Vancouver, BC - January 22, 2009 - Golden Predator Mines Inc. (TSX:GP) ("the Company") wishes to update investors on the previously announced spin-out of its gold and silver focused, precious metals assets. The objective of the spin-out is to maximize shareholder value by allowing the market to independently value two very different businesses.
The spin-out will constitute a business reorganization whereby the precious metals assets will be transferred to a newly incorporated company named Golden Predator Royalty & Development Corp. ("New GP"). Following the spin-out, New GP will apply to list its shares on the TSX Venture Exchange, and has reserved the trading symbol GPD. The existing parent company will on closing of the reorganization change its name to EMC Metals Corp. and has reserved the TSX trading symbol EMC.
On completion of the reorganization New GP will be a Nevada focused precious metals company, with assets including a revenue generating royalty portfolio with anticipated 2009 revenues of approximately $1.2 million, the Taylor mill and property with a NI 43-101 silver resource, and a portfolio of advanced gold exploration projects and other precious metal properties.
The renamed parent company, EMC Metals Corp. will focus its efforts as a specialty metals and alloys company targeting primarily tungsten, molybdenum, vanadium and uranium. EMC Metals' primary assets will continue to be the fully permitted Springer tungsten mill in Pershing County Nevada, and its portfolio of specialty metals exploration projects.
Additional information on the spin-out is contained in the Company's December 19, 2008 press release.
Management of the Company and New GP
On closing of the reorganization, it is expected that the management team at EMC Metals will be headed by Peter J. Bosse, MSc. as President. Mr. Bosse, currently the Chief Operating Officer of Golden Predator Mines (US) Inc., has over 40 years experience in various management positions in the minerals processing industry for such companies as Anglo American, Energy Metals Corp, Ralph M. Parsons Company, Wyoming Minerals and Rocky Mountain Energy among others. He holds a MSc. degree in extractive metallurgy from Delft University in Holland.
The management team of New GP will be headed by William M. Sheriff as CEO, and Steve Vanry as President.
The information circular to be mailed to shareholders in connection with the reorganization will contain additional information on the management of each company following completion of the reorganization.
Proposed Timetable for the Spin-Off
The Company is proposing the following time-table for the shareholder meeting and reorganization. The dates are proposed only, and are subject to court approvals, shareholder approvals, regulatory approvals and other factors. Accordingly the Company may change the timetable as necessary to achieve its objectives.
|January 27, 2009|
|January 30, 2009|
|February 25, 2009|
|February 26, 2009|
|February 27, 2009|
|March 20, 2009|
As presently proposed, shareholders of the Company will receive one unit of New GP for each four shares of the Company held by them of record at the effective time of the reorganization. Each unit of New GP comprises one New GP share and one New GP share purchase right. The New GP share purchase right may be exercised for a period of 21 days from closing of the reorganization at a price of $0.50 to acquire a further New GP share and a half New GP share purchase warrant. Each whole New GP warrant may be exercised at a price of $0.60 until three months from the date New GP is listed on a stock exchange, and thereafter at $0.65, $0.75, $0.90 for each subsequent three month period.
Existing Warrants of the Company are proposed to be exchanged for EMC Warrants with decrease to the exercise price reflecting the adjustment in value of the underlying common shares. In addition, holders of Company warrants will receive a corresponding ¼ warrant of New GP exerciseable to acquire New GP shares.
Existing Options of the Company are proposed to be exchanged for a EMC option with no change to the exercise price, and a corresponding ¼ New GP option. The Company is proposing to cancel all of the Company options that are priced significantly above current market levels, prior to completion of the reorganization.
New GP is negotiating the terms of a brokered equity offering for proposed proceeds of up to $8 million. The offering would occur immediately following the expiration of the Rights, and would involve the sale of units on the same terms as the New GP share purchase rights. New GP would seek to time the stock exchange listing of New GP shares to occur concurrently with, or immediately prior to, the closing of the proposed offering.
Approvals and Information
The proposed corporate reorganization has received the unanimous approval of the Company's board of directors. The reorganization remains subject to shareholder approval, court approval and TSX approval. The listing of the New GP shares on the TSXV is subject to meeting listing criteria.
The Company is preparing an information circular for delivery to shareholders. The information circular will contain comprehensive information on the reorganization, as well as on the Company and New GP.
About Golden Predator Mines Inc.
Golden Predator Mines Inc. is a tungsten and gold mining company focused on mineral development in Nevada and surrounding states.
Further information on Golden Predator Mines Inc. is available on the SEDAR web site at www.sedar.com and on the company's web site at www.goldenpredator.com, or contact us as follows:
Golden Predator Mines Inc.
William M. Sheriff, CEO: (778) 855-7230
Steve Vanry, President: (604) 648-4660
The Toronto Stock Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of the contents of this press release.
Certain disclosures in this release, including management's assessment of Golden Predator's plans and projects and intentions with respect to a proposed spin-out, constitute forward-looking statements that are subject to numerous risks, uncertainties and other factors relating to Golden Predator's operation as a mineral exploration company that may cause future results to differ materially from those expressed or implied in such forward-looking statements, including risks as to the completion of the plans and projects and the receipts of all necessary approvals and consents for the proposed spin-out. Specific additional risks include that New GP may not meet the requirements for listing on the TSX Venture Exchange, may not be successful in raising funding as proposed in this press release. Readers are cautioned not to place undue reliance on forward-looking statements, including the transactions proposed in this press release. Golden Predator expressly disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events, or otherwise.
Completion of the transaction 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 Management Information Circular to be prepared in connection with the transaction, any information released or received with respect to the spin-off 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.
This press release does not constitute an offer of securities in the United States. The securities referenced herein, including the shares, share purchase rights and the shares and warrants underlying the share purchase rights, have not been and will not be registered under any federal or state securities law of the United States, and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements. The share purchase rights and warrants underlying the share purchase rights may not be exercised in the United States or by U.S. Persons except in very limited cases. Please refer to the Information Circular when available for additional information on these restrictions.