EPM Mining Ventures Inc. Announces Private Placement With EMR Capital Resources Fund 1, LP

TORONTO, ONTARIO--(Marketwired - May 12, 2015) - EPM Mining Ventures Inc. ("EPM" or the "Company") (TSX VENTURE:EPK)(OTCQX:EPKMF) announced that it has entered into an agreement (the "Subscription Agreement") with EMR Capital Resources Fund 1, LP ("EMR") pursuant to which EPM will issue to EMR 34,516,129 units of EPM (the "Units") at C$0.30 per Unit for gross proceeds of C$10,354,839, with each Unit being composed of one common share of EPM (a "Common Share") and one Common Share purchase warrant (a "Warrant") for an aggregate of 34,516,129 Common Shares and 34,516,129 Warrants (together, the "Offering"). Each Warrant will entitle the holder to subscribe for one Common Share at a price of C$0.4243 per Common Share for a period of 24 months following the closing of the Offering. However, subject to the achievement of certain milestones, EMR will be deemed to irrevocably exercise the Warrants into 34,516,129 Common Shares at a price of C$0.4243 per Common Share for gross proceeds of C$14,645,194 with an additional investment commitment of not less than C$60 million, or one-third of the project equity commensurate with EMR's pro rata share of EPM's Sevier Playa SOP Project (the "Project") project equity value based upon the net present value to be determined by the Company's planned Feasibility Study.

"We are very pleased that cornerstone-investor EMR Capital is making this substantial commitment to our company," said Lance D'Ambrosio, Chief Executive Officer of EPM. "This is a significant milestone towards advancing the Project. EMR has a team with a proven history of developing and operating resource properties that will benefit EPM's ability to fast-track our efforts as we evolve from development phase to construction-ready stage."

"EMR considers itself to be a knowledgeable resource investor," said Owen Hegarty, Chairman of EMR. "Potash is one of our four preferred commodities and we see our EPM investment as dovetailing very well with our MOP investment Highfield Resources. EPM shares the same criteria that compelled our investment in Highfield: promising resource, lowest quartile CapEx and OpEx, great jurisdiction, proven mining process, access to existing infrastructure and excellent management. Additionally, EPM will produce SOP, a specialty fertilizer, as well as other likely minerals that add to our excitement for investing in the company."

The closing of the Offering is subject to certain customary closing conditions set out in the Subscription Agreement, including the approval of the TSX Venture Exchange (the "TSXV") and the consent of shareholders of EPM. EPM intends to use the proceeds of the Offering towards funding its development program including its advanced fieldwork identified in its Preliminary Feasibility Study and permitting efforts to deliver a draft Environmental Impact Statement. If applicable, proceeds from the exercise of Warrants will be used by EPM to fund (i) the completion of its feasibility study, (ii) an Environmental Impact Statement and permitting, and (iii) for general working capital purposes.

The closing of the Offering will take place on the third business day following the satisfaction (or waiver, if applicable) of the closing conditions specified in the Subscription Agreement, or such other date as EPM and EMR may agree, but in any event no later than June 30, 2015. All of the securities issued pursuant to the Subscription Agreement will be subject to a four month and one day hold period from the date of issuance.

About EMR

EMR Capital Resources is a specialist private equity manager whose team has a proven track record in the dimensions critical to achieving superior returns. The team has demonstrated success in resource exploration, development, and operation as well as in the commercialization of resource projects. Further, the company has deep links to Asian markets and, in particular, to commodity purchasers, end-users, resources companies, investors, and governments. Lastly, the team has extensive private equity investment management experience and follows an investment strategy that allows their highly experienced team to identify and unlock value from high-quality asset opportunities at various stages of the mining life cycle. EMR Capital has offices in Melbourne, Sydney and networks across the globe, including an office at 89 Nexus Way, Camana Bay, Grand Cayman, Cayman Islands, KY1-9007.

Extract Capital Credit Agreement

Effective March 30, 2015, EPM and Extract Capital LLC ("Extract Capital") agreed to amend the credit agreement (the "Amendment") dated May 2, 2014 among EPM, certain of its subsidiaries, Extract Capital, and certain lenders from time to time. The Amendment provides for a waiver by Extract Capital of a mandatory repayment covenant with respect to the initial equity investment by EMR of C$10,354,839. The Amendment also requires EPM to, from and after the earlier of the closing of the Offering and July 1, 2015, continuously maintain at least $500,000 in working capital.

Extract Capital is a long/short equity fund focused on the junior resource sector. The fund targets investments with strong management teams and early-stage assets that are underperforming the market while putting lessor importance on market trends and popularity. By utilizing its in-house technical expertise, extensive relationships across the sector, and proprietary database, Extract makes investments that can realize significant gains in a 6 to 24 month time frame.

