Advanced Explorations Inc announced that XinXing Pipes Group Co, Ltd has completed its initial review and site visit of the Roche Bay project and based on their positive assessment have committed to finalizing negotiations to a formal agreement by October 15th 2010.
Subsequent discussions with XXP's led to a number of changes to the original July 19th MoU in order to facilitate the implementation of a strategic investment and alignment with other potential complimentary investors.
The key points to the supplemental agreement are
1. Initial review of the technical and economic parameters of AEI's Roche Bay project have been completed with XXP agreeing to move negotiations forward to complete a formal agreement.
2. XXP has modified the Agreement to allow one of its affiliates to undertake an investment in AEI at $0.25 per share to acquire 19% of the Company's outstanding shares.
3. The Agreement has also been modified to facilitate the inclusions of potential third parties interested in developing other sites/projects together with AEI in the Melville Area. XXP and AEI will jointly assess the possible synergies to their plans in respect to any proposed opportunity.
4. With the satisfactory completion of the initial phase, the Parties have agreed to a target date of October 15, 2010 to complete the formal agreement in respect to a strategic investment and cooperation.
The basis of the Agreement is a process by which XXP can acquire a substantial direct or indirect interest in the project in exchange for technical and financial support to ensure AEI's development of the project. The contemplated agreement is subject to TSX Venture Exchange, and other regulatory approvals which may also include shareholder approval.
Mr John Gingerich president & CEO commented “We are extremely pleased to have XXP involved in the project as we believe them to be a partner with the financial strength and technical expertise required to move the Roche Bay iron ore project towards production. With the changes to the Agreement we have introduced the possibility for more dynamic development scenarios allowing other interested companies to work with XXP and AEI on the region's development opportunities. There is now a mechanism that provides additional investment opportunities without affecting XXP's desires to be AEI's exclusive primary partner in the Roche Bay development and becoming its largest shareholder.”
XXP is a State Owned Enterprise in China and has its main business in iron and steel, military clothing supply, heavy machinery engineering, real estate investments and others. Currently XXP has Subsidiaries in 24 provinces throughout China, Mongolia and India with over 80,000 employees. According to XinXing Ductile Pipe's most recent news release dated August 11th this year, their 2010 target production is approximately 6 million tons of steel and cast iron pipes. XXP is one of the world's largest producers and vendors of cast iron pipe.
