Minority Dissident Shareholder Attempting to Hijack Control of Canagold
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Minority Dissident Shareholder Attempting to Hijack Control of Canagold
Vancouver, Canada – June 16, 2022 – Canagold Resources Ltd. (TSX: CCM, OTC -QB: CRCUF,
Frankfurt: CANA) announces that a minority dissident shareholder based in Dubai, UAE, (the “Dissident
Shareholder”) is trying to take over Canagold Resources Ltd. (“ Canagold” or the “ Company”) by
hijacking control of your Board of Directors.
Dissident’s Attempt to Seize Control of Board and Company
The Dissident Shareholder has nominated three new directors (the “Dissident Nominees”) out of five total
directors to try and seize control of the Company. If the Dissident Nominees are elected, y ou run the risk
that their hand -picked and interlocked board nominees with limited Canadian board experience w ill
represent only the Dissident Shareholder rather than the Company and all of its shareholders. You have the
ability to stop this completely unjustified and self -serving minority dissident action by voting your
shares for manage ment’s nominees to the board at Canagold’s upcoming annual and special o f
shareholders on July 19, 2022.
Shareholders are encouraged to read Management’s letter to shareholde rs and information circular
(“Management Materials”) and vote FOR Canagold’s Board nominees using only the YELLOW Proxy.
Mailing of the Management Materials have commenced and can be found at
www.canagoldresources.com/2022AGM.
So why is the dissident minority shareholder doing this? One has to look no further than Canagold’s news
release, issued on June 14, 2022, which highlighted the discovery of yet another new high-grade gold vein
at the Company’s core asset, the New Polaris gold min e project located in northern British Columbia . In
fact, New Polaris is one of the highest grade gold discoveries in Canada , which makes it a very
desirable asset.
Management Successfully Advancing New Polaris
For the past two years, your b oard of directors (the “ Board”) and management team have successfully
advanced the New Polaris gold project towards a feasibility study. Management’s execution and the Board’s
oversight of the identification and testing of the BIOX process as a key to unlock metallurgical recoveries,
and the recent infill drilling programs to expand and upgrade the gold resources, have confirmed
consistently positive results.
Management has conducted continuous baseline studies for environmental permitting and fostered a
positive relationship with the local First Nations. Your Company is now entering a critical stage as the New
Polaris project progresses towards an updated resource estimate, to be followed by updated economic
studies, project permitting and a feasibility study.
Dissident’s Request for Non-Proportional Representation
The Dissident Shareholder had only a 9.4% interest in Canagold as of the deadline for giving advance notice
CANAGOLD RESOURCES LTD.
810-625 Howe Street
Vancouver, BC V6C 2T6
T: 604.685.9700
F: 604.6685 -9744
www. canagold resources .com
CCM: TSX
CRCUF: OTCQ B
to nominate directors to the board . On June 10, 2022 , they acquired, at a 19 .6% premium to market , an
additional 8.25% of the Company’s c ommon shares for a total of 17.6% of Canagold. That premium was
provided only to one Canagold shareholder.
In management’s view, the Dissident Shareholder is attempting to take advantage of Canagold’s
recent exploration success and depressed share price by buying shares - and therefore votes - in order
to elect its Dissident Nominees wh o would constitute a 60% majority of our Board. A vote “FOR”
Canagold’s management nominees (the “ Canagold Nominees ”) will ensure that you have
representatives on the Board who will continue to act in the best interest of the Company and all
stakeholders (not just the dissident minority shareholder).
Dissident Shareholder Acting In Its Own Self-Interest
The Dissident Shareholder’s original 9.4% investment in Canagold came from participating in recent equity
financings. Canagold management maintained open communications and a positive relationship with the
Dissident Shareholder until very recently . Unfortunately, the Dissident Shareholder blindsided the
Company with the nomination of the Dissident Nominees to attempt to take over the board and ultimately,
the Company. They claim their intention is just representation on the board; however, if that were the case,
they could have simply called management or the Chairman and requested a nominee. This they did not do.
Instead, they quietly solicited three new nominees, sent a letter from their lawyer to Canagold providing
advance notice of their Dissident Nominees, and made threats to bring proxies to the Meeting to get their
way. They also increased their share ownership in your Company after the record date for the meeting by
paying a premium to buy out one Canagold shareholder. Management’s view is that the sole purpose of
the minority shareholder’s nominations and acquisition of additional shares is to attempt to hijack and seize
control of the Board for their own purposes.
In proposing the Dissident Nominee s, the Dissident Shareholder is clearly acting in its own self -interest
and not in the interests of Canagold, its other shareholders or stakeholders. They want control of Canagold
along with its main asset, the New Polaris gold mine project. Their aim is to attempt to achieve this through
stealthy means and without paying the proper premium that you and all Canagold shareholders deserve.
