proprietary Leaching Technologies. It represents the cumulative result of a large amount of development work undertaken on a range of base metals projects and prospects in many countries. Ebullio will fund the technical project work on the RCR Assets. Bulk samples have already been collected in Turkey and are now in Perth, Australia , including mineralised material from Sivas. Ebullio's intended first step will be a pilot plant programme of around nine tonnes of mineralised zinc material from Hakkari and Tufanbeyli, to be carried out at the independent commercial facilities of Simulus Engineers Laboratories , Perth, Australia , under the supervision of Alexander's technical personnel. RCR Assets comprise copper and zinc projects at exploration, development and production stages and with significant potential for using the Leaching Technologies. This includes the Sivas project which, according to earlier exploration work done by Falconbridge /Noranda (now part of GlencoreXstrata ), has the potential to host a world class resource of several million tonnes of copper. There are also two zinc oxide properties in the portfolio which Alexander rates as having excellent potential for a significant mining operation. Subject to certain technical studies and criteria, Ebullio's plan is to build a low cost plant using Alexander's AmmLeach technology to process ore from the RCR zinc properties and to supply high quality zinc cathode into the Turkish market. Other metal streams are planned to be added thereafter. Ebullio's stated objective is to create the most efficient and lowest cost producer of copper and zinc in Europe and to become the largest producer in Turkey by the year 2023. Entry into the Agreement between Alexander and Ebullio constitutes a related party transaction under Rule 13 of the AIM Rules for Companies, by virtue of Ebullio's substantial shareholding in the Company. The Company's directors consider, having consulted with its nominated adviser, that the terms of the transaction are fair and reasonable insofar as its shareholders are concerned. Key provisions of the Agreement Upon completion of the acquisition by Ebullio Mining Ltd ('EM') of the RCR Assets, Alexander will issue to Ebullio Commodities Ltd ('EC') 30,000,000 new ordinary shares in the capital of the Company (the 'AXM Shares'). The AXM Shares will be held by an independent escrow agent and released in tranches of 6,000,000 AXM Shares upon receipt of payments for EC's repurchase of EM shares described in 2. As consideration for the issue of the 30,000,000 shares Alexander will receive: Upon signing of the Agreement, a non-refundable, cash payment of GBP100,000 as a down payment toward the purchase consideration, and Shares representing 20 % of the issued equity capital of EM from its holding company EC. As a result of the issue of the AXM Shares, EC would increase its shareholding in Alexander from 11.85 per cent of the current issued share capital to 24.96 per cent. of the Company's issued share capital, as enlarged by the issue. Thereafter, EC shall have the obligation to re-purchase 15% of the EM shares whereby Alexander shall sell these shares to EC in five tranches of 3% at a price of GBP300,000 per tranche according to the payment schedule detailed in 3, below. Upon completion of the payments scheduled below, Alexander will retain a 5% free carried equity interest in EM. Should Alexander not receive any of the relevant payments from EC within five business days of such a payment falling due, Alexander has, at its sole election, the option to immediately re-purchase for an aggregate consideration of GBP1 , those AXM Shares, on a pro-rata basis, for which it has not received payment in respect of EC's commitment to re-purchase EM's shares in 3% tranches. Payments schedule: Alexander is contracted to receive a total of GBP2,500,000 in payments, apportioned as shown: GBP100,000 , non-refundable, upon signing of these agreements, apportioned to part consideration for the issue of its 30,000,000 shares; GBP300,000 by 3 March 2014 , non-refundable, apportioned to a signing bonus; GBP1,500,000 in respect of five tranches, on each of 15 May 2014 , 15 August 2014 ; 17 November 2015 ; 16 February 2015 and15 May 2015, each in respect of 3% of EML's shares repurchased by EC; GBP300,000 on 15 August 2015 apportioned to payment for technical consultancy, supervision and services, to be provided by Alexander or its wholly owned subsidiary MetaLeach Limited ('MetaLeach') and GBP300,000 on 15 November 2015 apportioned to payment for technical consultancy, supervision and services, to be provided by Alexander or MetaLeach. Should Ebullio fail to pay any of the first six quarterly payments, it shall lose the exclusive rights to the Leaching Technologies granted by MetaLeach as part of the Licence Arrangements. Ebullio will review certain mineral properties for potential acquisition, either sourced by itself or in consultation with Alexander , on which Alexander's Leaching Technologies may be suitable for utilisation(the 'Selected Properties'). Ebullio will be responsible for funding all acquisition, feasibility and development costs associated with the RCR Assets and any Selected Property through to commercial production. Alexander , via MetaLeach, will grant Ebullio an exclusive licence in the Republic of Turkey for the right to use the Leaching Technologies, including on the RCR Assets, and a non-exclusive licence outside of Turkey for Selected Properties (the 'Licence Arrangements'), unless it has a conflicting licence arrangement with a third party already in place, in return for: a 2 per cent. royalty on all metals production from the RCR Assets which utilise the Leaching Technologies; a 31/2 per cent. royalty on metals production from all other Selected Properties acquired by