VANCOUVER, BRITISH COLUMBIA, Nov. 3, 2009 (Marketwire) -- Nevada Copper Corp. (TSX:NCU) ("Nevada Copper") is pleased to announce the closing of its previously announced private placement in the amount of CDN$11.25 million (the "Private Placement") by Capstone Mining Corp. ("Capstone").
A summary of significant terms of this strategic investment by Capstone in Nevada Copper, pursuant to an investment agreement between Capstone and Nevada Copper (the "Investment Agreement"), include the following:
- Private Placement. Capstone has subscribed for 4,500,000 units (the "Units") of Nevada Copper, each Unit consisting of one common share (a "Common Share") and one-half of a transferable common share purchase warrant (a "Warrant") at a price of $2.50 per Unit for total consideration of $11.25 million. Each whole Warrant is exercisable into one common share for a period of two years from the closing date at an exercise price of $3.00 per common share. If at any time prior to the second anniversary of the closing date, the closing price of Nevada Copper's common shares is greater than $3.50 for at least 20 consecutive trading days, Nevada Copper can send a notice to Capstone stating that the Warrants will expire if not exercised within 30 days.
All securities issued in connection with the Private Placement are subject to a four month hold period, expiring March 4, 2010.
On closing of the private placement Capstone will hold 11.1% of the total issued and outstanding common shares of Nevada Copper.
- Pre-Emptive Right. Nevada Copper has granted Capstone a pre-emptive right to participate in any share offerings by Nevada Copper so that Capstone can maintain its 11.1% ownership percentage of Nevada Copper. In the event that Capstone's ownership interest falls below 9% of the common shares this pre-emptive right will be terminated. Exercise of the pre-emptive right is subject to regulatory approval at the time of exercise.
- Board of Directors. If Capstone increases its ownership interest in Nevada Copper to 19% or higher, Capstone shall be entitled to nominate a representative to the Board of Directors of Nevada Copper at Nevada Copper's next annual general meeting. Following such appointment to the Board of Directors, in the event that Capstone's ownership interest falls below 19%, Capstone shall cause its nominee to resign subject to a 15 day remedy period.
- Acquisition of Control. Capstone has agreed that it will not, without the consent of the Board of Directors of Nevada Copper, commence, or announce any intention to commence, a formal bid or tender offer to acquire or increase its ownership interest beyond 20% of common shares in Nevada Copper.
