Thundermin Announces Proposed Private Placement

TORONTO, ONTARIO--(Marketwired - Sept. 5, 2013) -

Not for distribution to United States newswire services or for release, publication, distribution or dissemination directly, or indirectly, in whole or in part, in or into the United States

Thundermin Resources Inc. (the "Corporation" or "Thundermin") (TSX:THR) announces that it intends to complete a non-brokered private placement offering of units (the "Units") at a price of $0.02 per Unit, for gross proceeds of $220,000 (the "Private Placement"). Each Unit will be comprised of one common share in the capital of the Corporation (a "Common Share") and one Common Share purchase warrant (each, a "Warrant"). Each Warrant will be exercisable to acquire a Common Share at an exercise price of $0.04 per Common Share for a period of two years from the date of closing of the Private Placement (the "Closing"). The number of Common Shares to be issued pursuant to the Private Placement represents approximately 12% of the Common Shares currently issued and outstanding (on a non-diluted basis) prior to giving effect to the Private Placement. It is anticipated that the sole subscribers under the Private Placement will be insiders (including directors and officers) of the Corporation.

The proceeds from the Private Placement will be used to address immediate liquidity concerns and for general corporate purposes.

Financial Hardship Application

As the number of Common Shares (or rights to acquire Common Shares) issuable to insiders of the Corporation pursuant to the Private Placement exceeds 10% of the currently issued and outstanding Common Shares, Thundermin would ordinarily be required to obtain disinterested shareholder approval pursuant to the applicable policies of the Toronto Stock Exchange (the "TSX"). However, the Corporation has applied to the TSX, pursuant to the provisions of Section 604(e) of the TSX Company Manual (the "Manual"), for a "financial hardship" exemption from the requirement to obtain shareholder approval, on the basis that the Corporation is in serious financial difficulty.

The Corporation's decision to rely on the financial hardship exemption in the Manual was made upon the recommendation of a special committee (the "Special Committee") of the board of directors of the Corporation (the "Board") comprised of Mr. Peter McCarter, who is an independent member of the Board, free from interest in the Private Placement and unrelated to the parties involved in the Private Placement. The Special Committee was established for the purposes of reviewing the Private Placement and ascertaining whether it is reasonable for the Corporation to proceed with such transaction in the circumstances.

After considering and reviewing all of the circumstances currently surrounding the Corporation and the Private Placement (including: (i) the Corporation's current financial difficulties and immediate capital requirements; (ii) the lack of alternate financing arrangements and the fact that the Private Placement is the only viable financing option at the present time; (iii) the fact that the Private Placement is being conducted at premium to the market price; and (iv) all other relevant factors available to the Special Committee), the Special Committee determined that: (i) the Corporation is in serious financial difficulty; (ii) the Private Placement is designed to improve the financial condition of the Corporation; and (iii) the terms of the Private Placement are reasonable in the circumstances of the Corporation (the "Special Committee Determinations"). As such, the Special Committee recommended that the Corporation: (i) proceed with the Private Placement, and (ii) given the immediate need for a capital infusion, apply for the financial hardship exemption (the "Special Committee Recommendations").

The Board, relying in part on the recommendation of the Special Committee, unanimously agreed with the Special Committee Determinations and adopted the Special Committee Recommendations.

There can be no assurance that the TSX will accept the application for the use of the financial hardship exemption from the requirement to obtain shareholder approval for the Private Placement. As previously announced, the Common Shares will be delisted from the TSX effective at the close of the market on September 12, 2013. The Corporation has applied to list the Common Shares on the TSX Venture Exchange.

Background and Relevant Considerations

The Corporation's current operational cash flows are insufficient to cover the estimated $100,000 of near-term capital cost commitments relating to general and administrative costs. The Corporation has a current working capital deficit of approximately $50,000. Such working capital deficit is expected to increase in the event that the Corporation is not able to secure immediate financing.

The following factors have led to the Corporation's current financial difficulties:

1. For the last 18 months, global capital markets conditions have been extremely unfavourable to junior exploration companies such as Thundermin. This has made it difficult for such issuers to raise outside capital for exploration purposes and working capital on viable terms.
   
   
2. During the fourth quarter of 2012 and throughout 2013, Thundermin actively engaged in discussions with a number of brokers and potential investors to secure third party financing and explore strategic alternatives. Regrettably, despite a number of promising opportunities, Thundermin was not able to secure additional financing.
   
   
3. Thundermin's efforts to raise capital were further hindered by the following factors:
   
   
   • The Corporation's financial statements include a "going concern" note.
     
     
   • For a three month period during 2013, the Corporation was engaged in certain strategic discussions. Despite best efforts, such strategic discussions did not materialize into a viable opportunity for Thundermin. As a precautionary measure, during such discussions, Thundermin's directors, officers and other insiders were blacked out from trading Thundermin's securities and marketing activities. Management's limited ability to market during this time materially diminished the Corporation's ability to raise additional capital during a critical period. This contributed to Thundermin not being able to improve its financial position. It also led to the Corporation not being able to meet TSX continued listing requirements.
     
     

The Private Placement is structured to: (i) enable Thundermin to address its immediate working capital deficit and intermediate term liquidity needs; and (ii) provide certainty of immediate funding of $220,000.

