Tribune Minerals Corp.
TSX VENTURE : TCB

Tribune Minerals Corp.

May 19, 2011 19:58 ET

Tribune Announces a Change of Control, a Proposed Acquisition of AZ Copper Corp. and a $7 Million Financing

VANCOUVER, BRITISH COLUMBIA--(Marketwire - May 19, 2011) - Tribune Minerals Corp. (TSX VENTURE:TCB) ("Tribune "or the "Company") Mr. Luke Norman, Director announces a change of control of the Company, together with an agreement to acquire all of the outstanding shares of privately held AZ Copper Corp. ("AZ Copper") and a proposed private placement financing to raise $7 million at a price of $1.50 per share.

Change Of Control

Experienced Vancouver mining executives Shawn Wallace and Ivan Bebek, for themselves and certain other buyers, have executed an agreement with five shareholders of the Company to purchase, pursuant to take-over bid exemptions, an aggregate of 2,373,250 shares (61% of the 3,865,353 outstanding shares) plus 2,205,000 share purchase warrants of the Company (for a total holding of up to 4,578,250 shares out of a then issued capital of 6,070,353). This aggregate share position (assuming warrants are exercised) would constitute 75% of fully diluted shares before the proposed issuance of 5 million Tribune shares for the below-described acquisition of AZ Copper plus a further 4.66 million Tribune shares for the below-described financing. As a consequence of the purchase Messrs. Wallace, Bebek and Greg McCunn have been appointed to the board replacing Kelly Russell and Richard Silas so that the board now comprises Messrs Wallace, Bebek, McCunn and Luke Norman.

Acquisition of AZ Copper Corp.

Consequent upon the change of the Board, the Company has entered into an arrangement agreement dated May 19, 2011 with Vancouver based AZ Copper whereby AZ Copper will, pursuant to a statutory plan of arrangement, be acquired for an aggregate of five million Tribune shares to acquire the approximately 27.5 million outstanding AZ Copper shares. The transaction with AZ Copper is at arms length to the Company and the incoming controlling shareholders. AZ Copper has acquired options over mineral claims in British Columbia and in Arizona that are described below. AZ Copper has raised approximately $2 million in private equity to date and spent it largely on the properties described below. The acquisition of AZ Copper is subject to a due diligence condition, Tribune raising a minimum of $6 million in new common equity, approval by AZ Copper shareholders, BC Supreme Court approval, acceptance by the TSX Venture Exchange and other customary closing conditions. Completion is targeted for approximately 6-8 weeks. On completion two AZ Copper principals will be appointed to the Tribune board as well as two other persons who will be independent directors. It will also be proposed that Tribune split its shares on a one for two new shares basis (all figures herein are pre-split). Certain principal shareholders of both Tribune and AZ Copper have agreed to support the acquisition.

Mac Property, BC –Molybdenum Property

AZ Copper has an option to earn a 90% interest in 33 of the mineral tenures; subject to a 2% net smelter return ("NSR") from 802213 AB Ltd ("Optionor"). AZ Copper must fulfill certain option obligations by May 15, 2015, including $3.1 million in cash payments and incur $7.5 million in exploration expenditures to earn a 90% interest in the Mac Property. The 10% interest retained by the underlying owner is a carried interest that can be purchased for 2/3 of appraised value. AZ Copper owns a 100% interest in the remaining 9 mineral tenures. One-half of the NSR can be purchased for $3 million within the first year after commercial production. The property is subject to advance royalties of $100,000 per year starting in 2017.

Since optioning the property on May 4, 2010, AZ Copper has expended almost $400,000 in advancing the MAC project by compiling and digitizing all historic data, relogging and photologging drillcore from 57 drillholes on the property, check assays, GPS drillhole collar location and grid location, inverse mag profiling, expanding the property to 12,944 hectares, reclamation of the previous camp, permitting for up to 300 new drillholes and 22 km of new access road, continuing First Nations negotiations, and option payments. AZ has obtained a NI 43-101 technical report from. Brian D. Game, P. Geo. Geominex Consultants Inc. dated October 21, 2010 that will be updated and addressed to Tribune. The technical report notes that in February 1997, Spokane Resources published a geostatistical resource estimate from Giroux Consultants setting forth that at a cut-off grade of 0.04% Mo, the Mac property tonnage classified as indicated was 52,420,000 tonnes and the tonnage classified as inferred was 47,520,000 tonnes at an average grade of 0.072% Mo (0.12% MoS2). All drill hole data collected for this historical resource estimate pre-date NI 43-101. These historical resources at the Mac property should be used for geological inference only and cannot be reported as current resources as they cannot be relied upon.

Historical exploration work completed on the Mac property has identified significant zones of porphyry molybdenum and copper mineralization that warrant further drill testing and other exploration work. A non-contingent two phase exploration program is recommended for the Mac property. A $1,550,000 budget is proposed to complete a Phase 1 program consisting of data compilation, camp construction, airborne geophysics, preliminary IP geophysics testing the known mineralized zones, and approximately 4,000 meters of diamond drilling with the objective to initiate resource definition of known mineralization in the Camp Zone.

