great news.this should get this movingApr 01, 2009 13:21 ET
Nanika Announces Signing of Joint Venture Agreement
VANCOUVER, BRITISH COLUMBIA--(Marketwire - April 1, 2009) - Nanika Resources Inc. (TSX VENTURE:NKA)(FRANKFURT:C7X) is pleased to announce that it has signed a Joint Venture Agreement with Palm Clean Energy Inc. and Daewon Chemical Co. Ltd. of South Korea.
The new joint venture company formed by these partners will hold the continued exploration, development and mining right to the "Lucky Ship" molybdenum project located at the "Nanika Ridge" site approximately 85 kilometres southwest of the town of Houston, British Columbia.
Pursuant to the Nanika Molybdenum Joint Venture Agreement (JVA) the Korean partners will be issued 40% of the new joint venture company shares and Nanika will hold 60%. The terms of the new joint venture are consistent with the Memorandum of Understanding previously announced on November 27, 2008 between the parties, except that given the continuing financial crisis the signing payment of $500,000 is to be divided into two payments, with the second half payable in 6 months time, with payments subject to Korean government approval.
The total payments by Korean partners to the "Lucky Ship" molybdenum project will then be $5.0 million dollars, inclusive of private placements. Following the subsequent completion by the Korean partners of the junior financing needed for all reasonably estimated exploration costs to provide the information necessary to produce a bankable feasibility study in accordance with National Instrument 43-101 the Korean partners will be entitled to an option to 51% of the shares of the joint venture company and Nanika will hold 49%. This financing is to be completed within 24 months of the signing of the Joint Venture Agreement.
The Korean partners will then complete the bankable feasibility study and arrange the senior financing required to put the property into continuous production. Upon arranging the senior financing the Korean partners will be entitled to an option to 60% of the shares of the joint venture company and Nanika will hold 40%.
In the event that the Korean partners are not able to arrange the senior financing then Nanika would be at liberty to do so. Upon Nanika arranging the senior financing, the Korean partners would hold 42% of the shares in the joint venture company, and Nanika would hold 58%.
About Nanika Resources Inc.
Nanika Resources Inc. is a TSX Venture listed mineral exploration and development company focusing on the development of its mineral properties in British Columbia and the advancement of its other mineral exploration properties, all of which are located within Canada.
On Behalf of the Board
James. D Jacuta, Chairman, President & CEO
Neither the TSX Venture Exchange nor the Investment Industry Regulatory Organization of Canada (IROC) accepts responsibility for the adequacy or accuracy of this release.