VANCOUVER, Jan. 5, 2015 /CNW/ - Western Pacific Resources
Corp. ("Western Pacific" or the "Company") (TSX-V: WRP) is
pleased to announce that it has arranged a private placement of up
to US$650,000, issuable in two
tranches, in unsecured convertible notes (the "Notes") to Quintana
WRP Holding Company LLC (the "Placee").
The principal amount of the Notes will be convertible at the
option of the Placee into common shares of the Company ("Shares")
at a price of CAD$0.1215 per share.
The closing of the first tranche in the amount of US$355,000 (the "First Note") is expected to
occur within five business days. Closing of the second
tranche in the amount of US$295,000
(the "Second Note") is at the sole discretion of the Placee, but
the Placee's option to provide the Second Note expires on
February 1, 2015.
The Note holder will have the option to convert US$123,750 of the principal amount of the First
Note into a net smelter return royalty ("NSR") equal to 0.1375% and
US$101,250 of the principal amount of
the Second Note into an NSR equal to 0.1125%. The NSR is to be
calculated based on all metal and minerals, if any, produced from
the Company's Deer Trail Project.
The Notes shall become due on the third anniversary after
issuance and shall accrue interest at a rate of nine and one-half
percent per annum, compounded semi-annually and payable
quarterly. The Company will have the option, in lieu of a
cash payment, to convert all or part of any accrued interest on the
Notes into Shares at a price equal to the greater of (a)
CAD$0.1215 per Share, and (b) the
closing price of the Shares on the TSX Venture Exchange ("TSX-V")
on the trading day immediately preceding the date of
conversion.
The net proceeds from the private placement will be used for
further development work on the Company's Deer Trail Project and
for general working capital purposes. The Notes and any
Shares issued either on conversion of the Notes or in lieu of cash
payments of interest will be subject to a four month hold period
from their date of issue under applicable securities laws and the
policies of the TSX-V. Completion of issuance of the Notes is
subject to the receipt of TSX-V acceptance.
As the Placee is a related party within the meaning of TSX-V
Policy 5.9, which incorporates the provisions of Multilateral
Instrument 61-101 ("MI 61-101"), the acquisition of Notes by the
Placee will constitute a "related party transaction" subject to the
provisions of MI 61-101. The acquisition of Notes will be exempt
from the formal valuation and minority shareholder approval
requirements of MI 61-101 as the fair market value of the Notes
will not exceed 25% of the Company's market capitalization.
Oliver Rodz and Lawrence Roulston, who are nominees of the
Placee or its related parties on the Board of Directors of the
Company (the "Board"), abstained from voting on the approval by the
Board of the Notes placement. Alf
Hills, who is a nominee of the Placee or its related parties
on the Board but does not hold a "disclosable interest" in the
transaction within the meaning of the Business Corporations Act
(BC), voted in favour of the Notes placement, as did all of the
other directors.
A material change report in relation to this transaction will be
filed less than 21 days before closing as the Company intends to
complete this transaction as soon as is commercially feasible.
The Placee and its related and associated entities currently
beneficially own or control the following securities of the
Company:
- 13,978,538 common shares of the Company;
- Secured convertible notes (the "Secured Notes") in the amount
of US$5.0 million which are
convertible at any time, in whole or in part, into common shares of
the Company at a rate of CAD$0.1328
per share; and
- A right to provide up to US$3,300,000 of future, unsecured, non-interest
bearing convertible notes (the "Future Notes"), which, if issued,
would be convertible at the option of the Placee or the Company
into Shares at a price of CAD$0.1328
per share.
In the event that all of the Notes and the Future Notes were
issued, and assuming the entire principal amounts of the Notes, the
Secured Notes and the Future Notes were converted into Shares,
based on a US$-CAD$ exchange rate of 1.1632, the Placee and its
related and associated entities would, on a pro forma basis,
beneficially own or control 93,777,322 of the Shares, representing
71.49% of the pro forma issued and outstanding Shares.
About Quintana Minerals Corporation
Quintana Minerals
Corporation ("QMC") is the management company for a portfolio of
energy and natural resources-based private and publicly traded
companies controlled and/or operated by the Corbin J. Robertson Jr.
family. The company was formed in 1963 as a division of
Quintana Petroleum Corp. and has actively developed and operated
precious and industrial metals/minerals projects throughout the
Americas. The following are examples of some the group's
on-going ventures: Natural Resource Partners L.P., a publicly
traded MLP (NYSE: NRP); Great Northern Properties L.P., a private
company that holds over 22 billion tons of coal reserves; Corsa
Coal Corp., a publicly traded junior mining company (TSXV: CSO);
Quintana Energy Partners, L.P., an energy-focused private equity
fund; and Quintana Shipping Ltd., the group's 2nd dry
bulk shipping venture. For more information please contact
Oliver Rodz, Managing Director of
QMC, 601 Jefferson Street, Suite 3600, Houston, Texas 77002 (tel: 713-751-7500).
About Western Pacific Resources Corp.
Western Pacific
is a publicly traded resource exploration company focused on
advancing a strong portfolio of precious metal properties in the
Western United States. The Company
is currently exploring the historic polymetallic Deer Trail Mine in
Piute County, Utah. The Company's
shares trade on the TSX Venture Exchange under the symbol "WRP".
Western Pacific's team is led by a slate of technical and financial
experts whose aim is to succeed in creating shareholder value
through the development of its portfolio of projects as well as by
pursuing additional property acquisitions and other strategic
opportunities.
ON BEHALF OF THE BOARD
"Michael Callahan"
Michael Callahan
President & CEO
Neither the TSX Venture Exchange nor the Investment Industry
Regulatory Organization of Canada
accepts responsibility for the adequacy or accuracy of this news
release.
Forward-Looking Statements
Certain statements contained in this press release constitute
forward-looking statements within the meaning of Canadian
securities legislation. Forward-looking statements contained in
this news release include, without limitation, statements in
respect of the expected closing of the private placement. These
statements relate to future events, business prospects or
opportunities and product development. All such statements other
than statements of historical fact are forward-looking statements.
Forward-looking statements are often, but not always, identified by
the use of words such as "seek", "anticipate", "plan", "continue",
"estimate", "expect, "may", "will", "project", "predict",
"potential", "targeting", "intend", "could", "might", "should",
"believe" and similar expressions. The Company believes that the
expectations reflected in those forward-looking statements are
reasonable, but no assurance can be given that these expectations
will prove to be correct and such forward-looking statements should
not be unduly relied upon. Actual results and developments may
differ, and may differ materially, from those expressed or implied
by the forward-looking statements contained in this news release.
The Company disclaims any duty to update any of the forward-looking
statements after the date of this news release to conform such
statements to actual results or to changes in the Company's
expectations except as otherwise required by applicable
law.
SOURCE Western Pacific Resources Corp.