Mantra Capital Enters Into Wind Mountain Option Agreement; Announces Private Placement
08 July 2014 - 11:30PM
Marketwired Canada
NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN
THE UNITED STATES
Mantra Capital Inc. ("Mantra" or the "Company") (TSX VENTURE:MTR) is pleased to
announce that it has entered into an Option Agreement to acquire a 100% interest
in the Wind Mountain gold and silver property in Nevada from Bravada Gold
Corporation ("Bravada"). The Company previously disclosed the term sheet for
this transaction (see the Company's April 30, 2014 news release). The Company
also announces a private placement of common shares to raise up to $500,000 CAD
(all funds listed in this release are in Canadian Dollars unless otherwise
stated).
Steven Khan, Interim CEO, commented, "We are very pleased to complete this
option agreement which, upon closing of the transaction, will position Mantra as
a new gold development company. We envision being able to develop a low cost
heap leach gold operation in Nevada - a jurisdiction that is both safe and has a
good track record for permitting mines."
Wind Mountain Project and Option Agreement
The Wind Mountain Project is a low-sulphidation-type gold and silver property
consisting of 138 claims totaling approximately 1,117 hectares located within
the highly prospective Walker Lane Gold trend approximately 160 kilometres
northeast of Reno, Nevada, with good road access and power. Wind Mountain is a
past-producing property and is the subject of the Updated Technical Report and
Preliminary Economic Assessment, Wind Mountain Gold-Silver Project Washoe
County, Nevada, effective date May 2, 2012 (revised January 15, 2014) and
prepared for Bravada by Mine Development Associates (the "PEA"). The PEA
discloses the following mineral resource estimate for the Wind Mountain Project:
----------------------------------------------------------------------------
Cutoff
oz Au/T Tons oz Au/T oz Ag/T oz Au oz Ag
----------------------------------------------------------------------------
Oxide Mineralization
----------------------------------------------------------------------------
Indicated
----------------------------------------------------------------------------
0.005 58,816,000 0.010 0.25 564,600 14,539,000
----------------------------------------------------------------------------
Inferred
----------------------------------------------------------------------------
0.005 19,866,000 0.006 0.17 125,200 3,443,000
----------------------------------------------------------------------------
Mixed and Unoxidized Mineralization
----------------------------------------------------------------------------
Indicated
----------------------------------------------------------------------------
0.010 498,000 0.012 0.40 5,900 197,000
----------------------------------------------------------------------------
Inferred
----------------------------------------------------------------------------
0.010 14,595,000 0.016 0.46 229,100 6,672,000
----------------------------------------------------------------------------
To the best of the Company's knowledge, information and belief, there is no new
material scientific or technical information that would make the disclosure of
these mineral resources inaccurate or misleading.
Mantra will be required to make the following cash and share payments to earn a
100% interest in the Wind Mountain project, subject to certain existing
royalties:
Cash Common Shares
On execution of the option $25,000 (paid) -
agreement
On or before August 1, 2014 $275,000 $100,000 of Mantra common
shares
On or before August 1, 2015 $700,000 $100,000 of Mantra common
shares
On or before August 1, 2016 $2,000,000 (1) -
On or before August 1, 2017 $2,000,000 (1) -
----------------
$5,000,000
----------------
----------------
Note 1: Up to one-half ($1,000,000) may, at the election of Mantra, be satisfied
by Mantra issuing common shares.
Mantra has no work commitments under the Option Agreement and Bravada will not
retain any royalty interest in the Property.
The number of Mantra common shares issued pursuant to the Option Agreement will
in each case be determined using an issue price equal to the volume weighted
average trading price for the five consecutive trading days ending on the
trading date that is five trading days prior to the date of issuance, subject to
the minimum conversion price permitted by the TSX Venture Exchange (the
"Exchange"). In addition to the securities law hold period, the Mantra common
shares issued to Bravada pursuant to the Option Agreement will be subject to
certain contractual restrictions on sale. Bravada has also agreed to vote the
shares in accordance with the recommendations of Mantra's management or board of
directors.
The Option Agreement is subject to certain conditions, including acceptance by
the Exchange.
