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VANCOUVER, BRITISH COLUMBIA—Catalyst Copper Corp. (“Catalyst” or the “Company”) (TSXVENTURE:CCY) announces that further to its news release dated June 23, 2014, it has closed its non-brokered private placement of 20,000,000 units at a price of $0.07 per unit for gross proceeds of $1,400,000. Each unit consists of one common share and one full common share purchase warrant. Each whole common share purchase warrant will be exercisable at $0.10 per common share until July 21, 2019. The securities issued in connection with this private placement are subject to a four month statutory hold period expiring on November 22, 2014. Proceeds will be used for payment of costs of the study by JDS Energy and Mining Inc., existing payables including $1,200,000 of secured loans, and for general working capital.
The Company also announces that pursuant to the private placement, Augusta Investments Inc., a company owned and controlled by Richard Warke, acquired 3,400,000 units at a price of $0.07 per unit which consists of 3,400,000 common shares, representing 11.6% of the issued and outstanding common shares and 3,400,000 warrants representing 16.2% of the issued and outstanding warrants of the Company. In addition, a company 50% beneficially owned by Richard Warke acquired 2,857,143 units at a price of $0.07 per unit. 1,428,571 common shares (50% of 2,857,143) represents 4.9% of the issued and outstanding common shares and 1,428,571 warrants (50% of 2,857,143) represents 6.8% of the issued and outstanding warrants of the Company. As a result of the acquisition of securities described above, Mr. Warkeowns in aggregate, 4,961,904 common shares of Catalyst, representing 16.94% of the current issued and outstanding shares of Catalyst and would own 9,790,475 common shares, representing 28.70% on a partially diluted basis, assuming the exercise of 4,828,571 warrants. Mr. Warke has signed a Letter of Undertaking to the TSX Venture Exchange stating that without receiving prior approval of Catalyst’s shareholders, none of the aforementioned entities will exercise its warrants at any time when such exercise would increase Mr. Warke’s beneficial ownership of common shares of Catalyst to 20% or more of the issued capital.
The Company has also been advised that pursuant to the private placement, Ian Telfer acquired 5,600,000 units at a price of $0.07 per unit which consists of 5,600,000 common shares, representing 19.1% of the issued and outstanding common shares and 5,600,000 warrants representing 26.7% of the issued and outstanding warrants of the Company. If the 5,600,000 warrants were exercised, Ian Telfer would own 32.1% of the issued and outstanding common shares on a partially diluted basis. Mr. Telfer has signed a Letter of Undertaking to the TSXVenture Exchange stating that without receiving prior approval of Catalyst’s shareholders, he will not exercise his warrants at any time when such exercise would increase his ownership of common shares of Catalyst to 20% or more of the issued capital.
The Company further announces that pursuant to the private placement, Fiore Financial Corporation., a company owned and controlled by Frank Giustra, acquired 970,000 units at a price of $0.07 per unit which consists of 970,000 common shares representing 3.3% of the issued and outstanding common shares and 970,000 warrants representing 4.6% of the issued and outstanding warrants of the Company. In addition, a company 50% beneficially owned by Frank Giustra, acquired 2,857,143 units at a price of $0.07 per unit. 1,428,571 common shares (50% of 2,857,143) represents 4.9% of the issued and outstanding common shares and 1,428,571 warrants (50% of 2,857,143) represents 6.8% of the issued and outstanding warrants of the Company. As a result of the acquisition of securities described above, Mr. Giustraowns and/or controls 3,669,123 common shares of Catalyst representing 12.53% of the current issued and outstanding shares of Catalyst and would own and/or control 6,392,961 common shares, representing 19.97% on a partially diluted basis, assuming the exercise of 2,676,171 warrants and 47,667 options.
The Company also announces that pursuant to the private placement, Diamond Hill Investment Corporation acquired 2,314,285 units at a price of $0.07 per unit which consists of 2,314,285 common shares representing 7.9% of the issued and outstanding common shares and 2,314,285 warrants representing 11.0% of the issued and outstanding warrants of the Company. As a result of the acquisition of securities described above, Diamond Hill Investment Corporation owns 2,314,285 common shares of Catalyst representing 7.90% of the current issued and outstanding shares of Catalyst and would own 4,628,570 common shares, representing 14.65% on a partially diluted basis, assuming the exercise of 2,314,285 warrants.
The Company has been advised that Frank Giustra and his related entities, Richard Warke and his related entities, Ian Telfer, and Diamond Hill Investment Corporation have acquired these securities for investment purposes and have no present intention to acquire further securities of the Company, although they may in the future acquire or dispose of securities of the Company, through the market, privately or otherwise, as circumstances or market conditions warrant.
http://www.catalystcopper.com/media/news-releases/2014/catalyst-copper-annouces-closing-non-brokered-private-placement?
----- COMMENTARY -----
A group of accomplished mining entrepreneurs have taken control of an un-loved junior mining company.
Catalyst Copper Corp., which holds a 60% interest in the La Verde copper porphyry project in Mexico, closed a $1.4 million financing today, selling 20 million units, consisting of a $0.07 share and a full $0.10 warrant.
Richard Warke
Richard Warke, who just sold his Arizona copper developer, Augusta Resource Corp, for $555 million to Hudbay, and in 2011, sold his Ventana Gold for $1.54 billion to to Eike Batista’s AUX, now owns 28.7% (assuming he exercises his warrants) of Catalyst. This is the first time Mr. Warke has shown up as an investor in the company.
