Brett Resources Consolidates Ownership of Hammond
Reef Project and Forms Strategic Alliance with Kinross
News Release 08-06
Brett Resources Inc. (TSX Venture Exchange - BBR) is pleased to
announce that it has entered into an agreement (the "Agreement")
with Kinross Gold Corporation ("Kinross") to acquire 100 percent of
the Hammond Reef Gold Project ("Hammond Reef"). The Agreement
provides that Brett will by May 30, 2008: (a) exercise its existing option to
acquire a 60% interest in Hammond Reef from Kinross; and (b) complete the
acquisition of the remaining 40% interest in accordance with the terms of an
acquisition agreement (the "Acquisition Agreement") to be entered
into between Brett and Kinross. As part of the Acquisition, Brett has agreed
to spend up to $2 million reviewing properties of interest in British
Columbia and the Yukon, which Kinross can elect to obtain a 50 percent
interest upon acquisition by Brett (The Project Participation Agreement).
"This strategic alliance with Brett is an excellent example of Kinross'
strategy to expand our exploration network and geographic reach by partnering
with quality junior companies and proven mine finders," said Hugh Agro,
Executive Vice-President Strategic Development at Kinross. "As a result
of this transaction we are increasing our stake in a high-calibre company and
exploration team, as well as leveraging Brett's exploration experience and
abilities to expand our interests and potential in BC and the Yukon."
Ron Netolitzky Chairman of Brett said, "Kinross has been a supportive
partner during the initial Hammond Reef exploration program. We look forward
to our continued partnership in reviewing potential properties of interest in
BC and the Yukon."
"Once these transactions are completed, Brett will be able to expand the
scope of its exploration activities at Hammond Reef.," said Patrick
Soares President and CEO of Brett Resources Inc. "Our exploration team
has done a fine job in discovering new areas of mineralization during the
past 18 months, indicating to us that the property has great growth
potential. Brett currently has two diamond drills active on the property and
expects to deliver a new resource to the market that meets NI 43-101
standards by mid year."
The terms of the
Agreement provide that:
1. Brett
will exercise its 60 percent option on Hammond Reef which will require that
Brett: (a) provide Kinross with evidence that it has completed US$5 million
in expenditures on the project; and (b) complete the issuance of the
remaining 400,000 shares to Kinross necessary to exercise the option; and
2. The
terms of the Acquisition Agreement will include:
a. that
Brett and Kinross will enter into a strategic association where Brett will
spend up to $2 million dollars to identify significant projects in British
Columbia and the Yukon. Kinross will have the election to obtain a 50%
interest in up to three projects acquired by Brett.
b. the
requirement for Brett to issue 14 million common shares to Kinross (the
"Acquisition Shares");
c. Kinross
being granted an anti-dilution right whereby it will have the right to
participate in future Brett financings to the extent necessary to maintain
its then pro-rata interest in Brett's issued and outstanding share capital
(the "Anti-Dilution Right");
d. Kinross
being granted the right to nominate one person to the Board of Directors of
Brett (the "Nomination Right");
e. the
requirement that the Anti-Dilution Right and the Nomination Right will
terminate should Kinross' ownership position in Brett fall below 10% of the
issued and outstanding common shares;
f.
Kinross being granted a 2% net
smelter return royalty ("NSR") on Hammond Reef and certain
associated Brett properties;
g. Brett
having a right of first refusal in the event that Kinross wishes to sell all
or a portion of the NSR;
h. a
requirement that as long as Kinross holds 10% or more of Brett's issued and
outstanding common shares it shall not sell, transfer or otherwise dispose of
more than 5 percent of the shares in any given 30 day period without first
providing Brett with a period of 20 days to find a purchaser for said shares;
The final Acquisition Agreement is subject to
Kinross Board approval and Brett shareholder approval as necessary, and any
other required approvals.
About Brett Resources
Brett Resources Inc. is a Canadian minerals exploration company whose primary
mandate is the discovery, acquisition, and development of precious metals
systems, with particular expertise in Canada and Latin America. Opportunities
in the acquisition of tin and tungsten resources in North America and gold in
Ontario have provided diversification to its asset portfolio.
ON BEHALF OF THE BOARD OF DIRECTORS OF
BRETT RESOURCES INC.
"Patrick Soares"
Patrick Soares, President & CEO
Cautionary Statements on Forward-Looking
Information.
The statements made in this News Release may contain certain forward-looking
statements. Actual events or results may differ from the Company's
expectations. Certain risk factors may also affect the actual results
achieved by the Company. The TSX Venture Exchange has not reviewed and does
not accept responsibility for the adequacy or accuracy of this news release.
Contact:
Patrick Soares, President
or
Tony Perri, Manager, Investor Relations
Brett Resources Inc.
Suite 611 - 675 Hastings Street
Vancouver, BC V6B 1N2
Tel: (604) 488-0008
Fax: (604) 669-2543
tperri@brettresources.com
www.brettresources.com
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