Niocan Enters into Binding Letter of Intent with Forbes & Manhattan

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Posted on May 04, 2011

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Niocan Enters into Binding Letter of Intent with Forbes & Manhattan


Toronto, Ontario, May 4, 2011: Niocan Inc. (“Niocan” or the “Company”) (TSX-NIO) announced today that the Company has entered into a binding letter of intent (“LOI”) with Forbes & Manhattan, Inc. (“F&M”) whereby F&M, its affiliates and/or assigns would provide Niocan with the lead order for a private placement of 5,157,000 common shares of Niocan at a price of $1.15 per share, which represents a 15% premium to the closing price of Niocan’s common shares on the Toronto Stock Exchange on May 3, 2011, being $1.00. The aggregate gross proceeds to the Company from the financing would be approximately $6 million. The proceeds of the private placement will be used to pay the Company’s current operating costs, and to fund the development of the Company’s assets. The Company and F&M have also agreed to work together to propose a reconstituted board of directors and the appointment of a new Chief Executive Officer of the Company.

Completion of the proposed private placement financing is conditional on the completion of due diligence to the sole satisfaction of F&M, and approval from the Toronto Stock Exchange. Niocan has agreed to a 16 day exclusivity period ending on May 20, 2011 to allow the completion of due diligence and the negotiation of a definitive subscription agreement. During that period the Company shall not be permitted to discuss, negotiate or solicit competing financing transactions or the sale of the Company’s assets with any other person. As a result of the conditions referred to above, the Company cautions that no assurance can be given that the financing will be completed.

The execution of the LOI reflects the commitment of the Special Committee and the Board of Directors of Niocan to maximize value for all shareholders through their review of strategic alternatives.

About F&M
F&M is a leading merchant bank with a proven track record in managing, developing and operating iron ore and strategic minerals companies globally. F&M participated in the development of Consolidated Thompson Iron Mines Ltd. and the Bloom Lake deposit, resulting in a resource expansion, off-take arrangements with a strategic investor, commercial production and the subsequent sale to Cliffs Natural Resources Inc. F&M has also been involved in the management and development of Alderon Resource Corp. Alderon’s Kami property is strategically located within the Labrador Trough in close proximity to Consolidated Thompson’s Bloom Lake mine, IOC’s Carol Lake mine and Cliffs Natural Resources Scully mine. F&M has also been instrumental in the development of the Shymanivske and Zelenivske iron ore projects located in Krivoy Rog, Ukraine, which are 100% owned by Black Iron Inc.

About Niocan
Niocan’s mission is to become a ferroniobium producer as soon as possible, following the issuance of a Certificate of Authorization from the Ministry of Sustainable Development, Environment and Parks for its Oka niobium property. Mining assets include mining rights in two (2) properties: 48 claims covering 1604 acres as well as surface rights on 231 acres at Oka and the Hudson Bay Great Whale Iron property covering 17,098 acres.
2000 rue Peel, bureau 760
Montréal (Québec) H3A 2W5
Tél: (514) 288-8506
Fax: (514) 843-4809

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Published in 2011