The Relationship Agreement

Pursuant to the terms of the Subscription Agreement, at the closing time EMR and EPM will enter into a relationship agreement (the "Relationship Agreement"), which will provide for certain rights, obligations and responsibilities of the parties over the term of the Relationship Agreement and in respect of the Project. The term of the Relationship Agreement will be for a period of five years from the date of closing of the Offering, providing EMR maintains an equity and voting interest in EPM of at least 15% during such time. The significant terms of the Relationship Agreement are described below:

• Pre-Emptive Rights: EMR will be granted a right to maintain its pro rata interest in EPM going forward. This right will not extend to issuances of securities in connection with the grant or exercise of options under EPM's stock option plan, warrants that are presently outstanding, or pursuant to the terms of convertible or exchangeable securities presently outstanding or issued by EPM in compliance with the terms of the Relationship Agreement. In addition, EMR will have the right to participate in future financings to attain and retain a shareholding at all times that is no less than that held by Gusiute Holdings (UK) Limited.

• Transfer Restrictions: EMR will be subject to certain transfer restrictions on any securities of EPM it has acquired for a period of two years following the date of closing of the Offering, subject to certain exceptions.

• Standstill Restrictions: EMR will be subject to various standstill provisions for a period running until September 2, 2016 (unless such term is otherwise terminated pursuant to the terms of Relationship Agreement, such as in connection with a change of control). These restrictions prohibit the subscriber from, among other things, acquiring or making a proposal to acquire securities or material assets of EPM; proposing any amalgamation, merger, arrangement, or any other business reorganization, restructuring or liquidation with respect to EPM; or soliciting or publicly announcing any of the foregoing, provided that EMR may make such proposals to EPM's board of directors (the "Board") on a confidential basis. However, EMR will be permitted to acquire shares (i) from Gusiute Holdings (UK) Limited, and (ii) provided no trading blackout is in place pursuant to the insider trading policy of EPM, in compliance with Section 4.1 or 4.2 of Multilateral Instrument 62-104 - Take-Over Bids and Issuer Bids.

• Investment Right: Pursuant to the terms of the Offering, provided no material adverse change occurs with respect to the Project or EPM, EMR commits to provide an additional investment in the Project or EPM at either the Project level or in Common Shares as further described below immediately following the achievement of certain milestones (the "Investment Right"). The parties agree to act in a commercially reasonable manner and good faith towards one another to negotiate the terms of such additional investment taking into account regulatory approval issues and tax and other structural issues relating to such additional investment. The parties acknowledge that this investment will be subject to applicable regulatory approvals at the time of the investment.
  
  EMR shall have the right to invest an amount equal to, but not less than C$60,000,000 or up to one third (1/3) of the required equity contribution determined by the Board at the Project level (the "Construction Financing") to construct and develop the Project contemplated in the feasibility study prepared for the Project. The Construction Financing will be used to fund Project construction, working capital and other recognized costs associated with the Project. EMR will receive a direct interest in and to the Project commensurate with its pro rata share of the Project's equity value (the calculation of which is more fully described in the Relationship Agreement). Upon the completion of the Construction Financing EMR shall enter into an applicable agreement with EPM and EPM's subsidiary that holds title to the Project. If practicable, upon the completion of the Construction Financing, if EMR invests at the Project level, the parties and their affiliates shall use commercially reasonable efforts to enter into a joint venture agreement or other relational agreement, which agreement shall be based on the precedent forms published by the Rocky Mountain Mineral Law Foundation.
  
  However, notwithstanding the above, EMR shall have the right not to complete the Construction Financing at the Project level but instead subscribe for Common Shares for aggregate consideration of no less than C$60,000,000 or up to one third (1/3) of the required equity contribution to construct and develop the Project contemplated in the feasibility study. The price per Common Share shall be determined in accordance with applicable securities laws and stock exchange rules, but shall not be less than the price offered to other investors subscribing for Common Shares to fund the equity portion of financing required to fund Project construction.

• Board Representation Rights: The size of the Board will be set at nine directors and EMR will be entitled to designate such number of individuals for election to the Board as part of the management proposed list of directors (each a "Subscriber Nominee") as is based on EMR's pro rata equity and voting interest in EPM, as such interest is more specifically described in the Relationship Agreement. The Relationship Agreement provides that where EMR's equity and voting interest is greater than or equal to 15% and less than 22.2%, EMR will be entitled to designate one Subscriber Nominee. In general, EMR will be entitled to designate an additional Subscriber Nominee for each additional 11.1% in equity and voting interest it acquires beyond 22.2% (inclusive). Where EMR's equity and voting interest is greater than or equal to 99.9%, EMR will be entitled to designate nine Subscriber Nominees. On closing of the Offering, EMR will be entitled to have two persons appointed to the Board based on EMR holding a 23.6% Common Share equity interest in EPM.
  
  In addition, up to two Subscriber Nominees will join the Technical Advisory Committee of the Board. This committee will have, among other things, approval rights over annual project operating and capital expenditure budgets and any material changes to them until such time as the Warrants are exercised. Furthermore, up to two Subscriber Nominees will join the Finance Committee to be established by the Board, which will be responsible for, among other things, developing and maintaining a financing plan for the project.

