October 25, 2006
Aurelian Resources Advised of Legal Actions-Considers Warrant Actions to be Without Merit
TORONTO, ONTARIO--(CCNMatthews - Oct. 25, 2006) - Aurelian Resources Inc. ("Aurelian") (TSX VENTURE:ARU) announces that Timothy Yee, on his own behalf and on behalf of all persons residing in Alberta who purchased warrants in Aurelian Resources Inc. in 2003, (the "Yee Class"), have filed a Statement of Claim (the "Yee Claim") in the Court of Queen's Bench of Alberta, on August 25, 2006 naming Aurelian as defendant. The Claim was received by Aurelian on October 17, 2006.
Also, Timothy Gallagher, on his own behalf and on behalf of all persons residing in Ontario who purchased warrants in Aurelian in 2003, (the "Gallagher Class"), have filed a Statement of Claim (the "Gallagher Claim") in the Ontario Superior Court of Justice, on October 16, 2006 naming Aurelian as defendant.
The Claims surround certain common share purchase warrants (the "Warrants") issued by Aurelian on June 6, 2003 as part of a private placement of 6,000,000 units at $0.50 per unit for gross proceeds of $3,000,000. Each unit was comprised of one common share and one Warrant. Each Warrant entitled the holder to purchase one common share at $0.60 per share during the first year from the date of issuance and $0.75 per share during the second year. The terms of the Warrants provided that they would expire in June 2005 unless, prior to that time, Aurelian became listed on Tier 1 of the TSXV or on the TSX in which case Aurelian would petition the applicable exchange for an additional two year extension to the Warrants. The Classes allege that Aurelian did not use "best efforts" to obtain the necessary approvals to extend the term of the Warrants to June 6, 2007.
Accordingly, the Yee Class is claiming that they are entitled to be issued the 400,000 common shares that would have been issued to the Yee Class on the exercise of their Warrants had the term been extended to June 6, 2007 upon the payment to Aurelian of $400,000 or in the alternative, $12 million plus costs and interest.
The Gallagher Class is claiming that they are entitled to be issued the estimated 1,660,000 common shares that would have been issued to the Gallagher Class on the exercise of their Warrants had the term been extended to June 6, 2007 upon the payment to Aurelian of $1,660,000 or in the alternative, $40 million plus costs and interest.
Management believes that these Claims are without merit and intends to vigorously defend these and related actions. Notices of Intent to Defend will be filed on behalf of Aurelian in this regard.
About Aurelian:
Aurelian Resources Inc. is a publicly-listed (TSX VENTURE:ARU) junior resource company engaged in the business of exploring, discovering and developing mineral wealth in Ecuador. The Condor Project properties are located in southeastern Ecuador and consist of 38 mining concessions totalling approximately 95,000 hectares.
Forward Looking Statement:
Some of the statements contained herein may be forward-looking statements which involve known and unknown risks and uncertainties. Without limitation, statements regarding potential mineralization and resources, exploration results, and future plans and objectives of the Company are forward looking statements that involve various degrees of risk. The following are important factors that could cause the Company's actual results to differ materially from those expressed or implied by such forward looking statements: changes in the world wide price of mineral commodities, general market conditions, risks inherent in mineral exploration, risks associated with development, construction and mining operations, the uncertainty of future profitability and the uncertainty of access to additional capital.
THE TSX VENTURE EXCHANGE HAS NOT REVIEWED AND DOES NOT ACCEPT RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.
CONTACT INFORMATION
Aurelian Resources Inc.
Patrick F. N. Anderson
President & CEO
(416) 868-9100
Fax: (416) 868-1807
Email: pfnanderson@aurelian.ca
Website: www.aurelian.ca
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