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Ultra Lithium Executes Balkans Framework Agreement And Announces Equity Financing


Vancouver, B.C., May 31, 2012 Ultra Lithium (TSX-V: ULI) (FSE: QFB) ("the Company" or "Ultra") is pleased to announce that it has executed a legally binding Framework Agreement with Beijing Explo-Tech Engineering Co. Ltd. (BETEC) to explore and develop its Balkans Project in the Republic of Serbia. In addition, Beijing Guofang Mining Investment Co. Ltd. (BGMI) will complete a financing in the amount of C$1 million to ensure rapid advancement of the Company’s exploration program.

This joint venture will allow Ultra to commence geophysical exploration work on its seven highly-prospective, mineral exploration licenses in the Republic of Serbia. Ultra anticipates two exploration crews in the field from mid-June to commence “Magneto Telluric” surveys over all seven concessions.

Highlights from the agreement include:

  • BGMI and associates will invest C$1,000,000 through the purchase of units of securities of Ultra at $0.05 per unit. Each unit will consist of one (1) common share of Ultra and one common share purchase warrant, with each warrant entitling BETEC to acquire one (1) additional common share of Ultra at $0.10 per share for a period of two (2) years.
  • BETEC undertakes and commits to fund up to CAD$3,500,000 of approved expenditures. Such expenditures will be incurred within a period of three (3) years.
  • BETEC will earn a five (5%) per cent equity interest in Ultra Balkans d.o.o., Ultra’s wholly-owned Serbian subsidiary, for each CAD$500,000 of approved expenditures incurred and up to a 35% equity interest once the entire CAD$3,500,000 of qualified expenditures has been incurred.

Ultra Lithium’s Chief Executive Officer Marc Morin commented: "This $4.5 million investment strengthens our balance sheet and allows us to start our exploration program  which will include soil sampling, geophysics and a drilling program to advance the Balkans Project. We are very excited to be working with our new partners."

About Ultra Lithium:

Ultra Lithium Inc. is a junior explorer listed on the TSX Venture Exchange under the symbol ULI. The Company is committed to the aggressive pursuit of properties with high returns-on-investment and maximizing the value of assets through a disciplined process of assessment and responsible acquisitions. Currently, the Company holds exploration licenses in Ontario, Canada, Nevada, U.S.A and Serbia.

Property Highlights:

  • 643 km2 of lithium/boron mineral exploration licenses in the Republic of Serbia
  • All seven exploration concessions are within well-defined sedimentary basins
  • Proximity to infrastructure (rail/road/sea), (electricity), and (labour force)
  • Ultra has 100% ownership of its exploration licenses
  • Rio Tinto is completing a $27 million pre-feasibility study & projecting production for 2016 1
  • Rio Tinto’s Jadar deposit could produce up to 20% of the current worldwide annual lithium demand1
  • Off the shelf technology can process Jadarite ore2

About Beijing Explo-Tech Engineering Co. Ltd.

BETEC is a high-tech geological exploration enterprise which provides geological exploration services, research, software development and technology support for the mining industry. Areas of expertise include geological, geophysical, geochemical and remote sensing. BETEC has 110 official employees.  

Terms of the proposed transaction:

As stated in the preceding highlights, under the terms of the framework agreement, BGMI and its associates will invest CAD$1,000,000 through the purchase of units of securities of Ultra at $0.05 per unit. Each unit will consist of one (1) common share of Ultra and one common share purchase warrant, with each warrant entitling BGMI and associates to acquire one (1) additional common share of Ultra at $0.10 per share for a period of two (2) years. BETEC also undertakes and commits to fund up to CAD$3,500,000 of approved exploration expenditures on the Property to be incurred within a period of three (3) years from the date of formation of the joint venture. BETEC will earn a five (5%) per cent equity interest for each CAD$500,000 of approved expenditures incurred and up to a thirty five (35%) per cent equity interest once the entire CAD$3,500,000 of qualified expenditures has been incurred.

Both parties agree to hold the Property and the other assets of the partnership consistent with applicable legislation, to explore the Property for minerals and, if feasible, develop a mine thereon, and so long as it is technically, economically and legally feasible, operate such mine and exploit the minerals extracted from the Property, and carry out any other activity in connection with or incidental to any of the foregoing.

Closing of the proposed transaction is subject to satisfaction or waiver of terms and conditions, customary or otherwise, including, but not limited to, acceptance by the TSX Venture Exchange of the proposed transactions.

The units issued will be subject to a four-month hold period from the closing date of the private placement offering. Finders' fees may be payable in connection with this private placement in accordance with TSX Venture Exchange policy.

For further information please contact Mr. Marc Morin, President and CEO at 604-669-9788.

ULTRA LITHIUM INC.

On behalf of the Board

"Marc Morin"
Marc Morin, President & CEO

Statements in this press release regarding the Company which are not historical facts are “forward-looking statements” that involve risks and uncertainties. Such information can generally be identified by the use of forwarding-looking wording such as “may”, “expect”, “estimate”, “anticipate”, “intend”, “believe” and “continue” or the negative thereof or similar variations. Since forward-looking statements address future events and conditions, by their very nature, they involve inherent risks and uncertainties such as the risk that the closing may not occur for any reason. Actual results in each case could differ materially from those currently anticipated in such statements due to factors such as: (i) the inability of the parties to consummate the definitive letter agreement; (ii) fluctuation of mineral prices; (iii) a change in market conditions; (iv) the inability to produce the technical report for any reason whatsoever; and (v) the refusal of the Exchange to accept the proposed transaction for any reason whatsoever. Except as required by law, the Company does not intend to update any changes to such statements.

Neither the 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.

We seek Safe Harbor.

Sources:
1  Serbian Lithium Under Focus, Critical Materials for Green Energy, September 2011
2  Jadar Project, IM Lithium Conference, Santiago, 28th January 2009