/C O R R E C T I O N -- Corporation TomaGold/ In the news release "TomaGold provides update on spin-out transaction, announces Monster Exploration secured additional gold deposit and named a new seasoned board member", issued
/C O R R E C T I O N -- Corporation TomaGold/
In the news release "TomaGold provides update on spin-out transaction, announces Monster
Exploration secured additional gold deposit and named a new seasoned board member", issued
18-
Apr-2019
by Corporation TomaGold over CNW Telbec, we are advised by the company that the
information under the section "Philibert Gold Deposit Transaction" has been modified. The first bullet
point now reads: "Share payments:
$300,000
payment upon the closing date of the Spin-Out
followed by
$300,000
on a quarterly basis on or before the last day of each of the four quarters
following the closing date of the Spin-Out, and a further
$250,000
payment upon 9220 acquiring a
50% interest in the Philibert Property followed by
$250,000
on a quarterly basis on or before the last
day of each of the five quarters following the date 9220 acquired a 50% of the Spin-Out. The first
share payment will be priced at
$0.50
per Monster Share, and the following four payments will be
priced at the 10-day volume-weighted average Monster Share price at the time of payment." The
cash payment under the third paragraph of this section has also been modified from
$3,000,000
to
$3,500,000
. The complete, corrected release follows:
TomaGold provides update on spin-out transaction, announces Monster
Exploration secured additional gold deposit and named a new seasoned board
member
The Corporation's subsidiary, Monster Exploration, further consolidates its Monster Lake land
position, which now includes two gold deposits and several promising exploration sites on more
than 700 claims
MONTREAL
,
April 18, 2019
/CNW Telbec/ -
TOMAGOLD CORPORATION (TSXV: LOT)
("
TomaGold
" or the "
Corporation
") is pleased to provide an update on the previously announced
spin-out transaction (the "
Spin-out
") involving the Corporation's wholly-owned subsidiary, Monster
Exploration Inc. ("
Monster
"), and to announce that, in connection with the Spin-Out, Monster
entered into a share purchase option agreement (the "
Option Agreement
") with an arm's length
party with respect to the acquisition of all the issued and outstanding securities of 9220-
5392 Québec Inc. ("
9220
"), which holds an option to acquire a 100% interest in the
Philibert property (the "
Philibert Property
"), located approximately 10 km southeast of the Monster
Lake property, in
Quebec's
Chibougamau
mining camp.
Monster also announces that it intends to complete its non-brokered private placement offering (the
"
Offering
") through the issuance of subscription receipts (each a "
Subscription Receipt
") at a price
of $0.50 per Subscription Receipt, and flow-through subscription receipt (each a "
FT Subscription
Receipt
") at a price of $0.65 per FT Subscription Receipt, for aggregate minimum gross proceeds
of
$8,000,000
and up to $10,000,000.
In addition, the Corporation is pleased to announce that Monster has strengthened its proposed
Board of Directors with the addition of Jean-Sébastien Jacquetin as an Independent Director.
Jean-Sébastien Jacquetin has over 20 years of corporate finance and merchant banking experience
for small and medium-sized enterprises. He is currently Managing Partner at Confluence Synergy &
Co., an associate company of Rosemont International, which provides in-depth management
expertise in corporate finance, mergers and acquisitions, wealth management and business
strategy. Mr. Jacquetin began his career as a Project Officer for UNESCO in
Paris
and then worked
as an Investment Manager for Natixis Banque both in
Paris
and
New York
, where he coordinated
fund sponsors and capital markets contacts. After Natixis Banque, Mr. Jacquetin was with both
Meredith Financial Group and
Du Pasquier
in
New York
, where he was involved in corporate finance,
advisory, and institutional brokerage. Since 2016, Mr. Jacquetin has spent his time in
Asia
, where he
worked for Citic Hyperion, helping his corporate clients with investor diversification, corporate
finance advisory, and strategic partnerships. Mr. Jacquetin has a B.Sc. and an M.Sc. in political
science from the
University of Montreal
and an MBA from Institut d'études politiques - Sciences Po
Paris.
"We're extremely pleased to announce that Jean-Sébastien has agreed to join Monster's Board of
Directors," said
David Grondin
, President and CEO of TomaGold. "Monster's ability to attract such a
well-regarded individual to its team speaks to the high-quality and compelling aspect of its property
portfolio and general business strategy. His vast financial expertise and international network will
definitely contribute to the venture success, as we are pushing on finalizing the spin out transaction
and financing."
