VANCOUVER, July 8, 2016 /PRNewswire/ --
/NOT FOR DISTRIBUTION TO U.S.
NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES/
Kootenay Silver Inc. (TSXV:KTN) ("Kootenay" or the
"Company") is pleased to report that, in connection with
its previously announced private placement offering of units (the
"Units") at a price of CAD$0.40 per
Unit (the "Offering Price"), it has amended its agreement with
Haywood Securities Inc. (the "Agent") to increase the amount of the
Offering from 10,000,000 Units to up to 11,250,000 Units for
aggregate gross proceeds of up to CAD$4,500,000 (the "Offering"). In addition, the
Company is pleased to announce that Pan American Siver Corp. (TSX:
PAA, NASDAQ: PAAS)("Pan American") has indicated it intends to
exercise its participation right in full to maintain its pro-rata
10% interest in the Company. As a result, Pan American will
subscribe for up to an additional 1,250,000 Units at the Offering
Price for aggregate gross proceeds of up to CAD$500,000 (the "Non-Brokered Offering").
The number of additional Units that may be acquired under the
option granted to the Agent (the "Agent's Option") has also been
increased from 1,500,000 Units to 1,687,500 Units. The Agent's
Option is exercisable in whole or in part by giving notice to the
Company at any time up to 48 hours prior to the closing date. As
previous disclosed, each Unit shall consist of one common share and
one-quarter of one common share purchase warrant (each whole common
share purchase warrant, a "Warrant"). Each Warrant will entitle the
holder to acquire one common share (a "Warrant Share") at a price
per Warrant Share of CAD$0.55 for a
period ending April 21, 2021. The
Warrants will have identical terms to the 23,103,969 listed
warrants (the "Listed Warrants") of the Company currently
outstanding and trading under the ticker 'TSXV: KTN.WT'. Assuming
the completion of the Offering, the exercise of the Agent's Option,
and the Non-Brokered Offering, the Company will issue 14,187,500
Units for aggregate gross proceeds of CAD$5,675,000.
The net proceeds of the Offering will be used to fund the
exploration and development of the Company's La Cigarra project in
Mexico and for general working
capital purposes.
All securities to be issued pursuant to the Offering will be
subject to a four month hold period under applicable securities
laws in Canada. Subject to
compliance with the policies of the TSX Venture Exchange, the
Company will apply to list the Warrants on the TSXV with the Listed
Warrants, on the expiry of the four month hold period.
The Offering is expected to close on or before July 28, 2016 (the "Closing"). Closing of the
Offering is subject to certain conditions customary for financings
of this kind, including, but not limited to, the receipt of all
necessary approvals including approval and acceptance by the TSX
Venture Exchange. The Company has agreed to pay the Agent a cash
commission of 6% of the gross proceeds raised under the Offering
including on exercise of the Agent's Option and issue compensation
warrants equal to 3% of the number of Units and Additional Units
sold. Each such compensation warrant will entitle the Agent to
purchase one common share at a price of CAD$0.55 for a period of twelve months following
the closing of the Offering. Certain insiders of the Company have
indicated that they intend to participate in a portion of the
Offering.
This news release does not constitute an offer to sell or a
solicitation of an offer to buy the securities described herein in
the United States. The securities
described herein have not been and will not be registered under the
United States Securities Act of 1933, as amended, or any State
Securities Laws and may not be offered or sold in the United States or to the account or benefit
of a U.S. person absent an exemption from the registration
requirements of such Act.
About Kootenay Silver Inc.
Kootenay Silver Inc. is an exploration company actively engaged
in the discovery and development of mineral projects in the Sierra
Madre Region of Mexico and in
British Columbia, Canada. The
Company's top priorities are the advancement of the La Cigarra
silver project and the Promontorio Mineral Belt, in Chihuahua, Mexico and Sonora, Mexico, respectively. The La
Cigarra property is 26 kilometres from the historic mining city of
Parral and boasts nearby power, good road access, gentle
topography, and established infrastructure. La Cigarra
currently hosts a resource estimate of 18.54 million tonnes
containing 51.47 million ounces of silver in the Measured &
Indicated categories grading 86.3 g/t silver and 4.45 million
tonnes containing 11.46 million ounces of silver in the Inferred
category grading 80 g/t silver. The mineralized system at La
Cigarra has been traced over 6.5 kilometres and is defined at
surface as a silver soil anomaly and by numerous historic mine
workings. The La Cigarra silver deposit is open along strike and at
depth and is approximately 25 kilometres north, and along strike,
of Grupo Mexico's Santa Barbara
mine and Minera Frisco's
San Francisco del Oro mine. The Promontorio Mineral Belt
includes the Company's La Negra high-grade silver discovery and its
Promontorio Silver Resource. The Promontorio Mineral Belt is under
option to Pan American Silver whereby they can earn a 75% interest
in the project with US$16 million of
expenditures and payments with Kootenay retaining a 25% carried to
production interest (see news releases dated February 16 and March
4, 2016). The Promontorio Silver Resource currently
hosts a resource estimate of 44.5 million tonnes containing 92
million ounces of silver equivalent in the Measured & Indicated
categories grading 64.3 g/t silver equivalent and 14.6 million
tonnes containing 24.3 million ounces of silver equivalent in the
Inferred category grading 52 g/t silver equivalent. The Company's
core objective is to create value by acquiring silver resources
through discovery and acquisition and testing those resources with
the ultimate goal of developing them into silver production if they
are proven to be economically viable.
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in policies of the TSX Venture
Exchange) accepts responsibility for the adequacy or accuracy of
this release.
Forward Looking Information
The information in this news release has been prepared as at
July 7, 2016. Certain statements in
this news release, referred to herein as "forward-looking
statements", constitute "forward-looking statements" under the
provisions of Canadian provincial securities laws. These statements
can be identified by the use of words such as "expected", "may",
"will" or similar terms.
Forward-looking statements are necessarily based upon a
number of factors and assumptions that, while considered reasonable
by Kootenay as of the date of such statements, are inherently
subject to significant business, economic and competitive
uncertainties and contingencies. Many factors, known
and unknown, could cause actual results to be materially
different from those expressed or implied by such
forward-looking statements. Readers are cautioned not
to place undue reliance on these forward-looking statements, which
speak only as of the date made. Except as otherwise
required by law, Kootenay expressly disclaims any obligation or
undertaking to release publicly any updates or revisions to any
such statements to reflect any change in Kootenay's expectations or
any change in events, conditions or circumstances on which any such
statement is based. More particularly, this release
contains statements concerning the anticipated Offering.
Accordingly, there is a risk that the Offering will not be
completely sold, and completed within the anticipated
time or at all.
Kootenay Silver Inc., Jim
McDonald, President / CEO, Phone: +1-403-880-6016, Email:
info@kootenaysilver.com ; Ken Berry,
Chairman, Phone +1-604-601-5652; +1-888-601-5650 or visit:
http://www.kootenaysilver.com