Management Plan Going Forward to Benefit ALL Shareholders
Canagold’s Board and management team are following their strategic plan to create value for shareholders.
The results from our 50 drill hole sample results show that New Polaris is one of the highest grade gold
discoveries in Canada and our preliminary economic assessment (PEA) outlines a clear path to value
creation for our shareholders. As previously communicated to our shareholders, the next steps on
Canagold’s path to production include:
• Complete the infill drilling program at New Polaris.
• Expand and upgrade the gold resources on the property
• Complete a feasibility study, project permitting and mine financing
• As detailed in our previous PEA, the New Polaris project has a robust economic outlook. Using a
$1,500 gold price, the expected after tax internal rate of return is 56%, the net present value of the
New Polaris Project is US$333M and the payback period is expected to be under two years.
• We expect to unlock value for ALL shareholders by producing dore bars on site, using a fly-in, fly-
out operation with no need for risky and expensive road construction.
Reasons to Vote FOR the Canagold Nominees
• Successful Execution. Canagold’s current Board identified and tested the BIOX process as a
commercially viable key to unlocking metallurgical recoveries at New Polaris and has overseen
the successful execution of a multi -year exploration plan to advance the New Polaris project
towards a feasibility study.
• Over 100 Years of Combined Experience. Canagold Nominees have well over 100 years of
combined mine exploration, evaluation, development and production experience and the
technical expertise to transition Canagold from exploration to feasibility and beyond.
• Jurisdictional Experience. Canagold Nominees have juris dictional experience in North
America to ensure the permitting process passes the approval of regulatory authorities and local
First Nations support and scrutiny. More importantly, three of the Canagold Nominees reside in
British Columbia, Canada where the Company’s flagship project is located.
• Reputational Credibility. Canagold Nominees , Bradford Cooke, Martin Burian and Scott
Eldridge, have reputational credibility in the capital markets to finance the growth of your
Company.
• Practical and Professional E xpertise. Canagold Nominees , Bradford Cooke, Dr. Deepak
Malhotra and Dr. Kadri Dagdelen, have significant and substantial practical experience and
professional expertise to oversee the resource estimates and economic studies and development
of Canagold’s flagship project, New Polaris.
• Strong Compliance Qualifications. Canagold Nominee, Mr. Martin Burian, CA, IDC.D, is a
professional director and a professional accountant and has strong qualifications to provide
Board oversight in continuous disclosure oblig ations and regulatory compliance in North
America given Canagold is a reporting issuer in both Canada and the USA.
• Public Mining Company Expertise and Experience. Canagold Nominees each have a
significant breadth and depth of expertise and experience in di recting public mining sector
companies in Canada and elsewhere.
• Shareholder Support. Each of Canagold’s incumbent nominees have garnered over 94%
positive votes at each annual general meeting over the past several years, strong evidence that
shareholders have consistently supported Canagold nominees in the past.
• Shareholder Democracy. Canagold’s incumbent nominees have consistently acted, and will
continue to act, in the best interests of the Company and will consider the interests of all
stakeholders, not just a small minority of shareholders.
VOTE “FOR” CANAGOLD NOMINEES USING THE YELLOW PROXY
Reasons to Reject the Dissident Nominees
Don’t let the Dissident Shareholder, a Dubai based entity, take over your Company. Consider the
following concerns:
(1) ZERO Canagold Shares Held. Dissident Nominees have no shareholdings in Canagold,
minimal commercial knowledge of Canagold’s main asset, the New Polaris gold mine project, and little
understanding of Canagold’s strategic goals and plans for cu rrent and future financial and operational
success.
(2) Little to No Experience as Directors of Canadian Public Companies. In contrast to the
Canagold Nominees , two Dissident Nominees appear to each have less than two to three years’
experience as Directors of one Canadian public company and the other appearing to having no experience
as a Director of Canadian public companies.
(3) Limited North American Experience. Dissident Nominees are based in Australia, Switzerland
and South Africa and the majority of them appear to have limited experience in exploration and mining
and regulatory environment in North America.
(4) Concerning Pattern. Dissident Nominee, Ms. Sofia Bianchi, resigned from a TSX Venture
issuer on March 9, 2020 before the TSX Venture issuer we nt bankrupt in July 23, 2020, less than 5
months after her resignation.
(5) Excessive Compensation. Each director of Canagold only receives CAD$8,000 per annum as
a stipend. Based on publicly available information, the only two of the three Dissident Nomi nees who
have served on a board of a Canadian public company received US$170,000 and US$81,451 respectively
in cash compensation for acting as a director of a company in 2021. This disparity in compensation may
act as a disincentive for the Dissident Nomi nees to act as Directors of Canagold in terms of their
risk/reward and time commitment.
