August 13, 2014
Excelsior Mining Corp. (TSX-V: MIN) (Frankfurt: 3XS) (OTCQX: EXMGF) ("Excelsior" or the“Company”) is pleased to announce that it has entered into an agreement with an affiliate of Greenstone Resources L.P. (“Greenstone”), whereby Greenstone will purchase, by way of a treasury offering, common shares of Excelsior at a price of C$0.34 per common share for total gross proceeds of US$10 million. Settlement will occur in United States dollars. It is estimated that upon closing, this transaction would represent approximately 28% of Excelsior’s shares issued and outstanding, estimated to be approximately 32 million common shares.
Details of the Transaction
The transaction is scheduled to close in two separate tranches. The first settlement will occur within 15 business days of this announcement. This first tranche will see Greenstone purchase 20,580,000 common shares, equal to approximately 19.9% of the issued and common shares of Excelsior, in return for gross proceeds of US$6,393,341.64.
The second tranche shall require shareholder approval under the rules and policies of the TSX Venture Exchange as it will result in the creation of a new “control person”. The Company intends to obtain shareholder approval for the second tranche at its annual and special meeting of shareholders currently scheduled for September 30, 2014 in Vancouver (the “Meeting”). Assuming shareholder approval is obtained, the second tranche is scheduled to close 15 business days after the Meeting. The second tranche will see Greenstone purchase US$3,606,658.36 of common shares of Excelsior at price of C$0.34 per common share. The exact number of common shares will be determined based on the noon US$/C$ exchange rate from the Bank of Canada exchange rate on the day of the Meeting.
Executive Chairman, Mark Morabito, stated, “To be able to do a common share transaction of this size at a premium to the market price, despite all the current challenges of junior mining market, is a notable endorsement of the strength of the Gunnison project and the quality of our management team. Coming on the heels of the $4 million bought-deal financing by Dundee Capital Markets, and the $3 million royalty-option execution by Callinan Royalties, Excelsior is now substantially funded as the project enters the feasibility and permitting stage of development.”
Commenting on the transaction, Stephen Twyerould said, “One of our primary goals for 2014 was to secure a financing partner; we have exceeded our objective by creating a partnership with a firm that has vast knowledge of the mining industry; Greenstone fully intends to apply their wealth of experience to help advance the Gunnison Project successfully into production.”
As part of the transaction, Greenstone will have the right to nominate two directors to the Excelsior Board. The first director will be nominated on or before the closing of the first tranche of the private placement. The second director will be nominated on or before the closing of the second tranche of the private placement.
A Project Steering Committee will be formed to enable Excelsior to take full advantage of Greenstone’s industry experience. The Steering Committee will be responsible for assessing and reviewing the overall progress of the project. Chaired by Excelsior’s CEO, the Project Steering Committee shall meet on a regular basis.
The offering is subject to a number of conditions, including, without limitation, receipt of all regulatory approvals, including the approval of the TSX Venture Exchange and the applicable securities regulatory authorities, and the receipt of shareholder approval for the second tranche of the private placement.
The net proceeds of the offering will be used for the continued development of the company's Gunnison Copper Project and for working capital and general corporate purposes. Excelsior will pay a finder fee in accordance with the rules and policies of the TSX Venture Exchange.
Greenstone is a private equity fund specialising in the mining and metals sector. The Greenstone team has over 80 years of experience in the sector covering all aspects of mining project development. Further details on Greenstone can be found at www.greenstoneresources.com.
Greenstone is acquiring the securities in the offering described herein for investment purposes. Depending on market conditions and other factors, Greenstone may from time to time acquire and/or dispose of securities of Excelsior or continue to hold its current position.
Excelsior is a mineral exploration and development company that is advancing the Gunnison Copper Project. The Excelsior management team consists of experienced professionals with proven track records of advancing mining projects into production. Further information about the Gunnison Copper Project can be found in the technical report filed on SEDAR at www.sedar.com entitled: “Gunnison Copper Project, NI 43-101 Technical Report, Prefeasibility Study” dated February 14, 2014.
For more information on Excelsior, please visit our website at www.excelsiormining.com.
ON BEHALF OF THE EXCELSIOR BOARD
" Mark J. Morabito"
For further information regarding this press release and/or for a copy of the early warning report required to be filed with the applicable securities commissions in connection with the offering, please contact:
Excelsior Mining Corp.
JJ Jennex, Vice President, Corporate Affairs
T: 604-681-8030 x240
Cautionary Note Regarding Forward-Looking Information
This news release contains "forward-looking information" concerning anticipated developments and events that may occur in the future. Forward looking information contained in this news release includes, but is not limited to, statements with respect to (i) the timing and closing of the private placement; (ii) the anticipated use of proceeds of the private placement; and (iii) the advancement of the Gunnison Project.
Such forward-looking information can be identified by the use of word “will”. Forward-looking information contained in this news release is based on certain factors and assumptions regarding, among other things, the estimation of mineral resources and mineral reserves, the realization of resource and reserve estimates, copper and other metal prices, the timing and amount of future exploration and development expenditures, the estimation of initial and sustaining capital requirements, the estimation of labour and operating costs, the availability of necessary financing and materials to continue to explore and develop the Gunnison Project in the short and long-term, the progress of exploration and development activities, the receipt of necessary regulatory approvals, the completion of the permitting process, the estimation of insurance coverage, and assumptions with respect to currency fluctuations, environmental risks, title disputes or claims, and other similar matters. While the Company considers these assumptions to be reasonable based on information currently available to it, they may prove to be incorrect.
Forward looking information involves known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking information. Such factors include risks inherent in the exploration and development of mineral deposits, including risks relating to changes in project parameters as plans continue to be redefined including the possibility that mining operations may not commence at the Gunnison Project, risks relating to variations in mineral resources and reserves, grade or recovery rates resulting from current exploration and development activities, risks relating to the ability to access infrastructure, risks relating to changes in copper and other commodity prices and the worldwide demand for and supply of copper and related products, risks related to increased competition in the market for copper and related products and in the mining industry generally, risks related to current global financial conditions, uncertainties inherent in the estimation of mineral resources, access and supply risks, reliance on key personnel, operational risks inherent in the conduct of mining activities, including the risk of accidents, labour disputes, increases in capital and operating costs and the risk of delays or increased costs that might be encountered during the development process, regulatory risks, including risks relating to the acquisition of the necessary licenses and permits, financing, capitalization and liquidity risks, including the risk that the financing necessary to fund the exploration and development activities at the Gunnison Project may not be available on satisfactory terms, or at all, risks related to disputes concerning property titles and interest, environmental risks and the additional risks identified in the “Risk Factors” section of the Company’s reports and filings with applicable Canadian securities regulators.
Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking information, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. Accordingly, readers should not place undue reliance on forward-looking information. The forward-looking information is made as of the date of this news release. Except as required by applicable securities laws, the Company does not undertake any obligation to publicly update or revise any forward-looking information.
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, and no securities regulatory authority has either approved or disapproved of the contents of this release.