Philibert Gold Deposit Transaction
Pursuant to the Option Agreement, Monster has the right and option to acquire 100% of the
outstanding shares of 9220, subject to a 0.5% net smelter return royalty. Monster's option is
exercisable as follows:
Share payments:
$300,000
payment upon the closing date of the Spin-Out followed by
$300,000
on a quarterly basis on or before the last day of each of the four quarters following
the closing date of the Spin-Out, and a further
$250,000
payment upon 9220 acquiring a 50%
interest in the Philibert Property followed by
$250,000
on a quarterly basis on or before the last
day of each of the five quarters following the date 9220 acquired a 50% of the Spin-Out. The
first share payment will be priced at
$0.50
per Monster Share, and the following four payments
will be priced at the 10-day volume-weighted average Monster Share price at the time of
payment.
Minimum work expenditures up to a cumulative
$3,200,000
.
In addition, Monster is required to pay a cash amount equal to the aggregate work expenditures
incurred by 9220 on the Philibert Property as of the closing date of the Spin-Out minus
$300,000
.
The Philibert Property consists of 110 mining claims covering 5,392.57 hectares. The property is
located less than 10 km from the power grid and a non-functioning mill. An economic potential study
carried out by Roche Ltd., Consulting Group (now Norda Stelo) in 1991 for SOQUEM reported a
historical resource estimate* of 1,393,042 tonnes grading 5.3 g/t Au. The mineralization remains
open along strike and at depth and only covers a small section of the property. The main structure
has been explored over approximately 1 km but remains underexplored over another 2 km that
shows the distinct magnetic signature that characterizes the mineralized corridor. SOQUEM and its
partners have drilled 227 holes totalling 59,475 metres on the Philibert Property since 1983. In
addition to hosting Philibert mineralization, the property is well located, lying in the western extension
of the deformation corridor that crosses the old
Joe Mann
mine, six kilometres away.
9220 holds an option to acquire from SOQUEM Inc. up to a 100% interest in the Philibert Property.
In order to acquire an initial 50% interest in the property, 9220 must incur
$3,500,000
in exploration
expenses over a five-year period, of which
$500,000
should have been incurred by 9220 upon
closing of the Spin-Out. 9220 can increase its interest to 75% by incurring an additional
$2,000,000
in exploration expenses. Finally, 9220 can increase its interest to 100%, subject to a 2% net smelter
return royalty, by making a cash payment of
$3,500,000
.
Spin-Out Transaction Update
Subject to execution of an arrangement agreement to be entered into by the Corporation and
Monster (the "
Arrangement Agreement
") and receipt of requisite corporate, regulatory and court
approvals, the Distribution Record Date (as defined below) is expected to be on or about June 17,
2019. The Corporation will provide further updates on the Distribution in due course.
Further to the termination of the initial agreement with Quinto Resources Inc. ("
Quinto
") and in order
to secure the acquisition, Monster entered in a property acquisition agreement with QIT, to acquire
Quinto's 5% interest in the Monster Lake property for a cash payment of
$500,000
, and the
issuance of 500,000 common shares of Monster (each a "
Monster Share
").
As previously announced, the Spin-Out is expected to be effected through the distribution (the
"
Distribution
") of Monster Shares to TomaGold shareholders by way of a court-approved plan of
arrangement (the "
Arrangement
") under the terms and conditions of the Arrangement Agreement.
Pursuant to the Arrangement, TomaGold will receive 44,130,000 Monster Shares at a deemed price
of
$0.50
per Monster Share, which TomaGold will distribute a portion of to the TomaGold
shareholders of record as of the distribution date for the Distribution (the "
Distribution Record
Date
"). The number of Monster Shares to be distributed to TomaGold's shareholders under the
Spin-Out has not yet been determined.
The Arrangement remains subject to the approval of at least two-thirds of the votes cast by
TomaGold shareholders at the TomaGold Meeting (as defined below). Terms of the Arrangement
are subject to finalization based on ongoing tax and legal structuring advice. Completion of the
Arrangement is also subject to other closing conditions customary for a transaction of this nature,
including requisite corporate, regulatory and court approvals.
As the Corporation is due to hold an annual general meeting of its shareholders and in order to avoid
an additional shareholders meeting, the resolutions to approve the Arrangement and the related
matters will be presented to TomaGold shareholders together with annual meeting matters at an
annual general and special meeting of TomaGold shareholders expected to be held early June
2019 (the "
TomaGold Meeting
"). Further details of the Arrangement, the Offering and annual
meeting matters will be included in a management information circular of TomaGold (the "
Circular
")
to be prepared in respect of the TomaGold Meeting. TomaGold intends to mail the Circular in May,
a copy of which will be concurrently filed under TomaGold's profile on SEDAR at
www.sedar.com
.