Based upon the comprehensive review of the Corporation's commitments, prospects and funding requirements, the Board, including the Special Committee, has concluded that the Private Placement offers the only practical and timely financing solution to meet the needs of the Corporation. In addition, the Board and management of the Corporation believe that reliance upon the financial hardship exemption is a necessary route given the serious immediate financial needs facing the Corporation.

If TSX approval for the Private Placement and the financial hardship application is obtained prior to such time, it is anticipated that the Private Placement will be completed prior to September 12, 2013.

Related Party Transaction and Other Insider Disclosure

The Units will be offered and sold to directors and officers of the Corporation. Details concerning such insiders' securityholdings in Thundermin, both before and after the Closing, are as follows: 

Name of Insider and Relationship to Thundermin	Number and Percentage of Common Shares Owned Prior to Closing(1)	Number and Percentage of Common Shares Owned Following Closing(1)
James Gill, Chairman and Director	1,369,034 Common Shares (1.48% of the issued and outstanding Common Shares)	6,868,034 Common Shares (6.7% of the issued and outstanding Common Shares)(2)
John Arnold, Director	669,567 Common Shares (0.73% of the issued and outstanding Common Shares)	3,169,567 Common Shares (3.07% of the issued and outstanding Common Shares(3)
Hugh Harbinson, Director	291,866 Common Shares (0.32% of the issued and outstanding Common Shares)	2,791,866 Common Shares (2.71% of the issued and outstanding Common Shares)(4)
John Heslop, President, Chief Executive Officer and Director	1,318,070 Common Shares (1.43% of the issued and outstanding Common Shares)	1,818,070 Common Shares (1.76 of the issued and outstanding Common Shares)(5)

Notes:

(1)	Calculated on a non-diluted basis.
(2)	Mr. Gill also owns options exercisable to acquire 500,000 Common Shares. Assuming completion of the Private Placement and the exercise in full of all options and Warrants owned by Mr. Gill, Mr. Gill would own an aggregate of 12,869,034 Common Shares, representing approximately 11.78% of the then issued and outstanding Common Shares (on a partially diluted basis, assuming no other convertible securities of the Corporation are exercised).
(3)	Mr. Arnold also owns options exercisable to acquire 500,000 Common Shares. Assuming completion of the Private Placement and the exercise in full of all options and Warrants owned by Mr. Arnold, Mr. Arnold would own an aggregate of 6,169,657 Common Shares, representing approximately 5.81% of the then issued and outstanding Common Shares (on a partially diluted basis, assuming no other convertible securities of the Corporation are exercised).
(4)	Mr. Harbinson also owns options exercisable to acquire 500,000 Common Shares. Assuming completion of the Private Placement and the exercise in full of all options and Warrants owned by Mr. Harbinson, Mr. Harbinson would own an aggregate of 5,791,866 Common Shares, representing approximately 5.45% of the then issued and outstanding Common Shares (on a partially diluted basis, assuming no other convertible securities of the Corporation are exercised).
(5)	Mr. Heslop also owns options exercisable to acquire 775,000 Common Shares. Assuming completion of the Private Placement and the exercise in full of all options and Warrants owned by Mr. Heslop, Mr. Heslop would own an aggregate of 3,093,070 Common Shares, representing approximately 2.96% of the then issued and outstanding Common Shares (on a partially diluted basis, assuming no other convertible securities of the Corporation are exercised).

Following completion of the Private Placement, to the knowledge of the Corporation, no person will own, directly or indirectly, or exercise control or direction over, more than 10% of the issued and outstanding Common Shares (on a non-diluted basis). However, as indicated above, assuming full conversion of all options and Warrants owned by him, Mr. Gill would own an aggregate of 12,869,034 Common Shares, representing approximately 11.78% of the then issued and outstanding Common Shares (on a partially diluted basis, assuming no other convertible securities of the Corporation are exercised). Notwithstanding the foregoing, the Private Placement is not expected to have any material effect on the control of Thundermin since no control person (within the meaning of applicable securities legislation) will be created by virtue of the completion thereof.

In light of the fact that all subscribers under the Private Placement will be insiders of Thundermin, the Private Placement will be considered to be a "related party transaction" within the meaning of Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61-101"). The Corporation is relying on the exemptions from the formal valuation and minority shareholder approval requirements of MI 61-101 contained in Sections 5.5(a) and 5.7(1)(a) of MI 61-101 in respect of the related party transaction based on the fact that the fair market value of the related party participation in the Private Placement will not exceed 25% of Corporation's market capitalization prior to the Closing. 

About Thundermin

For further information on Thundermin, please visit Thundermin's website at www.thundermin.com or the SEDAR website at www.sedar.com.

Certain statements in this press release may constitute "forward looking statements" reflecting Thundermin's current beliefs, plans, estimates and expectations including with respect to the use of proceeds from the Private Placement, the completion of the Private Placement and the timing thereof, the timing of the delisting of the Common Shares from the TSX and the listing of the Common Shares on the TSX Venture Exchange. These forward looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Corporation or the combined companies to be materially different from any performance or achievement expressed or implied by such "forward looking statements". Except as required by applicable laws, Thundermin undertakes no obligation to update any forward looking statements for any reason after the date hereof to conform these statements to actual results or to changes in its expectations.