Mukuba Announces Financing and Proposed Share Consolidation

TORONTO, July 12, 2012 /CNW/ - Mukuba Resources Limited (TSX-V:MKU) ("Mukuba" or the "Company") announced today that it has arranged a private placement financing for a minimum of $750,000 and a maximum of $1,500,000 on the following terms and conditions (the "Offering"):

• The Offering is conditional upon a consolidation of the Company's outstanding common shares at a ratio of four pre-consolidation common shares for one post-consolidation common share (the "Consolidation"). The Consolidation requires approval by the holders of the Company's common shares at a meeting of shareholders expected to occur on August 30, 2012. All references to units are on a post-consolidation basis unless otherwise identified.
• The Offering will comprise a maximum of 12,500,000 units at a subscription price of $0.12 per unit. Each unit will consist of one common share and one common share purchase warrant of Mukuba entitling the holder thereof (each a "Warrant"). Each Warrant will entitle the holder thereof, during a period of 24 months from the date of closing of the private placement, to purchase one Mukuba common share at an exercise price of $0.16 per common share. The securities issued pursuant to the Offering will be subject to a four month hold period.
• Cormark Securities Inc. and Ocean Equities Limited have committed to purchase, or find suitable substitute purchasers for a minimum aggregate amount of $500,000.
• The Company will issue a convertible debenture in aggregate principal amount of $250,000 convertible into 2,083,333 Units upon closing of the Offering. These units are included in the 12,500,000 units described above. In the event that the Consolidation and Offering is not completed within four months from the date hereof, the convertible debenture will bear interest at a rate of 10% effective from the date of issue and be convertible into shares at a rate of $0.10 per common share on a pre-Consolidation basis.
• The remaining aggregate amount of $750,000 will be issued to suitable subscribers on a best efforts basis. There is no current commitment from any subscriber for the remaining $750,000.
• The net proceeds of the Offering will be used for general corporate purposes.

Closing is expected to occur on September 12, 2012. The shareholders meeting to consider the Consolidation is anticipated to occur on August 30, 2012, but may be extended in the sole discretion of the Company. In connection with the Offering, Mukuba expects to pay a finder's fee consisting of a cash commission equal to 5% of the gross proceeds of the Units sold and issue share purchase warrants equal to 10% of the Units sold by each such finder or as otherwise agreed upon on an individual basis.

As compensation for past services, the board of directors of the Company has determined to award each of Mr. John Hawkrigg, Mr. Martin Horgan, Mr. Danny Keating, Mr. Michael Smyth (the "Directors") and Mr. Kelly Ehler (the "Chief Executive Officer") a payment each of $50,000 for an aggregate total of $250,000. Such compensation is to be paid in common shares of the Company on the same terms of the common shares to be issued through the Offering.

Completion of the Offering and the payment to the Directors and Chief Executive Officer is subject to the receipt of all required regulatory and shareholder approvals, including acceptance by the TSX Venture Exchange.

Mr. John Hawkrigg, Chairman of Mukuba, stated that, "the financing announced today places Mukuba on firm ground with respect to its cash position and will allow the company to move forward with its strategic plan with respect to existing assets and any opportunities that may present itself in the near future."

About the Company

Mukuba is a Canadian mining company focused on the exploration and development of certain African base metal assets alone and through a joint venture partner. These assets include a 100% interest in the Northcore Project, which is licensed for both copper and cobalt and encompasses approximately 2,274 square km of geologically prospective ground in the Central African Copperbelt region of Zambia. Mukuba is also a party to a joint venture with Benzu Resources Limited to explore and develop a copper and base metals project in the Democratic Republic of the Congo.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Forward-looking Information

Securities regulators encourage companies to disclose forward-looking information to help investors understand a company's future prospects. This press release contains statements about our future business and planned activities, including matters relating to the Offering, future shareholder meetings and the use of proceeds of the Offering. These are "forward-looking" because we have used what we know and expect today to make a statement about the future. Forward-looking statements usually include words such as may, intend, plan, expect, anticipate, believe or other similar words. We believe the expectations reflected in these forward-looking statements are reasonable. However, actual events and results could be substantially different because of the risks and uncertainties associated with our business or events that happen after the date of this press release. You should not place undue reliance on forward-looking statements. As a general policy, we do not update forward-looking statements except as required by securities laws and regulations.

Kelly Ehler, interim President and CEO
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Email: [email protected]