TORONTO, ONTARIO--(Marketwire - Feb. 10, 2011) -
NOT FOR DISSEMINATION IN THE UNITED STATES OR OVER UNITED STATES NEWSWIRE SERVICES
Montero Mining and Exploration Ltd. (TSX VENTURE:MON) ("Montero") is pleased to announce that today it has completed an Initial Public Offering (the "Offering") and that its common shares are expected to commence trading on the TSX Venture Exchange ("TSXV") under the symbol "MON" on or about Tuesday, February 15, 2011. The offering raised total gross proceeds of $4,000,000 through Montero's agents, Byron Securities Limited and Haywood Securities Inc. (collectively, the "Agents").
On January 25, 2011, Montero filed a final prospectus in the provinces of Alberta, British Columbia and Ontario, and had earlier received conditional approval to list Montero's common shares on the TSXV. A copy of Montero's prospectus can be viewed on SEDAR (www.sedar.com).
Pursuant to the Offering, Montero raised total gross proceeds of $4,000,000 through the issuance of 8,000,000 units (each, a "Unit") at a price of $0.50 per Unit (the "Issue Price"). Each Unit is comprised of one common share of the Corporation (each, a "Share") and one half of a Share purchase warrant (each whole such warrant, a "Warrant"), each Warrant entitling the holder thereof to purchase one additional Share at a price of $0.70 per Share at any time on or before 5:00 p.m. (Toronto time) on February 10, 2013. A cash commission of $280,000 was paid, and 560,000 Agents Warrants were issued to the Agents. Each such Agents Warrant entitles the holder to purchase one Unit at $0.50 per Unit until February 10, 2013. The Agents also received $25,000 plus applicable HST as a corporate finance fee in connection with the Offering.
8,102,669 Shares and 1,850,000 stock options of Montero held by Principals of Montero prior to completion of the Offering will be held in escrow; 10% of such securities will be released upon Montero's shares being listed on the TSX Venture Exchange, and 15% every six months thereafter, subject to acceleration provisions provided for in NP 46-201. In addition 1,769,834 Shares and 125,000 stock options held by non-Principals prior to completion of the Offering will be subject to resale restrictions imposed by the TSXV. 1,000,000 of such Shares will be subject to the same release schedule noted above for Principals; 16,667 of such shares will be subject to a one-year hold period, with 20% released every three months, the first release on completion of the Offering; and 753,167 of such Shares and the 125,000 stock options will be subject to a four-month hold period, with 20% released every month, the first release on completion of the Offering.
Montero now has a total of 42,315,730 Shares issued and outstanding, an additional 7,076,500 Shares are subject to issuance pursuant to outstanding warrants, and an additional 3,700,000 Shares are subject to issuance pursuant to outstanding stock options, including 1,475,000 stock options granted as of today's date as disclosed below, for a total of 53,092,230 Shares on a fully diluted basis.
Net proceeds from the offering will be used to conduct an extensive two-phase exploration program on Montero's Wigu Hill Rare-Earth Element Project located in the Kisaki District of Eastern Tanzania over the next twenty four months, and for general working capital. The Wigu Hill Project is currently owned 60% by Montero and 40% by RSR (Tanzania) Limited ("RSR"), a private family-owned company in Tanzania. Under the terms of an Option Agreement between Montero and RSR, Montero retains the right to acquire an additional 10% of the Wigu Hill Project and may earn a further interest subject to a dilution formula.
The recommended two-phase exploration program on the Wigu Hill Rare Earth Element Project is to include trenching and sampling of carbonatite veins and diamond drilling of defined targets. The proposed two-phase budget for exploration on the Wigu Hill Project is estimated to cost a total of approximately C$3.4 million. The net proceeds of the Offering will be used for the completion of Phase I in the amount of approximately C$1.1 million, and for the commencement of Phase II in the amount of C$1 million, the completion of which is contingent on the results on Phase I.
The officers and directors of Montero are Antony Harwood (President, Chief Executive Officer, Director), Antonia Chapman (Chief Financial Officer, Corporate Secretary, Director), Gregory Hall (Director), John Dixon (Director), and Andrew Thomson (Director). The board of directors of Montero have granted today to certain officers, directors, employees and consultants of Montero stock options exercisable for an aggregate of 1,475,000 Shares of Montero, at an exercise price of $0.50 per Share for a period of five years from the date of grant.
Antony Harwood, President and Chief Executive Officer of Montero, said "I would like to thank our Board of Directors and management team, our agents Byron Securities Limited and Haywood Securities Inc. for all of their hard work and support. We would like to welcome all new shareholders and look forward to developing lasting relationships as we actively explore the Wigu Hill Rare Earth Element Project."
The securities described herein 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 accordingly, may not be offered or sold within the United States except in compliance with the registration requirements of the U.S. Securities Act and applicable state securities requirements or pursuant to exemptions therefrom. This press release does not constitute an offer to sell or a solicitation of an offer to buy any of the company's securities in the United States.
CAUTIONARY STATEMENT: This news release contains forward-looking information which is not comprised of historical facts. Forward-looking information involves risks, uncertainties and other factors that could cause actual events, results, performance, prospects and opportunities to differ materially from those expressed or implied by such forward- looking information. Forward looking information in this news release includes, but is not limited to, Montero's objectives, goals or future plans, and the estimated timing and cost of the exploration of the Wigu Hill Project. Factors that could cause actual results to differ materially from such forward-looking information include, but are not limited to, those risks set out in Montero's public documents filed on SEDAR. Although Montero believes that the assumptions and factors used in preparing the forward-looking information in this news release are reasonable, undue reliance should not be placed on such information, which only applies as of the date of this news release, and no assurance can be given that such events will occur in the disclosed time frames or at all. Montero disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, other than as required by law.
Montero Mining and Exploration Ltd.