Dianor Resources Completes Acquisition of Surface Rights to Leadbetter Extension Property
Dianor Resources Inc. announce that it has completed a previously-announced purchase of surface rights to the Leadbetter Extension Property from persons associated with Mr. Joseph Leadbetter and that the surface rights have been registered in Dianor’s name.
As previously announced, under the definitive agreement for the sale of the surface rights and a related agreement for the immediate suspension and eventual termination of an Excavation Contract between Dianor and Mr. Leadbetter, Dianor is required to pay Mr. Leadbetter and persons associated with him a total of $5 million in cash under a payment schedule which starts on January 31, 2009 and runs until November 30, 2012. The Excavation Contract will be automatically terminated when Dianor completes the payments. As security for payment of the $5 million, Dianor has granted a mortgage over the surface rights to Mr. Leadbetter and persons associated with him.
Dianor is also pleased to announce that by making a final payment of $750,000 in cash and 8,417,461 common shares to a company associated with Mr. Leadbetter, Dianor has completed the acquisition of a 100% undivided ownership interest in the Leadbetter Property and Leadbetter Extension Property, and that Dianor has taken the necessary measures to register its 100% ownership interest in the Leadbetter Property and Leadbetter Extension Property with the Ontario authorities. The two properties are subject to a 20% gross overriding royalty (GOR) for diamonds and a 1.5% GOR for all other metals and minerals in favour of the optionors of the properties. The Leadbetter Extension Property is also subject to a 10% royalty for all minerals in favour of a third party. Under a previously-announced agreement entered into in April 2007 (press release April 4th, 2007), Dianor can purchase up to one-half of the 20% GOR on both properties by making cash and share payments over a period of 40 months. To date, Dianor has reduced each GOR by 4.56%.
In 2008, Dianor issued the following shares in connection with the acquisition of the Leadbetter Property and Leadbetter Extension Property: (i) January 15 – 1,239,045 shares; (ii) April 1 – 1,419,437 shares; (iii) October 1 – 3,334,802 shares; and (iv) December 2 – 8,417,461 shares.
The definitive agreements provide that in the case of a merger, amalgamation, change in control, successful take-over bid or other similar event involving Dianor, all amounts then outstanding and owing to Mr. Leadbetter and the persons associated with him by Dianor under the agreements will become immediately due and payable at their sole and exclusive option, exercised on 30 days’ notice.
Dianor is an innovative exploration company focused on advancing diamond exploration properties in Canada. The Leadbetter Diamond Project is its most advanced project and is located 12 kilometers north east of Wawa in Northern Ontario. Substantial exploration work has been conducted on the property since 2005 and the Company is in the process of permitting up to a 50,000 tonne bulk sampling programme. In addition to diamonds, it contains gold, sapphires and rubies . New diamond discoveries including rare purple diamonds, by the Company in rocks of similar type, age (Archean) and geological settings (press release March 3rd, April 10th, & May 13th 2008) in Quebec have added further diamond properties to our portfolio of low cost, accessible exploration targets. These diamond discoveries (Ontario and Quebec) are both unique and amongst the oldest diamond bearing occurrences in the world.
