Prophecy Resource Corp. ("Prophecy") (TSX VENTURE: PCY)(OTCQX:
PRPCF)(FRANKFURT: 1P2) and Pacific Coast Nickel Corp. ("PCNC") (TSX
VENTURE: NKL) (the "Companies") announce that their respective
shareholders have approved the arrangement transaction
("Arrangement") whereby PCNC will acquire the Lynn Lake and
Wellgreen nickel properties from Prophecy. The votes were tabulated
during separate shareholder meetings held by Prophecy and PCNC
earlier today. 98.17% of Prophecy shares and 74.64% of PCNC shares
present in person or by proxy at the respective shareholder
meetings supported the arrangement transaction. In connection with
the arrangement, shareholders of Prophecy also approved a change of
name to "Prophecy Coal Corp.", and shareholders of PCNC also
approved a 10:1 share consolidation. It is expected the name change
and share consolidation will be effected shortly after the
completion of the arrangement.
Completion of the arrangement remains subject to approvals from
the British Columbia Supreme Court and the TSX Venture Exchange.
Prophecy will seek final approval from the B.C. Supreme Court for
the Arrangement at a hearing to be held on June 2, 2011 with
arrangement completion date on or before June 9, 2011.
The Prophecy shareholder meeting was also an annual general
meeting, and shareholders of Prophecy also elected the directors
and appointed Smythe Ratcliffe as auditors for the ensuing year as
outlined in the management information circular accompanying the
meeting.
Details on the arrangement, as well as the additional items of
business conducted at the Prophecy and PCNC shareholder meetings,
can be reviewed in the following joint news releases issued by the
Companies: January 18, 2011, February 17, 2011 and April 4, 2011,
and in the joint management circular prepared by the Companies
dated April 28, 2011.
About Prophecy Resource
Prophecy Resource Corp. is an internationally diversified
company engaged in developing energy, nickel and platinum group
metals projects. The company controls over 1.4 billion tonnes of
surface minable thermal coal resources in Mongolia. Prophecy's
Ulaan Ovoo coal mine is operational and its Chandgana mine mouth
power plant is currently being permitted. In Canada, Prophecy owns
the Wellgreen PGM Project in Yukon and Lynn Lake Nickel Sulphide
Project in Manitoba, both of which it has agreed to sell to Pacific
Coast Nickel Corp (TSX VENTURE: NKL). Prophecy also owns equity
stakes in Victory Nickel Inc. (TSX: NI) and Compliance Energy Corp.
(TSX: CEC). Mineral resources that are not mineral reserves do not
have demonstrated economic viability.
About PCNC
Pacific Coast Nickel Corp. is a Canadian based Nickel PGM
exploration company with projects in Canada, Argentina and Uruguay.
PCNC's Burwash property is located adjacent to Prophecy's Wellgreen
project in Yukon Territory, Canada. On April 4, 2011, PCNC agreed
to buy Wellgreen and Lynn Lake projects from Prophecy Resource
Corp. by issuing 450 million Pacific Coast Nickel shares to
Prophecy.
ON BEHALF OF THE BOARD OF DIRECTORS of
Prophecy Resource Corp.
John Lee, Chairman and CEO
Pacific Coast Nickel Corp.
John Lee, Chairman and Interim CEO
Cautionary Statements: Completion of the transaction is subject
to a number of conditions, including regulatory approval,
shareholder approvals, a definitive agreement and approval of the
British Columbia Supreme Court if applicable. There can be no
assurance that the transaction will be completed as proposed or at
all. Investors are cautioned that, except as disclosed in the
Management Information Circular to be prepared in connection with
the transaction, any information released or received with respect
to the Transaction may not be accurate or complete and should not
be relied upon. Trading in the securities of exploration and
development stage resource companies should be considered highly
speculative.
Forward Looking Statements: This news release includes certain
statements that may be deemed "forward-looking statements". All
statements in this release, other than statements of historical
facts, including, without limitation, statements regarding timing
of the Transaction, future share ownership of PCNC, Prophecy's
intentions in respect of the PCNC Distribution, potential
mineralization, the estimation of mineral resources, the
realization of mineral resource estimates, interpretation of prior
exploration and potential exploration results, the timing and
success of exploration activities generally, the timing and results
of future resource estimates, permitting time lines, metal prices
and currency exchange rates, availability of capital, government
regulation of exploration operations, environmental risks,
reclamation, title, and future plans and objectives of the
companies are forward-looking statements that involve various risks
and uncertainties. Although PCNC and Prophecy believe the
expectations expressed in such forward-looking statements are based
on reasonable assumptions, such statements are not guarantees of
future performance and actual results or developments may differ
materially from those in the forward-looking statements.
Forward-looking statements are based on a number of material
factors and assumptions. Factors that could cause actual results to
differ materially from those in forward-looking statements include
failure to obtain necessary approvals in respect of the
Transaction, unsuccessful exploration results, changes in project
parameters as plans continue to be refined, results of future
resource estimates, future metal prices, availability of capital
and financing on acceptable terms, general economic, market or
business conditions, risks associated with operating in foreign
jurisdictions, uninsured risks, regulatory changes, defects in
title, availability of personnel, materials and equipment on a
timely basis, accidents or equipment breakdowns, delays in
receiving government approvals, unanticipated environmental impacts
on operations and costs to remedy same, and other exploration or
other risks detailed herein and from time to time in the filings
made by the companies with securities regulators. Readers are
cautioned that mineral resources that are not mineral reserves do
not have demonstrated economic viability. Mineral exploration and
development of mines is an inherently risky business. Accordingly
the actual events may differ materially from those projected in the
forward-looking statements. For more information on PCNC and
Prophecy and the risks and challenges of their businesses,
investors should review their annual filings that are available at
www.sedar.com.
This press release does not constitute an offer to sell or a
solicitation to buy any of the securities in the United States. The
securities have not been and will not be registered under the
United States Securities Act of 1933, as amended ("the U.S.
Securities Act") or any state securities law and may not be offered
or sold in the United States or to U.S. Persons unless registered
under the U.S. Securities Act and applicable state securities laws
or an exemption from such registration is available.
Completion of the Transaction is subject to a number of
conditions, including Exchange acceptance and disinterested PCNC
shareholder approval. The transaction cannot close until the
required shareholder approval is obtained. There can be no
assurance that the Transaction will be completed as proposed or at
all.
Investors are cautioned that, except as disclosed in the
Management Information Circular and/or Filing Statement to be
prepared in connection with the transaction, any information
released or received with respect to the Transaction may not be
accurate or complete and should not be relied upon. Trading in the
securities of PCNC should be considered highly speculative.
Neither the 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. The TSX Venture Exchange has in no way
passed upon the merits of the proposed Transaction and has neither
approved nor disapproved the contents of this press release.
Contacts: Prophecy Resource Corp. David Jan Chief Financial
Officer 1.800.358.5865 djan@prophecyresource.com
www.prophecyresource.com Pacific Coast Nickel Corp. John Lee
Chairman and Interim CEO 1.800.851.1528 info@pacificcoastnickel.com
www.pacificcoastnickel.com
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