Archer Exploration Completes Acquisition of Grasset Nickel Deposit and Other Nickel Assets from Wallbridge Mining
Archer Exploration Completes Acquisition of Grasset Nickel Deposit and Other Nickel
Assets from Wallbridge Mining
Completes C$10.2 Million Equity Financing
Common Shares Expected to Resume Trading on the CSE Shortly
NOT FOR DISSEMINATION IN OR INTO THE UNITED STATES OR FOR DISTRIBUTION TO U.S.
NEWSWIRE SERVICES
VANCOUVER, BC, November 18, 2022 – Archer Exploration Corp. (CSE: RCHR) (the
“Company” or “Archer”) announces that it has completed its previously announced acquisition
(the “Asset Acquisition”) of all of the nickel assets, rights and obligations located in Quebec and
Ontario (the “Nickel Assets”) from Wallbridge Mining Company Limited (“Wallbridge”). Prior to
the Asset Acquisition taking effect, the Company completed its previously announced brokered
private placement (the “ Concurrent Financing ”) for gross proceeds of approximately
C$10,182,500. The Asset Acquisition and the Concurrent Financing were completed on
November 18, 2022 (the “Closing Date”).
“We are very grateful to our new and existing shareholders for their support and look forward to
creating value for all stakeholders as we advance our exploration plans within our exciting portfolio
of nickel sulphide projects at Grasset in Quebec and in the Sudbury camp. We believe this
acquisition will establish Archer as a leading Canadian nickel sulphide focused exploration and
development company” said Tom Meyer, Archer’s President and Chief Executive Officer.
Asset Acquisition
The Asset Acquisition was completed pursuant to the terms of an asset purchase agreement
dated July 12, 2022 , as amended on November 9, 2022 (the “Asset Purchase Agreement”),
between the Company and Wallbridge.
The Nickel Assets consist of 2,046 mining titles covering approximately 67,000 hectares and
include a 100% interest in the Grasset nickel sulphide project located in Quebec (the “Grasset
Project”). As previously announced on September 14, 2022, the Nickel Assets also included cash
in the amount of C$2,652,997 representing proceeds received by Wallbridge following the sale of
certain shares it held in Lonmin Canada Inc. (the “Loncan Proceeds”).
As consideration for the Nickel Assets, the Company issued to Wallbridge 66,211,929 common
shares (each, a “ Consideration Share ”) with an aggregate deemed value of approximately
C$53.6 million (valued using the July 12, 2022 closing price of such shares). Archer also granted
to Wallbridge a 2% net smelter return royalty on production from the Grasset Project.
In connection with the Asset Acquisition, the Company entered into a finder’s fee agreement with
two arm’s length parties (the “ Finders”). As compensation for the Finders’ introduction of the
Company and Wallbridge, Archer issued to th e Finders 1,655,298 Common Shares (as defined
below) of Archer (representing 2.5% of the number of Consideration Shares). The Common
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Shares issued to the Finders are subject to voluntary escrow and will be released over a period
of two years after the Closing Date.
Wallbridge has advised the Company that it will distribute 48,168,171 Consideration Shares (the
“Wallbridge Spinout Shares”) to its shareholders on a pro rata basis on the Closing Date (the
“Share Distribution ”). Following the Share Distribution, Wallbridge is expected to retain
18,043,758 Consideration Shares (the “ Wallbridge Retained Shares”), representing
approximately 19.9 % of the outstanding Common Shares. Wallbridge has further advised the
Company that no Wallbridge shareholder will own more than 10 % of the Common Shares as a
result of the Share Distribution. The Wallbridge Retained Shares and the Wallbridge Spinout
Shares have a hold period of four months and one day from the Closing Date.
In connection with closing of the Asset Acquisition , Archer and Wallbridge entered into the
following ancillary agreements (collectively, the “ Ancillary Agreements”): a royalty agreement,
an investor rights agreement and an exploration cooperation agreement. Pursuant to the investor
rights agreement entered into with Wallbridge, among other things, Wallbridge has agreed to not
dispose of any Wallbridge Retained Shares for a period of one year.
The Company also agreed to assume o bligations under the closure plan relating to Wallbridge’s
Broken Hammer open pit mine which ceased operation in 2015 (the “ Mine Closure Plan ”).
Wallbridge has posted a standby letter of cre dit in the amount of $361,245 to provide financial
assurance for the Mine Closure Plan. The Company has agreed to provide a replacement letter
of credit within 90 days of closing of the Asset Acquisition.
The Asset Acquisition constitutes a “Fundamental Change” as defined by Policy 8 of the Canadian
Securities Exchange (the “ CSE”). The common shares of Archer (the “ Common Shares”) are
expected to resume trading on the CSE shortly, upon satisfaction of certain CSE conditions to
listing, under the symbol “ RCHR.” A further press release will be issued once trading has
resumed.
Following the Asset Acquisition, the management team and board of directors (the “Board”) of
the Company is as follows:
• Tom Meyer — President, Chief Executive Officer and Director
• Dilshan Anthony — Chief Financial Officer
• Jacquelin (Jack) Gauthier — Vice President of Exploration
• Wes Short — Corporate Secretary
• David Cobbold — Director
• Christian Kargl-Simard — Director
• Michael Konnert — Director
• Marz Kord — Director (Wallbridge Nominee)
• Brian Penny — Director (Wallbridge Nominee)
Each of the directors was elected to the Board at the shareholders’ meeting held on October 12,
2022, subject to completion of the Asset Acquisition.
As described in the Company’s listing statement, which will be filed under the Company’s profile
on SEDAR at www.sedar.com (the “Listing Statement”), certain Common Shares, including the
Wallbridge Retained Shares, are subject to three-year escrow in accordance with CSE Policy 8.