Ebullio using the Leaching Technologies. Ebullio has undertaken until 1 July 2015 , not to vote against any ordinary or special resolutions proposed by the Alexander board in order to (a) give effect to the issue of new ordinary shares in the capital of the Company at a general or annual general meeting, (b) effect the dis-application of pre-emption rights to allow the Company to undertake general issuances of shares or (c) allow the Company to undertake a possible re-purchase of the AXM Shares (or a portion thereof) as detailed above. Furthermore, Ebullio undertakes that until 31 December 2015 that it will not dispose of any of those of the AXM Shares that remain subject to the re-purchase option without the Company's consent. Background on RCR Assets The following information is provided based on information from the RCR website and available public documents. Ebullio has signed an SPA to acquire the RCR Assets, which are currently held through RCR's 100% owned Turkish subsidiary RCR Holding A.S., and comprise several significant base metals projects in Turkey , notably: Hakkari Zinc (in production), Tufanbeyli Zinc (pre-production stage) and Sivas Copper (exploration stage). Hakkari Zinc Project The Hakkari Zinc Project is located in the Hakkari and rnak provinces of south-eastern Turkey . Alexander has already reported favourable AmmLeach amenability testwork results for the recovery of zinc from samples provided by RCR from its Hakkari Zinc Project . The samples were of a type of common zinc oxide/non sulphide mineralisation that occurs in other parts of Turkey (including Tufanbeyli) and the rest of the world. The Hakkari testwork showed that zinc recoveries of at least 80% should be possible once the pre-treatment and leaching conditions are optimised. The completion of these amenability tests has shown that AmmLeach could be used for leaching zinc from the Hakkari ore to produce either zinc metal or an intermediate zinc oxide product. RCR has focused on getting the Hakkari zinc mining operation to become cash generating as quickly as possible. According to a NI 43-101 Technical Report prepared by MSA Group in July 2013 , the potential for defining additional resources and upgrading currently defined resources is regarded as significant. Small-scale exploitation of high grade non-sulphide zinc-lead mineralised zones has been on-going for a long time. In excess of 600,000t of zinc-lead material from the Hakkari region have been officially recorded as sold under contracts through traders, with typical grades (certified by SGS and Alfred Knight Laboratories ) ranging from 25% to 40% zinc and 4% to 8% lead. A significant proportion of this material has been mined from areas adjacent to or between the RCR licences. Sivas Copper Project The property covers an area of approximately 5,240 hectares in the Sivas Region of East Central Turkey. Although more exploration, including drilling, is required, extensive work has already been performed on this property, including by Falconbridge /Noranda (now part of GlencoreXstrata ). Falconbridge prepared an internal report which concluded that the property was prospective for the discovery of significant tonnages of copper bearing materials, including potential by-products such as gold, nickel and cobalt. Falconbridge stated that the MZ target area had the potential to host a deposit of 200 Mt @ 1.98% copper (3.96Mt contained copper) and the SEZ zone had the potential to host a 100 Mt deposit @ 2.74% copper (2.74Mt contained copper). Tufanbeyli Zinc Project Tufanbeyli is located about 15km east of the town of Tufanbeyli in Adana province. It is 450km south-east of the capital Ankara . According to a NI 43-101 Technical Report prepared in July 2013 by MSA Group , the property hosts five prominent zinc prospects of which two were mined on a small scale between 1985 and 1998, producing an estimated 210,000 tonnes of material with grades in the range 20% to 40% zinc. Significant potential exists to define multiple deposits with lower grade but higher tonnage. Potential also exists to define sulphide resources at depth. Forward Looking Statements This news release may contain forward looking statements, being statements which are not historical facts, including, without limitation, statements regarding potential mineralization, exploration results, resource or reserve estimates, anticipated production or results, sales, revenues, costs, 'best-efforts' financings or discussions of future plans and objectives. There can be no assurance that such statements will prove accurate. Such statements are necessarily based upon a number of estimates and assumptions that are subject to numerous risks and uncertainties that could cause actual results and future events to differ materially from those anticipated or projected. The Company disclaims any intention or obligation to revise or update such statements unless required by law. About Ebullio Ebullio was established in 2007 and manages a range of funds and SPVs focused on commodities and natural resources. Ebullio Capital Management LLP has been named 'Managed Futures, CTA of the year, UK ' in the International Hedge Fund awards 2014. Ebullio's Far East Commodity Futures Fund ended 2013 ranked as the top performing commodity fund ( Eurohedge Magazine ), consistently ranks as one of the best performing commodity funds (Barclayhedge) and was voted ' UK Fund of the Year' and ' UK Top Performance Fund of the Year ' at the International Hedge Funds Awards 2013. Ebullio's flagship mining SPV 'Ebullio Return' has returned 41% since inception in March 2012 . Contact: Alexander Mining plc Martin Rosser Chief Executive Officer Mobile: + 44 (0) 7770 865 341 Matt Sutcliffe Executive Chairman Mobile: +44 (0) 7887 930 758
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