Bear Canyon, Arizona – Copper Prospect

Pursuant to an option agreement dated November 09, 2009 AZ Copper acquired the right to purchase a 100% interest in the Bear Canyon Project (the "Property") located in south-eastern Arizona near the community of Sierra Vista. The claims cover altered andesitic rocks which exhibit scattered fracture controlled copper mineralization. In 2008 the property vendors funded geophysical surveys that successfully defined a series of buried or blind IP anomalies that appear to warrant follow up exploration. Consequently, the company increased its land holdings to over 2230 hectares. The option agreement requires that AZ Copper incur expenditures of US $500,000 by November 10, 2012, make escalating cash payments totalling $415,000 US by November 10, 2013, make a payment of $2.5 million US on November 10, 2014 and pay an additional $2.0 million US within 90 days following the delivery of a positive feasibility study. The Bear Canyon property has been the subject of approximately $500,000 of expenditures by AZ Copper to date and is subject to an NI 43-110 report by Carl A. Von Einsiedel, P.Geo., dated August 24, 2010. It is expected that this report will be updated and addressed to Tribune. Bear Canyon is a unique style of deposit setting in which a low sulphide porphyry system has been discovered, by use of a metal detector, locating native copper. The alteration is typical epidote whereas mineralization is almost exclusively native copper and chalcocite. 2 grids (north and south) were completed and I.P. geophysics completed which gave chargeability and resistivity responses typical of a copper porphyry. Two sub-parallel I.P. anomalies running a minimum strike length of 1400 metres northwest/southeast and a combined width of 900 metres. These anomalies are open on strike and to depth. Two MMI lines confirmed the mineralized extent. Permits have been submitted for an initial 12-hole program.

Both the MAC and the Bear Canyon properties are road accessible.

The Von Einsiedel report notes that the geophysical survey work completed in 2008 consists of eight, north – south oriented, 100 to 200 meter spaced IP and SP survey lines approximately 1,300 meters in length. According to Geotronics Consulting the IP and resistivity surveying identified a large, northwest striking IP anomaly. The causative source is interpreted to be intrusive hosted, disseminated and or fracture controlled copper mineralization. The IP anomaly includes two distinct anomalous responses (termed A and B). Anomaly A averages 400 meters in width and Anomaly B, 200 meters in width. The anomalies appear to be separate for the three westernmost survey lines and appear to join together for the remaining five lines in the eastern part of the survey. It is important to note that, although the IP anomaly is weak near the surface where mineralization is scattered, the chargeability response increases with depth on all eight-survey lines. The preliminary exploration work completed by the Property vendor has identified geophysical targets (IP and resistivity) that warrant drill testing. In Mr Von Einsiedel's opinion the Bear Canyon Project warrants a staged exploration program designed to evaluate the IP anomalies that have been defined. Stage 1, estimated at $588,500 should consist of an initial program of diamond drilling designed to test the anomalies identified by the IP geophysical survey. In the event that significant mineralization is encountered in Stage 1 a follow up program (Stage 2) consisting of additional ground geophysics (IP and resistivity) and drill testing at an estimated cost of $880,000 would be warranted.

$7.0 Million Financing and Interim Loan Advance

The incoming control group is arranging financing for the Company. The financing is part and parcel of the acquisition of the AZ Copper transaction and is a condition for the closing of the acquisition of AZ Copper. The Company proposes to raise $7.0 million through the issuance of 4.66 million Tribune shares at $1.50 each through a private placement to accredited investors. $3.5 million of the financing will be flow-through and 3.5 million will be non flow-through. The non flow-though portion will be comprised of units with one share and one warrant exercisable for 1 year at $2.00 subject to certain acceleration clauses. No finders fees or commissions will be payable insider participation is expected to be up to 10%. The terms of the placement are subject to TSX Venture acceptance. Completion is targeted for end of June and is subject to the negotiation and execution of definitive agreements as well as customary closing conditions. Proceeds will be used for exploration and general corporate purposes. The shares will be offered only in Canada. Tribune will make a secured interim advance of $250,000 to AZ Copper in order to allow it to make an option payment due on the MAC property. The advance will be largely from existing Tribune funds augmented by a portion of the placement proceeds. Two of the incoming control shareholders have agreed to guarantee the return of the funds to Tribune if for any reason the Arrangement does not close within 90 days.

Richard Haslinger, P.Eng. is the qualified person under NI 43-101 who has reviewed the technical disclosure in this news release and assumed responsibility for it. Under TSX Venture rules this transaction is a reverse take-over and therefore Tribune shares will remain halted pending certain principal transaction documents being filed with the Exchange. At this time there can be no certainty of these transactions completing.

This release includes certain statements that may be deemed "forward-looking statements" in connection with the likelihood of completion of an acquisition and a private placement. Any statement about a future event is inherently uncertain and completion of any transaction or financing is subject to a number of conditions including regulatory and the state of capital markets. For more information on the Company, Investors should review the Company's home jurisdiction filings that are available at www.sedar.com.

Neither the TSX Venture Exchange (the "TSXV") nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) has reviewed, nor do they accept responsibility for the adequacy or accuracy of this release.

Contact Information