Nov 30, 2015 Download PDF   Share:       

Working Towards Finalizing Macquarie Financing

Vancouver, BC - Northern Vertex Mining Corp. (the "Company") (TSX.V: NEE, OTCQX: NHVCF) announces that the Company's unaudited interim consolidated financial results for the first quarter fiscal 2016 ended September 30, 2015 have been filed on SEDAR. The full version of the Financial Statements and Management's Discussion & Analysis can be viewed on the Company's website at www.northernvertex.com or on SEDAR at www.sedar.com.

Financial and Corporate Highlights for the Quarter Ended September 30, 2015

• For the quarter, net loss was $0.66 million (2015: $0.36 million), excluding a non-cash, unrealized foreign exchange gain of $2.81 million (2015: $1.60 million);
  • Net gain for the quarter was $2.15 million ($0.025 per share) due to a $2.81 million non-cash, unrealized foreign exchange gain compared to a net gain of $1.24 million ($0.017 per share), after a $1.60 million non-cash, unrealized foreign exchange gain, for the same period last year;

• Cash and cash equivalents was $3.46 million at September 30, 2015, compared to $3.95 million at September 30, 2014. The variance was primarily due to a reduction of trade payables from the previous year, exploration and evaluation spend at the Moss Mine Project that included the feasibility study and partially offset by cash from financing activities;

• Working capital decreased slightly to $3.38 million at September 30, 2015, compared to $3.67 million for the previous year; and

• Total costs incurred to September 30, 2015 for the Moss Mine Project including the Silver Creek Project increased to $32.75 million, compared to $25.79 million for the same period in the prior year. Foreign exchange translation of $8.21 million and $2.76 million, respectively, were included in the figures above.

Dick Whittington, President & CEO, states, "The Company is anticipating the successful conclusion of the arbitration, finalizing a JV LLC agreement with Patriot Gold including the required financing arrangements, followed by commencing development for the Moss Mine. We look forward to 2016 which we believe will be an exciting year for the Company."

Cost Management

• The Company has taken significant measures to optimize and preserve its cash position and continues to adapt to the challenging external environment.

Operating Results

Operations

• Phase I - Pilot Plant Operations is on scheduled care and maintenance. Mohave Security continues to monitor the site outside working hours, while Company staff monitor the site during working hours. The Company maintains the facilities on site in preparation of a future construction decision pertaining to Phase II -- Commercial Operations.

Exploration

• As exploration to date has only focused on known mineral occurrences, only approximately 5% of the property has been explored to date. The Company plans to assess the prospects for a property wide drilling program to test the potential for further discoveries on the Moss and Silver Creek claims. Given the success to date, the Company believes that the prospects for additional discoveries of gold bearing veins and structures continue to be good.

Feasibility Study

• The Bankable Feasibility Study was delivered and received by Patriot Gold on July 20, 2015 which completes the final requirement of the "earn-in" obligation. The NI 43-101, Disclosure Standards for Mineral Projects Technical Report was filed on SEDAR on July 23, 2015. It is the Company's position that since it has completed the "earn-in" requirements of the Company's 2011 Exploration and Option to Enter Joint Venture Agreement, Moss Mine Project with Patriot Gold ("2011 Agreement"), all costs incurred for services rendered or supplies received after July 20, 2015 will be shared on a 70:30 basis with Patriot Gold.

• The economic highlights of the Feasibility Study ("FS"), at prices of US$1,250/oz Gold and US$20/oz Silver, 100% Project basis using a discount factor of 5% in arriving at the Project Net Present Value ("NPV") and recoveries to doré for gold and silver of 82% and 65%, respectively are summarized in the following table:

Debt Financing

• The Company signed an Engagement Letter with indicative terms for Macquarie Bank Limited to provide project finance facilities of up to US$20 million (the "Macquarie Facility") to be used to fund the majority of the projected development costs of the Company's 70% beneficially owned Moss Mine Project. The Company has also received indicative terms for a US$6.5 million Equipment Finance Facility (the "Equipment Facility") from a major US bank. The Macquarie Facility and the Equipment Facility are complementary and together would provide up to US$26.5 million towards the estimated pre-production capital of US$33.0 million required to construct the planned gold-silver mine at the Moss Mine site. Due diligence work continues on the debt financings.

Corporate

• The Company announces that the common shares of the Company will be voluntarily delisted from the OTCQX in the United States effective December 31, 2015. The common shares of the Company will continue to trade on the TSX Venture Exchange under the symbol "NEE".

Tax Pools

• As of September 30, 2015, the Company has approximately US$30.8 million in tax deduction pools that can be applied directly to the Company's 70% share of taxable income to off-set future tax liabilities. Utilizing these tax deduction pools to the Company's portion of the joint venture will significantly enhance the Moss Mine Project's economics.

Advance Notice Policy

• The Company has approved an advance notice policy (the "Advance Notice Policy"), the purpose of which is to require advance notice to be provided to the Company in circumstances where nominations of persons for election to the Board are made by shareholders of the Company other than pursuant to: (i) a requisition of a meeting of shareholders made pursuant to the provisions of the Business Corporations Act (British Columbia) (the "Act") or (ii) a shareholder proposal made pursuant to the provisions of the Act.

