VANCOUVER, British Columbia,
June 15, 2017 /PRNewswire/ --
Capstone Mining Corp. ("Capstone" or the "Company") (TSX: CS)
has entered into a definitive share purchase agreement (the
"Agreement") pursuant to which it has agreed to sell its Kutcho
development project to Desert Star Resources Ltd. (TSX-V: DSR) (the
"Transaction"). Under the terms of the Agreement, Capstone will
receive C$28.8 million in cash,
common shares of Desert Star representing 9.9% of the issued and
outstanding shares upon completion of the Transaction, and will
have the right to nominate one representative to the Desert Star
board of directors under certain circumstances.
"The divestiture of Kutcho is consistent with our strategy to
focus on our core assets," said Darren
Pylot, President and Chief Executive Officer of Capstone.
"This agreement allows us to retain exposure to the Kutcho project,
while strengthening our balance sheet. We look forward to seeing
the Kutcho project advance under Desert Star's ownership."
The Transaction is subject to financing and other customary
closing conditions and is expected to close in the third quarter of
2017. Capstone intends to use net proceeds from the sale primarily
to reduce outstanding borrowings under its revolving credit
facility.
About Capstone Mining Corp.
Capstone Mining Corp. is a Canadian base metals mining company,
focused on copper. We are committed to the responsible development
of our assets and the environments in which we operate. Our three
producing mines are the Pinto Valley copper mine located in
Arizona, US, the Cozamin
polymetallic mine in Zacatecas State, Mexico and the Minto copper mine in Yukon, Canada. In addition, Capstone has two
development projects; the large scale 70% owned copper-iron
Santo Domingo project in Region
III, Chile, in partnership with
Korea Resources Corporation, and the 100% owned Kutcho copper-zinc
project in British Columbia,
Canada, as well as exploration properties in Chile and US. Capstone's strategy is to focus
on the optimization of operations and assets in politically stable,
mining-friendly regions, centred in the Americas. Our headquarters
are in Vancouver, Canada and we
are listed on the Toronto Stock Exchange (TSX). Further information
is available at http://www.capstonemining.com.
Cautionary Note Regarding Forward-Looking
Information
This document may contain "forward-looking information" within
the meaning of Canadian securities legislation and "forward-looking
statements" within the meaning of the United States Private
Securities Litigation Reform Act of 1995 (collectively,
"forward-looking statements"). These forward-looking statements are
made as of the date of this document and Capstone does not intend,
and does not assume any obligation, to update these forward-looking
statements, except as required under applicable securities
legislation.
Forward-looking statements relate to future events or future
performance and reflect our expectations or beliefs regarding
future events. Forward-looking statements include, but are not
limited to, statements with respect to the ability of Desert Star
to raise the necessary financing to complete the Transaction, the
completion of the closing conditions and the Company's use of
proceeds for the sale. In certain cases, forward-looking statements
can be identified by the use of words such as "plans", "expects",
"budget", "scheduled", "estimates", "forecasts", "intends",
"anticipates", "believes" or variations of such words and phrases,
or statements that certain actions, events or results "may",
"could", "would", "might" or "will be taken", "occur" or "be
achieved" or the negative of these terms or comparable terminology.
In this document certain forward-looking statements are identified
by words including "subject", "expected" and "intend". By their
very nature, forward-looking statements involve known and unknown
risks, uncertainties and other factors that may cause our actual
results, performance or achievements to be materially different
from any future results, performance or achievements expressed or
implied by the forward-looking statements. Such factors include,
amongst others, risks related to inherent hazards associated with
mining projects, future prices of copper and other metals, changes
in general economic conditions, and other risks of the mining
industry as well as those factors detailed from time to time in the
Company's interim and annual financial statements and management's
discussion and analysis of those statements, all of which are filed
and available for review under the Company's profile on SEDAR at
http://www.sedar.com. Although the Company has attempted to
identify important factors that could cause our actual results,
performance or achievements to differ materially from those
described in our forward-looking statements, there may be other
factors that cause our results, performance or achievements not to
be as anticipated, estimated or intended. There can be no assurance
that our forward-looking statements will prove to be accurate, as
our actual results, performance or achievements could differ
materially from those anticipated in such statements. Accordingly,
readers should not place undue reliance on our forward-looking
statements.
Cindy Burnett, VP, Investor
Relations and Communications, +1-604-637-8157,
cburnett@capstonemining.com