Prophecy Resource Corp. ("Prophecy") (TSX VENTURE: PCY)(OTCQX:
PRPCF)(FRANKFURT: 1P2) and Pacific Coast Nickel Corp. ("PCNC") (TSX
VENTURE: NKL) ("PCNC", and collectively with Prophecy, the
"Companies") are pleased to announce that further to their
announcement on April 4, 2011, both Companies have each set a
shareholder meeting date of May 31, 2011 to approve the sale of
Prophecy's Wellgreen PGM Ni-Cu and Lynn Lake Nickel projects (the
"Projects") to PCNC.
The sale of the Projects will be implemented by way of a plan of
arrangement under the Business Corporations Act (British Columbia)
(the "Arrangement"). In connection with the Arrangement, Prophecy
has obtained an interim court order from the British Columbia
Supreme Court on April 29, 2011. A joint management information
circular containing detailed disclosure n respect of the
Arrangement has been prepared by the Companies and will be mailed
to shareholders of the Companies in early May.
The Prophecy shareholder meeting will be held at the offices of
Blake, Cassels & Graydon LLP at Suite 2600, 595 Burrard Street,
Vancouver at 10:00 am on Tuesday, May 31, 2011. The PCNC
shareholder meeting will be held at the offices of Armstrong
Simpson at Suite 2080, 777 Hornby Street, Vancouver at 11:00 a.m.
on Tuesday, May 31, 2011.
Upon completion of the Arrangement, 450,000,000
pre-consolidation common shares of PCNC (the "PCNC Shares") will be
issued to Prophecy, of which 225,000,000 PCNC Shares will be
retained by Prophecy and 225,000,000 PCNC Shares will be
distributed to Prophecy securityholders ("PCNC Distribution").
Assuming Prophecy fully-diluted share count of 237,350,652, each
Prophecy shareholder of record at the effective time of the
Arrangement would receive 0.9482 of a PCNC Share per Prophecy share
held, and each Prophecy warrant and option holder of record at the
effective time of the Arrangement, upon exercise anytime before
expiration, would also receive 0.9482 of a PCNC Share per Prophecy
share exercised for.
It is expected that the PCNC Shares will be consolidated on a
10:1 basis shortly after completion of the Arrangement.
Completion of the Arrangement is subject to a number of
conditions, including the approvals of the shareholders of Prophecy
and PCNC, the final approval of the Supreme Court of British
Columbia, and the TSX Venture Exchange, as well as other customary
conditions. The Arrangement Agreement and related information
circular will be filed and available for public download at
www.sedar.com.
About Prophecy
Prophecy Resource Corp. is an internationally diversified
company engaged in developing energy, nickel and platinum group
metals projects. The company controls over 1.4 billion tonnes of
surface minable thermal coal resources in Mongolia. Prophecy's
Ulaan Ovoo coal mine is fully operational and its Chandgana mine
mouth power plant is currently being permitted. In Canada, Prophecy
owns the Wellgreen PGM Project in Yukon and Lynn Lake Nickel
Sulphide Project in Manitoba, both of which it has agreed to sell
to Pacific Coast Nickel Corp (TSX VENTURE: NKL). Prophecy also owns
equity stakes in Victory Nickel Inc. and Compliance Energy Corp.
Mineral resources that are not mineral reserves do not have
demonstrated economic viability.
About PCNC
Pacific Coast Nickel Corp is a Canadian based nickel and copper
base metal exploration company actively exploring properties in
Canada, Argentina and Uruguay. PCNC's Burwash property is located
adjacent to Prophecy's Wellgreen project, Yukon Territory, Canada.
PCNC in December optioned the Las Aguilas Nickel-PGM project in
Argentina, which contains an historic, non 43-101 compliant
resource of 2.2mt of 0.52% Ni, 0.50% Cu, 1.16 g/t PGM. A qualified
person has not done sufficient work to classify the historical
estimate as current mineral resources and PCNC is not treating the
historical estimate as current mineral resources but as a
historical estimate that should not be relied upon.