Ian Telfer and Frank Giustra, the duo that took over Wheaton River Minerals, which subsequently merged with Rob McEwen’s Goldcorp and spun out Silver Wheaton, round out the top three largest shareholders in Catalyst following the financing, with Telfer owning 32.1% of the company, and Giustra owning 19.9%, assuming the gentlemen exercise their warrants.
Lawyer and mining entrepreneur Robert “Tookie” Angus will also own 14.7% through his Diamond Hill Investment Corp. Mr. Angus was a director of Ventana Gold at the time it was sold for over $13 per share, having climbed from $0.10 just a few years earlier.
A December 2012 PEA suggested Catalyst’s La Verde project had a 21.2% IRR and $1.625 billion pre-tax NPV (undiscounted) using $2.70/lb copper, $1,200/oz gold and $25/oz silver. Last month, the company retained engineering firm, JDS Energy and Mining Inc., “to review the La Verde Project with the objective of identifying potential optimization and value enhancement opportunities.”
Catalyst has been on my radar ever since Riverside Resources CEO John-Mark Staude and I discussed La Verde randomly at the Mining Indaba in Cape Town, South Africa earlier this year. Dr. Staude told me La Verde is a quality project that should have sold to a producer in the last cycle, and probably came very close to being sold, which was enough to compel me to pick up some shares in the company. Getting access to the project, within Michoacán State, has been among its primary challenges, I learned in that discussion.
Catalyst’s stock has withered away over the past couple of years, with two share consolidations having taken place, now equal to a 13:1 roll-back. Former CEO John Greenslade, of Baja Mining infamy, resigned from the top seat at Catalyst earlier this year.
Following today’s financing, Catalyst has 29.28 million shares outstanding, which last traded at $0.165 Monday, giving the company an approximate market capitalization of $4.83 million ($8.13 million if you include the 20 million warrants which are now in the money).
As a shareholder in the company, I am biased. Always do your own due diligence.
------ http://blog.ceo.ca/2014/07/21/warke-telfer-and-giustra-take-over-tiny-catalyst-copper/The merger will be effected by way of a statutory plan of arrangement under which shareholders of Catalyst will receive one common share of NewCastle for each common share of Catalyst held (the "Arrangement"). On a post-merger basis, the outstanding shares of NewCastle will be held, as to approximately 60%, by the shareholders of NewCastle and, as to approximately 40%, by the former shareholders of Catalyst.
The Arrangement will be subject to approval by at least two-thirds of the votes cast by the shareholders of Catalyst and at least two-thirds of the votes cast by the shareholders, warrantholders and optionholders of Catalyst (voting together) at a special meeting of the Catalyst securityholders. In addition, the Arrangement will be subject to approval by the Supreme Court of British Columbia and by the TSX Venture Exchange (the "TSX-V").
Certain directors and officers of Catalyst have entered into agreements to vote all securities of Catalyst owned or controlled by them in favour of the Arrangement (representing in aggregate 66.48% of the outstanding Catalyst common shares and 73.05% of the outstanding Catalyst common shares, options and warrants).
The Agreement includes customary provisions including, among other things, non-solicitation covenants, a fiduciary out of the Catalyst board and a right of NewCastle to match any superior proposal. In the event that Catalyst wishes to terminate the Agreement in order to support a superior proposal, Catalyst is obligated to pay to NewCastle an amount equal to C$1.5 million as a termination payment.
It is a condition of the Arrangement that Catalyst will have not less than C$3,750,000 of net cash at closing (less any amounts invested by Catalyst in NewCastle pursuant to the private placement described below). Certain directors and officers of Catalyst have agreed to exercise certain of their warrants and stock options to provide Catalyst with cash prior to closing. In addition, Catalyst has agreed to complete a private placement of shares if Catalyst will not have sufficient net cash to satisfy the condition. Such private placement will be at a price of C$0.275 per Catalyst common share.
Catalyst agreed to subscribe for up to C$600,000 of common shares of NewCastle by way of a private placement at an issue price of C$0.275 per common share. The first tranche of C$100,000 closed on March 28, 2016. The second and final tranche of $500,000 is expected to close later today.
In connection with the Arrangement, Catalyst agreed to issue a C$400,000 convertible note to a third party investor, subject to approval of the TSX-V. The convertible note has a term of one year and is convertible into units at a price of C$0.275 per unit, with each unit comprised of one Catalyst common share and one-half of one common share purchase warrant. A whole warrant entitles the holder to purchase one Catalyst common share at an exercise price of C$0.41 per common share with an expiry date that is two years after the date of issuance of the convertible note. The convertible note will automatically convert into Catalyst shares and warrants immediately prior to the closing of the Arrangement.
In connection with the Arrangement, NewCastle engaged GMP Securities L.P. ("GMP") to provide a fairness opinion to the NewCastle board of directors. As consideration for its services under this engagement, GMP will be issued, subject to approval of the TSX-V, 357,143 common shares of NewCastle.
The Catalyst securityholder meeting to approve the Arrangement is expected to be held on May 18, 2016 and the Arrangement is expected to close before the end of May 2016. Further details of the Arrangement will be provided in the information circular to be mailed to securityholders in connection with the meeting.
http://www.marketwired.com/press-release/newcastle-gold-and-catalyst-copper-announce-definitive-agreement-tsx-venture-nca-2114887.htm
