Aquiline, IMA finalize Navidad transfer

In response to the July judgment of British Columbia’s Supreme Court that stripped the Navidad silver project in Argentina’s Chubut province from IMA Exploration (IMR-V, IMR-X) and awarded it to Aquiline Resources (AQI-T), the two litigants have finally come to terms over the transfer of operatorship.

IMA is appealing the decision, and will appear in B.C. appeals court on April 10, 2007.

Between now and then, Aquiline will operate the Navidad Project under a newly agreed-upon arrangement.

The parties have agreed that IMA’s reimbursable costs for Navidad are $18.5 million, a figure which excludes legal costs which may be set off against IMA’s reimbursable costs in the event that Aquiline is once and for all determined to be the Navidad project owner.

Aquiline has agreed to spend up to $11 million to further develop Navidad during the appeal period (being the difference between the $18.5 million and $7.5 million held in escrow).

There is also a standstill clause provides that neither party will attempt to acquire the other, solicit proxies in the other, or encourage any third parties in such an endeavour for the duration of the appeal period.

“”We are pleased to finally bring clarity to this situation so that we can proceed to accelerate the development of this world-class project for the benefit of Aquiline shareholders and all other stakeholders, said Aquiline President Marc Henderson in a release. “Given the tenor of the trial court judgment, we see little risk in IMA’s appeal and are pleased the British Columbia Court of Appeal has agreed to hear the matter on such an expedited basis. We look forward to a resumption of activity at Navidad and will make public our plans in this regard at the earliest possible opportunity.”

Aquiline also announced that all of the $2 per share warrants issued in connection with the private placement of Oct. 11, 2005, have been exercised for proceeds of $5.1 million.

A further 2.6 million secondary warrants were issued to the holders of these warrants pursuant to the “step-up” feature of the $2 Primary Warrant. The new warrants are exercisable at $3.00 per share until Oct. 11, 2007.

Joseph Grosso, IMA’s president and CEO, commented that “We would like to reassure our shareholders that we continue to fight to regain our ownership of Navidad. This will be the company’s sole focus.”