NOVO19 Captial Corp. and Nobel Resources Inc. Enter into Letter of Intent FOR Business Combination
00419871-1
NOVO19 CAPTIAL CORP. AND NOBEL RESOURCES INC. ENTER INTO LETTER
OF INTENT FOR BUSINESS COMBINATION
Toronto, Ontario, September 22, 2020 – Novo19 Capital Corp. (“Novo19” or the
“Corporation”), a n unlisted reporting issuer in British Columbia and Alberta, is pleased to
announce it has entered into a letter of intent dated September 17, 2020 (the “LOI”) with Nobel
Resources Inc. (“Nobel”), a private company incorporated under the laws of the Provin ce of
Ontario with mining assets located in Chile, pursuant to which Novo19 and Nobel have agreed to
complete an arrangement, amalgamation, share exchange, or similar transaction to ultimately form
the resulting issuer (the “ Resulting Issuer”) that will continue on the business of Nobel (the
“Transaction”), subject to the terms and conditions outlined below. Concurrently with the
completion of the Transaction, the Resulting Issuer will seek to list its common shares for trading
on a nationally recognized stock exchange in Canada.
Nobel is an Ontario corporation with a head office in Toronto Ontario. Nobel, through its option
agreement with Mr. Gunther Stromberger (90%) and Ms. Elsa Duarte Horta (10%) (the “Option
Agreement”), holds interests in the Algorrobo IOCG Copper Project (the “ Project” or
“Algorrobo”), located in the coastal IOCG ( Iron, Oxide, Copper, Gold) belt in northern Chile ,
approximately 25km from the port of Caldera on the Pacific Ocean. Pursuant to t he Option
Agreement, Nobel can acquire a 100% ownership interest in the Project.
Algorrobo is an extensively mineralized IOCG (Iron Oxide Copper -Gold) system in one of the
most important producing IO CG belts globally and is relatively unexplored except for an
extensive history of small-scale mining. Production from the Project is sold to Enami, the Chilean
government mining company that has processing facilities (mill and smelter) in Copiapo
approximately 50 km to the south. The Project is permitted for mining which is a key advantage
for Nobel. The Project is located in the Atacama region of northern Chile. This area is host to
numerous deposits including the Candelaria Mine with one of the large copper reserves in Chile
estimated at 600 million tonnes of ore grading 0.95% copper, 3.84 million ounces of Gold and
576 million ounces of Silver.
Management and Board of the Resulting Issuer will include:
David Gower, (P.Geo), CEO and Director
Mr. Gower has held Executive and Director positions with several junior and midsize mining
companies for the past 12 years, including Emerita Resources Corp, and President of Brazil Potash
Corp. David spent over 20 years with Falconbridge (now Glencore) as Director of Global Nickel
and PGM exploration and as a member of the Senior Operating Team for mining projects and
operations. He led exploration teams that made brownfield discoveries at Raglan and Sudbury,
Matagami Falcondo and greenfield discoveries at A raguaia in Brazil, Kabanga in Tanzania and
Amazonas, Brazil. Mr. Gower is a Director of Alamos Gold Inc.
Lawrence Guy, Director
Mr. Guy is Chief Executive Officer of North 52nd Asset Management Inc and Chair of Emerita
Resources Corp. Previously, Larry was a Portfolio Manager with Aston Hill Financial Inc. Prior
to Aston Hill, Mr . Guy was Chief Financial Officer and Director of Navina Asset Management
Inc a company he co founded that was subsequently acquired by Aston Hill Financial Inc . Mr.
Guy has also held senior offices at Fairway Capital Management Corp and First Trust Portfol ios
Canada Inc.
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Mr. Guy holds a Bachelor of Arts degree from the University of Western Ontario and is a
Chartered Financial Analyst
Vernon Arseneau, (P.Geo), COO and Director
Mr. Arseneau has over forty years of experience in exploration, project managemen t and
development, of which the last twenty-five have been in South America, principally in Peru, Chile,
and Argentina. Mr. Arseneau spent 20 years working as exploration manager and senior geologist
for Noranda Inc in Canada and South America. He was general manager of Noranda’s Peru office
and project manager of the El Pachon porphyry Cu Mo project in Argentina. He has consulted on
numerous base and precious metals projects including as Vice President Exploration for Zincore
Metals Inc and was responsible for the exploration and feasibility studies of two zinc deposits and
the discovery of the Dolores Cu Mo porphyry, Peru. More recently, he was COO of Royal Road
Minerals Ltd exploring for gold in Colombia and Nicaragua. Vern holds a Bachelor of Science in
geology.
