Vancouver — As part of the proposed reorganization of
“This reorganization will provide Misty Mountain shareholders with a substantial economic interest in the Harmony project, while putting the project into the stronger hands of Taseko,” says Ron Thiessen, president of the latter.
The project will be transferred to Taseko’s wholly owned subsidiary, Gibraltar Mines. In return, Taseko will pay $2.2 million and issue preferred shares of Gibraltar to Misty Mountain shareholders. The preferred shares are designed to track the Harmony project and will be convertible into Taseko shares once certain events take place.
Using a cutoff grade of 0.6 gram gold per tonne, the Harmony property hosts a measured and indicated resource of 64 million tonnes grading 1.53 grams gold.
The sale is part of a Misty Mountain reorganization which will be proposed to shareholders at the annual general meeting, scheduled for March 29.
Under the reorganization, Misty Mountain shareholders will receive 10 New Misty redeemable shares and one New Misty share for each 10 shares held. The Gibraltar preferred shares issued to New Misty will have a paid-up capital of $62.8 million and be convertible to Taseko shares, initially at $3.39 per share.
Misty Mountain plans to wipe out its $3.5-million debt by using $2 million from the deal and by issuing 15.5 million New Misty shares at 10 each.
Gibraltar will also transfer its Westgarde copper porphyry property in northern British Columbia to Misty Mountain for $230,000. The property hosts several geophysical anomalies. The reorganized company then plans to raise $350,000 by issuing 3.5 million units. Each unit will hold one share and one warrant exercisable over a 2-year period at 10.
The reorganization is subject to the approval of 75% of the majority shareholders and a simple majority of the remaining shareholders of both Misty and Taseko.
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