Eagle Hill Announces Three Year Extension of Windfall Lake Option Agreement
VANCOUVER, BRITISH COLUMBIA -- (Marketwired) -- 04/22/13 -- Eagle Hill Exploration Corporation ("Eagle Hill" or the "Company") is pleased to announce that it has entered into an amending agreement (the "Amending Agreement") with Noront Resources Ltd. ("Noront"), dated April 19, 2013, to amend certain provisions of the option agreement entered into between the parties on July 20, 2009 (the "Option Agreement") for the Windfall Lake Property ("Windfall Lake" or the "Property").
"The three year extension period will allow Eagle Hill to continue to develop the Windfall Lake Property. We look forward to the next stage of our property's development and getting one step closer to Quebec's next gold mine." stated P. Bradley Kitchen, President and CEO of Eagle Hill.
Salient points of the Amending Agreement are as follows:
-- A three (3) year extension to April 20, 2016 of the delivery date under
the Option Agreement for Eagle Hill to satisfy certain Delivery
Requirements (defined below) (the "Extension");
-- Noront has granted Eagle Hill a 90 day exclusivity period to negotiate
the purchase of the Noront's 25% interest in the Property;
-- Eagle Hill's deliverable requirements have been clarified and now state
that Eagle Hill must deliver either a bankable feasibility study (the
"BFS") with no defined hurdle rate or obtain a financing commitment to
immediately enter into commercial production (the "Delivery
Requirements");
-- If Eagle Hill does not complete the Delivery Requirements by April 20,
2016, then Noront retains its existing repurchase right to purchase back
the 75% of the Property from Eagle Hill for the lesser of (i) an amount
equal to the expenses incurred by Eagle Hill, and (ii) $6 million (the
"Buy-Back Provisions"); and
-- If Noront exercises its rights under the Buy-Back Provisions, Noront
will pay $6.0 million to Eagle Hill. If then Noront, or a third party,
takes Windfall Lake into commercial production, Noront will pay to Eagle
Hill the amount Eagle Hill has spent during the period from April 20,
2013 to April 20, 2016 from the proceeds of production. Consideration to
Noront for the Extension includes:
-- the transfer of the financial guarantee with the Quebec government
from Noront to Eagle Hill in respect of certain reclamation
obligations on the Property;
-- a cash payment to Noront totaling $615,000 (the "Extension
Payment"); and
-- the removal of the provision in the Option Agreement requiring
Noront to obtain consent from Eagle Hill for the transfer or sale of
Noront's interest in the Property.
To incentivize Eagle Hill to make the Extension Payment and close the Amending Agreement within 90 days, Noront will have the right to purchase back 75% of the Property from the Company for $6 million if Eagle Hill does not make the extension payment within the 90 day period. Alternatively, if Noront does not elect to exercise this buy-back right, Noront's interest in the Property will increase to 30% upon failure of Eagle Hill to make the Extension Payment. All other terms and conditions of the Option Agreement remain. The Amending Agreement will be available on SEDAR on April 23, 2013.
About the Windfall Lake Property
The Windfall Lake Property is comprised of 362 contiguous claims (over 12,000 hectares) in the Abitibi mineralized belt of northern Quebec. This area between Val-d'Or and Chibougamau is known for its gold and copper production and excellent infrastructure for exploration and mining. Historically, the Windfall Lake Property has had extensive grassroots exploration work. Along with its independently acquired claims at the Windfall Lake Property, Eagle Hill has signed options with Noront (as described above) and also jointly with Murgor Resources Inc. and Cliffs Natural Resources Inc. (formerly, Freewest Resources Canada Inc.) to acquire the Windfall Lake Property. During July 2012, the Company received its second mineral resource estimate, the results of which are displayed in the table below:
----------------------------------------------------------------------------
Quantity Gold Grade Contained Gold
('000 tonnes) (g/t) (ounces)
----------------------------------------------------------------------------
Indicated 1,665 10.05 538,000
----------------------------------------------------------------------------
Inferred 2,906 8.76 822,000
----------------------------------------------------------------------------
Jean-Philippe Desrochers, PhD, PGeo, is a qualified person registered in Quebec as defined by NI-43-101 and has reviewed the technical information that this press release contains.
About Eagle Hill Exploration Corporation
Eagle Hill Exploration Corporation is a Canadian mineral exploration company focused on the exploration and development of gold and precious metal prospects. The Company is set to become an advanced stage gold exploration company with its acquisition of the Windfall Lake high grade gold project, located in Urban Township, Quebec, between Val-d'Or and Chibougamau. Eagle Hill seeks projects that contain or have potential to contain large resource potential. The Company's website at www.eaglehillexploration.com and public filings at www.sedar.com provide additional information on its properties and other information with respect to its management and operations.
ON BEHALF OF THE BOARD,
P. Bradley Kitchen, President
Neither the TSX Venture Exchange nor its Regulation 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.
Contacts:
Network IR (Vancouver)
Andrew Mugridge
604.559.5573 or Cellular: 604.764.6847
andrew@networkir.com
Network IR (Vancouver)
Benjamin Curry
604.559.5573
www.networkir.com
MI3 Communications Financières Inc. (Montréal)
Nathalie Dion
514.904.1333
nathalie@mi3.ca
www.mi3.ca
