Telson Resources Announces Private Placement
Telson Resources Inc. (TSX.V: TSN) Shares Issued – 46,996,616
TELSON RESOURCES ANNOUNCES PRIVATE PLACEMENT
VANCOUVER, BRITISH COLUMBIA – February 13, 2014 – Telson Resources Inc. (TSX Venture – TSN) (“Telson” or the “Company”) announces that it is conducting a non-brokered private placement (the “Private Placement”) of up to 10,000,000 units (each a “Unit”) Each Unit is comprised of one common share of the Company and one share purchase warrant (a “Warrant”). Each Warrant entitles the holder thereof to purchase one additional common share (a “Warrant Share”) of the Company at $0.05 per Warrant Share for a period of two years from the date of its issuance.
Proceeds of the Private Placement are used for general corporate purposes and to fund the Company’s Mexican operations related to the Tahuehueto Project. This private placement replaces a private placement announced July 18, 2013 which did not close within the time frame allotted under TSX.V policy. All proceeds of the private placement have been received in tranches between July 2013 to February 2014.
All securities issued under the Private Placement are subject to a hold period expiring four months and one day after the closing date. Closing of the Private Placement is subject to approval of the TSX Venture Exchange.
RELATED PARTY TRANSACTION
Currently, Ms. DanDan Zhang has control or direction over 6,562,500 common shares of the Company, which represent a security holding percentage of 16.53%, of the outstanding common shares of the Company (on a non-diluted basis) calculated in accordance with National Instrument 62-103 The Early Warning System and Related Take-Over Bid and Insider Reporting Issues.
On June 13, 2013, the Company closed a non-brokered private placement (“2013 Private Placement”), pursuant to which Ms. Zhang acquired 5,000,000 units at a price of $0.05 per unit, each unit comprised of one common share and one share purchase warrant. Each warrant entitles the holder to purchase one additional common share of the Company at a price of $0.10 per share for a period of two years from the date of issuance. On closing of the 2013 Private Placement, Ms. Zhang was issued 5,000,000 common shares of the Company and 5,000,000 warrants (the “Securities”) for an aggregate purchase price of $250,000.
The Securities were issued into escrow and to be released subject to satisfactory completion by the TSX Venture Exchange (the “Exchange”) of its searches regarding a personal information form submitted by Ms. Zhang. The Exchange has completed its searches and the Securities have been released from escrow.
If Ms. Zhang converts the warrants, she would become a new “Control Person” of the Company as such term is defined in Exchange Policy 1.1. Ms. Zhang may also become a new “Control Person” of the Company as a result of a subscription in the Private Placement.
Telson’s shareholders approved the creation of a new Control Person at the Company’s annual general meeting on December 19, 2013.
The Private Placement is a “related party transaction” as defined under Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions ("MI 61-101") as Ms. Zhang is participating in the Private Placement and is a related party to the Company; however, the Company is relying on exemptions available in MI 61-101 from the requirement to obtain a formal valuation and minority shareholder approval.
Additional information about the 2013 Private Placement is provided in the early warning report filed on www.sedar.com under the Company’s profile.
ON BEHALF OF THE BOARD OF DIRECTORS
(signed) “Ralph Shearing”
Ralph Shearing, Chief Executive Officer
NEITHER TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICE PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.
WARNING: The Company relies upon litigation protection for "forward-looking" statements. This News Release may contain forward-looking statements including but not limited to comments regarding the timing and content of up-coming work programs, geological interpretations, receipt of property titles, potential mineral recovery processes, etc. Forward-looking statements address future events and conditions and therefore involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated in such statements. Telson Resources Inc. relies upon litigation protection for forward-looking statements.