Mr. Andre Savard reports

THERMAL FRAGMENTATION: NIPPON SIGNS AN EXCLUSIVE LICENSING AGREEMENT FOR AUSTRALIA

Nippon Dragon Resources Inc. has signed an exclusive distribution agreement with Safescape for its patented thermal fragmentation mining method in various contracts and mining operations throughout the countries of Australia, New Zealand, Papua New Guinea, Indonesia and the Philippines. Highlights of the distributorship agreement include the granting of the exclusive rights to Safescape for the usage, distribution, training and marketing of the method by Safescape, which will have the exclusivity in the territory for a period of five years, once certain terms specified within the agreement have been met. It is intended that the revenues generated by the agreement be based using a monthly intellectual property fee model and an equipment leasing model.

Safescape plans on also using the method to facilitate the installation of its Safescape Laddertube escape-way system designed specifically for use in underground mines. A fully enclosed, durable polyethylene product, Safescape Laddertube is not impacted by water, salt or other mineral deposits. It requires minimal upkeep, fits comfortably within one-metre/42-inch openings and provides for the ultimate in user safety.

Nippon will manufacture and ship two thermal fragmentation units known as Mini-Dragons to Safescape premises in Forrestfield, Western Australia. Nippon will retain ownership of the units that will become part of Nippon's fleet of thermal fragmentation units.

"This agreement is the perfect example of how we intend to derive a constant flow of revenue for the company while achieving global availability of our thermal fragmentation mining method. Safescape's management's vision and business strategy are totally in line with ours, and we look forward to working closely with them to rapidly develop these major markets," stated Andre Savard, Nippon's president and chief executive officer.

Steve Durkin, managing director of Safescape, reports: "I quickly realized that this versatile and innovative mining method is a solution needed by the mining industry in order to reduce costs, increase productivity and contribute to a safer workplace. I intend to use this innovative technology not only for regular stoping and mining development services, but also for creating one-metre-diameter openings in order to install our man-way and escape-way systems in lieu of using raise boring or conventional raise blasting methods."

About Safescape

Safescape manufactures and installs the Safescape Laddertube escape-way system to mining and other industries. Safescape commenced operations in 2010; since then, over 12,000 metres of Laddertube have been installed worldwide. With offices in Bendigo, Victoria, Perth, Western Australia, and Denver, United States, Safescape is able to meet the needs of mining companies globally. Safescape's vision is to create a safer and better underground mining workplace globally, and its success has been recognized through various awards. Please visit its website.

Additionally, Nippon is pleased to announce the closing of a second tranche of its non-brokered private placement. This second tranche is for 812,500 units of the corporation at a price of eight cents per unit, for aggregate gross proceeds of $65,000. Each unit consists of one common share in the share capital of the corporation and one warrant of the corporation. Each warrant entitles the holder thereof to purchase one additional common share in the share capital of the corporation at a price of 12 cents per common share for a period of 24 months following the closing of the private placement.

All securities issued in connection with the private placement are subject to a four-month-and-one-day hold period from the date of issuance, expiring on Aug. 28, 2015. The corporation intends to use the net proceeds of the private placement for general corporate purposes, and working capital for adequate deployment of the thermal fragmentation technology on different projects at the national and international level.

We seek Safe Harbor.