2012-12-13 16:59:20 -
Toronto, Ontario CANADA, December 13, 2012 /FSC/ - Cuervo Resources Inc.(CNSX-FE; FWB-CRR; "Cuervo" or the "Company") reports that Strike Resources Limited of Perth, Australia, has elected not to advance the $9.75 million Phase Two Loan to Cuervo contemplated under a 3 year $15 million Investment Agreement entered into in July 2011.
As a result of the decision by Strike, a number of consequences have been triggered under the Investment Agreement. These include the extinguishment of the mortgage provided as security for the outstanding $5.25 million Phase One Loan provided previously by Strike, and the cancellation of the Phase Two Warrant entitling Strike to acquire an additional 17.7 million Cuervo shares. Correspondingly, Strike's potential fully diluted interest in Cuervo has been
reduced from approximately 46% to approximately 32.5%. In addition, restrictive covenants affecting Cuervo's ability to finance, repay debt and form partnerships have been eased, while pre-emptive equity participation rights held by Strike have been reduced to approximately 32.5%.
Cuervo notes that while immediate funding of $9.75 million would be desirable to further advance its Cerro Ccopane Iron Project in Peru, the door to alternative and much larger sources of funding has now been opened. The Company anticipates completing a NI 43-101 resource estimate in February 2013 reflecting the results of the recently completed initial drilling program of the Bob 1 Zone at Cerro Ccopane.
For further information, please contact Mr. Brian Berner, CEO and a Director of the Company, at 416-203-3957 ext 201 or Mr. Tom Berner, Investor Relations, at 416-203-3957 ext 202. Additional information about Cuervo can be found at the Company's website at www.cuervoresources.com.
The Canadian National Stock Exchange (CNSX Markets Inc.) has neither approved nor disapproved of the contents of this press release.
Cuervo Resources Inc.
247 Major Street,
M5S 2L5 Canada
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Source: Cuervo Resources Inc. (FE - CNSX) (CRR - FWB) www.cuervoresources.com
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