Odyssey Resources Limited
TSX VENTURE : ODX.H
NEX BOARD : ODX

Odyssey Resources Limited

December 03, 2015 08:48 ET

Odyssey Resources Provides an Update on the Acquisition of a Gold Tailings Project and Processing Plant in Peru

LONGUEUIL, QUÉBEC--(Marketwired - Dec. 3, 2015) -

NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR FOR DISSEMINATION IN THE U.S.

Odyssey Resources Limited ("Odyssey" or the "Company") (TSX VENTURE:ODX.H) is pleased to report that the Company has entered into a revised letter of intent (the "Revised LOI") dated November 24, 2015 with LAI Corp S.A.S. ("LAI") which amends, restates and supersedes the previously announced letter of intent with Green Mountain Inc., the parent company of LAI (see news release issued on September 28, 2015).

Pursuant to the Revised LOI, Odyssey contemplates acquiring all of the shares of LAI from the shareholders of LAI which, following the completion of a reorganization, will be the former shareholders of Green Mountain. In consideration of the acquisition of the LAI shares, the shareholders of LAI will receive, in exchange for each one share of LAI, 0.948 common share of Odyssey on a post consolidation basis (see below Share Consolidation) (the "Transaction").

Immediately following the completion of the Transaction, Odyssey intends to cause LAI to complete the acquisition of Compania Minera Corire S.A.C. ("Corire"), the entity that owns the Ishihuinca gold tailings project and processing plant in Southern Peru (the "Ishihuinca Project"). LAI and Corire have entered into a share purchase agreement on March 27, 2015. The completion of the acquisition of Corire by LAI is subject to LAI making a payment of US2.85 million to the shareholders of Corire followed by the payment of a balance of purchase price of US$1 million owed by Corire to Buenaventura Mining Company ("Buenaventura").

The Transaction is subject to Odyssey completing a financing (the "Financing"), raising a minimum of US$7.5 million to finance the acquisition and development of the Ishihuinca project. The Transaction is also subject to the parties satisfying various conditions including completion of due diligence, execution of a definitive agreement, and Odyssey having received a title opinion. The Transaction constitutes a reverse takeover under the policies of the TSX Venture Exchange ("TSX-V") and is subject to approval of the TSXV and shareholders' approval. The parties anticipate closing the Transaction in February 2016 and the Revised LOI provides exclusivity to Odyssey until February 26, 2016.

Bridge Loan

In connection with the Revised LOI, Odyssey has advanced to LAI US$200,000 under a bridge financing agreement. The advance will be used by LAI for a payment to Corire for the grant of an extension of the time to close the acquisition, for environmental work and studies on the Ishihuinca Project, and for general and administrative expenses.

The Ishihuinca Project

The Ishihuinca Project consists of a gold processing facility, tailings from previous mining operations, and nearby mining concessions covering 1061 hectares. The Ishihuinca mine and processing plant operated from 1979 to 2012 through a subsidiary of the Buenaventura. Several investigations of the tailings since 2008 have been conducted in order to test the feasibility of reprocessing these tailings for gold and copper recovery. Two distinct areas of tailings have been identified: the CIL tailings and the Flotation tailings. Approximately 372,000 tonnes of high grade CIL tailings grading better than 4g/t Au have been identified in the historical resources, as well as 877,000 tonnes of Flotation tailings grading 1.86 g/t Au. Grade and tonnage estimates are considered historical since they are derived from investigations by Buenaventura in 2008 that included a 139 drill hole program and measurements of dry bulk density of both types of tailings.

The resources reported herein are provided as historical data only. A qualified person has not done sufficient work to classify the historical estimate as current mineral resources or mineral reserves and Odyssey is not treating the historical estimate as current mineral resources or mineral reserves. Steven Park, C.P.G. (AIPG) is the Qualified Person under National Instrument 43-101 has reviewed the technical disclosure with respect to the Ishihuinca Project contained in this press release. Mr. Park is an independent consultant.

Share Consolidation

The Company also announces that its shareholders have passed a special resolution approving the consolidation of the Company's issued and outstanding shares on the basis of one (1) post-consolidation share for each ten (10) pre-consolidation shares currently issued and outstanding, at the special meeting held on November 27, 2015. The resolution gives the Board of directors authority to implement the share consolidation at any time. The Board intends to implement the share consolidation prior to the closing of the acquisition of LAI, subject to TSX-V approval.

About Odyssey Resources Limited

Odyssey is a Canadian-based exploration company whose focus is the acquisition, exploration and development of mineral resource properties. At the present time, the Company does not own any exploration property and is not carrying out any exploration programs. The Company has 36,231,486 common shares issued and outstanding. At September 30, 2015, the Company had working capital of approximately US$0.6 million. Odyssey's common shares are listed on the NEX board of the TSX-V and trade under the symbol ODX.H.

Additional information about the Company is available on the Company's website (www.odysseyresources.com) and on SEDAR at www.sedar.ca.

Cautionary Statement

This press release contains forward-looking information. In particular, this press release contains statements concerning the prospective Transaction of the Company and the potential of the Ishihuinca Project. Although the Company believes in light of the experience of its officers and directors, current conditions and expected future developments and other factors that have been considered appropriate that the expectations reflected in this forward-looking information are reasonable, undue reliance should not be placed on them because the Company can give no assurance that they will prove to be correct. Forward-looking information is subject to known and unknown risks and uncertainties, and depends on assumptions (including, but not limited to, assumptions about the potential of the Ishihuinca Project) and other factors, all of which may cause actual results or events to differ materially from those anticipated in such forward-looking information. The terms and conditions of the prospective Transaction may change based on the Company's due diligence on the proposed Transaction, the entering into a binding agreement for the Transaction, the success of the Financing, regulatory and third party comments, consents and approvals and the parties' ability to satisfy the conditions of the Transaction in the required timeframes. The forward-looking statements contained in this press release are made as of the date hereof and the Company undertakes no obligations to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

Completion of the Transaction, the Financing and the share consolidation are subject to a number of conditions, including but not limited to, TSX-V acceptance and shareholder approval or consent in respect of the Transaction. The Transaction cannot close until the required approvals are obtained. There can be no assurance that the Transaction, the Financing or the share consolidation will be completed as proposed or at all.

The TSX-V has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved the contents of this press release.

Neither TSX-V 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.

Contact Information