Benz Capital Corp.

March 24, 2014 19:49 ET

Benz Capital Corp. Announces Non-Binding Proposal

VANCOUVER, BRITISH COLUMBIA--(Marketwired - March 24, 2014) -


Benz Capital Corp. (TSX VENTURE:BZ) (the "Corporation" or "Benz") is pleased to announce that it has entered into a Non-Binding Proposal (the "Proposal") with Tusk Exploration Ltd., a private British Columbia company ("Tusk") for the option to acquire a 100% interest (the "Transaction") in the San Javier Copper Project (the "Property"), located approximately two hours driving time east of the capital city of Hermosillo, Sonora, Mexico, and immediately adjacent to Mexican Highway 16 and near the village of San Javier, Sonora.

The Proposal is to be superseded by a definitive agreement (the "Agreement") to be entered into between Benz and Tusk on or before June 15, 2014. The Transaction is subject to requisite regulatory approval, including the approval of the TSX Venture Exchange (the "Exchange") and standard closing conditions, including, approval of the shareholders of Benz, if required, the approval of the directors of each of Benz and Tusk, and completion of due diligence investigations to the satisfaction of each of Benz and Tusk, as well as the conditions described below.

"San Javier represents a unique opportunity to acquire a well-explored and defined copper deposit in a well-established and low-risk mining jurisdiction," said Miloje Vicentijevic, President and CEO of Benz. "This transaction may give Benz the opportunity to develop its first producing mine and is consistent with Benz's strategy of building a mining producer focused in the Americas."

The Proposed Transaction

The Proposal gives Benz an 80 day period to complete a detailed due diligence review (the "Due Diligence Review") and execute the Agreement. The terms of the Proposal provide for an aggregate purchase price of C$9.2 million comprised of a cash payment of C$4.2 million payable in instalments (C$200,000 on or before July 15, 2014 and C$2.0 million on or before each of December 31, 2017 and 2018), and the issuance of such number of Benz common shares (the "Consideration Shares") having a value equal to C$5.0 million at a deemed price per Consideration Share equal to the lesser of C$0.50 and the price per common share in a private placement to be completed by Benz on or before October 31, 2014. Upon issuance, the Consideration Shares are to be held in escrow and released in stages over a four year period.

The cash payment of C$2.0 million on December 31, 2017 will grant Benz a 40% interest in the Property, with the final payment of C$2.0 million on December 31, 2018 granting Benz a 100% interest.

Tusk will also retain a 1% net smelter return royalty on any future metal production from the Property.

About the San Javier Copper Project

The Property consists of two non-contiguous groups of concessions. The Group 1 land block contains the Cerro Verde Deposit and includes the Uno, Dos, Tres, Cerro Verde, and Ampliacion Cerro Verde concessions and totals about 379.8 hectares. The Group 2 land block contains the Mesa Grande and La Trinidad deposits, and includes the San Carlos, La Trinidad Fraction 1, and La Trinidad Fraction 2 concessions and totals 307.5 hectares in area.

The Property is essentially copper-only mineralization which is hosted within Laramide age volcanic rocks.

The following table has been reproduced from the PEA National Instrument 43-101 compliant Technical Report dated December 20, 2007 prepared for Constellation Copper Corporation, the previous owner of the Property.

Ore Tonnes ktonnes 89,484
Total Copper Grade % 0.34
Recovered Copper Grade % 0.19
Contained Copper Pounds mlbs 671
Recovered Copper Pounds mlbs 383
Average Recovery % 57.1
Total Material in Design Pit ktonnes 163,549
Waste to Ore Ratio 0.83

About Tusk

Tusk is a private exploration company with mining interests in the Yukon and Mexico. Tusk acquires grass roots or early stage opportunities and advances the projects to pre-development for producing miners.

Randy Reifel, President and CEO stated: "We look forward to working with Benz and the transition of San Javier from a known copper deposit to an operating open pit mine."

About the Corporation

Benz is a junior mining company focused on developing and exploring mineral properties located in North America. Its key strategic goal is to become a mining producer by 2017 or sooner. For more information, please refer to the Company's website at

This news release contains statements about the Corporation's expectations regarding the Transaction and the Property that are forward-looking in nature and, as a result, are subject to certain risks and uncertainties. Although the Corporation believes that the expectations reflected in these forward-looking statements are reasonable, undue reliance should not be placed on them as actual results may differ materially from the forward-looking statements and there can be no assurance that such expectations will prove to be correct. Factors that could cause the actual results to differ materially from those in forward-looking statements include failure to complete the Transaction for any reason whatsoever, including that the shareholders and/or regulators may not approve the Transaction, and the potential development of the Property to a producing mine may not occur as planned or at all. The forward-looking statements contained in this news release are made as of the date hereof, and the Corporation undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, except as required by applicable securities laws. The forward-looking statements contained in this news release are expressly qualified by this cautionary statement.

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.

Contact Information

  • Benz Capital Corp.
    Miloje Vicentijevic
    President and Chief Executive Officer
    604.689.9232 (FAX)