APM Andean Precious Metals Corp

Erdene Resource Development Corp. ("Erdene" or the "Company") (TSX:ERD) is
pleased to announce that it has entered into a definitive agreement (the
"Arrangement Agreement") with Advanced Primary Minerals Corporation ("APM") to
exchange all of Erdene's North American property interests, comprised primarily
of Erdene's interest in the Donkin Coal Project in Cape Breton, Nova Scotia, for
shares of APM. The transaction is being completed by way of a court-approved
plan of arrangement (the "Arrangement").


Highlights:



--  Following the Arrangement, all of Erdene's North American property
    interests will be held by an amalgamated company ("Amalco") 

--  Amalco will be focussed on the development of bulk commodity projects in
    North America, predominantly coal projects, led by the Donkin Project

--  Erdene will be focussed on precious and base metals exploration in Asia,
    primarily Mongolia 

--  Upon completion of the Arrangement, the outstanding shares of Erdene
    (totalling 95,802,901) will effectively be split on a 50/50 basis
    resulting in 47,901,450 shares outstanding in Erdene and 47,901,450
    shares of Amalco which will be distributed to Erdene shareholders

--  Upon completion of the Arrangement, Amalco will have 49,255,990 shares
    outstanding, 47,901,450 (97.25%) of which will be held by Erdene
    shareholders and the balance by the former APM shareholders

--  A total of $1.95M cash will be included with the North American assets
    being acquired by Amalco

--  It is anticipated that the remaining resources and real estate held by
    APM, with a fair market value of $1.1M to $1.4M, will be sold following
    the completion of the Arrangement

--  A new name and the management team of Amalco will be announced in an
    upcoming news release

--  A special meeting of the Erdene shareholders is expected to be held in
    Halifax, Nova Scotia in October 2012 to obtain the necessary shareholder
    approvals



"We strongly believe that the separation of Erdene's major projects, Donkin Coal
and Mongolian minerals exploration, into separate public companies will provide
excellent value to the Company's shareholders," said Peter Akerley, President
and CEO. "The split will provide investors with a clearer framework to assess
the investment opportunity and provide management with greater flexibility in
the advancement of specific projects." 


Board Recommendations & Management Remarks

The boards of both APM and Erdene have approved the transaction. The Arrangement
is a "related party transaction" pursuant to Multilateral Instrument 61-101 -
Protection of Minority Securityholders in Special Transactions ("MI 61-101").
Accordingly, the board of directors of Erdene (the "Erdene Board") formed an
independent committee and engaged Paradigm Capital Inc. ("Paradigm") to provide
an independent valuation pursuant to MI 61-101 and a fairness opinion. On the
basis of the receipt of a formal valuation and fairness opinion from Paradigm,
the Erdene Board has determined that the Arrangement is fair and in the best
interest of the Company and its shareholders. Accordingly, the Erdene Board
recommends that the Company's shareholders vote in favour of the Arrangement. 


Terms of the Arrangement

The Arrangement Agreement dated August 7, 2012 sets out the terms of the
statutory plan of arrangement under section 192 of the Canada Business
Corporations Act involving Erdene, APM, Erdene Resources Inc. ("ERI"), and the
securityholders of Erdene and APM whereby:




--  Erdene will transfer all of the issued and outstanding shares of its
    subsidiary, ERI, a corporation formed under the federal laws of Canada
    and being the entity that owns or will own Erdene's North American
    property interests, to APM in exchange for an aggregate of 360,028,650
    common shares of APM.

--  APM and ERI will amalgamate to form Amalco.

--  On the amalgamation of APM and ERI, each shareholder of APM (including
    Erdene) will receive one (1) common share of Amalco for every 7.85
    shares of APM owned by such shareholder. 

--  Erdene will create a new class of common shares ("Erdene New Shares")
    and will distribute to the Erdene shareholders one-half of one Amalco
    share and one half of one Erdene New Share for each existing common
    share of Erdene.



Following the Arrangement, Erdene will have 47,901,450 Erdene New Shares
outstanding and Amalco will have 49,255,990 shares outstanding, 47,901,450
(97.25%) of which will be held by the Erdene shareholders.


