VANCOUVER, BC--(Marketwired - February 16, 2017) -
Not for Distribution to a United States Newswire or for Dissemination in the United States
Sarama Resources Limited ("Sarama" or the "Company") announces that it will immediately
implement an incentive program (the "Incentive Program") to encourage the early exercise of up to 10,361,183
warrants originally issued between May 30 and July 4, 2014 (collectively, the "Original Warrants").
Each Original Warrant is exercisable to purchase one common share of the Company (a "Share") at $0.20 per
Share until a date three years from the issuance of the Original Warrant. The Company will, from the date of this announcement,
issue to a holder of Original Warrants who exercises their Original Warrants on or before March 10, 2017, one-half of one
incentive warrant (an "Incentive Warrant") for each Original Warrant exercised. Each full Incentive Warrant will
entitle the holder to acquire an additional Share at a price of $0.35 per Share for a period expiring March 10, 2019.
The proceeds from the early exercise of the Original Warrants will be used to advance the exploration of the Company's
resource properties and to fund administrative expenses.
If a holder of Original Warrants does not exercise their outstanding Original Warrants on or before March 10, 2017 (or only
partially exercises them), their remaining Original Warrants will continue to be exercisable to purchase Shares of the Company on
their original terms.
The TSX Venture Exchange has conditionally approved the issuance of the Incentive Warrants. The Company will send a notice to
the holders of the Original Warrants outlining the details of the Incentive Program.
Related Party Transaction
Sun Valley Gold Master Fund, Ltd. ("Sun Valley") is a related party of the Company as a result of owning
approximately 14% of the Company's outstanding Shares. Sun Valley owns or controls an aggregate 2,500,000 Original Warrants.
Mr. Andrew Dinning, a director and President and Chief Executive Officer of the Company owns or controls 500,000 Original
Warrants; Mr. Sean Harvey, the Chairman of the Company owns or controls 400,000 Original Warrants; and other directors and
executive officers of the Company own or control a combined 365,167 Original Warrants.
The participation in the Incentive Program by, and issuance of Incentive Warrants to Sun Valley and the Company's directors
and executive officers would constitute a "related party transaction" as defined in Multilateral Instrument 61-101 -
Protection of Minority Security Holders in Special Transactions, which has been adopted by the TSX Venture Exchange
pursuant to its Policy 5.9 - Protection of Minority Security Holders in Special Transactions (the "61-101
Policy"). However, the Incentive Program is exempt from the formal valuation and minority shareholder approval
requirements of such instrument and policy, as the Company's Shares are listed on the TSX Venture Exchange and, in respect of the
minority shareholder approval requirement, neither the fair market value of the additional Incentive Warrants, nor the
consideration to be received for the Incentive Warrants exceeds 25% of the Company's market capitalization.
The Incentive Warrants and any Shares issued upon the exercise of the Incentive Warrants will be subject to hold period
expiring four months after the date of distribution of the Incentive Warrants.
Material Change Report
A material change report will not be filed 21 days or more prior to closing of the Incentive Program as a result of the timing
of the Incentive Program and uncertainty with regards to the quantity of Incentive Warrants issuable to related parties.
Incentive Warrants not Subject to United States Securities Act of 1933
These securities have not been and will not be registered under the United States Securities Act of 1933, as amended, (the
"U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States
unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from registration is
available. This announcement does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in
this Private Placement within the United States or to, or for the account or benefit of, U.S. Persons (as defined under
Regulation S under the U.S. Securities Act).
For further information on the Company's activities, please contact:
Andrew Dinning or Lui Evangelista
e: info@saramaresources.com
t: +61 (0) 8 9363 7600
ABOUT SARAMA RESOURCES LTD
Sarama Resources Ltd (TSX VENTURE: SWA) is a West African focused gold explorer with
substantial landholdings in Burkina Faso. Sarama is focused on consolidating under-explored landholdings in Burkina Faso and
other established mining jurisdictions.
