Advanced Explorations Inc.
TSX VENTURE : AXI

Advanced Explorations Inc.

June 06, 2007 21:55 ET

Advanced Explorations Inc. Announces Close of $11 Million Financing and Roche Bay Option Agreement

TORONTO, ONTARIO--(Marketwire - June 6, 2007) - Advanced Explorations Inc. (the "Company" or "AEI") (TSX VENTURE:AXI) is pleased to announce the completion of the private placement previously announced on March 30th, 2007. D&D Securities Company ("D&D") and Octagon Capital Corporation (the "Agents") sold a total of 1,774,000 units (the "Units") at a price of $1.25 per Unit and 613,000 flow-through shares (the "FT Shares") for gross proceeds of $3,137,000 (the "Offering"). Each Unit consists of one common share and one-half of one common share purchase warrant. Each whole warrant will be exercisable into one common share for two years from the closing date (the "Closing Date") at an exercise price of $2.00.

Concurrent with the Offering, the Company also completed a non-brokered private placement of 5,963,000 Units and 333,333 FT Shares for gross proceeds of $7,953,750 (the "Concurrent Offering").

AEI is pleased to announce a non-brokered private placement of $500,000.00 through the sale of 333,333 FT Shares to the MineralFields Group as part of the Concurrent Offering.

"We are very pleased to be entering into this relationship with MineralFields Group", said John Gingerich, President and CEO. "This is an important milestone in the growth of Advanced Explorations Inc. and we look forward to working with MineralFields Group as we develop our company."

The Company paid a total cash commission of $250,960 in connection with Offering to the Agents. In addition, as a commission for the sale of the Units under the Offering, the Agents were granted compensation options which will entitle the Agents to purchase 141,920 common shares of the Company at an exercise price of $1.25 per common share. As a commission for the sale of the FT Shares under the Offering, the Agents were granted compensation options which will entitle the Agents to purchase 49,040 common shares of the Company at an exercise price of $1.50 per common share. All compensation options granted to the Agents will have an exercise period which expires 2 years from the Closing Date.

In connection with the Concurrent Offering, the Company paid a cash commission of $298,150 to Parolini Marketing Services Ltd. In addition, Company paid Limited Market Dealer Inc. a cash commission of $28,500 and compensation warrants which will entitle Limited Market Dealer Inc. to purchase 13,333 common shares of the Company, at an exercise price of $1.25 per common share and have an exercise period which expires 2 years from the Closing Date.

For providing advisory and due diligence services to the Company in connection with the Concurrent Offering, D&D received a payment of $111,500. In addition, D&D was granted compensation options which will entitle the Agents to purchase 475,000 common shares of the Company at an exercise price of $1.25 per common share and 13,334 common shares of the Company at an exercise price of $1.50 per common shares. All of the compensation options will have an exercise period which expires 2 years from the Closing Date.

Proceeds of the private placement will be used towards funding exploration on the Company's magnetite project (the "Project") in Nunavut and other obligations of the Company under the Option Agreement it entered into with Roche Bay plc to acquire up to a 50.1% in the Project which was previously announced on February 12, 2007. The closing of the Option Agreement is concurrent with the Closing Date.

Pursuant to the Option Agreement, on the Closing Date the Company issued 12,000,000 rights (the "Rights") to Roche Bay as follows: i) 8,000,000 Rights at an exercise price of $0.35 per Right, effective immediately upon issue; ii) 2,000,000 Rights at an exercise price of $0.60 per Right, effective upon completion of 15,000 meters of drilling; and iii) 2,000,000 Rights at an exercise price of $1.00 per Right, effective upon the completion of both (a) a total of 30,000 meters of drilling and (b) a NI 43-101 compliant pre-feasibility study based on an envisioned minimum 6 million tonnes per year mining operation containing a resource estimate of at least 750,000,000 tonnes on iron ore in the aggregate among the "measured" and "indicated" categories. Each Right will entitle the holder to purchase one common share of the Issuer within a period of 3 years after the effective date of the Right.

The Company paid finder's fees in connection with the Option Agreement to the following arm's length parties: i) 48,206 common shares issued to 834689 Ontario Ltd.; and ii) 96,413 common shares issued to John Moses.

In consideration of entering into certain Non-Recourse Loans Agreements with the Company, the Company issued an aggregate of 420,591 common shares as bonus shares to certain lenders. The following insider is one of the lenders receiving the following amount of bonus shares: John Gingerich, 160,000 (via Geotechnical Business Solutions Inc.) and 64,000 (via Gingerich Family Trust).

On the Closing Date the Company issued 294,763 common shares to 2053068 Ontario Ltd. to settle outstanding debt for $368,454.14.

All securities issued pursuant to this transaction and are subject to a hold period expiring October 5, 2007.

ON BEHALF OF THE BOARD

John Gingerich, Chairman

About MineralFields, Pathway and First Canadian Securities®

MineralFields Group (a division of Pathway Asset Management) is a Toronto-based mining fund with significant assets under administration that offers its tax-advantaged super flow-through limited partnerships to investors throughout Canada during most of the calendar year, as well as hard-dollar resource limited partnerships to investors throughout the world. Pathway Asset Management also specializes in the manufacturing and distribution of structured products and mutual funds. Information about MineralFields Group is available at www.mineralfields.com. First Canadian Securities® is active in leading resource financings (both flow-through and hard dollar)on competitive, effective and service-friendly terms, with investors both within, and outside of MineralFields Group.

This news release does not constitute an offer to sell or a solicitation of an offer to sell any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.

This news release also includes forward-looking statements that involve a number of risks and uncertainties. The information reflects numerous assumptions as to industry performance, general business and economic conditions, regulatory and legal requirements, taxes and other matters, many of which are beyond the control of the company. Similarly, this information assumes certain future business decisions that are subject to change. There can be no assurance that the results predicted here will be realized. Actual results may vary from those represented, and those variations may be material.

THE TSX VENTURE EXCHANGE HAS NEITHER APPROVED OR DISAPPROVED OF THE CONTENTS HEREIN.

Contact Information

  • Advanced Explorations Inc.
    John Gingerich
    Chairman
    (416) 570-3250