MX buys 360 cryptocurrency miners, cancels Symple deal
MX Gold Corp. has bought 360 Avalon Miner 741 cryptocurrency mining system units, which it expects to receive around Nov. 20, 2017. The company has cancelled its LOI with Symple Internet Financial Ltd.
MX GOLD Corp. has purchased 360 cryptocurre ncy mining systems as part of the company’s pilot project in the cryptocurre ncy mining space. The company has ordered 360 units of the Avalon Miner 741 cryptocurrency mining system, made by Canaan Creative Co., which units are expected to be delivered on or about Nov. 20, 2017. Assuming timely delivery, management expects to commence cryptocurrency mining operations by mid-December. To house the cryptocurrency mining operations for this pilot project, MX Gold is currently negotiating a 15,680-square-foot lease with 3409377 Manitoba Ltd. for premises located at 900 Fisher Ave., La Portage, Man., and access to 2.5 megawatts of power. The proposed lease will enable the company to take advantage of competitive power rates, which are 5.4 cents per kilowatt-hour.
Since 3409377 Manitoba Ltd. is a company wholly owned by Dan Omeniuk, chief executive officer of MX Gold, the proposed lease is considered a related party transaction under Multilateral Instrument 61-101. The proposed lease is exempt from the formal valuation requirement under Section 5.4 of MI 61-101, by virtue of the exemption contained in Section 5.5(a) of MI 61-101, and from the minority shareholder approval requirement under MI 61-101, by virtue of the exemption contained in section 5.7(a) of MI 61-101, as the fair market value of the consideration under the proposed lease does not exceed 25 per cent of the company’s market capitalization.
Mr. Omeniuk stated: “Our company is looking forward to developing a pilot project involving a cryptocurrency mining operation to determine whether further investment in the growing cryptocurrency industry is warranted.”
Additionally, MX Gold has decided not to proceed with the letter of intent for the acquisition of Symple Internet Financial Ltd., which terminated in accordance with its terms on Nov. 6, 2017. The company has instead determined to internally develop its own pilot cryptocurrency mining operations located in Manitoba, as disclosed above.
Mr. Omeniuk also stated: “MX’s decision to take on this project internally will result in reduced dilution to shareholders, as MX will no longer be required to issue shares in connection with the purchase of Symple.”
About MX Gold Corp.
MX Gold is a junior mining company focused on the exploration and development of advanced projects located in Mexico and British Columbia, Canada. The company’s primary focus is the Magistral del Oro tailings project located 392 kilometres southwest of Chihuahua and includes a 500-tonne-per-day dynamic cyanide countercurrent system plant constructed in 2013, which the company plans to expand to 1,000 tonnes per day. The company also owns 50 per cent of the IDS project, which includes a smelter that was completed in 2014 for a throughput capacity of 50 tonnes per day. The smelter was built to receive and process material from small-scale miners across the state of Durango and beyond.
We seek Safe Harbor.
Walter A Jr Marting, Hugh Charles McPherson, Dan Omeniuk, Akash Patel, Kenneth Clifford Phillippe, Lorne McLeod Warner
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