Shareholders Enter into Framework Agreement Regarding Sale of Shares of Stone Resources Limited
November 20 2011 - 6:23AM
PR Newswire (Canada)
VANCOUVER, Nov. 21, 2011 /CNW/ - Stone Resources Ltd. ("Stone" or
the "Company"), Stone Group Holdings Limited ("SGHL"), Duan Yongji
("Duan") and Stone Group Corporation (PRC) ("Stone Group" and
together with SGHL and Duan, the "Stone Controlling Shareholders")
are pleased to announce that on November 17, 2011, SGHL entered
into a framework agreement (the "Framework Agreement") with Superb
Summit International Timber Company Limited ("Superb Summit")
whereby Superb Summit would acquire, in an entirely off-shore
transaction, not less than 51% of the issued shares (the "Stone
Shares") of the Company (the "Proposed Acquisition"), consisting of
the Stone Shares owned by the Stone Controlling Shareholders..
Completion of the Proposed Acquisition is subject to, among other
things, the negotiation of formal agreements ("Formal Agreements").
Superb Summit is a Cayman Islands company listed on The Stock
Exchange of Hong Kong, principally engaged in integrated timber and
electronic products including: (i) exploitation and management of
timber resources in China; and (ii) distribution, marketing and
sales of a wide range of timber products. Upon completion of the
Proposed Acquisition, the parties to the Framework Agreement intend
further cooperation in investing in the gold mining business in
Australia. The Company understands that SGHL was authorized by the
other Stone Controlling Shareholders to, among other things,
negotiate and attend to matters relating to the Proposed
Acquisition. The Stone Controlling Shareholders own and control,
directly and indirectly, the number and percentage of Stone Shares
set forth below: Shareholder Number of Stone Shares Percentage of
over which control is outstanding exercised Stone Shares Stone
Group Holdings 34,160,907 10.46% Limited Duan Yongji 77,456,547
23.71% Stone Group Corporation 89,947,374 27.53% (PRC) Duan owns
71,151,394 Stone Shares through Seasource Holdings Limited, an
indirectly wholly-owned company. Stone Group owns its Stone Shares
through Springbend Holdings Limited, an indirectly wholly-owned
subsidiary. The key terms of the Framework Agreement are as
follows: -- Consideration for the Proposed Acquisition will be
satisfied by the issuance by Superb Summit of: (i) shares of Superb
Summit with a par value of HK$0.10 each ("Superb Summit Shares");
and/or (ii) convertible notes by Superb Summit which entitle the
holder(s) thereof to subscribe for new Superb Summit Shares, at an
issue price or conversion price, as applicable, of between HK$0.20
and HK$0.25 per Superb Summit Share or the average closing price
per Superb Summit Share for the thirty business days prior to the
completion date of the Proposed Acquisition, whichever is lower. --
Pursuant to the Framework Agreement, the amount to be paid for each
Stone Share is subject to, among other things, further negotiation
between the parties, and will be fixed upon the entering into of
the Formal Agreements. -- For a period of four months from the date
of the Framework Agreement, Superb Summit has exclusive rights to
negotiate with the Stone Controlling Shareholders in respect of the
Proposed Acquisition, to conduct a due diligence review and to
conclude the Formal Agreements. The Stone Controlling Shareholders
shall not during this period negotiate or enter into any agreement
or arrangement with any third party in relation to the Proposed
Acquisition. -- In the event that the Formal Agreements are not
entered into within four months from the date of the Framework
Agreement, or such other date as is agreed to by Superb Summit and
SGHL, the Framework Agreement will lapse. -- Superb Summit will
arrange for further funds to finance the operations and production
of A1 Minerals Limited, a subsidiary of Stone, within seven days
after the entry into of the Formal Agreements. -- Superb Summit and
SGHL will use best endeavours to cooperate with each other in
respect of a due diligence review process. Stone intends to appoint
a special committee of independent directors to consider the
Proposed Acquisition, and will provide further announcements when
appropriate. The Proposed Acquisition is subject to various
conditions, including the entry into formal agreements, and
obtaining approval from applicable regulators and stock exchanges.
On behalf of the Board, "Yongji Duan" Yongji Duan Chairman About
Stone Resources Limited Stone Resources Limited is a company
incorporated in Bermuda and listed on the TSX Venture Exchange in
Canada. The Company is involved with mineral resources exploration
and development, and owns majority control of the Brightstar
Project, a gold exploration property in Western Australia. Stone
Resources plans to expand and develop its business using its
effective team of experts in exploration, geology, metallurgy, mine
engineering, law and finance. Cautionary Statement on
Forward-Looking Statements The information in this document
contains certain forward-looking statements with respect to the
Proposed Acquisition, the negotiation of Formal Agreements, the
satisfaction of conditions precedent to the Proposed Acquisition,
and the future actions of Superb Summit and SGHL. Although
management of the Company has a reasonable basis for the
conclusions drawn, risk factors and uncertainties may cause actual
results to differ materially from those currently anticipated in
such statements. These risks and uncertainties relate to such
factors as the ability of the Stone Controlling Shareholders to
negotiate and complete the Proposed Acquisition as expected or at
all. In view of these uncertainties we caution readers not to place
undue reliance on these forward-looking statements. Statements made
in this document are made as of the date hereof and the Company
disclaims any intention or obligation to update or revise any
statements made herein, except in accordance with applicable
securities 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. Stone Resources Limited CONTACT: For
additional information or a copy of the early warning reportsofthe
Stone Controlling Shareholders, contact:Kelei XinVice-President and
Corporate Secretary+1 (604) 303-9070
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