Sarama's flagship properties are situated within the Company's South Houndé Project area in south-west Burkina Faso. Located
within the prolific Houndé greenstone belt, Sarama's exploration programs have built on significant early success to deliver an
inferred mineral resource estimate of 2.1 Moz gold(1),(2) Acacia Mining plc is earning up to a 70% interest in the
South Houndé Project by satisfying certain conditions, including funding earn-in expenditures of up to US$14 million, over a
4-year earn-in period and may acquire an additional 5% interest, for an aggregate 75% interest in the Project, upon declaration
of a minimum mineral reserve of 1.6 million ounces of gold.
Sarama holds a 31% participating interest in the Karankasso Project Joint Venture ("JV")(3) which
is situated adjacent to the Company's South Houndé Project in Burkina Faso and is a JV between Sarama and Savary Gold Corp.
("Savary"). Savary is the operator of the JV and in October 2015, declared a maiden inferred mineral resource
estimate of 671,000 ounces of contained gold(4),(5)at the Karankasso Project JV.
Sarama has also agreed to acquire a 100% interest in the Bondi gold deposit from Orezone Gold Corporation (refer news release
May 24, 2016). Bondi has a historical estimate of mineral resources of 0.3Moz Au (measured and indicated) and 0.1Moz Au
(inferred)(6),(7).
Together, the South Houndé Project, Bondi deposit and the Karankasso Project form a cluster of advanced gold deposits, within
trucking distance of one another, which potentially offers a development option for a multi-source fed central processing
facility in the southern Houndé Belt region of Burkina Faso.
Incorporated in 2010, the Company's Board and management team have a proven track record in Africa and a strong history in the
discovery and development of large-scale gold deposits. Sarama is well positioned to build on its current success with a sound
exploration strategy across its property portfolio.
CAUTION REGARDING FORWARD LOOKING STATEMENTS
Information in this news release that is not a statement of historical fact constitutes forward-looking information. Such
forward-looking information includes statements regarding the Company's intentions for the use of proceeds from the exercise of
the Original Warrants, plans for drilling and geochemical and geophysical surveys at the South Houndé Project, the Earn-In
Agreement with Acacia, including the amounts that may be spent on exploration and interests in the South Houndé Project that may
be earned by Acacia upon making certain expenditures and estimating a minimum reserve, the potential to expand the present oxide
component of the Company's existing estimated mineral resources, and future exploration plans. Actual results, performance or
achievements of the Company may vary from the results suggested by such forward-looking statements due to known and unknown
risks, uncertainties and other factors. Such factors include, among others, that the business of exploration for gold and other
precious minerals involves a high degree of risk and is highly speculative in nature; Mineral Resources are not Mineral Reserves,
they do not have demonstrated economic viability, and there is no certainty that they can be upgraded to Mineral Reserves through
continued exploration; few properties that are explored are ultimately developed into producing mines; geological factors; the
actual results of current and future exploration; changes in project parameters as plans continue to be evaluated, as well as
those factors disclosed in the Company's publicly filed documents. There can be no assurance that any mineralisation that is
discovered will be proven to be economic, or that future required regulatory licensing or approvals will be obtained. However,
the Company believes that the assumptions and expectations reflected in the forward-looking information are reasonable.
Assumptions have been made regarding, among other things, Acacia's continued funding of exploration activities, the Company's
ability to carry on its exploration activities, the sufficiency of funding, the timely receipt of required approvals, the price
of gold and other precious metals, that the Company will not be affected by adverse political events, the ability of the Company
to operate in a safe, efficient and effective manner and the ability of the Company to obtain further financing as and when
required and on reasonable terms. Readers should not place undue reliance on forward-looking information.
Sarama does not undertake to update any forward-looking information, except as required by applicable laws.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture
Exchange) accepts responsibility for the adequacy or accuracy of this release.