Greg Duras, CFO
Mr. Duras is a senior executive with over 20 years of experience in the resource sector in corporate
development, financial management and cost control positions. Mr. Duras has held the position
of CFO at several publicly traded c ompanies, including Savary Gold Corp , Nordic Gold Corp.,
and Avion Gold Corp. He is currently CFO of Red Pine Exploration. Greg is a Certified General
Accountant and a Certified Professional Accountant and holds a Bachelor of Administration from
Lakehead University.
Damian Lopez, Corporate Secretary
Mr. Lopez is a corporate securities lawyer who works as a legal consultant to various Toronto
Stock Exchange and TSX Venture Exchange listed companies. He previously worked as a
securities and merger acquisitions lawyer at a large Toronto corporate legal firm, where he worked
on a variety of corporate and commercial transactions . Mr. Lopez obtained a Juris Doctor from
Osgoode Hall and he received a Bachelor of Commerce with a major in Economics from Rotman
Commerce at the University of Toronto.
Nobel and Novo19 are arm’s length parties to one another . The valuations of Novo19 and the
Nobel are to be determined by the parties. Nobel is seeking to complete a n equity financing in
September 2020 for minimum gross proceeds of CDN$1 million and maximum gross proceeds of
CDN$1.5 million. It is anticipated that an additional financing for gross proceeds of between
CDN$5 million and CDN$7 million will be completed upon closing of the Transaction. Nobel
currently has 18 million common shares issued and outstanding, and no options or warrants issued.
The material terms and conditions of the LOI are non-binding, and completion of the Transaction
is conditional on, among other matters, completion of due diligence, satisfactory determination of
valuations, completion of the financings, the execution of a definitive agreement (the “Definitive
Agreement”) to be negotiated between the parties , and the listing for trading of the Resu lting
Issuer’s common shares on a nationally recognized stock exchange in Canada.
There is no assurance that the parties will settle on satisfactory respective valuations, that the
financings will be completed, or a that a Definitive Agreement will be successfully negotiated or
entered into. The common shares of Novo19 are not currently listed for trading on any stock
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exchange. The parties will seek to list the common shares of the Resulting Issuer on a nationally
recognized stock exchange in Canada.
Further Information
Novo19 will provide further and more comprehensive details in respect of the Transaction and the
financings in due course by way of subsequent press releases as information becomes available.
All information contained in this press release with respect to Nobel and Novo19 (but excluding
the terms of the Transaction) was supplied by the parties respectively, for inclusion herein, without
independent review by the other party, and each party and its directors and officers have relied on
the other party for any information concerning the other party.
About the Algorrobo Project
The Project is located approximately 850 km north of Santiago, in Region III, Province of Chanaral,
Chile. The Project is located in the southern Atacama Desert, with the city of Copiapo located
approximately 43 km to the southeast and the port at Caldera 25 km to the east.
The Project consists of 21 “Angela” and 11 “Roble” tenures, comprising a total of 6,161 ha (15,224
acres).
The Project hosts high grade copper mineralization with exploration and development potential for
significant expansion that is consistent with an Iron oxide -copper-gold deposit (IOCG) along the
western margin of both the Chilean Iron Belt and the Atacama Fault Zone. The Cerro Negro Norte
iron deposit, having and similar structural setting and possible associated IOCG -style
mineralization, is located approximately 15 km east of the Project. Manto Verde (120 million
tonnes grading 0.73% Cu (Marschik e t al 2011), approximately 30 km north) and the Punta del
Cobre (>120 Mt grading 1.5% Cu, 0.2 to 0.6 g/t Au, and 2 to 8 g/t Ag (van Angeren 2005)) –
Candelaria (Lundin) (366 Mt grading 1.08 % Cu, 0.26 g/T Au, and 5g/T Ag (Raab 2010)) belt
(approximately 60 km south) are examples of IOCG deposits similarly located in the belt and are
considered to be possible analogues for mineralization and economic potential for the Project.
