Highlights:
- $6,843,603 Non-brokered private placement completed at $0.75/Unit,
which represents a 39% premium to Telson’s last closing share price on
the TSX.V Exchange.
- This funding milestone enables Telson to request the second loan
tranche of US
$5 million under its off-take loan agreement
with Trafigura for financing the construction rehabilitation and
operation of the Tahuehueto Mine project. - Proceeds will be used to finalize the construction of the
Tahuehueto mine, which will have a processing plant capable of milling
1,000 tonnes per day.
VANCOUVER, British Columbia -- (Business Wire)
Telson Mining Corporation (“Telson” or the “Company”)
(TSX-V – TSN, OTC Pink – SOHFF, Frankfurt – TSGN (formerly SQ82)) is
pleased to announce that it has closed its non-brokered private
placement financing (the “Private Placement”) consisting of 9,124,805
Units of the Company at a price of $0.75 per Unit for gross proceeds of
$6,843,603.
The financing was originally announced in a press release dated September
26, 2018 and was closed over-subscribed by 458,138 units
representing an additional $343,604.
Each Unit of the Private Placement consists of one Common Share and one
half of one transferable Common Share purchase warrant. Each whole
purchase warrant entitles the holder thereof to acquire one Common Share
of the Company at a price of $1.25 for a period of two years following
the closing of the Private Placement. All Common Shares issued in
connection with the Private Placement are subject to a four month plus
one day hold period under applicable Canadian securities laws. No
finder’s fees were paid in connection with the Private Placement. The
total issued and outstanding Common Shares of the Company after
completion of the Private Placement is 139,559,153.
The Private Placement included four insiders of the Company subscribing
for a total of 8,008,755 Units for aggregate subscription proceeds of
$6,006,566. That portion of the Private Placement is a “related party
transaction” as defined under Multilateral Instrument 61-101 (“MI
61-101”). In addition, one of the insiders is a significant shareholder
with a control position in the Company, for which the Company previously
received shareholder consent in late 2015, in accordance with TSXV
policy. The Company is relying on the exemptions from the formal
valuation and minority approval requirements under MI 61-101. The
Company is exempt from the formal valuation and minority approval
requirements of MI 61-101 in reliance of sections 5.5(b) and 5.7(1)(a),
as the fair market value of the Private Placement, insofar as it
involves related parties, is not more than 25% of the Company’s market
capitalization.
The net proceeds from Private Placement will be used by the Company to
cover the Company’s requirement to contribute funding to the Tahuehueto
Mine’s construction rehabilitation and operation under its loan
agreement with Trafigura Mexico, S.A. de C.V., and for general working
capital purposes.
Closing of this Private Placement also qualifies the Company to request
a second tranche from its loan agreement with Trafigura for up to US$5
million, which when combined with the proceeds from the Private
Placement, is estimated to be sufficient capital to complete the
construction of the Tahuehueto Mine, targeted for completion during the
first quarter of 2019.
Antonio Berlanga, CEO states “We are thrilled to complete this financing
on behalf of Telson’s shareholders. This above market priced financing,
largely subscribed to by insiders’ of the Company, clearly demonstrates
management and insider’s commitment to our shareholders by avoiding
discounted market priced dilutive financings while securing the
necessary funding to complete the Tahuehueto Mine construction”.
About Telson Mining Corporation
Telson Mining Corporation is a Canadian based mining company with two
Mexican gold, silver and base metal mining projects. Telson is currently
in commercial production at its 100% owned Campo Morado Mine in
Guerrero, Mexico and is producing zinc and lead concentrates with gold,
silver and copper as by-products, processing an average of approximately
2,000+ tpd.
Telson's 100% owned Tahuehueto Project, located in north-western Durango
State, Mexico is currently in construction development. Pre-production
at Tahuehueto is currently mining at a rate averaging 190 tonnes per day
in Sept 2018. Management estimates Tahuehueto to be producing gold,
silver, lead, zinc and copper with its own on-site mineral processing
plant, with a capacity of at least 1,000 tpd, during the first quarter
of 2019.