The purpose of the Advance Notice Policy is to provide shareholders, directors and management of the Company with a clear framework for nominating directors. Amongst other items, the Advance Notice Policy fixes a deadline by which shareholders must submit director nominations to the Company prior to any annual or special meeting of the shareholders and sets forth the minimum information that a shareholder must include in the notice to the Company for the notice to be in proper written form.

In the case of an annual or special meeting of shareholders, notice to the Company must be made not less than 30 days and nor more than 65 prior to the date of the annual meeting, provided, however, in the event that the annual meeting is to be held on a date that is less than 50 days after the date on which the first public announcement of the date of the annual meeting was made, notice may be made not later than the close of business on the 10th day following such public announcement.

The Company believes that adopting the Advance Notice Policy is considered to be sound corporate governance. The Advance Notice Policy provides a clear process for shareholders to follow for director nominations and sets out a reasonable time frame for nominee submissions and the provision of accompanying information. The purpose of the Advance Notice Policy is to treat all shareholders fairly by ensuring that all shareholders receive adequate notice of the nominations to be considered at a meeting and can subsequently exercise their voting rights in an informed manner. In addition, the Advance Notice Policy should assist in facilitating an orderly and efficient meeting process.

The Advance Notice Policy will be placed before the shareholders of the Company for ratification at the annual meeting of shareholders to be held on December 29, 2015. A full description of the Advance Notice Policy will be included in the Information Circular for this meeting.

Arbitration

• The Company and Patriot Gold are engaged in an arbitration process under the 2011 Agreement in connection with certain allegations by Patriot Gold that, amongst other items, allege that a) the pilot plant was profitable and that Patriot Gold is entitled to the profits, and b) that the scope of the FS, as it relates to the BFS requirement under the 2011 Agreement, is too limited by focusing on the patented Moss lands only. The Company's position is that it is completely within its discretion under the 2011 Agreement to evaluate a mine within the patented lands of the Moss Mine Project. It is the Company's belief that the two matters are without merit and will be vigorously defended. The arbitration is scheduled to be heard in early December 2015. The outcome of the arbitration cannot be predicted at this time but the Company remains very confident in its legal position with respect to the matters in dispute.

Strategic Priorities

• The key strategic priorities for the Company are to conclude the arbitration, finalize a joint venture agreement on a 70:30 basis with Patriot Gold, and complete debt, equipment and equity financings, following which the Company's development plans for the Moss Mine Project will commence.

About Northern Vertex

Northern Vertex Mining Corp. is a Canadian based exploration and mining company focused on the reactivation of the Moss Mine Gold-Silver Project located in NW Arizona, USA where the Company has recently earned a 70% property interest and will form an LLC joint venture with Patriot Gold Corp. The Moss Mine Gold-Silver Project is an epithermal, brecciated, low sulphidation quartz-calcite vein and stockwork system which extends over a strike length of 1,400 meters and has been drill tested to depths of 370 meters vertically. It is a potential heap leach, open pit project being advanced to the Feasibility Study stage to ensure that technical, economic, permitting and funding requirements are met prior to proceeding with the development of the mine. The Company's management comprises an experienced management team with a strong background in all aspects of acquisition, exploration, development, operations and financing of mining projects worldwide. The Company is focused on working effectively and respectfully with our stakeholders in the vicinity of the historical Moss Mine and enhancing the capacity of the local communities in the area.

Qualified Persons:

The foregoing technical information contained in this news release has been approved by Mr. L.J. Bardswich, P. Eng., General Manager Moss Project, and a Qualified Person ("QP") for the purpose of National Instrument 43-101 (Standards of Disclosure for Mineral Projects).

ON BEHALF OF THE BOARD OF DIRECTORS

J.R.H. (Dick) Whittington, President & CEO

For further information, please visit www.northernvertex.com
or contact Investor Relations at: 604-601-3656 or 1-855-633-8798

Neither 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.

Cautionary Note About Forward Looking Information
This news release contains statements about our future business and planned activities. These are "forward-looking" because we have used what we know and expect today to make a statement about the future. Forward-looking statements including but are not limited to comments regarding the timing and content of upcoming work and analyses. Forward-looking statements usually include words such as may, intend, plan, expect, anticipate, believe or other similar words. We believe the expectations reflected in these forward-looking statements are reasonable. However, actual events and results could be substantially different because of the risks and uncertainties associated with our business or events that happen after the date of this news release. You should not place undue reliance on forward-looking statements. As a general policy, we do not update forward-looking statements except as required by securities laws and regulations.

Cautionary Note to US Investors:
This news release uses the terms "Measured", "Indicated", and "Inferred" resources. US investors are advised that while such terms are recognized and required by Canadian regulations, the United States Securities and Exchange Commission does not recognize them. "Inferred Mineral Resources" have a great amount of uncertainty as to their existence, and as to their economic and legal feasibility. It cannot be assumed that all or any part of an Inferred Mineral Resource will ever be upgraded to a higher category. Under Canadian rules, estimates of Inferred Mineral Resources may not form the basis of feasibility or other economic studies. US investors are cautioned not to assume that all or any part of Measured or Indicated Mineral Resources will ever be converted into Mineral Reserves. US Investors are also cautioned not to assume that all or any part of a Mineral Resource is economically or legally mineable.

2015 number 15