The Arrangement will result in two strategically positioned public companies,
with Amalco focused on North America (i.e. the Donkin Coal Project) and Erdene
focused on minerals exploration and development in Mongolia.


Related Party Transaction

Erdene currently owns approximately 60% of the issued and outstanding shares of
APM. Consequently, the Arrangement is a "related party transaction" pursuant to
MI 61-101. The Erdene Board appointed an independent committee comprised of two
directors to lead the valuation process on behalf of the Company. The
independent committee retained its financial advisor, Paradigm, to prepare a
formal valuation to meet the requirements of MI 61-101 and to prepare a fairness
opinion. Paradigm has advised that, in its opinion, based on the various
assumptions and limitations set out in its opinion, the Arrangement is fair,
from a financial point of view to the Erdene shareholders. The Erdene Board has
concluded that the Arrangement is in the best interest of the Company and the
Erdene shareholders.


Under MI 61-101, because it is a related party transaction, the Arrangement is
required to be approved by greater than 50% of the Erdene shareholders
(excluding the directors and senior officers of Erdene and APM) present in
person or by proxy at a meeting held to consider the Arrangement.


Closing Conditions

A special meeting of the Erdene shareholders is expected to be held in Halifax,
Nova Scotia in October 2012 to obtain the necessary shareholder approval.
Completion of the Arrangement is also subject to satisfaction of certain
conditions including the approval and acceptance of the Toronto Stock Exchange
and the TSX Venture Exchange and approval of the APM disinterested shareholders
and the Nova Scotia Supreme Court. The Arrangement may be terminated if certain
conditions are not met, with a termination fee payable in certain circumstances.


It is currently anticipated that the Arrangement will be completed on or before
October 31, 2012.


Information Regarding Amalco Post-Arrangement 

Currently there is an aggregate of 26,342,963 shares of APM issued and
outstanding. It is expected that, upon completion of the Arrangement, there will
be an aggregate of 49,255,990 shares of Amalco outstanding, 97.25% of which will
be held by the Erdene shareholders.


Following the completion of the Arrangement, Amalco will hold all of Erdene's
North American property interests, consisting primarily of its 25% interest in
the Donkin Coal Project, with the remaining 75% interest held by Xstrata Coal
Donkin Limited ("Xstrata"). Given Xstrata's announcement of its intent to sell
its interest in the project, the Donkin Coal Project is expected to have a new
ownership structure later this year, which is anticipated to bring the project
to production.


It is contemplated that post-transaction, the board of directors of Amalco will
consist of five directors, selected by Erdene, who shall be described in the
materials circulated in connection with the special meeting of the Erdene
shareholders.


A copy of the Arrangement Agreement will be available under Erdene's profile on
SEDAR at www.sedar.com. Full details of the proposed transaction will be
described in detail in the notice of meeting and information circular describing
the Arrangement, which will be mailed to the Erdene shareholders in due course.


About Erdene

Erdene Resource Development Corp. is a diversified resource company with metal
and coal interests in Mongolia as well as the Donkin Coal Project and industrial
mineral assets in North America. Erdene has 95,802,901 common shares issued and
outstanding and a fully diluted position of 103,215,901 common shares.


Forward-Looking Statements

Certain information regarding Erdene contained herein may constitute
forward-looking statements within the meaning of applicable securities laws.
Forward-looking statements may include estimates, plans, expectations, opinions,
forecasts, projections, guidance or other statements that are not statements of
fact. Although Erdene believes that the expectations reflected in such
forward-looking statements are reasonable, it can give no assurance that such
expectations will prove to have been correct. Erdene cautions that actual
performance will be affected by a number of factors, most of which are beyond
its control, and that future events and results may vary substantially from what
Erdene currently foresees. Factors that could cause actual results to differ
materially from those in forward-looking statements include market prices,
exploitation and exploration results, continued availability of capital and
financing and general economic, market or business conditions. The
forward-looking statements are expressly qualified in their entirety by this
cautionary statement. The information contained herein is stated as of the
current date and subject to change after that date.


NO REGULATORY AUTHORITY HAS APPROVED OR DISAPPROVED THE CONTENTS OF THIS RELEASE

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