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Adanac Molybdenum Enters Non-Binding Letter of Intent for Sale of Company and Distribution to Shareholders

SURREY, BRITISH COLUMBIA--(Marketwired - Sep 11, 2015) - Adanac Molybdenum Corporation ("Adanac" or the "Company") (TSX VENTURE:AUA) announces that is has entered into a letter of intent (the "Letter of Intent") with Whitebox Advisors, LLC ("Whitebox"), which acts as investment advisor for several significant shareholders of the Company. The Letter of Intent sets out the intention of the Company and Whitebox (collectively, the "Parties"), on a non-binding basis, to engage in negotiations to attempt to agree upon and execute a definitive agreement (the "Definitive Agreement") pursuant to which Whitebox would agree to acquire, by way of a plan of arrangement (the "Proposed Transaction"), all of the issued and outstanding shares of Adanac that Whitebox does not currently own. The Letter of Intent provides for a cash purchase price of $350,000 (the "Proposed Purchase Price") which represents the value of Adanac's non-cash assets. Adanac estimates that approximately $4.3 million in cash (the "Cash Holding") would also be distributed to all shareholders, on a pro-rata return of capital basis as part of the Proposed Transaction.

Period of Exclusivity

The Parties have agreed, on a binding basis, to a period of exclusivity until 5 pm Eastern on September 23, 2015 (the "Exclusivity Period"), unless earlier terminated, during which the Company will not solicit a proposal that might be competitive with the Proposed Transaction and during which the Company and Whitebox will work to finalize the terms of the Definitive Agreement.

Structure and Timing of Proposed Transaction

Subject to the Parties entering into a Definitive Agreement, the Proposed Transaction is expected to be carried out by way of a plan of arrangement under the provisions of the Business Corporations Act (British Columbia) and will be subject to the approval of 66 2/3% of the votes cast by Adanac shareholders at a special meeting of shareholders expected to be held in early November, 2015. All shares held by Whitebox will be excluded from voting pursuant to the requirements of Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61-101") as a result of Whitebox being a related party to the Company by virtue of its affiliates holding in excess of 10% of the Company's outstanding shares.

It is anticipated that closing of the Proposed Transaction will subject to certain other conditions, including receipt of British Columbia court, TSX Venture Exchange and other regulatory and third party approvals, and is expected to close shortly after the special meeting. An information circular is expected to be mailed to Adanac shareholders in October, 2015.