NEWS RELEASE 09-18
Merit Mining Corp. Signs Memorandum of Understanding
with Tianjin Huakan Group Co. Ltd.
December 22, 2009 ? Vancouver, British Columbia. Merit Mining Corp. (TSX-V:MEM) announces that it has signed a Memorandum of Understanding (?MOU?) with Tianjin Huakan Group Co. Ltd. (?Tianjin?), whereby Tianjin will subscribe for 27,955,223 common shares of the Company for aggregate proceeds of $15,500,000, subject to due diligence, shareholder and regulatory approval (the ?Offering?).
The proceeds of the Offering will be used to reopen the Greenwood Gold project, located near Greenwood, BC and to continue advancement of the J&L project, located near Revelstoke, BC.
Under the terms of the MOU, the Offering will be completed in two tranches. The first tranche of $9,500,000, priced at $0.50 per share, will be completed upon satisfactory due diligence. The second tranche of $6,000,000, priced at $0.67 per share, will be completed as soon as possible after the closing of the first tranche, but in any event within 6 months of the closing of the first tranche. If the first tranche is completed, Tianjin will be required to complete the second tranche.
Subject to regulatory approval and registration exemptions, the Company will pay a finders fee of 3% (payable as to 2% in cash and 1% in shares) and 5% in warrants, exercisable at the applicable subscription price of the subscription amount.
Prior to shareholder approval of the Offering, Merit may terminate the MOU and enter into an alternative transaction that the board of Merit determines would, if completed in accordance with its terms, result in a transaction more favourable to the securityholders of the Company. Once shareholder approval of the Offering has been obtained, Tianjin shall have 40 days to complete its due diligence (provided that the due diligence shall be completed on or before March 10, 2010) and Merit and Tianjin will be bound to complete the Offering on an exclusive basis.
Merit Mining Corp.
Signed ?Fred Sveinson?
Fred Sveinson, President & CEO
For further information please contact:
Fred Sveinson at (604) 694-2344
The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.