Osisko Mining Corporation

Osisko Mining Corporation

March 11, 2008 13:37 ET

Osisko Creates a Sustainable Development Fund for the Town of Malartic

MALARTIC, QUEBEC--(Marketwire - March 11, 2008) - Osisko Exploration Ltd. (TSX:OSK)(FRANKFURT:EWX) ("Osisko")(today announced the creation of the Fonds Essor Malartic Osisko, a sustainable development fund for the town of Malartic. Osisko also plans contributions to the fund in cash and Osisko stock that could amount to more than $3 million over the next five years.

The announcement was made today by Osisko president and CEO Sean Roosen at a press conference held with Malartic Mayor Fernand Carpentier and representatives from local and regional communities.

"We're very proud to initiate the creation of the Fonds Essor Malartic Osisko," Roosen said. "Our mining project will definitely generate major spinoffs for Malartic, but we intend to contribute even more so that our mining project leaves a sustainable legacy for the people of Malartic."

"After considering several approaches to creating this legacy for Malartic's residents, we decided the fund was the best formula. It's innovative, dynamic and adaptable, and it will allow the people of Malartic to set their own priorities. As far as I know, this formula is a first in Canada's mining industry," Roosen added.

"Osisko is demonstrating that it wants to be a good corporate citizen and assume social responsibility as a business above and beyond the usual standards," said Mayor Carpentier. "Our town is very pleased to welcome this major initiative for our community's long-term future."

Initial investment may top $3 million

Osisko Exploration has agreed to provide the fund with adequate financing to fulfill its mission and create a permanent legacy. Funding will begin when it receives its operating permit and throughout the entire period of mining operations in Malartic. The funding will come in the form of a blend of cash and Osisko shares so the fund can benefit directly from the company's profitability.

The actual value of the endowment will vary with the market value of Osisko stock over the next few years. The fund is worth approximately $2.5 million at present market price (please see table below) and could exceed $3 million in the fund's first five years if the share value is at least $7.50 when the fund eventually divests the shares. Afterward Osisko is committed to contributing a minimum of $150,000 per year for the duration of operations at its Canadian Malartic mine.

Mr Roosen also announced that he and other members of Osisko management donated 25,000 of their own Osisko shares to the fund, being an approximate value of $150,000 at current market price.

"We want the foundation to have quick access to substantial funding, in order to have an impact and build a legacy," said Sean Roosen. "The way our contribution formula works, the whole population of Malartic will benefit from the profits of our operations and the high price of gold."

A seven-member board

The legal process of establishing the Fonds Essor Malartic Osisko is currently underway, and management expects it to take a few more months.

The fund will be administered by a board of seven directors, a majority of who will be drawn from the social, economic and community sectors of Malartic or other communities in Abitibi-Temiscamingue. Osisko will be represented on the board by two of its senior executives. The following people have accepted to sit on the Board of Directors:

- Pauline Champagne, a Malartic resident active in community organisations;

- Johanne Jean, President of the Universite du Quebec en Abitibi-Temiscamingue;

- Raoul Boissonneault, retired from a career in mining, who is active in Malartic community organisations;

- Denis Cimon, manager, Mineral Processing of Osisko and an Abitibi citizen;

- Jean-Sebastien David, Osisko's vice-president Sustainable Development;

- Gilles Leclerc, a Malartic businessman and chair of the Malartic Chamber of Commerce;

- Laurier Verville, a Malartic alderman.

The board will establish appropriate rules of practice, governance and accountability in compliance with the fund's letters patent, by-laws and regulations.

A vision of the future

"The fund's board of directors will have a great deal of latitude to adapt its activities to the needs expressed by Malartic residents, but the fund's by-laws and regulations will require it to favour projects designed to have long-term impact," Sean Roosen explained.

The fund will finance economic development projects, community facilities and infrastructure that will improve the quality of life for Malartic residents. Scholarships and other investments in education will also have an important place.

Osisko Exploration: a fresh outlook on mining

Osisko Exploration Ltd. is a Canadian mining company devoted principally to the development of the Canadian Malartic gold-bearing deposit located at Malartic in the Abitibi region of North-Western Quebec. With inferred resources of 8.4 million ounces of gold, the Canadian Malartic deposit is one of the largest in Canada. Osisko currently employs approximately 60 people, and this number will increase to over 400 when Canadian Malartic is in full operation.


Type of 2008 Approval Start First 2012 Total
contribution (Establish of of anniver-
-ment of permit operations sary
the fund) (2009) (2010) of
Shares (N)(i) 300,000 300,000
Price per
share ($) $6.00(ii)
Value of
(thousand $) $1,800 $1,800
(thousand $) $150 $150 $150 $150 $150 $750
(thousand $) $1,950 $150 $150 $150 $150 $2,550
(thousand $) $1,950 $2,100 $2,250 $2,400 $2,550

(i) The 300,000 shares will be transferred as soon as the fund is legally
established. The shares will be held in escrow and released on the
following time frame:
100,000 on approval of the permit (2009)
100,000 on commencement of commercial operations (2010)
100,000 one year from the date of commencement of commercial
operations (2011)
(ii) Closing price as of March 7, 2008


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