Visit: www.telsonmining.com
On behalf of the board of directors
(signed) “Ralph Shearing”
Ralph Shearing, P.Geol, President and Director
Qualified Persons
This press release was prepared under the supervision and review of
Ralph Shearing, P.Geol., President and Director of Telson Mining
Corporation, a Professional Geologist registered in Alberta as a member
of the professional association APEGA, and a Qualified Person as defined
by NI 43-101. Data verification by Mr. Shearing includes personal
inspection of the Campo Morado and Tahuehueto mine sites, reviewing
mining facilities, drill core, underground development and discussing
work programs and results with geology and mining personnel.
Cautionary Note Regarding Production Decisions and Forward-Looking
Statements
It should be noted that Telson has declared commercial production at
Campo Morado prior to completing a feasibility study of mineral reserves
demonstrating economic and technical viability. Accordingly, readers
should be cautioned that Telson’s production decision has been made
without a comprehensive feasibility study ofestablished reserves
such that there is greater risk and uncertainty as to future economic
results from the Campo Morado mine and a higher technical risk of
failure than would be the case if a feasibility study was completed and
relied upon to make a production decision. Telson has completed a
preliminary economic assessment (“PEA”) mining study on the Campo Morado
mine that provides a conceptual life of mine plan and a preliminary
economic analysis based on the previously identified mineral resources
(see News Release dated November 8, 2017 and April 4, 2018). This will
soon be replaced by a pre-feasibility study (“PFS”) that will allow the
application of modifying factors to the mineral resources to allow a
portion of them to be converted to mineral reserves. At Tahuehueto,
Telson is mining reserves supported by a pre-feasibility published early
2017.
Statements contained in this news release that are not historical
facts are “forward-looking information” or “forward- looking statements”
(collectively, “Forward-Looking Information”) within the meaning of
applicable Canadian securities laws. Forward Looking Information
includes, but is not limitedto,disclosureregarding
possible events, conditions or financial performance that is based on
assumptions about future economic conditions and courses of action; the
timing and costs of future activities on the Company’s properties, such
as production rates and increases; success of exploration,developmentandbulksampleprocessingactivities and
timing for processing at its own mineralprocessingfacilityontheTahuehuetoprojectsite.In
certain cases, Forward-Looking Information can be identified by the use
of words and phrases such as “plans”, “expects”, “scheduled”,
“estimates”, “forecasts”, “intends”, “anticipates” or variations of such
words and phrases. In preparing the Forward-Looking Informationinthisnewsrelease,theCompanyhasappliedseveral materialassumptions,including,butnotlimitedto,thatthecurrentexploration,development, environmental and other objectives
concerning the Campo Morado Mine and the Tahuehueto Project can be
achieved, the continuity of the price of gold, zinc, lead and other
metals, economic and political conditions and operations.
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. There can be no assurance
that Forward-Looking Information will prove to be accurate, as actual
results and future events could differ materially from those anticipated
insuchstatements. Accordingly, readers should not place
undue reliance on Forward-Looking Information. Except as required by
law, the Company does not assume any obligation to release publicly any
revisions to Forward-Looking Information contained in this news release
to reflect events or circumstances after the date hereof or to reflect
the occurrence of unanticipated events.
Neither TSX Venture Exchange nor its Regulation Services Provider (as
that term is defined in the policies of the TSXVenture Exchange)
accepts responsibility for the adequacy or accuracy of this release.
View source version on businesswire.com: https://www.businesswire.com/news/home/20181010005321/en/
Contacts:
For further information about Telson Mining Corporation, please contact:
Glen
Sandwell
Corporate Communications Manager
ir@telsonmining.com
Tel:
+1 (604) 684-8071
Source: Telson Mining Corporation
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