QUALIFIED PERSONS' STATEMENT
Scientific or technical information in this news release that relates to the preparation of the Company's mineral resource
estimate for the South Houndé Project is based on information compiled or approved by Adrian Shepherd. Adrian Shepherd is an
employee of Cube Consulting Pty Ltd and is considered to be independent of Sarama Resources Ltd. Adrian Shepherd is a Chartered
Professional Member in good standing of the Australasian Institute of Mining and Metallurgy and has sufficient experience which
is relevant to the commodity, style of mineralisation under consideration and activity which he is undertaking to qualify as a
Qualified Person under National Instrument 43-101. Adrian Shepherd consents to the inclusion in this news release of the
information, in the form and context in which it appears.
Scientific or technical information in this news release that relates to the preparation of the Karankasso Project's mineral
resource estimate is based on information compiled or approved by Eugene Puritch and Antoine Yassa. Eugene Puritch and Antoine
Yassa are employees of P&E Mining Consultants Inc. and are considered to be independent of Savary Gold Corp. and Sarama
Resources Ltd. Antoine Yassa is a member in good standing of the Ordre des Géologues du Québec and Eugene Puritch is a member in
good standing of Professional Engineers Ontario. Eugene Puritch and Antoine Yassa have sufficient experience which is relevant to
the commodity, style of mineralisation under consideration and activity which they are undertaking to qualify as a Qualified
Person under National Instrument 43-101. Eugene Puritch and Antoine Yassa consent to the inclusion in this news release of the
information, in the form and context in which it appears.
Scientific or technical information in this news release, in respect of the Bondi gold deposit relating to mineral resource
and exploration information drawn from the Technical Report prepared for Orezone on that deposit has been approved by Guy
Scherrer. Guy Scherrer is an employee of Sarama Resources Ltd and is a member in good standing of the Ordre des Géologues du
Québec and has sufficient experience which is relevant to the commodity, style of mineralisation under consideration and activity
which he is undertaking to qualify as a Qualified Person under National Instrument 43-101. Guy Scherrer consents to the inclusion
in this report of the information, in the form and context in which it appears.
(1) 43.0 Mt @ 1.5 g/t Au (reported above cut-off grades ranging 0.3-2.2 g/t Au, reflecting the mining methods
and processing flowsheets assumed to assess the likelihood of the inferred mineral resources having reasonable prospects for
eventual economic extraction)
(2) The effective date of the Company's inferred mineral resource estimate is February 4, 2016. For further
information regarding the mineral resource estimate please refer to the technical report titled "NI 43-101 Independent Technical
Report South Houndé Project Update, Bougouriba and Ioba Provinces, Burkina Faso", dated March 31, 2016. The technical report is
available under Sarama Resources Ltd.'s profile on SEDAR at www.sedar.com.
(3) Sarama has 31% and Savary has 69% ownership interests.
(4) 9.2 Mt @ 2.3 g/t Au (at a 0.5 g/t Au cut-off)
(5) The effective date of the Karankasso Project JV mineral resource estimate is October 7, 2015. For further
information regarding the mineral resource estimate please refer to the technical report titled "Technical Report and Resource
Estimate on the Karankasso Project, Burkina Faso", dated October 7, 2015. The technical report is available under Savary Gold
Corp's profile on SEDAR at www.sedar.com.
(6) 4.1Mt @ 2.1g/t Au for 282,000 oz Au (measured and indicated) and 2.5Mt @ 1.8g/t Au for 149,700 oz Au
(inferred), reported at a 0.5 g/t Au cut-off
(7) The effective date of the historical estimate of the Bondi deposit mineral resource estimate is
February 20, 2009. For further information regarding the mineral resource estimate please refer to the technical report titled
"Technical Report on the Mineral Resource of the Bondigui Gold Project", dated February 20, 2009. The technical report is
available under Orezone Gold Corporation's profile on SEDAR at www.sedar.com.