Toronto, Ontario – August 24, 2017 – Pine Point Mining Limited (TSXV: ZINC) (“Pine Point” or the “Company”) is pleased to announce that is has closed its previously announced non-brokered private placement through the issuance of 8,000,000 units (“Units”) at a price of $0.25 per Unit for gross proceeds of $2,000,000 (the “Offering”). Each Unit consists of one common share (“Common Share”) and one-half of one Common Share purchase warrant (“Warrant”). Each whole Warrant entitles the holder thereof to purchase one additional Common Share at a price of $0.35 per Common Share for a period of two (2) years from the closing of the Offering.
The Company is pleased to announce that Zebra Holdings and Investments S.à.r.l, a company controlled by a trust settled by the late Adolf H. Lundin, subscribed for $1 million comprised of 4 million Units of the Offering. Upon closing of the $2-million private placement, Zebra as an insider of the company would own approximately 16.27% of the company’s outstanding shares on a partially diluted basis assuming the exercise of all warrants held and currently acquired. The financing also had participation by the PowerOne Group, directors and management of the company.
In connection with the completion of the Offering, certain eligible persons, including (the “Finders”), were paid a cash commission equal to 7% of the proceeds raised from subscribers introduced to the Company by such Finders, and issued finder warrants (the “Finder Warrants”) equal to 7% of the securities purchased by such subscribers. Each Finder Warrant entitles the holder thereof to purchase one Common Share for a period of two (2) years from the closing of the Offering at a price of $0.30 per Common Share.
Closing of the Offering is subject to receipt of all necessary corporate and regulatory approvals, including the approval of TSX Venture Exchange. All securities issued in connection with the Offering will be subject to a hold period of four months plus a day from the date of issuance and the resale rules of applicable securities legislation. The net proceeds of the Offering will be used for general working capital and to fund the continued evaluation of the Company’s zinc-lead deposits.
The Offering constituted a related party transaction within the meaning of TSX Venture Exchange Policy 5.9 and Multilateral Instrument 61-101 (“MI 61-101”) as certain insiders of the Company subscribed for an aggregate of 4,900,000 Units pursuant to the Offering. The Company is relying on the exemptions from the valuation and minority shareholder approval requirements of MI 61-101 contained in sections 5.5(a) and 5.7(1)(a) of MI 61-101, as the fair market value of the participation in the Offering by insiders does not exceed 25% of the market capitalization of the Company, as determined in accordance with MI 61-101. The Company did not file a material change report in respect of the related party transaction at least 21 days before the closing of the first tranche of the Offering, which the Company deems reasonable in the circumstances in order to complete the Offering in an expeditious manner.
About Pine Point Mining Limited
Pine Point Mining acquired a 100% interest in the Pine Point lead-zinc project in December, 2016. Since that time a positive Preliminary Economic Assessment (PEA) on the project showing a robust mining operation which, over a 13-year mine life, would have an after-tax net present value of $C210.5 million and internal rate of return of 34.5%, with a payback of 1.8 years. The study assumed a zinc price of US$1.10 per pound and a lead price of US$1.00 per pound, and used an exchange rate $C:$US of 0.75. The PEA was prepared by JDS Energy and Mining and is based on a mineral resource estimate for the Pine Point project published as a National Instrument 43-101 technical report with an effective date of April 18, 2017. To view further details of the study, please see the press release of April 18, 2017. Stanley Clemmer, a Qualified Person under NI 43-101, reviewed and approved the scientific and technical information presented in this press release.
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This release includes certain statements that may be deemed “forward-looking statements”. All statements in this release, other than statements of historical facts, that address future production, reserve potential, exploration drilling, exploitation activities and events or developments that Pine Point expects are forward-looking statements. Although Pine Point believes the expectations expressed in such statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the statements. There are certain factors that could cause actual results to differ materially from those in forward-looking statements. These include market prices, exploitation and exploration successes, continued availability of capital and financing, and general economic, market or business conditions. Investors are cautioned that any such statements are not guarantees of future performance and actual results or developments may differ materially from those projected in the forward-looking statements. For more information on Pine Point, investors should review registered filings at www.sedar.com.
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.