• Information Rights: EMR will also have customary information rights, including the right to receive quarterly financial and production reports.

The foregoing summary of the Relationship Agreement does not purport to be complete and is qualified in its entirety by reference to the Relationship Agreement, which is appended as Appendix "C" to the Subscription Agreement. The Subscription Agreement has been filed on EPM's SEDAR profile and is accessible at www.sedar.com.

Success Fee

EPM was advised on the transaction by Ricardo Campoy and Joel Schneyer, Managing Directors in the Minerals Capital & Advisory practice of Headwaters MB ("Headwaters"). Headwaters is an independent, middle-market investment banking firm providing strategic merger and acquisitions, corporate finance services, and merchant banking through proprietary sources of capital. Headwaters is headquartered in Denver, Colorado, with 6 regional offices across the United States and partnerships with 18 firms covering 30 countries. For more information, visit www.headwatersmb.com.

Pursuant to an agreement with Headwaters dated October 15, 2013, as amended September 29, 2014 and May 8, 2015, EPM has agreed to pay to Headwaters in connection with the Offering a success fee equal to 4.0% of the value of the Offering (such fee being C$414,194) plus reasonable expenses. EPM has also agreed to pay to Headwaters a success fee of 4.0% upon the exercise of Warrants by EMR (such fee being C$585,808) and the exercise by EMR of the Investment Right (such fee being not less than approximately C$2,400,000). However, EPM and Headwaters have agreed that, should EPM retain Headwaters to assist with project financing in respect of the Project, the success fee on the Investment Right will be reduced from 4.0% to 2.0%. Payments to Headwaters will be made in accordance with the rules and policies of the TSXV, and subject to the applicable regulatory approvals.

Capitalization

Upon completion of the Offering, there will be 146,450,071 Common Shares outstanding of which EMR will own or control 34,516,129 Common Shares, representing approximately 23.6% of the outstanding Common Shares, on an undiluted basis. If EMR were to exercise the Warrants, there would be 180,966,200 Common Shares outstanding on a partially diluted basis of which EMR will own or control 69,032,258 Common Shares, representing approximately 38.1% of the outstanding Common Shares on a partially diluted basis.

The following table sets forth the capitalization of EPM as at December 31, 2014, the date of the most recent consolidated financial statements filed by EPM, before and after giving effect to the Offering and the exercise of Warrants. The table should be read in conjunction with the consolidated financial statements of EPM, including notes thereto, and the associated management's discussion and analysis.

Note:

TSXV

The completion of the Offering will materially affect the control of EPM and may result in the creation of a new "Control Person", and a "Change of Control" of EPM, within the meaning of the rules and policies of the TSXV, and, accordingly, EPM is seeking the written consent of disinterested shareholders holding over 50% of its issued and outstanding Common Shares in accordance with the rules and policies of the TSXV.

About EPM Mining Ventures

EPM is a development-stage company focused on specialty fertilizers. Through Peak Minerals Inc., its indirect wholly owned subsidiary, EPM controls directly or through agreement, mineral leases on more than 124,000 acres on its Sevier Lake Playa property in Millard County, Utah. With a brine resource known to contain potassium, magnesium, sulphate, lithium, and a suite of other beneficial minerals, EPM is targeting the development and production of specialty fertilizers, including SOP, through the use of a cost-effective solar evaporation process. SOP and other specialty fertilizers are used in the production of high value, chloride-sensitive crops such as fruits, vegetables, and tree nuts. With the completion of a Preliminary Feasibility Study, EPM is currently engaged in engineering and analysis designed to support a feasibility study, environmental permitting, and ultimately mineral production.

For more information, please visit our web site at www.epmmining.com.

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.

Forward-Looking Information

This news release contains "forward-looking information" within the meaning of applicable Canadian securities legislation. Forward-looking information includes, but is not limited to, information with respect to the Offering and the closing thereof, the entry by the parties into a Relationship Agreement, the exercise of Warrants, the exercise by EMR of its Investment Right and obtaining any applicable regulatory approvals therefor, the appointment of the Subscription Nominees and EPM's future business. Generally, forward-looking information can be identified by the use of forward-looking terminology such as "plans", "expects", or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates", or "does not anticipate", or "believes" or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might", or "will be taken", "occur", or "be achieved". Forward-looking information is based on the opinions and estimates of management at the date the information is made, and is based on a number of assumptions and is subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of EPM to be materially different from those expressed or implied by such forward-looking information, including risks associated with the future business and development of EPM and the actual terms of any agreement that would be entered into in respect of the transactions described in this press release. Although EPM has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. Accordingly, readers should not place undue reliance on forward-looking information. EPM does not undertake to update any forward-looking information, except in accordance with applicable securities laws.

Contact

EPM Mining Ventures Inc.
Lance D'Ambrosio
Chief Executive Officer
801-485-0223
www.epmmining.com