Atomic Signs Letter of Intent to Acquire Tanzanian Property Package
Vancouver, BC - October 3, 2007 - Atomic Minerals Ltd. (TSX-V: ATL) ("Atomic" or the "Company") is pleased to announce that it has signed an amended letter of intent (the "Amended LOI") with Geo Can Resources Company Ltd. ("Geo Can") to almost double the size of the land package in the United Republic of Tanzania to be subject to an option agreement (the "Option"), which the Company originally announced by news release dated July 25, 2007. The Amended LOI will permit Atomic to acquire under the Option up to a 90% interest in a land package now totalling approximately to over 1.45 million square acres (the "Property") divided into 10 separate licenses (the "Licenses"). The two companies have agreed to negotiate the Option based on the Amended LOI by November 15, 2007 subject to the results of Atomic's due diligence on the Property (including the preparation of a title opinion and a Technical Repor
t pursuant to National Instrument 43-101) and TSX Venture Exchange ("TSX-V") approval.
The additional property which was added to those included in the original package are also located in southwestern Tanzania and are considered to be part of the Malawi Extension based on the location of the Property relative to blocks earmarked as potentially favourable for uranium enrichment. Other mining companies exploring in the area include Paladin Resources (Malawi), Universal Exploration and Western Metals (both in Tanzania). Located just 60 km from Atomics property PL4514 is Paladin's , Kayelekera Project.This project has a current resource of over 25,000,000 pounds of U3O8, and due to go into production in late 2008.
See Map http://atomicminerals.com/projects/tanzania/asp
In addition to the non-refundable deposit of US$65,000 which the Company already paid Geo Can on July 25th, Atomic paid Geo Can US$300,000 on execution of the Amended LOI as well as reimbursing Geo Can for land registration fees of US$42,000. The Option will still be for a term of four years and will include the following terms, all subject to TSX-V approval:
1) Atomic will make cash payments and issue common shares to Geo Can as follows:
a) On closing of the Option Agreement (the "Closing"), US$300,000 and 800,000 common shares;
b) On the first anniversary of Closing, US$850,000 and 850,000 common shares;
c) On the second anniversary of Closing, US$1,050,000 and 1,050,000 common shares;
d) On the third anniversary of Closing, US$1,250,000 and 1,250,000 common shares; and
e) On the fourth anniversary of Closing, US$1,500,000 and 1,500,000 common shares.
Atomic may still elect to pay up to 75% of the value of the Atomic common shares to be issued to Geo Can in cash on the same terms as were announced in our July 25th news release. Atomic may also elect to exercise its option to acquire 90% of any one or more Licenses within 90 days of any anniversary of Closing. If Atomic so elects, it will pay the pro rata portion (based on the number of square acres of the chosen Licenses) of all remaining cash and common share payments, subject to the following deductions depending upon the anniversary of Closing on which the election is made:
On or Before the First Anniversary of Closing: 50% deduction
On or Before the Second Anniversary of Closing: 30% deduction
On or Before the Third Anniversary of Closing: 10% deduction
The cash and share payments as well as the exploration requirements (see #2 below) on the remaining unexercised Licenses will be reduced pro rata to account for the Licenses on which Atomic exercised the option.
2) Atomic may elect to purchase the remaining 10% interest of any Licenses at the following times and for the amounts per acre of land in such License set out below:
a) On or before the first anniversary of Closing: US$1 per acre;
b) On or before the second anniversary of Closing: US$1.50 per acre;
c) On or before the third anniversary of Closing: US$2.00 per acre; and
d) On or before the fourth anniversary of Closing: US$2.50 per acre.
3) Atomic must incur yearly minimum exploration expenditures on the Property as follows:
a) By the first anniversary of Closing, US$350,000;
b) By the second anniversary of Closing, US$400,000;
c) By the third anniversary of Closing, US$600,000; and
d) By the fourth anniversary of Closing, US$750,000.
The Property will also be subject to a 2% NSR royalty, which Atomic may buy out at any time for US$5 million. In any year following Closing, Atomic may, on its election, surrender its interest in any one or more Licenses provided that the number of square acres of the Licenses surrendered in such year may not exceed 20% of the total square acreage of the Property. Upon surrender of any License, all rights thereto will immediately revert to Geo Can, and the remaining annual payments of cash and common shares set out under #1 below above will be reduced on a pro rata basis per acre of land surrendered.
About Atomic
Atomic Minerals has filed a Notice of Intent (see our news release dated September 25, 2007) to begin drilling on portions of the 932 claims it holds on the Dolores Anticline of southwestern Colorado. It has additionally secured another 1585 claims of the Anticline under a LOI (see our news release dated June 11, 2007). The total land package in Colorado will include over 2500 claims in the Dolores Anticline and 3 properties totalling 362 claims in Grand County, Colorado. The Dolores Anticline remains as one of the last salt anticlines of the Uravan Minerals Belt and Paradox Basin to be explored for uranium.
For further information on Atomic, please contact Warren McIntyre, the Company's Chief Executive Officer at (604) 639-2866.
"Warren McIntyre"
Warren McIntyre
President and Chief Executive Officer
Atomic Minerals Ltd.
Renmark Financial Communications Inc.
Christine Stewart : cstewart@renmarkfinancial.com
Victoria Stepanova : vstepanova@renmarkfinancial.com
Tel. : (514) 939-3989
Fax : (514) 939-3717
www.renmarkfinancial.com
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