Manhattan to reorganize (February 14, 2005)

Unfortunate Manhattan Minerals (MAN-T) will reorganize and change its name under resolutions approved by its shareholders at an extraordinary general meeting.

The meeting approved a change of name to Mediterranean Minerals, the sale of the company’s Peruvian assets, including the ill-fated Tambo Grande property, and a resolution allowing private-placement share issues to refinance the company.

Tambo Grande, where Manhattan and the Bureau de recherches gologiques et minires had outlined a significant copper, zinc, gold and silver resource, was stalled by a combination of factors including permitting, local and foreign opposition, and difficult financing. In November 2004, Manhattan, which had put US$60 million into the project, reached terms with Solar Energy (SLRE-O) to take over Tambo Grande and two other Peruvian properties, Lancones and Papayo, in exchange for US$600,000, the assumption of $2.4 million in promissory notes Manhattan had issued, and a 2% net smelter return royalty.

A September 2004 deal with Teck Cominco (TEK-T) gives Manhattan an option on two properties in Artvin province in northeastern Turkey. Manhattan’s obligations under the agreement, which make the financings necessary, are to issue 422,000 shares to Teck, pay US$550,000 or the equivalent in shares over two years, and do US$2 million worth of exploration work, divided equally over two years.

There is a US$2-million payment due to Teck if a property is brought to commercial production, as well as a sliding-scale royalty on gold production (1.5% of net smelter return at gold prices below US$425 per oz. and 2% above US$425), and a 1.75% net smelter return on metals other than gold.

The meeting also approved housekeeping resolutions to comply with changes to British Columbia corporate law, an addition of 1 million shares to the executive compensation plan, and a slate of four directors, namely Peter Guest, John Clarke, Bryan Morris and Bruce McKnight.