CALGARY, Nov. 2 /CNW/ -- CALGARY, Nov. 2 /CNW/ - (TSX Venture: WMI)
November 2, 2010 - Whetstone Minerals Ltd. ("Whetstone") is pleased
to announce that it has entered into share purchase agreement (the
"Acquisition Agreement") with Duration Gold Limited ("Duration") to
acquire the issued and outstanding share (the "Acquisition") of DGL
Investments Number Four Mauritius ("DGL"). DGL is a cell in a
protected cell company named Clarity Capital Holdings (Mauritius)
Limited PCC (the "Mauritius PCC") which is a single level entity
that can divide its assets between the different cells in the
protected cell company. DGL is currently wholly-owned by Duration,
a body corporate organized under the laws of Jersey which is
majority owned by Clarity Enterprises Limited ("CEL"). Mr. Allan
Dolan, the Chairman and interim President and Chief Executive
Officer of Whetstone is a discretionary beneficiary of a trust
which owns all of the issued and outstanding shares of CEL. CEL
also owns and controls 12,910,449 common shares of Whetstone
("Whetstone Shares"), representing approximately 49.1% of the
presently issued and outstanding Whetstone Shares. As such,
the Acquisition will constitute a non-arm's length acquisition
under the policies of the TSX Venture Exchange ("TSXV") and will be
subject to disinterested shareholder approval at an upcoming annual
and special meeting of Whetstone shareholders scheduled for
December 1, 2010 (the "Meeting"). Accordingly, none of the
Whetstone Shares owned or controlled by Allan Dolan or any of his
associates or affiliates (including CEL) will be entitled to vote
on the resolution approving the Acquisition at the Meeting. DGL
Investments Number Four Mauritius DGL indirectly owns, through its
wholly-owned Zimbabwe subsidiary, interests in mining claims
comprising a mining project (the "Bembesi Project") located in
Matabeleland North, Zimbabwe, of which claims within the Bembesi
Project area are grouped into three main groups knows as the Durban
Claims Group, the Sunace Claims Group and the Charliesona Claims
Group. Since its formation in February 2010, DGL has not conducted
any operations or business other than its indirect acquisition of
the interests in the mining claims comprising the Bembesi Project.
The Bembesi Project The Bembesi Project area is mineral rich and
has a long history of mineral production of both precious and base
metals, including gold. RSC Consulting Ltd. ("RSC") has prepared a
National Instrument 43-101 ("NI 43-101") technical report on the
Bembesi Project dated October 2010, entitled "National Instrument
43-101 Technical Report Bembesi Project, Zimbabwe" evaluating the
Durban Claims Group, the Sunace Claims Group and the Charliesona
Claims Group (the "RSC Report"). René Sterk, Consulting Geologist
and Director of RSC, the "Qualified Person" under NI 43-101
responsible for preparing the RSC Report, has reviewed and approved
the information contained in this news release derived from the RSC
Report. A complete copy of the RSC Report will be available
for review on Whetstone's SEDAR profile at www.sedar.com. According
to the RSC Report, the Durban Claims Group, the Sunace Claims Group
and the Charliesona Claims Group have reported historical gold
production totals of 56,700 ounces, 262,200 ounces and 47,900
ounces of gold, respectively. The Bembesi Project area is located
at the centre of the Bulawayo-Bubi Greenstone Belt in the
west-central part of the Zimbabwe craton, which is the largest
Archean greenstone belt in the Zimbabwe craton. The belt has been a
major producer of gold since the beginning of modern mining in
Zimbabwe, containing 16 mines that have each produced one tonne
(32,150 ounces) or more of gold. Several historic Mineral Resource
and Reserve estimates have been completed by previous operators on
the properties comprising the Bembesi Project, however RSC has not
completed the work necessary to verify these historical Mineral
Resource estimates. RSC therefore has not treated the previous
Mineral Resource estimates as NI 43-101 compliant resources
verified by a qualified person. Although the Bembesi Project area
will require further evaluation in due course, RSC believes that
the previous historical results provide an indication of the
potential of the properties and are relevant to ongoing
exploration. The Acquisition Pursuant to the terms of the
Acquisition Agreement, Whetstone will acquire the issued and
outstanding share of DGL from Duration in consideration for the
issuance by Whetstone to Duration of 45,000,000 Whetstone Shares at
a deemed issued price of $0.10 per Whetstone Share. Following the
Acquisition, Duration will hold approximately 37.1% of the
outstanding Whetstone Shares (on a non-diluted basis), assuming
50,000,000 Whetstone Shares are issued pursuant to the Private
Placement (as defined and discussed below). The Acquisition
Agreement is subject to, among other things, the receipt of all
necessary shareholder and other regulatory approvals (including
TSXV approval) as well as the completion of a private placement
financing of not less than 50,000,000 Whetstone Shares at an issue
price of $0.10 per Whetstone Share (the "Private Placement").