Monster Exploration Offering
Monster intends to complete the Offering of a minimum of 12,000,000 and a maximum of
16,000,000 Subscription Receipts at a price of $0.50 per Subscription Receipt, and a maximum of
3,076,924 FT Shares at a price of $0.65 per FT Share for minimum gross proceeds of
$8,000,000
and up to $10,000,000. Each Subscription Receipt, or FT Subscription Receipt, will automatically
entitle the holder to receive, without payment of additional consideration, one Monster Share, or one
Monster Share on a flow-through basis, upon receipt of the necessary shareholder and TSX
approvals of the Offering (the "
Escrow Release Conditions
").
Monster intends to use the net proceeds of the Offering to execute on Monster's investment strategy
and for general working capital purposes. Monster has not engaged any agents in connection with
the Offering.
There can be no assurance as to whether or when the Offering will be completed or whether the
Escrow Release Conditions will ever be met and the Monster Shares underlying the Subscription
Receipts and FT Subscription Receipts released to the subscribers. If the Escrow Release
Conditions are not satisfied in accordance with the terms of the Offering on or before June 30,
2019 (or such other date as the Corporation may determine), holders of the Subscription Receipts
will be entitled to the return of their subscription amount without interest.
U.S. Securities and Tax Matters
The Offering will be made on a private placement basis, exempt from the prospectus and
registration requirements of applicable securities laws. The Subscription Receipts, FT Subscription
Receipts and Monster Shares 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
accordingly, may not be offered or sold within the United States except in compliance with an
exemption from the registration requirements of the U.S. Securities Act and applicable state
securities laws. This press release does not constitute an offer to sell or a solicitation of an offer to
buy any of the Corporation's or Monster's securities in the
United States
, nor shall there be any sale
of these securities in any state or jurisdiction in which the offer, solicitation or sale would be unlawful.
The Monster Shares to be distributed pursuant to the Distribution will not be registered under the
laws of any foreign jurisdiction, including the U.S. Securities Act.
The technical content of this press release has been reviewed and approved by Claude P.
Larouche
,
Eng., a qualified person under National Instrument 43-101.
*The Corporation notes that a qualified person has not done sufficient work to classify the historical estimate as current mineral resources or mineral reserves and as such, the
Corporation is not treating the historical estimate as current mineral resources or mineral reserves. The resource estimate was part of an economic potential study of the Philibert
deposit and was calculated based on 189 diamond drill holes and a total of 39,945 metres of core, using the best practice guide for the evaluation of gold deposits produced by the
CRM (Centre de recherches minérales, now COREM). The resource estimate was not prepared using the current CIM definition standards for mineral resources.
About TomaGold Corporation
TomaGold Corporation is a Canadian mineral exploration Corporation engaged in the acquisition,
assessment, exploration and development of gold mineral properties. It currently has joint venture
agreements with IAMGOLD Corporation for the Monster Lake project, with Goldcorp Inc. for the
Sidace Lake property, and with Goldcorp Inc. and New Gold Inc. for the Baird property. TomaGold
has interests in seven gold properties near the
Chibougamau
mining camp in northern
Quebec
:
Monster Lake, Winchester, Lac à l'eau jaune, Monster Lake East, Monster Lake West, Obalski and
Lac Doda. It also holds interests of 39.5% in the Sidace Lake property and 24.5% in the Baird
property near the
Red Lake
mining camp in
Ontario
, and has a 70% interest in the Hazeur property,
at the southern edge of the Monster Lake group of properties.
www.tomagoldcorp.com
Forward-Looking Information Cautionary Statement
This news release includes statements containing certain "forward-looking information" within the
meaning of applicable securities law ("forward-looking statements"). Forward-looking statements in
this release includes, but is not limited to, statements regarding the execution of the Arrangement
Agreement, statements regarding the timing, closing and approval of the Arrangement, the
Distribution, the Offering and the Transaction, statements about future development and by the
Corporation, and statements regarding the future performance of the Corporation. Forward-looking
statements are frequently characterized by words such as "plan", "continue", "expect", "project",
"intend", "believe", "anticipate", "estimate", "may", "will", "potential", "proposed" and other similar
words, or statements that certain events or conditions "may" or "will" occur. These statements are
only predictions. Various assumptions were used in drawing the conclusions or making the
projections contained in the forward-looking statements throughout this news release. Forward-
looking statements are based on the opinions and estimates of management at the date the
statements are made, and are subject to a variety of risks and uncertainties and other factors that
could cause actual events or results to differ materially from those projected in the forward-looking
statements. The Corporation is under no obligation, and expressly disclaims any intention or
obligation, to update or revise any forward-looking statements, whether as a result of new
information, future events or otherwise, except as expressly required by applicable law.
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
news release.
SOURCE
Corporation TomaGold
View original content:
http://www.newswire.ca/en/releases/archive/April2019/19/c0928.html
%SEDAR: 00025917E
For further information:
David Grondin, President and Chief Executive Officer, (514) 583-3490
CO: Corporation TomaGold
CNW 01:05e 19-APR-19