From the 1920’s until 1997, sporadic manual production on a limited basis was undertaken by local
miners on extensions of the veins previously mined at the Project. Mining operations to date on
the Project, and immediately area, resulted in approximately 35 mines, ranging from near surface
workings to more extensive operations extendin g several hundred metres below surface. The
Project has only been exploited to very shallow depths.
Within the old mines on adjacent properties to the Project, copper, as copper oxides, were mined
to an approximate depth of 120 meters, with copper sulfide ores mined below to greater depth (i.e.
450 meters in the Viuda Mine). The mineralized trends are very well defined by abundant workings,
both historical and those arising from more recent work, ranging from shallow pits and workings
to mine development ex tending to depths up to 450 m below surface. Taken together, these
workings delineate three major structures and a vast number of minor veins, having clearly evident
surface extent of at least 1.3 km, with an interpreted potential surface extent of at leas t 4 km. In
addition to the Major Veins, a number of subordinate, subsidiary and/or undeveloped veins are
present between the Major Veins, defining the “Main Mineralized Trend”. Veins on which the more
significant workings have been developed are described as ranging between 1.2 and 3.5 metres at,
or near, surface, and thickening with increasing depth up to 5 metres.
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Analyses of select grab samples from the recently developed drifts, False Estaca and Descubridora,
document “Direct Smelting Ore” grades of re presentative grab samples of Brochantite -bearing,
high grade “Direct Smelting Ore” from Acme Analytical Laboratories S.A. in Copiapo confirm
grades in excess of 30% copper. Independent analysis of a representative grab sample of
Brochantite (Cu4SO4(OH)6), submitted to Acme lab in Santiago, returned an analysis of 34.27%
Cu and 36 g/t Ag.
Qualified Person
The scientific and technical information in this news release has been reviewed and approved by
Mr. Vernon Arseneau , P.Geo, and Mr. David Gower P.Geo., Qualified Persons as defined by
National Instrument 43-101 of the Canadian Securities Administrators.
For further information:
David Mitchell
Novo19 Capital Ltd.
Telephone: (416) 574-4818
Email: [email protected]
Forward-Looking Information
This press release contains “forward-looking information” and “forward -looking statements”
(collectively, “ forward-looking statements ”) within the meaning of applicable Canadian
securities legislation. All statements, other than statements of historical fact, are forward-looking
statements and are based on expectations, estimates and projections as at the date of this press
release. Any statement that involves discussions with respect to predictions, expectations, beliefs,
plans, projections, objectives, assumptions, future events or performance (often but not always
using phrases such as “expects”, or “does not expect”, “is expected” “anticipates” or “does not
anticipate”, “plans”, “budget”, “scheduled”, “forecasts”. “estimates”, “believes” or intends” or
variations of such words and phrases or stating that certain actions, events or results “may” or
“could, “would”, “might” or “will” be taken to occur or be achieved) are not statements of
historical fact and may be forward -looking statements. In this press release, forward -looking
statements relate, among other things, to: the Transaction and certain terms and conditions thereof;
the business of Novo19 or Nobel, the financings; the listing application; shareholder, director and
regulatory approvals; and future press releases and disclo sure. Forward-looking statements are
necessarily based upon a number of estimates and assumptions that, while considered reasonable,
are subject to known and unknown risks, uncertainties, and other factors which may cause the
actual results and future even ts to differ materially from those expressed or implied by such
forward-looking statements. Such factors include, but are not limited to: general business,
economic, competitive, political and social uncertainties; and the delay or failure to receive
shareholder, director or regulatory approvals. There can be no assurance that such statements will
prove to be accurate, as actual results and future events could differ materially from those
anticipated in such statements. Accordingly, readers should not place undue reliance on the
forward-looking statements and information contained in this press release. Except as required by
law, neither Novo19 nor Nobel assume any obligation to update the forward-looking statements
of beliefs, opinions, projections, or other factors, should they change, except as required by law.
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No stock exchange has reviewed the contents of this press release or the merits of the
Transaction.
This press release does not constitute an offer to sell or a solicitation of an offer to buy any of the
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 unless registered under the
U.S. Securities Act and applicable state securities laws, unless an exemption from such
registration is available.
NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR RELEASE,
PUBLICATION, DISTRIBUTION OR DISSEMINAT ION DIRECTLY, OR
INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES.