Awalé A nnounces the Acquisition of a Highly Prospective Gold Exploration Portfolio in the Greenstone Belt of Suriname
Awalé A nnounces the Acquisition of a Highly Prospective Gold Exploration
Portfolio in the Greenstone Belt of Suriname
September 13, 2022 - Vancouver, BC - Awalé Resources Limited (“Awalé” or the “Company”) (TSXV: ARIC)
is pleased to announce that it has entered into a binding letter agreement dated September 12, 2022 (the
“Agreement”) with Colossal Gold Resources Limited (“ Colossal”) and the shareholders of Colossal
(collectively, the “Sellers”) to acquire 100% of the issued share capital of Colossal (the “Colossal Shares”
and the acqu isition of the Colossal Shares the “Acquisition”). In consideration for the Colossal Shares,
Awalé will issue to the Sellers an aggregate of 21,663,138 common shares of the Company (the
“Consideration Shares”) which will represent 41% of the outstanding Awalé common shares post-closing
of the Acquisition but prior to giving effect to any Awalé common s hares issued under the Financing
discussed below (the “Financing Shares”). The Consideration Shares are being issued at an agreed deemed
price per share of CAD$0.197, a premium of approximately 40% to the Awalé closing share price on
September 9, 2022.
Colossal is a private holding company with an exciting gold exploration portfolio focus ed on the highly
prospective, but underexplored , greenstone belt of Suriname, South America (the “Project”). Colossal
holds, through its wholly-owned Surinamese subsidiary, Consolidated Gold Resources N.V. (“Consolidated
Gold”), a 100% interest in certain existing mineral exploration and exploitation licences in Suriname
(collectively, the “Licences”).
Colossal, Consolidated Gold and each of the Sellers, other than Glen Parsons, the Chief Executive Officer
and a director of Awalé, are arm’s length to Awalé (see “Related Party Transaction Process” below).
Acquisition Highlights
• The A cquisition will provide Awalé with an immediate presence in the little-explored section of
the northern greenstone belt of Suriname, well known for its gold mineralization endowment.
• The Licences are located along trend and close to IAMGOLD’s Rosebel mine and project area.
• The largest Li cense held by Colossal is also contiguous to the NW Extension Project operated by
the Barrick/Reunion Gold Alliance.
• Furthermore, Newmont o perates the world-class Merian mine in the same regional greenstone
terrane.
• The Licences consist of:
o 1 exploitation licence covering an area of 38km2 and expiring 2035 (the Goliath Project);
o 3 contiguous exploration licenses covering an area of 184km2 along trend from the
IAMGOLD Rosebel and Saramacca deposits; and
o 1 exploration licence covering an area of 360km2 contiguous to the NW Extension Project
licence area being explored by the Reunion Gold /Barrick Alliance.
o An overview of the Licences can be found in the attached figures by following the link :
https://www.awaleresources.com/_resources/maps/2022-09-13-Suriname-Acquistion-Figures.pdf
• Colossal’s existing exploration team will continue advancing the Licenses and Awalé intends to
build upon Colossal’s existing team to achieve accelerated exploration results.
• Colossal’s existing exploration team is headed by Chris Hughes, current Chief Operating Officer of
Colossal, who will drive the Project’s exploration activities on the ground in Suriname.
Awale’s Strategic Rationale
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• Awalé’s strategy is building a value adding multi-jurisdictional exploration portfolio in stable and
mining-friendly countries by using the Company’s proven delivery capabilities and strong
systematic exploration track record.
• The Awalé team continues to be led by Glen Parsons who has operated successfully in the past as
the CEO of Mariana Resources Ltd which had a multi-jurisdictional exploration portfolio including
the Hod Maden project in Turkey and which was acquired by Sandstorm Gold Limited.
• The Awal é team has experience operating in Suriname through its leadership of Mariana
Resources Ltd.
• The Odienné Project earn-in Joint Venture with Newmont (see Company News Release dated May
31, 2022) p rovides the solid foundation to enable this value adding multi-jurisdictional strategy
to be achieved.
• In accordance with Awalé’s strategy, the objective is to create value for all stakeholders by
responsibly exploring and advancing district scale projects to feasibility ; as the Company’s focus
is on stable jurisdictions with compelling geology that ultimately attract major producers ,
Suriname fits this strategy.
• The s trategic rationale for the Acquisition is gaining an immediate foothold on an established
exploration portfolio in the northern greenstone belt of Suriname, well known for its gold
mineralization endowment, located along trend and close to IAMGOLD’s Rosebel mine and
project area.
Overview of the Acquisition
• Awalé will acquire an indirect 100% interest in Colossal’s subsidiary, Consolidated Gold, by virtue
of its acquisition of 100% of the Colossal Shares.
• In consideration for the Colossal Shares, Awalé will issue to the Sellers an aggregate of 21,663,138
Consideration Shares at an agreed deemed price per Consideration Share of CAD$0.197 which is
the same price as Newmont paid for its interest in Awalé (see News Release date May 31, 2022).
• The Consideration Shares will represent 4 1% of the outstanding Awalé common shares post -
Closing of the Acquisition but prior to the issuance of any Financing Shares.
• The Sellers currently own approximately 26% of the outstanding Awalé common shares. After
issuance to the Sellers of the Consideration Shares, post-Closing of the Acquisition the Sellers will
hold approximately 56.62% of the outstanding Awalé common shares prior to the issuance of any
Financing Shares.
• Closing of the Acquisition i s subject to receipt of TSX Venture Exchange (“ TSXV”) acceptance;
receipt of the approval of the shareholders of the Company is required by the policies of the TSXV;
Awalé being satisfied in its sole discretion with the results of its in -country due diligence review
(the “Due Diligence Review”) (to be completed on or before October 15, 2022, unless mutually
extended by Awalé and Colossal); Awalé having completed a financing to raise a minimum of gross
proceeds of CAD$2,000,000 (the “ Financing”); the assumption by Awalé of the Assumed
Obligations (as defined herein); and other closing conditions as are standard for a transaction of
the nature of the Acquisition, (collectively, the “Closing Conditions”);
• The Consideration Shares issued in the Acquisition will be subject to a statutory hold period under
applicable Canadian securities laws which will expire four months and one day after the c losing
of the Acquisition (the “Closing”) and a voluntary trading restriction preventing the Sellers from
reselling any of the Consideration Shares for a period of eighteen months from Closing; and
• The Agreement may be terminated by a party if any of the Closing Conditions for the benefit of
the terminating party is not satisfied or waived by October 15, 2022, unless such date is extended
by mutual written consent of Awalé and Colossal or by Awalé if it determines, acting reasonably,
that the results of its Due Diligence Review are not satisfactory to it in all material respects.
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Colossal originally acquired the Licenses from a third party (the “ Vendor”) and agreed to make
certain future payments to the Vendor. Upon Closing of the Acquisition, Awalé has agreed to
assume from Colossal the following payment obligations to the Vendor:
• Payment of US$250,000 on Closing of the Acquisition or as otherwise agreed;
• Payments totaling a maximum of US$1.75M following issuance of a technical report
prepared in accordance National Instrument 43-101 – Standards for Disclosure of Mineral
Projects establishing a mineral resource on the Project on the following basis:
1. US$0.50 per ounce of gold for reported accumulated ounces of up to 999,999 ounces
of gold (the “Initial Ounces)
2. US$1.00 per ounce of gold for reported accumulated ounces of one million ounces or
greater of gold plus an additional payment of US$0.50 per Initial Ounce.
Related Party Transaction Process
Glen Parsons, a director and the Chief Executive Officer of Awalé, is a “related party” of the Company (as
defined by Multilateral Instrument 61-101 – Protection of Minority Securityholders in Special Transactions
(“MI 61-101”)). Gle n Parson s is also a shareholder of Colossal and, therefore, one of the Sellers under the
Acquisition and will be a party to the Agreement. Mr. Parsons’ direct and indirect ownership is
approximately 12% of Awalé’s current issued and outstanding shares and 23.4% of the current issued and
outstanding Colossal Shares. He will be issued 5,472,978 Consideration Shares under the Acquisition.
Accordingly, the issuance of the Consideration Shares to Mr. Parsons will constitute a “related party
transaction” within the meaning of TSXV Policy 5.9 which adopts MI -61 -101. The Company is relying on
the exemptions from both the formal valuation requirement and the minority shareholder approval
requirement in MI 61-101 for related party transactions under sections 5.5(a) and 5.7(1)(a), respectively,
of MI 61-101, in connection with the issuance of the Consideration Shares to Mr. Parsons on the basis that
neither the fair market value of the Colossal Shares held by Mr. Parsons, nor the fair market value of the
Consideration Shares to be issued to Mr. Parsons, exceeds 25% of the Company’s market capitalization
calculated in accordance with MI 61 -101. The Company did not file a material change report more than
21 days befor e the expected Closing date of the Acquisition as it has negotiated the Acquisition on an
expedited basis.
A special committee was established by the board of directors of the Company, which is comprised of the
independent non- executive directors of the Company, and is chaired by Derk Hartman , (the “ Special
Committee”) to evaluate and, if appropriate, approve the Acquisition. Mr. Parsons has not participated in
the evaluation and approval process for the Acquisition for either Awalé or Colossal.
The Special Committee assessed the merits of the Acquisition and unanimously approved the Acquisition
on the following basis:
• The Licenses are strategically located on known producing gold trends in the greenstone belt of
Suriname;
• The greenstone belt of Suriname is an underexplored region with large potential for further major
gold discoveries;
• Suriname is a s table jurisdiction with existing major operating multi-million ounce mines –
IAMGOLD and Newmont;
• The Licenses are easily accessible for logistics, exploration and development (just three hours
from capital Paramaribo); and
• Awalé acquires access to an experienced gold exploration team with a proven track record of
operating in Suriname.
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The Closing of the Acquisition is expected to occur on the fifth business day in the City of Vancouver,
British Columbia following the satisfaction or waiver of the Closing Conditions.
