| ||May 13, 2008|
Commander Leverages Its Base Metal Rights On Baffin Island
| ||Commander Resources Ltd. (CMD-TSX Venture) has entered into a Heads of Agreement with Global Resources Corporation Pty Ltd., a privately held Australian company ("GRC") regarding Commander's exploration and development rights on the Bravo and Qimmiq properties, Baffin Island, Nunvaut (the "Property"). The agreement provides GRC the right to earn a 100% interest in non-gold rights on Commander's Baffin Island properties as part of a planned Initial Public Offering ("IPO") contemplated by GRC ("Newco"). Gold, diamond and uranium-dominant resources are excluded from this agreement. |
GRC plans to advance the exploration opportunity for zinc and nickel hosted by the sedimentary and volcanic rocks while Commander continues to focus its efforts on advancing the gold potential on the Property. The technical driving force behind GRC is Frank Bunting, formerly Base Metal and Operations Manager, North America and then Global Nickel Commodity Specialist with BHP Billiton.
A portion of the cash proceeds from this deal will be used by Commander to complete recently executed agreements between Commander and BHP Billiton announced January 14, 2008 and between Commander and Xstrata announced May 12, 2008, subject to successful completion of the Newco IPO.
"This deal represents exceptional leverage value for Commander. It provides us with the cash to gain 100% ownership of the large Baffin Island properties. It also gives us a significant equity position in a new public company with strong technical and financial backing to advance mineral properties in Mexico and Canada, including the base metal opportunity of our Baffin properties under this deal, as well as our wholly- owned Olympic-Rob IOCG property in the Yukon, through a deal we announced May 8," states Ken Leigh, President & CEO of Commander.
Under the Agreement, GRC shall have the right to earn a 100% interest in the base metal rights (non-gold rights) on the Qimmiq and Bravo properties for the following considerations to Commander:
- GRC will issue 10% of the total number of issued shares in Newco to Commander, calculated immediately following completion of the planned IPO;
- GRC will pay C$1,425,000 cash to Commander including $25,000 cash upon signing of this Agreement, $50,000 cash on or before July 15, 2008, $200,000 cash on or before October 15, 2008, and $1,150,000 cash within 10 days of successfully listing the IPO;
- Prior to the IPO of Newco, GRC shall offer Commander the opportunity to buy up to 10% of any pre-IPO seed stock, at the same price agreed between for all pre-IPO seed capital participants and GRC;
- GRC will also deliver to Commander, for no consideration, rights to 5% additional equity in Newco at the time of and as part of the IPO by means of an issue of un-listed warrants, at an exercise price and term to be determined by GRC immediately prior to the IPO of Newco;
- GRC agrees to complete a minimum $500,000 exploration program on the Baffin Project by December 31, 2009, and;
- GRC reserves one seat on the board of directors of Newco for Commander.
The terms and conditions as agreed are subject to the underlying agreements between Commander and BHP Billiton and between Commander and Xstrata such that GRC shall assume all obligations and considerations to Xstrata and BHPB under those agreements.
On behalf of the Board of Directors,
Kenneth E. Leigh
President & CEO
For further information, please call:
Investor Relations: BMK Communications
Toll Free: 1-866-782-6032
The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this news release.
You can view the Next News Releases item: Thu May 22, 2008, Commander Discovers Significant Geophysical Anomalies And Outlines High Priority Drill Targets On The South Voisey'S Bay Nickel Project
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