TORONTO, July 12, 2012 /CNW/ - Mukuba Resources Limited (TSX-V:MKU) ("Mukuba" or the "Company") announced today that it has arranged a private placement financing for
a minimum of $750,000 and a maximum of $1,500,000 on the following
terms and conditions (the "Offering"):
The Offering is conditional upon a consolidation of the Company's
outstanding common shares at a ratio of four pre-consolidation common
shares for one post-consolidation common share (the "Consolidation"). The Consolidation requires approval by the holders of the Company's
common shares at a meeting of shareholders expected to occur on August
30, 2012. All references to units are on a post-consolidation basis
unless otherwise identified.
The Offering will comprise a maximum of 12,500,000 units at a
subscription price of $0.12 per unit. Each unit will consist of one
common share and one common share purchase warrant of Mukuba entitling
the holder thereof (each a "Warrant"). Each Warrant will entitle the holder thereof, during a period of 24
months from the date of closing of the private placement, to purchase
one Mukuba common share at an exercise price of $0.16 per common share.
The securities issued pursuant to the Offering will be subject to a
four month hold period.
Cormark Securities Inc. and Ocean Equities Limited have committed to
purchase, or find suitable substitute purchasers for a minimum
aggregate amount of $500,000.
The Company will issue a convertible debenture in aggregate principal
amount of $250,000 convertible into 2,083,333 Units upon closing of the
Offering. These units are included in the 12,500,000 units described
above. In the event that the Consolidation and Offering is not
completed within four months from the date hereof, the convertible
debenture will bear interest at a rate of 10% effective from the date
of issue and be convertible into shares at a rate of $0.10 per common
share on a pre-Consolidation basis.
The remaining aggregate amount of $750,000 will be issued to suitable
subscribers on a best efforts basis. There is no current commitment
from any subscriber for the remaining $750,000.
The net proceeds of the Offering will be used for general corporate
Closing is expected to occur on September 12, 2012. The shareholders
meeting to consider the Consolidation is anticipated to occur on August
30, 2012, but may be extended in the sole discretion of the Company. In
connection with the Offering, Mukuba expects to pay a finder's fee
consisting of a cash commission equal to 5% of the gross proceeds of
the Units sold and issue share purchase warrants equal to 10% of the
Units sold by each such finder or as otherwise agreed upon on an
As compensation for past services, the board of directors of the Company
has determined to award each of Mr. John Hawkrigg, Mr. Martin Horgan,
Mr. Danny Keating, Mr. Michael Smyth (the "Directors") and Mr. Kelly Ehler (the "Chief Executive Officer") a payment each of $50,000 for an aggregate total of $250,000. Such
compensation is to be paid in common shares of the Company on the same
terms of the common shares to be issued through the Offering.
Completion of the Offering and the payment to the Directors and Chief
Executive Officer is subject to the receipt of all required regulatory
and shareholder approvals, including acceptance by the TSX Venture
Mr. John Hawkrigg, Chairman of Mukuba, stated that, "the financing
announced today places Mukuba on firm ground with respect to its cash
position and will allow the company to move forward with its strategic
plan with respect to existing assets and any opportunities that may
present itself in the near future."
About the Company
Mukuba is a Canadian mining company focused on the exploration and
development of certain African base metal assets alone and through a
joint venture partner. These assets include a 100% interest in the
Northcore Project, which is licensed for both copper and cobalt and
encompasses approximately 2,274 square km of geologically prospective
ground in the Central African Copperbelt region of Zambia. Mukuba is
also a party to a joint venture with Benzu Resources Limited to explore
and develop a copper and base metals project in the Democratic Republic
of the Congo.
Neither TSX Venture Exchange nor its Regulation Services Provider (as
that term is defined in policies of the TSX Venture Exchange) accepts
responsibility for the adequacy or accuracy of this release.
Securities regulators encourage companies to disclose forward-looking
information to help investors understand a company's future prospects.
This press release contains statements about our future business and
planned activities, including matters relating to the Offering, future
shareholder meetings and the use of proceeds of the Offering. These are
"forward-looking" because we have used what we know and expect today to
make a statement about the future. Forward-looking statements usually
include words such as may, intend, plan, expect, anticipate, believe or
other similar words. We believe the expectations reflected in these
forward-looking statements are reasonable. However, actual events and
results could be substantially different because of the risks and
uncertainties associated with our business or events that happen after
the date of this press release. You should not place undue reliance on
forward-looking statements. As a general policy, we do not update
forward-looking statements except as required by securities laws and
SOURCE Mukuba Resources Limited
For further information:
Kelly Ehler, interim President and CEO
TEL: +1 (416) 368 4013
FAX: +1 (416) 603 9200