|Toronto, Canada (August 2, 2016) - Mammoth Resources Corp. (TSX-V: MTH) would like to announce that it intends to proceed with a non-brokered private placement of up to 5.0 million units of the Company (the "Units") at an offering price of $0.02 per Unit, for gross proceeds of up to $100,000 (the "Private Placement"). Each Unit consists of one common share of the Company (a "Common Share") and one common share purchase warrant (the "Warrant"). Each Warrant will entitle the holder thereof to acquire one Common Share until two years following closing of the private placement, at an exercise price of $0.05. The Company has set no minimum number of Units to be distributed and no minimum dollar amount required to be raised in connection with the Private Placement. The gross proceeds of the Private Placement will be used to advance the Company's Tenoriba precious metal project in the prolific Sierra Madre region of Chihuahua State, Mexico and for property taxes.
The Private Placement will be conducted in reliance upon British Columbia Instrument 45-534 (the "Instrument"), which permits an issuer to distribute securities to its existing shareholders, subject to the terms of the instrument. The Company has set July 30, 2016, as the record date for the purpose of determining existing shareholders of the Company who are entitled to purchase Units under the Private Placement. This exemption is not available to shareholders resident in Ontario or Newfoundland, or jurisdictions outside of Canada. The Company may combine the offering under the instrument with other available prospectus exemptions, including sales to accredited investors.
The Private Placement is subject to TSX Venture Exchange approval and the pricing of this Private Placement was granted under the Venture Exchange Discretionary Waiver Bulletin. The securities issued pursuant to the Private Placement will be subject to a four-month hold period. The company may pay finders' fees of cash and/or securities on a portion of the Private Placement.
Revision to Terms to Acquire Tenoriba Property: The Company would like to announce that it has come to an agreement with the vendors of the Tenoriba exploration property whereby Mammoth has been granted a further extension to the dates upon which payments to acquire a 100% interest in the property (subject to a 2% net smelter return royalty which can be purchased for US$1.5 million) are due. Under the terms of this new agreement total cash payments to the vendors have been postponed from $50,000 and $75,000 in 2016 and 2017, respectively to cash payments of $7,500, $20,500, $26,000 and $C30,000 in 2016, 2017, 2018 and 2019, respectively, all amount in US$, with the 2016 payment due December 30, 2016 and 2017 through 2019 payments due June 30 and December 30 of these years. In lieu of postponing the payments Mammoth is to issue the vendors an additional 300,000 shares of the Company. If certain conditions have been met prior to year end 2016 the total amount to be paid to the vendors can be reduced by approximately $42,000 in exchange for 200,000 shares of the Company. The issuance of these shares are subject to TSX-V approval.
Surface X-ray Diffraction (XRD) and Mapping Survey: From the proceeds of this $100,000 financing Mammoth intends to conduct a systematic surface XRD and mapping survey over the property analyzing rocks for alteration clay minerals. This survey is an additional means to vector-in to areas of highest alteration/hydrothermal activity where gold values have often occurred on the property and enhance and further reinforce drill target identification. Drill targets had previously been identified on the site employing results from mapping, sampling and the geophysics survey completed on the property in 2013. On April 24, 2014 (please refer to press release of that date), following extensive work correlating results from previous mapping, sampling and geophysics surveys Mammoth identified 14 drill hole locations with the intention to drill a total of approximate 2,500 metres in this program. Given the decline in the equity capital markets that occurred throughout 2015 and 2015 Mammoth was forced to go into a hibernation mode as it was difficult to finance drill campaigns and for those companies that did drill exploration projects it was often observed that any value that may have been created in the companies that drilled often wasn't even equivalent to the cost of the drill programs.
Drill Program: Following completion of the surface XRD program Mammoth intends to revisit the mapping, sampling and the geophysics survey data, together with the results from the XRD program, to firm-up drill hole locations for a similar size; 15 hole, approximately 2,500 metre drill program to commence in late 2015 or early 2016. The Company has received a quotation from a reputable drill contracting firm for this program wherein the cost of drilling can be paid 50% by shares of Mammoth to be issued at no less than $0.05/share, subject to TSX-V approval.
Management Cease Trade Order: The Company would like to take this opportunity to remind shareholders of the granting of a Management Cease Trade Order ("MCTO") previously announced on June 2, 2016. The MCTO was granted as a result of the Company having exceeded the timing for filing its year-end audited financial statements and accompanying Management Discussion and Analysis, which were due to have been completed and filed on May 30, 2016 for the Company's fiscal year end dated January 31, 2016. The audited financial statements for the period under the MCTO were filed today and are available on Sedar. Mammoth is required to complete and file statements for the quarter ended April 30th. It is expected that the Company will advise shareholders and regulators of the status of the default, via press releases, no later than on a bi-weekly basis, or when these statements are completed until such time as this default is rectified. The quarter statements are expected to be completed and filed in short order and until these are filed management will continue to adhere to the MCTO.
During this MCTO all management, officers and directors of the Company will be prohibited from trading in the Company's shares pursuant to the Company's black-out procedures.
About Mammoth Resources:
Mammoth Resources (TSX-V: MTH) is a mineral exploration company focused on acquiring and defining precious metal resources in Mexico and other attractive mining friendly jurisdictions in the Americas. The Company has an option to acquire 100% in the Tenoriba Property located in the Sierra Madre Precious Metal Belt in southwestern Chihuahua State, Mexico. The company continues to seek other option agreements in the Americas on other properties it deems to host above average potential for economic concentrations of precious metals mineralization.
To find out more about Mammoth Resources and to sign up to receive future press releases, please visit the company's website at www.mammothresources.ca.
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.
Forward Looking Information: This news release may contain or refer to forward-looking information. All information other than statements of historical fact that address activities, events or developments that the Company believes, expects or anticipates will or may occur in the future are forward-looking statements; examples include the listing of its shares on a stock exchange and establishing mineral resources. These forward-looking statements are subject to a variety of risks and uncertainties beyond the Company's ability to control or predict that may cause actual events or results to differ materially from those discussed in such forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the Company disclaims any intent or obligation to update any forward-looking statement, whether as a result of new information, future events or results or otherwise. Although the Company believes that the assumptions inherent in the forward-looking statements are reasonable, forward-looking statements are not guarantees of future performance and, accordingly, undue reliance should not be placed on these forward-looking statements due to the inherent uncertainty therein.