Closes Qualifying Transaction, Announces Change of Name and New Management and Board Appointments
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FORTE RESOURCES INC.
Closes Qualifying Transaction, Announces Change of Name and New Management and Board Appointments
April 12, 2012 TSX Venture Exchange Trading Symbol: FJX.P
Vancouver, B.C. – Forte Resources Inc. ("Forte" or the "Company") is pleased to announce the closing on April 12, 2012 of the previously announced (see October 25, 2011 and January 4, 2012 news releases) transaction by acquiring all of the issued and outstanding shares of Santacruz Silver Mining Ltd. ("Santacruz") by way of a three-cornered amalgamation with a wholly-owned subsidiary of Forte (the "Transaction"). The Transaction constitutes Forte's qualifying transaction pursuant to the policies of the TSX Venture Exchange.
Pursuant to the Transaction, Forte issued one common share for each common share of Santacruz issued and outstanding immediately prior to the Transaction. In addition, outstanding warrants of Santacruz are exercisable for common shares of Forte on a one for one basis at an exercise price of $1.25 per share until July 20, 2012.
As part of the Transaction, Santacruz amalgamated with 0931204 BC Ltd. to form "Santacruz Holdings Ltd.", a wholly-owned subsidiary of the Company.
Immediately prior to the completion of the three-cornered amalgamation, Santacruz closed the associated brokered private placement of 22,222,222 shares at a price of $0.90 per share for gross proceeds of $20,000,000. Canaccord Genuity Corp. acted as the agent in the private placement and received a cash commission of $1,199,999.99, representing 6% of the gross proceeds, 200,000 corporate finance shares and 1,333,333 agent's warrants with each agent's warrant entitling the holder to purchase one share for $1.00 per share until April 12, 2014. The securities issued pursuant to the private placement were exchanged on a one for one basis for securities of Forte pursuant to the Transaction. The securities of Forte issued in exchange for the securities issued in the Santacruz private placement will have no resale restrictions under securities laws.
The proceeds from the private placement will be used primarily for exploration and development costs on the Company's Rosario and Gavilanes properties in Mexico, for general working capital and to pay the expenses of the Transaction.
A finder's fee of 2,375,000 common shares of the Company was issued in connection with the Transaction.
As a result of the completion of the Transaction, Forte issued 49,914,853 common shares to shareholders of Santacruz and 664,476 warrants. Forte now has 67,729,853 issued and outstanding common shares. Assuming that all of Forte's options, warrants and other convertible securities were exercised, 74,737,662 common shares of Forte would be issued and outstanding on a fully diluted basis.
An aggregate of 23,188,926 common shares are subject to escrow or seed share resale restrictions. Further details on the escrow and seed share resale restrictions can be found in the Company's Filing Statement dated March 29, 2012.
Details of the Transaction are contained in the Company's Filing Statement dated March 29, 2012 filed under the Company's profile on www.sedar.com.
Name Change
Upon completion of the Transaction, the Company changed its name to "Santacruz Silver Mining Ltd." It is anticipated that the common shares of the Company will begin trading under stock symbol "SCZ" on Monday, April 16, 2012.
Changes in Board and Management
Upon completion of the Transaction, Gunther Roehlig resigned as the Chief Executive Officer, Chief Financial Officer and a director of the Company and Andrew Williams resigned as a director of the Company.
Arturo Prestamo Elizondo, Francisco Ramos and Craig Angus have been appointed directors of the Company. The Board is now comprised of Arturo Prestamo Elizondo, James Hutton, Francisco Ramos and Craig Angus.
Arturo Prestamo Elizondo has also been appointed as the Chief Executive Officer of the Company, Francisco Ramos has been appointed as the Chief Operating Officer, Robert McMorran has been appointed as the Chief Financial Officer and James Harris will continue as the Corporate Secretary.
Grant of Options
A total of 4,810,000 incentive stock options have been granted to directors, officers and employees of the Company and its subsidiaries pursuant to the Company’s Stock Option Plan. The options are exercisable for a period of five years at a price of $0.90 per share.
National Instrument 62-103 Report Disclosure
The Company is advised that Arturo Prestamo Elizondo, the Chief Executive Officer and a director of the Company, has acquired ownership of 8,111,714 common shares of the Company in exchange for 8,111,714 shares of Santacuz in connection with the Transaction at a deemed value of $7,300,543.
In addition, the Company is advised that Mr. Prestamo Elizondo has acquired ownership of 750,000 shares of the Company from Gunther Roehlig, the former Chief Executive Officer and Chief Financial Officer of the Company, at a purchase price of $0.05 per share.
Mr. Prestamo Elizondo now owns an aggregate of 8,861,714 common shares of the Company and stock options to acquire an additional 800,000 common shares, which are exercisable until April 12, 2017 at an exercise price of $0.90 per share. Mr. Prestamo Elizondo's 8,861,714 shares represent 13.08% of the Company's issued and outstanding common shares or 14.1% on a partially-diluted basis assuming the exercise of his stock options.
For a copy of the early warning report, please contact Mr. Prestamo Elizondo at 52 (81) 8683- 6095.
APPROVED BY THE BOARD OF DIRECTORS
Arturo Prestamo Elizondo, Director
For further information please contact:
Arturo Prestamo Elizondo, Director Forte Resources Inc.
Email: [email protected] Telephone: 52 (81) 8378-5707
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.
Forward looking information
Certain statements contained in this news release, such as proposed use of proceeds and anticipated trading day on the TSXV, constitute "forward-looking information" as such term is used in applicable Canadian securities laws. Forward-looking information is based on plans, expectations and estimates of management at the date the information is provided and is subject to certain factors and assumptions, including, that the Company's the financial condition and development plans do not change as a result of unforeseen events and that the Company obtains regulatory approval. Forward-looking information is subject to a variety of risks and uncertainties and other factors that could cause plans, estimates and actual results to vary materially from those projected in such forward-looking information. Factors that could cause the forward-looking information in this news release to change or to be inaccurate include, but are not limited to, the risk that any of the assumptions referred to prove not to be valid or reliable, that occurrences such as those referred to above are realized and result in delays, or cessation in planned work, that the Company's financial condition and development plans change, and delays in regulatory approval, as well as the other risks and uncertainties applicable to mineral exploration and development activities and to the Company as set forth in the Company's Filing Statement in respect of the Transaction filed under the Company's profile at www.sedar.com . The Company undertakes no obligation to update these forward-looking statements, other than as required by applicable law.
This news release does not constitute an offer to sell or solicitation of an offer to sell any 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 laws and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable securities laws or an exemption from such registration is available.