CALGARY, ALBERTA--(Marketwire - Aug. 14, 2012) - Northern Abitibi Mining Corp. (TSX VENTURE:NAI) ("Northern Abitibi") is pleased to announce that it has entered into an option agreement with Spruce Ridge Resources ("Spruce Ridge") whereby Northern Abitibi will sell its 100% percent interest in the Viking Project to Spruce Ridge Resources in exchange for up to 10,000,000 shares in Spruce Ridge plus cash payments.
- The agreement will consolidate a large land package in the district and allow known mineralized trends to be explored along their entire strike lengths. The deal will give Northern Abitibi shareholders exposure to a much larger land package in the district through the large position they will hold in Spruce Ridge.
- Spruce Ridge is well financed and has a favorable share structure and has good potential for share appreciation through continued exploration success in the Viking district.
Terms of the Deal
To earn a 100% interest in the Viking project Spruce Ridge must pay $200,000 in staged cash payments over 12 months and issue up to 10 million Spruce Ridge shares. Upon regulatory and shareholder approval Spruce Ridge will pay Northern Abitibi $50,000 cash and issue 5 million Spruce Ridge shares. Within 6 months Spruce Ridge must make an additional $50,000 payment, and within 12 months Spruce Ridge must pay another $100,000 (Spruce Ridge can elect to issue up to 50% of the final cash payment by issuing equivalent shares of Spruce Ridge) and issue up to 5 million additional shares. If the share price of Spruce Ridge is between $0.25 and $0.50 cents the 12 month share payment is reduced to 3 million shares and if the share price of Spruce Ridge is above $0.50 cents the 12 month share price payment will be 2 million shares.
The agreement will be subject to regulatory and shareholder approval. Northern Abitibi has a 100% property interest in the Viking project subject to a 2% to 4% sliding scale net smelter royalty held by Altius Resources.
Northern Abitibi is currently evaluating exploration opportunities within North America.
Dr. Shane Ebert, P. Geo. is the Qualified Person responsible for the preparation of this news release.
Shane Ebert, President/Director
Except for the historical and present factual information contained herein, the matters set forth in this news release, including words such as "expects", "projects", "plans", "anticipates" and similar expressions, are forward-looking information that represents management of Northern Abitibi's internal projections, expectations or beliefs concerning, among other things, future operating results and various components thereof or the economic performance of Northern Abitibi. The projections, estimates and beliefs contained in such forward-looking statements necessarily involve known and unknown risks and uncertainties, which may cause Northern Abitibi's actual performance and financial results in future periods to differ materially from any projections of future performance or results expressed or implied by such forward-looking statements. These risks and uncertainties include, among other things, those described in Northern Abitibi's filings with the Canadian securities authorities. Accordingly, holders of Northern Abitibi shares and potential investors are cautioned that events or circumstances could cause results to differ materially from those predicted. Northern Abitibi disclaims any responsibility to update these forward-looking statements.
The TSX Venture Exchange has neither approved nor disapproved of the contents of this press release.