May 12, 2008 14:11 ET

Franc-Or to Raise up to $2 Million in Private Placement

MONTREAL, CANADA--(Marketwire - May 12, 2008) - Franc-Or Resources Corporation (TSX:FOR) is pleased to announce a $2 million non-brokered best efforts Private Placement. The financing will be completed in two tranches. The first tranche will consist of 2,000,000 Units ("Units I") at $0.10 per Unit, with the closing expected by the end of May 2008 with a lead order from Aberdeen International Inc. The second tranche will consist of 18,000,000 Units ('Units II") at $0.10 per Unit, with an expected closing in mid-July 2008. The proceeds of the Private Placement will be used by Franc-Or for working capital purposes.

Each Unit consists of one common share ('Common Share") and one common share purchase warrant ("Warrant"). Each Warrant shall entitle the holder to acquire one Common Share of the Company for a period of 36 months following the respective Closing Dates of Units I and Units II at an exercise price of $0.12. If, at any time following the one year anniversary at the closing of Units I and Units II, the closing price of the Common Shares of the Company on the Toronto Stock Exchange is greater than $0.18 for 20 or more consecutive trading days, the Company may give notice to the holders of the Warrants that the expiry date for exercise of the Warrants has been accelerated and the Warrants will expire on the 20th calendar day following the date such notice is mailed. The Common Shares and the Common Shares issuable upon the exercise of the Warrants will be subject to a hold period of four months plus one day pursuant to applicable securities legislation.

An advisory fee commission equal to: (i) Cash commission of 6.0% of the gross proceeds of the Offering derived from the sale of Units I and Units II; and (ii) compensation warrants (the "Compensation Warrants") exercisable to acquire that number of the Company Common Shares equal to 6.0% of the number of Units sold to the purchasers will be paid. The Compensation Warrants shall be issued on the Units I and Units II closing dates respectively. The Compensation Warrants shall be exercisable for a period of two years following the Units I and Units II closing dates at an exercise price of $0.12 per Common Share.

The deal is subject to normal regulatory approvals, and the closing of Units II is subject to shareholder approval which will be voted on at an Annual and Special Meeting of the Shareholders to be held on June 26. Upon closing of the Units II tranche, Mr. Stan Bharti and Mr. Scott Moore will be appointed to the Board of Directors of Franc-Or, replacing two standing Directors, and Mr. Scott Moore will be appointed President and CEO of the Company.

The Franc-Or management and Board believe that the Aberdeen group is capable of achieving maximum value for shareholders with a proven track record of advancing resource companies under their guidance. Aberdeen International Inc. (TSX:AAB) is a publicly-traded global resource investment and merchant banking company focused on small cap companies in the Resource sector.

Franc-Or currently owns and operates the Mario property in central Peru which exhibits Zn-Pb-Ag-Au vein and replacement mineralization, and the Humboldt Springs Au/Ag exploration property in north-central Nevada.


No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein. This News Release includes certain "forward-looking statements". All statements other than statements of historical fact, included in this release, including, without limitation, statements regarding future plans and objectives of Franc-Or, are forward-looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from Franc-Or's expectations are the risks detailed herein and from time to time in the filings made by Franc-Or with securities regulators.

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