Derk Hartman, Independent Director and Chairman of the Special Committee commented:
“Awalé’s acquisition of Colossal Gold Resources ’ gold exploration portfolio in Suriname is a
transformational and exciting transaction that represents an excellent strategic fit for Awalé. The Guiana
Shield and West African Shield share the same greenstone belt geology, as it was one continent before the
Atlantic Ocean was formed 195 million years ago. Whereas many multi-million ounce gold deposits have
been delineated in the West African Shield, the Guiana Shield, and particularly Suriname , remains very
underexplored relative to West Africa. With the acquisition of Colossal Gold Resources, Awalé is gaining
an immediate and highly prospective foothold in the northern greenstone belt of Suriname, well known for
its gold mineralization endowment . As Awalé succeeds, we look forward to accelerating the exploration
programmes in both Suriname and C ôte d’Ivoire with the combined exploration teams from Awalé and
Colossal Gold Resources.”
Thomas McNeill, Independent Director to Colossal Gold Resources Limited commented:
“The Directors and Shareholders of Colossal are excited in becoming part of the greater Awalé Group. The
underexplored Suriname, within the greater Guiana Shield, offers huge potential for Colossal’s objective
of a successful exploration business that offers scale in jurisdictions where major producers operate.
Therefore, Awalé’s strategy complements and achieves our objective of building a diversified portfolio of
highly prospective assets which mitigates project and jurisdictional risk and furthermore enhances the
chance of success.“
About Awalé Resources
Awalé is a gold exploration company focused on the discovery of large high-g rade gold and copper-gold
deposits. The Company currently undertakes exploration activities in the underexplored parts of Côte
d’Ivoire. Awalé’s success to date at the Odienné Project in the Northwest of Côte d’Ivoire has culminated
in an earn-in Joint Venture with Newmont (the “Newmont JV”) covering the Odienné Project where two
primary targets for world -class discoveries have been made: i) the gold -rich Empire corridor and ii) the
recently defined Sceptre Iron Oxide Copper Gold ("IOCG") target, while the remaining 200km2 of granted
tenure and 400km 2 under appli cation remains underexplored and has significant IOCG potential. The
Newmont JV forms the foundation for the Company to continue looking at new opportunities in new
jurisdictions which offers significant potential for district scale discoveries.
ON BEHALF OF THE BOARD
AWALÉ RESOURCES LIMITED
“Derk Hartman”- Independent Director and Chairman of the Special Committee
Derk Hartman, Director
For additional information you are invited to visit the Awalé Resources Limited website at
www.awaleresources.com, or contact Karen Davies, Head of Investor Relations at Tel: 604.314.6270
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Forward-Looking Information
This press release contains forward- looking information within the meaning of Canadian securities laws
(collectively “forward-looking statements”). Forward-looking statements are typically identified by words
such as: believe, expect, anticipate, intend, estimate, plans, postulate and similar expressions, or are those,
which, by their nature, refer to future events. All statements that are not statements of historical fact are
forward-looking statements. Forward-looking statements in this press release include but are not limited
to statements regarding the Closing of the Transaction, the Company’s presence in Suriname and ability
to achieve results, creation of value for Company shareholders, achievements under the Newmont JV,
planned drilling, commencement of operations, . Although the Company believes any forward- l ooking
statements in this press release are reasonable, it can give no assurance that the expectations and
assumptions in such statements will prove to be correct.
The Company cautions investors that any forward-looking statements by the Company are not guarantees
of future results or performance and that actual results may differ materially from those in forward-looking
statements as a result of various factors, including the potential inability to obtain required regulatory
approvals and satisfy other applicable C losing conditions; possible adverse impacts due the global
outbreak of COVID-19; the Company's inability to generate sufficient cash flow or raise sufficient additional
financing requirements; volatility in metals prices; the ability of the Company to retain its key management
employees and skilled and experienced personnel; conflicts of interest; litigation or other administrative
proceedings brought against the Company; actual or alleged breaches of governance processes or
instances of fraud, bribery or corruption; explor ation, development and mining risks and the inherently
dangerous nature of the mining industry, and the risk of inadequate insurance or inability to
obtain insurance to cover these risks and other risks and uncertainties; property and mineral title
risks including defective title to mineral claims or property; changes in national and local
government legislation, taxation, controls, regulations and political or economic developments in
Canada and Suriname; equipment shortages and the ability of the Company t o acquire necessary
access rights and infrastructure for its mineral properties; environmental regulations and the
ability to obtain and maintain necessary permits, including environmental authorizations and
water use licences; extreme competition in the mineral exploration industry; delays in obtaining,
or a failure to obtain, permits necessary for current or future operations or failures to comply with
the terms of such permits; risks of doing business in Suriname, including but not limited to, labour,
economic and political instability and potential changes to and failures to comply with legislation;
the Company's common shares may be delisted from the Exchange if it cannot maintain
compliance with the applicable listing requirements; and other risk factors described other filings
with Canadian securities regulators, which may be viewed at www.sedar.com. Any forward-
looking statement speaks only as of the date on which it is made and, except as may be required
by applicable securities laws, the Company disclaims any intent or obligation to update any
forward-looking statement, whether because of new information, future events or results or
otherwise.
Cautionary Statement
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