Novadx and Sandstorm Acquire Additional Rex Coal and Related Assets
in Tennessee
/NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR
DISSEMINATION IN THE UNITED
STATES/
- Maximizes productivity and future expansion through second
mine entry on Rex coal.
- Potential to significantly increase reserves, resources and
mine life.
- Facilitates a quicker start-up of mining operations at Rex #
1 mine.
Trading Symbol: NDX - TSX-V
VANCOUVER, Jan. 2, 2013 /CNW/ - Novadx Ventures Corp.
("Novadx" or the "Company") (TSX-V: NDX) and
Sandstorm Metals & Energy Ltd. ("Sandstorm") announce
completion of the acquisition (previously announced on October 16, 2012) of Mine 12, the Turley Rail
Load-Out, and the Smokey Junction Preparation Plant (the
"Acquisition") located in Campbell and Scott Counties, Tennessee (the "Tennessee
Properties"). The Tennessee Properties were acquired from
Premium Coal Company National Coal, LLC and Jacksboro Coal Company,
LLC for an aggregate purchase price of US$8.5 million (the "Purchase Price").
The Acquisition was completed through a newly
incorporated company ("US Inc.") owned by Sandstorm. Novadx
will have full control over management and operation of US Inc.
and, subject to Novadx completing financings for minimum
aggregate proceeds of not less than $10,000,000, Novadx will have a one-year option
(the "Option Period") to acquire Sandstorm's interest in US
Inc. at cost. Novadx will be responsible for the costs of any
operations until the expiry of the Option Period. The Purchase
Price was paid through a cash payment of US$3,000,000 contributed by Sandstorm,
US$2,000,000 paid through the
issuance of 4,377,675 common shares of Sandstorm and a 5 year
secured loan from National Coal LLC. to US Inc. in the amount of
US$3,500,000 (the "Loan"). The
Loan is secured by a first lien and security interest in the Smokey
Junction Preparation Plant, payable in annual installments of US
$700,000 in principal plus accrued
interest at the Prime Rate quoted in the Wall Street Journal.
US Inc. may pay the outstanding principal balance plus accrued
interest at any time prior to maturity without penalty.
Sandstorm has the option to pay the outstanding principal balance
plus accrued interest at any time through the issuance of Sandstorm
common shares at the 10 day trading average prior to Sandstorm
making such election. Novadx has otherwise agreed to fund the
repayment of the Loan and in doing so will earn up to a 41.2%
ownership interest in US Inc. based on its and Sandstorm's relative
contribution to the Purchase Price. By exercising the Option
and repaying the Loan, Novadx would gain a 100% interest in the
Tennessee Properties.
Mine 12 is contiguous with Novadx's existing Rex
coal reserves and will provide a second mine entry into the high
quality coal seam and potentially add to the reserves and resources
and extend the mine life. In addition, the Smokey Junction
Preparation Plant should facilitate a more rapid start-up of mining
operations at the Rex # 1 mine and the Turley Rail Load-Out
facility brings improved market access, both domestic and export.
The acquisition of the Tennessee Properties significantly improves
Novadx's asset package and marketability and puts Novadx in a more
favorable position to complete the special warrant financing
previously announced on September 21,
2012 and October 12, 2012. The
US$3,000,000 cash commitment from
Sandstorm towards the Purchase Price forms part of Sandstorm's
previously announced commitment to subscribe for up to $5,000,000 under the Novadx special warrant
financing.
Novadx CEO, Mr. Daniel
Roling commented, "With completion of this acquisition, the
Company now has the complete suite of assets needed to produce,
prepare, and ship coal at its Tennessee operations. Not only does this
improve our access to Rex coal, it should ultimately increase our
reserve and resource position in this highly sought after coal.
" Mr. Roling continued "Our immediate objective continues to
be completion of the announced equity raise, proceeds of which will
be used to bring the Tennessee
assets into production. There is much to do to bring these
facilities on line; however, we believe that objective is
achievable within three to six months. It is our objective to
be producing and shipping coal to customers six months after
completion of our announced equity raise."
