TORONTO, ONTARIO--(Marketwired - June 1, 2016) -
NOT FOR DISSEMINATION IN THE UNITED STATES OR OVER UNITED STATES NEWSWIRE SERVICES
Montero Mining and Exploration Ltd. (TSX VENTURE:MON) ("Montero" or the "Corporation") announces that it intends to complete a debt settlement transaction (the "Debt Settlement") with certain creditors ("Creditors"), including Creditors who are related parties of the Corporation, providing for the settlement of approximately $1,018,980 of its outstanding debts, of which $679,487 in debt will be settled through the issuance of an aggregate of 13,589,740 common shares of the Corporation ("Common Shares") at a deemed issue price of $0.05 per Common Share, and $339,493 in debt will be forgiven. The Debt Settlement is subject to regulatory and shareholder approval. The Corporation expects to complete the Debt Settlement shortly after such approvals are obtained.
Dr. Antony Harwood, President and Chief Executive Officer of Montero, commented, "Montero's goal is to create value for our shareholders. We propose to complete this debt settlement to preserve working capital and improve Montero's prospects for future financing." Dr. Harwood added, "Montero's strategy remains to attract strategic partners to fund projects at the asset level, avoiding dilution at the corporate level. We remain focused on funding for our Wigu Hill rare earth project to take it through feasibility study and development. The exploration work at Wigu Hill has been put on a care and maintenance program while we seek a funding partner and for rare earth prices to recover. I remain confident in our projects and our strategy to create value for Montero shareholders. Wigu Hill is one of a few world-class rare earth deposits that we believe has the potential to become a mine in the future."
Certain Creditors who are related parties of the Corporation will participate in the Debt Settlement. Global Mining Services Ltd., a corporation in which Antony Harwood, the President, Chief Executive Officer, and a director of the Corporation has beneficial interests, will settle approximately $237,546 in debt in exchange for 4,750,920 Common Shares, and will forgive a further $228,389 in debt; Criss Cross Inc., a corporation of which Antonia J. Chapman, the CFO, Corporate Secretary, and a director of the Corporation, is a director and 100% beneficial owner, will settle approximately $92,250 in debt in exchange for 1,845,000 Common Shares, and will forgive a further $69,750 in debt; Golden Phoenix International Pty Ltd., a corporation controlled by Gregory C. Hall, a director of the Corporation, will settle approximately $12,943 in debt in exchange for 258,680 Common Shares; and Andrew Thomson, a director of the Corporation, will forgive $11,000 in debt (Global Mining Services Ltd., Criss Cross Inc., Golden Phoenix International Pty Ltd., and Mr. Thomson, the "Related Creditors").
The participation in the Debt Settlement by the Related Creditors constitutes a "related party transaction" as such terms are defined by Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61-101"), requiring the Corporation, in the absence of exemptions, to obtain a formal valuation for, and minority shareholder approval of, the "related party transaction". The Corporation is relying on an exemption from the formal valuation requirements of MI 61-101 available because no securities of the Corporation are listed on specified markets, including the TSX, the New York Stock Exchange, the American Stock Exchange, the NASDAQ or any stock exchange outside of Canada and the United States other than the Alternative Investment Market of the London Stock Exchange or the PLUS markets operated by PLUS Markets Group plc. The Debt Settlement is not exempt from the disinterested shareholder approval requirements set out in MI 61-101. Accordingly, the Corporation will seek the approval of the Debt Settlement by the holders of a majority of the securities entitled to vote on a matter at the annual and special meeting of shareholders of the Corporation to be held on June 29, 2016. The participation by each of the Related Creditors in the Debt Settlement was approved by directors of the Corporation who are independent of such Related Creditors.
This press release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities 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 "U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States or to or for the account or benefit of a U.S. person (as defined in Regulation S under the U.S. Securities Act) unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.
About Montero Mining & Exploration
Montero Mining and Exploration Ltd. is a mineral exploration and development company engaged in the identification, acquisition, evaluation and exploration of mineral properties. These include phosphates in South Africa and rare earth elements (REE) in Tanzania. Montero has entered into agreement to develop its portfolio of phosphate properties with Ovation Capital in South Africa. Montero remains focused on attracting a strategic investor for the further development of the Wigu Hill Rare Earth Element Project in Tanzania. Montero trades on the TSX Venture Exchange under the symbol MON.
Neither 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.
CAUTIONARY STATEMENT: Neither 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. This News Release includes certain "forward-looking statements". These statements are based on information currently available to Montero and Montero provides no assurance that actual results will meet management's expectations. Forward-looking statements include estimates and statements with respect to Montero's future plans, objectives or goals, including words to the effect that Montero or management expects a stated condition or result to occur. Forward-looking statements may be identified by such terms as "believes", "anticipates", "expects", "estimates", "may", "could", "would", "will", or "plan". Since forward-looking statements are based on assumptions and address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results relating to, among other things, results of exploration, project development, reclamation and capital costs of Montero's mineral properties, and Montero's financial condition and prospects, could differ materially from those currently anticipated in such statements for many reasons such as: changes in general economic conditions and conditions in the financial markets; changes in demand and prices for minerals; litigation, legislative, environmental and other judicial, regulatory, political and competitive developments; technological and operational difficulties encountered in connection with Montero's activities; the ability to complete a resource estimation and to complete a feasibility study which recommends a production decision; capital and operating costs vary significantly from estimates, and other matters discussed in this News Release and in filings made with securities regulators. This list is not exhaustive of the factors that may affect any of Montero's forward-looking statements. These and other factors should be considered carefully and readers should not place undue reliance on Montero's forward-looking statements. Montero does not undertake to update any forward-looking statement that may be made from time to time by Montero or on its behalf, except in accordance with applicable securities laws.
Montero Mining and Exploration Ltd.
Dr. Tony Harwood
President and CEO
+1 866 688 4671
+1 416 840 9197