Further to its press release dated December 18th, 2012, Montero Mining and Exploration Ltd. (TSX VENTURE:MON) ("Montero" or the "Corporation") is pleased to announce the completion and over-subscription of its non-brokered private placement financing raising gross proceeds of $1,400,000 through the sale of 11,200,000 units (the "Units") at a price of $0.125 per Unit (the "Offering").
Dr. Tony Harwood, President and Chief Executive Officer of Montero commented, "We are pleased to report that the private placement was oversubscribed by 40% which is testimony to investor confidence in our strategy. I would like to thank existing shareholders, Board of Directors and new subscribers for their support."
Each Unit consists of one common share ("Common Share") and one Common Share purchase warrant ("Warrant") of Montero. Each Warrant entitles the holder to acquire one Common Share for $0.25 until January 18, 2015. Where the closing price of the common shares equals or exceeds $0.30 for 20 consecutive trading days following the date that is four months and one day after the date of issuance of the Warrants, the Corporation shall have the right to require conversion of the Warrants at the exercise price therefor upon 30 days' notice.
In connection with the Offering, $66,377 in finder's fees were paid in cash and 531,020 finder's warrants ("Finder's Warrants") were issued to certain eligible finders pursuant to the Offering. Each Finder's Warrant entitles the holder to acquire one Unit for $0.125 until January 18, 2015.
The proceeds of the Offering will be used for exploration and general working capital purposes. All securities issued pursuant to the Offering are subject to statutory hold period until May 19, 2013.
Montero also announces that it has completed the debt settlement transaction announced on December 18, 2012 (the "Debt Settlement") after receiving the approval of the TSX Venture Exchange to settle indebtedness relating to the provision of services and consulting. Pursuant to the Debt Settlement, the Corporation issued a total of 5,144,616 Common Shares to certain creditors at a deemed issue price of $0.125 per Common Share in settlement an aggregate total of $643,077 in debt owed by the Corporation. The Common Shares issued by the Corporation pursuant to the Debt Settlement are subject to a four month hold period expiring on May 10, 2013.
The participation in the Offering and the Debt Settlement by certain "related parties" of the Corporation constitutes a "related party transaction" as such terms are defined by Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61-101"), requiring the Corporation, in the absence of exemptions, to obtain a formal valuation for, and minority shareholder approval of, the "related party transaction". The Corporation is relying on the exemptions from the formal valuation and minority approval requirements of MI 61-101 pursuant to which a formal valuation and minority approval are not required in the event that at the time the transaction is agreed to, neither the fair market value of the subject matter of, nor the fair market value of the consideration for, the transaction, insofar as it involves interested parties, exceeds 25 per cent of the Corporation's market capitalization. Persons who are insiders of the corporation and are therefore related parties of the Corporation subscribed for an aggregate of 369,000 Units of the Offering for gross proceeds of $46,125, and were issued an aggregate of 1,774,456 Common Shares pursuant to the Debt Settlement. The participation by each of the related parties in the Offering and the Debt Settlement was approved by directors of the Corporation who are independent of such related parties.
This press release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended, (the "U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States or to or for the account or benefit of a U.S. person (as defined in Regulation S under the U.S. Securities Act) unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available