(6) Strategic Disruption. Turnover of Board members at this time would cause strategic disruption
as Canagold enters its critical life cycle from exploration to permitting and feasibility and eventually to
operations.
(7) Interlocking Relationships — Independence Questionable. The hand -picked Dissident
Nominees are an interconnected group who have either served on the same board or worked together for
an extended period of time in the past, including a partnership of two of the three Dissident Nominees
who are founding partners of an investment firm.
(8) Taking Control of Canagold Without Paying a Premium to Shareholders. Canagold has
always maintained open and cordial communications with the Dissident Shareholder. Yet surprisingly,
and without prior discussions with Canagold management, the Dissident Shareholder directed its lawyer
to forward an advance notice to replace the majority of Canagold’s Board. Management views this
advance notice, plus the Dissident Shareholder’s acquisition of an additional 8.25% of the outstanding
common shares of the Company as a hostile attempt to hijack the Board and control Canagold and its
flagship project without paying any requisite control premium to the other Canagold shareholders.
Canagold cannot allow a minority dissident shareholder with only 9.4% on the record date to
control and dictate the remainder of the 90.6% interests by controlling the Board nomination.
VOTE “FOR” CANAGOLD NOMINEES USING THE YELLOW PROXY
Qualified Person
Garry Biles, P.Eng, President & COO for Canagold Resources Ltd, is the Qualified Person who reviewed
and approved the contents of this news release.
Act Today to Protect Your Investment in Canagold
Voting is easy. You may vote online , by telephone or other methods found on the YELLOW Proxy.
Canagold may also utilize Broadridge’s QuickVoteTM service to assist eligible beneficial shareholders with
voting their shares directly over the phone. It is up to you to protect the value of your investment in Canagold
by voting FOR the Canagold Nominees. We encourage you to read Canagold’s Management Materials and
visit our website at www.canagoldresources.com/2022AGM. Your vote has never been more important.
Questions or Require Voting Assistance?
If you have questions or require assistance with voting your shares, please contact our proxy solicitation
agent:
Laurel Hill Advisory Group
North American Toll Free: 1-877-452-7184 (416-304-0211 Outside North America)
Email: [email protected]
“Bradford Cooke” "Scott Eldridge”
Bradford Cooke Scott Eldridge
Founder and Chairman of the Board Chief Executive Officer
CANAGOLD RESOURCES LTD. CANAGOLD RESOURCES LTD.
About Canagold - Canagold Resources Ltd. is a growth -oriented gold exploration company focused on
generating superior shareholder returns by discovering, exploring and developing strategic gold deposits in
North America. Canagold shares trade on the TSX: CCM and the OTCQB: CRCUF.
Cautionary Note Regarding Forward-Looking Statements
This news release contains “forward -looking statements” within the meaning of the United States private securities litigation
reform act of 1995 and “forward -looking information” within the mean ing of applicable Canadian securities legislation.
Statements contained in this news release that are not historical facts are forward -looking information that involves known and
unknown risks and uncertainties. Forward -looking statements in this news rele ase include, but are not limited to, statements in
connection with the Dissident Shareholder’s intention to nominate the Dissident Nominees; and statements related to the progress,
stage and path to production of the New Polaris mine, including goals of the project entering the permitting, feasibility and eventual
production lifecycle and expectations with respect to drill results . In certain cases, forward -looking statements can be identified
by the use of words such as "plans", "has proven", "expects" or "does not expect", "is expected", "potential", "appears", "budget",
"scheduled", "estimates", "forecasts", "at least", "intends", "anticipates" or "does not anticipate", or "believes", or varia tions of
such words and phrases or state that certain actions , events or results "may", "could", "would", "should", "might" or "will be
taken", "occur" or "be achieved".
Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results,
performance or ach ievements of the Company to be materially different from any future results, performance or achievements
expressed or implied by the forward -looking statements. Such risks and other factors include, among others risks related to the
uncertainties inherent in the estimation of mineral resources; commodity prices; changes in general economic conditions; market
sentiment; currency exchange rates; the Company's ability to continue as a going concern; the Company's ability to raise fund s
through equity financings; risks inherent in mineral exploration; risks related to operations in foreign countries; future prices of
metals; failure of equipment or processes to operate as anticipated; accidents, labor disputes and other risks of the mining industry;
delays in obtaining governmental approvals; government regulation of mining operations; environmental risks; title disputes or
claims; limitations on insurance coverage and the timing and possible outcome of litigation. Although the Company has attempted
to identify important factors that could affect the Company and may cause actual actions, events or results to differ materially from
those described in forward -looking statements, there may be other factors that cause actions, events or results not to be as
anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual
results and future events could differ materially from those anticipated in such statements. Accordingly, do not place undue reliance
on forward-looking statements. All statements are made as of the date of this news release and the Company is under no obligation
to update or alter any forward-looking statements except as required under applicable securities laws.