Provided that each of the Acquisition and Private Placement are
approved at the Meeting, Whetstone intends to nominate Mr.
Ndabezinhle N. Moyo as a director of the Corporation at the
Meeting, in addition to the current directors of the Corporation
(being Allan Dolan, Frank Moxon and Robert Stan). Mr. Moyo, a
Chartered Accountant by training, is a current director of Aucyn
Capital Investments, an investment and advisory company with a
focus on Southern Africa. Minority Approval In addition to the
requirements of the TSXV, the Acquisition will also be considered a
"related party transaction" pursuant to Multilateral Instrument
61-101 - Protection of Minority Security Holders in Special
Transactions ("MI 61-101"). As such, Whetstone shall not carry out
the Acquisition unless it has also obtained minority approval for
the transaction in accordance with MI 61-101. For the
purposes of MI 61-101, minority approval is determined by
excluding the votes attached to Whetstone Shares that, to the
knowledge of Whetstone or any interested party or their respective
directors or senior officers, after reasonably inquiry, are
beneficially owned or over which control or direction is exercised
by: (i) Whetstone; (ii) an interested party in the transaction:
(iii) a "related party" of an interested party in the transaction;
and (iv) a joint actor of any of the foregoing persons.
Specifically, Mr. Dolan and CEL beneficially own or control
13,088,324 Whetstone Shares. As such, a total of 13,088,324
Whetstone Shares, representing approximately 49.8% of the issued
and outstanding Whetstone Shares, will be withheld from voting at
the Meeting in accordance with MI 61-101. Whetstone is exempt
from the formal valuation requirement under MI 61-101 in respect of
the Acquisition based on reliance on the exemption in MI 61-101 at
Section 5.5(b) thereof as no securities of Whetstone are listed or
quoted on the Toronto Stock Exchange, the New York Stock Exchange,
the American Stock Exchange, the NASDAQ Stock Market, or a stock
exchange outside of Canada and the United States. The Private
Placement Whetstone intends to complete the Private Placement which
is a condition precedent to the completion of the Acquisition.
Whetstone currently anticipates that Audley European Opportunities
Master Fund Limited, a Guernsey hedge fund regulated by the
Guernsey Financial Services Commission ("Audley"), will subscribe
for 30,000,000 Whetstone Shares in connection with the Private
Placement. It is anticipated that the issuance of 30,000,000
Whetstone Shares to Audley will result in Audley holding Whetstone
Shares exceeding 20% of the total issued and outstanding Whetstone
Shares, on non-diluted basis, subsequent to the completion of each
of the Acquisition and the Private Placement (assuming 45,000,000
Whetstone Shares are issued pursuant to the Acquisition and
50,000,000 Whetstone Shares are issued pursuant to the Private
Placement). As such, in accordance with the rules and policies of
the TSXV, the issuance and sale by the Corporation of the
30,000,000 Whetstone Shares to Audley must be approved by a
majority of the votes cast by disinterested shareholders of
Whetstone at the Meeting. Consequently, any votes attached to the
Whetstone Shares held by Audley, and its associates or affiliates,
are excluded from the calculation of such approval of the Private
Placement at the Meeting. As Whetstone has been advised by
Audley that neither Audley nor any of its associates, affiliates or
joint actors own any Whetstone Shares, it is anticipated that all
shareholders of Whetstone will be entitled to vote on the
resolution approving the Private Placement. In addition,
Whetstone has been advised that none of its insiders, including
Allan Dolan, CEL or any of their respective associates, affiliates
or joint actors, are expected to subscribe to the Private
Placement. It is currently contemplated that the proceeds of the
Private Placement will be used by Whetstone to fund exploration and
development activities at its mineral properties and for general
corporate purposes. Whetstone anticipates it will mail an
information circular to its shareholders in connection with the
Meeting in early November and hopes to close each of the
Acquisition and the Private Placement shortly after the receipt of
all necessary shareholder and other regulatory approvals. In
connection with the completion of the Private Placement, Whetstone
plans to inter-list the Whetstone Shares on the Zimbabwe Stock
Exchange which, if completed, would make Whetstone the first dual
listed mineral exploration company in Zimbabwe in a number of
years. The Whetstone Shares remain halted from trading on the TSXV
pending receipt of acceptable documentation by the TSXV. Whetstone
is also pleased to announce that it has appointed Johannes Koen as
Interim Chief Financial Officer of Whetstone. Mr. Koen
completed a B. Comm.Hons in financial accounting and financial
management from the University of Pretoria in 1989 and completed
his Articles with KPMG, Chartered Accountants, in 1993.