Addressing the Company's objective Mr. Roling
went on to say that a number of productive meetings with potential
investors had been held, and said additional meetings are being
scheduled. "It is my view that we have come a very long way
in a very short period of time, and success is within our
reach. With the holiday season now over, the Company is
continuing its efforts to complete the previously announced Special
Warrant Financing."
About Novadx: Novadx Ventures Corp.
is a Vancouver based mining
investment company. Through its wholly owned subsidiary, Novadx's
primary focus is to invest its capital to acquire and develop
companies with active or near production high quality coal reserves
in the US Appalachia coal region. Novadx intends to continue to
grow the value of its coal investments through expanding production
and reserves amongst its existing investments and by investing in
additional acquisitions. Novadx is actively evaluating a
number of high quality coal acquisition opportunities. For
more information please visit www.novadx.com.
About MCoal: MCoal Corporation is a
wholly-owned subsidiary of Novadx Ventures Corp. which operates the
Rosa coal mine in Blount County, Alabama and is developing the
Rex #1 coal mine in Campbell County,
Tennessee.
ON BEHALF OF THE BOARD
Daniel A. Roling
President, CEO and Director
Neither TSX Venture Exchange nor its
Regulation Services Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this release The TSX Venture Exchange
has in no way passed upon the merits of the proposed transaction
and has neither approved nor disapproved the contents of this press
release. This press release shall not constitute an offer to sell
or the solicitation of an offer to buy, nor shall there be any sale
of these securities in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to the qualification
under the securities laws of such jurisdiction.
This release contains "forward-looking
information" that includes information relating to future events
and future financial and operating performance, including
management's assessment of Novadx's and MCoal's future outlook,
potential financings, potential acquisitions, properties,
permitting and mining activities and production. Specifically, this
release contains forward-looking information related to
future development of assets, mining operations, permitting and
regulatory approvals, and potential financings. Statements included
in this announcement, including statements concerning our plans,
intentions and expectations, which are not historical in nature are
intended to be, and are hereby identified as, "forward-looking
statements" for purposes of the safe harbor provided by Section 21E
of the Securities Exchange Act of 1934, as amended by the Private
Securities Litigation Reform Act of 1995. Forward-looking
statements may be identified by words including "anticipates",
"believes", "intends", "estimates", "expects" and similar
expressions. Forward-looking information should not be read as a
guarantee of future performance or results and will not necessarily
be accurate indications of the times at, or by which, that
performance or those results will be achieved. Forward-looking
information is based on information available at the time it is
made and/or management's good faith belief as of that time with
respect to future events, and such information is subject to risks
and uncertainties that could cause actual performance or results to
differ materially from those expressed in or suggested by the
forward-looking information. Important factors that could cause
these differences include but are not limited to: requisite
regulatory and shareholder approvals, actual or expected sampling
or production results, pricing and assumptions, projections
concerning reserves and/ or resources in our mining operations;
changes in contracted sales, the business of the Company may suffer
as a result of uncertainty surrounding the coal market; the Company
may be adversely affected by other economic, business, and/or
competitive factors; the worldwide demand for coal; the price of
coal; the price of alternative fuel sources; the supply of coal and
other competitive factors; the costs to mine and transport coal;
the ability to maintain existing mining leases and rights and the
ability obtain new mining leases, rights and permits; governmental
and regulatory approvals, the costs of reclamation of previously
mined properties; the risks of expanding coal mining activities and
production; the ability to bring new mines on line on schedule;
industry competition; the Company's ability to continue to execute
its growth strategies; the Company's ability to secure and complete
additional financing and debt restructuring; the Company's ability
to complete planned acquisitions; and general economic conditions.
You should not put undue reliance on any forward-looking
information. We assume no obligation to update forward-looking
information to reflect actual results, changes in assumptions or
changes in other factors affecting forward looking information,
except to the extent required by applicable securities laws. If we
do update one or more forward-looking information, no inference
should be drawn that we will make additional updates with respect
to those or other forward-looking information. The company
cautions readers that forward-looking statements, including without
limitation those relating to the company's future operations and
business prospects, are subject to certain risks and uncertainties
that could cause actual results to differ materially from those
indicated in the forward-looking statements.
SOURCE Novadx Ventures Corp.