Private Placement
Mantra intends to raise up to $500,000 through a non-brokered private placement
of up to 4,166,667 common shares at a price of $0.12 per share.
The proceeds of the private placement will be used to fund the $275,000 option
payment due on or before August 1, 2014, for the payment of claim-maintenance
fees due in respect of the Property and for general working capital purposes.
The Company may pay finder's fees in connection with the financing. The private
placement is subject to acceptance by the Exchange.
Certain directors and officers of the Company are expected to acquire securities
under the private placement. Such participation would be considered to be a
"related party transaction" as defined under Multilateral Instrument 61-101 ("MI
61-101"). The transaction will be exempt from the formal valuation and minority
shareholder approval requirements of MI 61-101 as neither the fair market value
of any shares issued to or the consideration paid by such persons will exceed
25% of the Company's market capitalization.
Potential Spin-out Transaction
Following completion of the private placement and initial cash and share
payments under the Option Agreement, the Company intends to consider a potential
spin-out of its Honeymoon Property, an early stage gold-silver-copper property
located on the west side of Adams Lake, British Columbia, into a new public
company that would be owned by the shareholders of Mantra. If Mantra determines
to proceed with a spin-out transaction, details will be provided to shareholders
when available and the transaction would be subject to required Exchange,
shareholder and court approvals.
ABOUT MANTRA CAPITAL INC.
Mantra Capital Inc. is a growth company focused on the exploration and
development of precious and base metals. The Company currently has the option to
acquire an undivided 100% interest in and to certain mineral claims in British
Columbia known collectively as the Honeymoon Property, an early stage
gold-silver-copper property located on the west side of Adams Lake, British
Columbia. Mantra is led by a highly experienced executive management team that
has a successful track record of building shareholder value through exploration,
corporate finance, and mine development.
For more information please visit www.mantracapitalinc.com.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that
term is defined in the policies of the TSX Venture Exchange) accepts
responsibility for the adequacy or accuracy of this release.
Kenneth Collison, for the Company, is a Qualified Person for the purposes of
National Instrument 43-101 and has reviewed and approved the information of a
scientific and technical nature contained in this news release. Mr. Collison has
reviewed, but has not verified, the PEA and the data from the PEA disclosed in
this release due to the PEA having been prepared on behalf of and filed by
Bravada. A copy of the PEA can be viewed under Bravada's profile at
www.sedar.com.
Cautionary Note Regarding Forward-Looking Statements: This news release includes
certain forward-looking statements and forward-looking information (together,
"forward-looking statements"). All statements other than statements of
historical fact included in this release, including, without limitation,
statements regarding the Option Agreement, the private placement and other
future plans and objectives of the Company. There can be no assurance that such
statements will prove to be accurate and actual results and future events may
vary from those anticipated in such statements. Important risk factors that
could cause actual results to differ materially from the Company's plans or
expectations include risks related to Exchange acceptance of the Option
Agreement and private placement, regulatory changes, risks associated with
obtaining required Exchange and other approvals, removal of conditions,
fundraising, and risk associated with mineral exploration, including the risk
that actual results of exploration will be different from those expected by
management. The forward-looking statements in this news release were developed
based on the expectations of management, including that Exchange acceptance for
the proposed transactions will be obtained, conditions will be satisfied,
required fundraising will be completed and the other risks described above will
not materialize. The Company expressly disclaims any intention or obligation to
update or revise any forward-looking statements whether as a result of new
information, future events or otherwise, except as otherwise required by
applicable securities legislation.
This press release does not constitute an offer to sell or the solicitation of
an offer to buy nor shall there be sale of the securities in any jurisdiction in
which such offer, solicitation or sale would be unlawful, including in the
United States. The securities have not been and will not be registered under the
United States Securities Act of 1933, as amended (the "1933 Act") or any
applicable securities laws of any state of the United States and may not be
offered or sold in the United States, or to, or for the account or benefits of a
U.S. person (as defined in Regulation S under the 1933 Act) unless registered or
pursuant to an available exemption from such registration requirements.
FOR FURTHER INFORMATION PLEASE CONTACT:
Mantra Capital Inc.
Steven N. Khan, Interim Chief Executive Officer
(604) 628-1162
Email: info@mantracapitalinc.com
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