Forward-Looking Statements In the interest of providing Whetstone
shareholders and potential investors with information regarding
Whetstone including management's assessment of the future plans and
operations of Whetstone, certain statements contained in this press
release constitute forward-looking statements or information
(collectively "forward-looking statements") within the meaning of
applicable securities legislation. Forward-looking statements are
typically identified by words such as "anticipate", "continue",
"estimate", "expect", "forecast", "may", "will", "project",
"could", "plan", "intend", "should", "believe", "outlook",
"potential", "target" and similar words suggesting future events or
future performance. In particular, this press release contains,
without limitation, forward-looking statements pertaining to the
following: expectations of management regarding the proposed
Acquisition, including the timing of completion of the Acquisition,
financing activities to be conducted by Whetstone in connection
with the Acquisition, including the Private Placement and the use
of proceeds thereof, the mailing of an information circular in
connection with seeking shareholder approval of, among other
things, the Acquisition and the Private Placement, and certain
operational and business plans of Whetstone subsequent to
completion of the Acquisition and the Private Placement. With
respect to forward-looking statements contained in this press
release, Whetstone has made assumptions regarding, among other
things: future capital expenditure levels; future commodity prices;
future gold production levels; future exchange rates and interest
rates; ability to obtain equipment in a timely manner to carry out
development activities; the impact of increasing competition; the
ability to obtain financing on acceptable terms. Although Whetstone
believes that the expectations reflected in the forward looking
statements contained in this press release, and the assumptions on
which such forward-looking statements are made, are reasonable,
there can be no assurance that such expectations will prove to be
correct. Readers are cautioned not to place undue reliance on
forward-looking statements included in this press release, as there
can be no assurance that the plans, intentions or expectations upon
which the forward-looking statements are based will occur. By their
nature, forward-looking statements involve numerous assumptions,
known and unknown risks and uncertainties that contribute to the
possibility that the predictions, forecasts, projections and other
forward-looking statements will not occur, which may cause
Whetstone's actual performance and financial results in future
periods to differ materially from any estimates or projections of
future performance or results expressed or implied by such
forward-looking statements. These risks and uncertainties include,
among other things, the following: that the Acquisition and the
Private Placement may not close when planned or at all or on the
terms and conditions set forth herein; the failure of Whetstone to
obtain the necessary shareholder, regulatory and other third party
approvals required in order to proceed with the Acquisition and the
Private Placement; incorrect assessment of the value of the
Acquisition; failure to realize the anticipated benefits of the
Acquisition; failure to complete planned financing activities;
general economic conditions in Canada, Zimbabwe and abroad. Readers
are cautioned that this list of risk factors should not be
construed as exhaustive. The forward-looking statements contained
in this press release speak only as of the date of this press
release. Except as expressly required by applicable securities
laws, Whetstone does not undertake any obligation to publicly
update or revise any forward looking statements, whether as a
result of new information, future events or otherwise. The
forward-looking statements contained in this document are expressly
qualified by this cautionary statement. 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. To
view this news release in HTML formatting, please use the following
URL:
http://www.newswire.ca/en/releases/archive/November2010/02/c8313.html
pFor further information please contact the Corporation or Charles
Vivian of Pelham Bell Pottinger:/p pWhetstone Minerals Ltd.
/p
pAllan Dolan, Chairman and Interim President and Chief Executive
Officerbr/ Phone: +44 (77) 9697 3008/p pPelham Bell
Pottinger/p pCharles Vivianbr/ Phone: +44 207 861 3126/p piTo
be added to Whetstone's private email list, please contact/ia
href="mailto:info@whetstoneminerals.com"info@whetstoneminerals.com/a /p
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