ON BEHALF OF THE BOARD OF DIRECTORS of
Prophecy Resource Corp.
John Lee, Chairman and CEO
Pacific Coast Nickel Corp.
John Lee, Chairman and Interim CEO
Cautionary Statements: Completion of the Arrangement is subject
to a number of conditions, including regulatory approval,
shareholder approvals, and approval of the British Columbia Supreme
Court. There can be no assurance that the transaction will be
completed as proposed or at all. Investors are cautioned that,
except as disclosed in the joint management information circular to
be prepared in connection with the Arrangement and related
transactions, any information released or received with respect to
the Arrangement may not be accurate or complete and should not be
relied upon. Trading in the securities of exploration and
development stage resource companies should be considered highly
speculative.
Forward Looking Statements: This news release includes certain
statements that may be deemed "forward-looking statements". All
statements in this release, other than statements of historical
facts, including, without limitation, statements regarding timing
of the Arrangement, future share ownership of PCNC, Prophecy's
intentions in respect of the distribution of PCNC Shares, potential
mineralization, the estimation of mineral resources, the
realization of mineral resource estimates, interpretation of prior
exploration and potential exploration results, the timing and
success of exploration activities generally, the timing and results
of future resource estimates, permitting time lines, metal prices
and currency exchange rates, availability of capital, government
regulation of exploration operations, environmental risks,
reclamation, title, and future plans and objectives of the
companies are forward-looking statements that involve various risks
and uncertainties. Although PCNC and Prophecy believe the
expectations expressed in such forward-looking statements are based
on reasonable assumptions, such statements are not guarantees of
future performance and actual results or developments may differ
materially from those in the forward-looking statements.
Forward-looking statements are based on a number of material
factors and assumptions. Factors that could cause actual results to
differ materially from those in forward-looking statements include
failure to obtain necessary approvals in respect of the
Arrangement, unsuccessful exploration results, changes in project
parameters as plans continue to be refined, results of future
resource estimates, future metal prices, availability of capital
and financing on acceptable terms, general economic, market or
business conditions, risks associated with operating in foreign
jurisdictions, uninsured risks, regulatory changes, defects in
title, availability of personnel, materials and equipment on a
timely basis, accidents or equipment breakdowns, delays in
receiving government approvals, unanticipated environmental impacts
on operations and costs to remedy same, and other exploration or
other risks detailed herein and from time to time in the filings
made by the companies with securities regulators. Readers are
cautioned that mineral resources that are not mineral reserves do
not have demonstrated economic viability. Mineral exploration and
development of mines is an inherently risky business. Accordingly
the actual events may differ materially from those projected in the
forward-looking statements. For more information on PCNC and
Prophecy and the risks and challenges of their businesses,
investors should review their annual filings that are available at
www.sedar.com.
This press release does not constitute an offer to sell or a
solicitation 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 law and may not be offered
or sold in the United States or to U.S. Persons unless registered
under the U.S. Securities Act and applicable state securities laws
or an exemption from such registration is available.
Completion of the transaction is subject to a number of
conditions, including Exchange acceptance and disinterested PCNC
shareholder approval. The transaction cannot close until the
required shareholder approval is obtained. There can be no
assurance that the Transaction will be completed as proposed or at
all.
Investors are cautioned that, except as disclosed in the joint
management Information circular and/or to be prepared in connection
with the transaction, any information released or received with
respect to the Arrangement may not be accurate or complete and
should not be relied upon. Trading in the securities of PCNC should
be considered highly speculative.
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release. The TSX Venture Exchange has in no way
passed upon the merits of the proposed transaction and has neither
approved nor disapproved the contents of this press release.
Contacts: Prophecy Resource Corp. / Pacific Coast Nickel Corp.
John Lee 1.800.851.1528 john@prophecyresource.com /
info@pacificcoastnickel.com www.prophecyresource.com /
www.pacificcoastnickel.com Prophecy Resource Corp. Paul McKenzie
+1.604.642.2625 ext. 107 Prophecy Resource Corp. Scott Parsons
+1.604.642.2625 ext. 106
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