Prophecy to Acquire Fourth Vanadium Project – Targets Production in 2017

Prophecy Development (“Prophecy” or the “Company”) (TSX:PCY, OTCPK:PRPCF, Frankfurt:1P2N) has entered into a binding letter agreement (the “Letter Agreement”) with Fairmont Resources (“Fairmont”) to acquire the fully-permitted Buttercup Iron-Titanium-Vanadium (Fe-Ti-V) project in Quebec, Canada (the “Buttercup Project”).
Prophecy is initiating discussions with several potential dense aggregate buyers and has targeted for production to commence by the end of 2017, should commercial terms be reached with an off taker.*
*A positive production decision would not be based on a feasibility study of mineral reserves demonstrating economic and technical viability so would carry increased uncertainty and the risk of failure as to the mining method and profitability.
Proposed Transaction Summary
Under the terms of the Letter Agreement, Prophecy will acquire the claims and a lease which constitute the Buttercup Project by paying to Fairmont:

(a) At closing, the equivalent of $1,000,000, up to half of which (i.e. $500,000), may at Prophecy’s sole discretion, be paid in Prophecy Common shares, calculated based on the 5-day volume-weighted average trading price of such shares as of the closing date; and
(b) On the 1-year anniversary date of the closing date, a further $500,000, up to half of which (i.e. $250,000), may at Prophecy’s sole discretion, be paid in Prophecy Common shares, calculated based on the 5-day volume-weighted average price of such shares as of the 1-year anniversary date of the closing date.