In the event that the Transaction is not completed, holders of Subscription Receipts would receive an interest equal to the amount of their subscription in the repayment of the advance of US$850,000 made to NMCC by THEMAC (announced 6 April, 2010). Alternatively, subject to the approval of the TSX Venture Exchange and the agreement of THEMAC and Mercator, the conversion of the Subscription Receipts would take place as planned.
About the Copper Flat Project and the Transaction
Copper Flat is a former producing mine with substantial infrastructure still in place. As a result of the Transaction, Mercator will hold a substantial interest in THEMAC, and will therefore retain a very significant interest in the Copper Flat project's future development.
Completion of the Transaction is conditional, inter alia, on the completion of a second placing ("the Second Placing") of units of THEMAC sufficient to raise C$5 million at a minimum placing price of C$0.50 per unit, each unit to consist of one common share and one warrant valid for one year and exercisable to acquire one common share at a price sufficient to raise C$10 million should all the warrants of the Second Placing be exercised.
Following completion of the Transaction and the Second Placing (assuming that the Second Placing is completed at C$0.50 per unit and that no warrants are exercised), it is anticipated that Mercator will hold 37.5% of the THEMAC's outstanding shares.
THEMAC is working with SRK Consulting (US) Inc. ("SRK") to complete a revised resource estimate and a preliminary assessment (as defined in Canadian National Instrument 43-101) on the Copper Flat property. The availability of the preliminary assessment is a condition of completion of the Transaction.
THEMAC has been advised that it will receive the initial draft of the NI 43-101 compliant preliminary assessment from SRK by early June 2010, and will thereafter make its formal submissions to the TSX Venture Exchange for approval of the Transaction.
Mercator is a diversified mineral development company dedicated to creating value for its shareholders through a process of finding value, adding value and realising value. Mercator has an experienced management team with expertise in the structuring and execution of value accretive transactions.
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