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Additional information related to the Asset Acquisition – including additional information regarding
the members of the management team and Board listed above, the Nickel Assets, the Ancillary
Agreements and the Mine Closure Plan – will be available in the Listing Statement.
Concurrent Financing
Pursuant to the Concurrent Financing, the Company issued an aggregate of (i) 4,545,455 non
flow-through units of Archer (each, an “NFT Unit”) at a price of C$0.66 per NFT Unit, (ii) 4,243,334
flow-through units of Archer (each, a “FT Unit”) at a price of C$0.75 per FT Unit and (iii) 2,898,550
charity flow-through units of Archer (each, a “ Charity FT Unit” and together with the NFT Units
and FT Units, the “Units”) at a price of C$1.38 per Charity FT Unit. Each FT Unit and Charity FT
Unit was issued as a “flow-through share” as defined in subsection 66(15) of the Income Tax Act
(Canada) and se ction 359.1 of the Quebec Tax Act with respect to purchasers in Quebec .
Aggregate gross proceeds of the Concurrent Financing were approximately C$10,182,500.
Each Unit consists of one common share of Archer (each, a “Unit Share”) and one common share
purchase warrant of Archer (each, a “ Warrant”). Each Warrant entitle s the holder thereof to
acquire one additional common share of Archer at a price of C$1.02 for a period of 24 months
following the Closing Date.
The Concurrent Financing was led by Canaccord Genuity Corp., acting as lead agent and sole
book-runner on behalf of a syndicate including National Bank Financial Inc. and Raymond James
Ltd. (collectively, the “Agents”). In connection with the Concurrent Financing, the Agents received
a cash fee equal to 6.0% of the aggregate gross proceeds raised pursuant to the Offering (other
than in respect of sales to those purchasers on the “ president’s list” in which case a cash fee of
2.0% was paid). In addition, the Company issued the Agents non-transferable broker warrants
(the “Broker Warrants”) exercisable to acquire that number of Common Shares which is equal
to 6.0% (reduced to nil in respect of sales to purchasers on the “president’s list”) of the number of
Units sold pursuant to the Offering. Each Broker Warrant will entitle the holder thereof to purchase
one Common Share at an exercise price of C$0.66 per Common Share for a period of 18 months
following the Closing Date.
The net proceeds from the sale of the NFT Units will be used for exploration and development of
the Nickel Assets and for working capital purposes. The proceeds from the issuance of the FT
Units and Charity FT Units w ill be used to incur eligible “Canadian exploration expenses” that
qualify as “flow-through critical mineral mining expenditures” (the “Qualifying Expenditures”) on
or before December 31, 2023. Archer has agreed to renounce such Qualifying Expenditures to
the purchasers of the FT Units and Charity FT Units with an effective date of no later than
December 31, 2022, in an aggregate amount of not less than the total amount of the gross
proceeds raised from the issuance of FT Units and Charity FT Units.
The Unit Shares and Warrants comprising the Units, the Broker Warrants, and the Common
Shares underlying the Broker Warrants all have a hold period of four months and one day from
the Closing Date.
In connection with closing of the Concurrent Financing, th e Company entered into an investor
rights agreement with a strategic shareholder (the “ Shareholder”) pursuant to which the
Shareholder will be entitled to, among other things, the following rights (subject to maintaining
certain ownership thresholds): (a) the right to participate in certain equity financings by the
Company in order to acquire up to a 19.99% ownership interest in the Company; and (b) the right
to nominate one person to the Board (and if the Board is increased to nine or more directors, two
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people to the Board). The Shareholder has advised Archer that it does not currently own a
sufficient number of the issued and outstanding Common Shares to trigger the nomination right.
Certain insiders of the Company acquired Units in the Concurrent Financing. This participation by
insiders in the Concurrent Financing constitutes a “related party transaction” as defined under
Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions (“MI
61-101”). However, the Company considers such participation would be exempt from the formal
valuation and minority shareholder approval requirements of MI 61-101 as neither the fair market
value of the Units subscribed for by the insiders, nor the consideration for the Units paid by such
insiders, would exceed 25% of the Company’s market capitalization.
The securities described herein 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 the
registration requirements of the U.S. Securities Act and applicable state securities requirements
or pursuant to exemptions therefrom. This press release does not constitute an offer to sell or a
solicitation to buy any securities in any jurisdiction.
About Archer
Archer Exploration is a Ni-Cu-Co-PGE focu sed exploration and development company
headquartered in Vancouver, Canada. The Company’s flagship and core asset is the Grasset
Project, located within the Abitibi greenstone belt approximately 55 kilometres west -northwest of
Matagami Quebec. In addition, the C ompany holds an extensive portfolio of 37 properties
comprised of 309 square kilometres within 807 mining titles in the world -class mining district of
Sudbury. The Company’s growth strategy is focused on the exploration and development of its
nickel sulphide properties within its portfolio, as well as other battery metal assets it may acquire
that fit its strategic criteria. Archer’s vision is to be a responsible nickel sulphide developer in
stable pro -mining jurisdictions. Archer is committed to soci ally responsible exploration and
development, working safely, ethically, and with integrity.
Archer is backed by Inventa Capital Corp., a Vancouver -based merchant bank founded in 2017
with the goal of discovering and funding opportunities in the resource sector. The common shares
of Archer are listed on the CSE (symbol RCHR). Additional information about the Company is
available on SEDAR (www.sedar.com) and on the Company’s website
(www.archerexploration.com).
For more information, please contact:
Tom Meyer
President and Chief Executive Officer
Tel: (604) 364-2215
Email: [email protected]
Cautionary Note Regarding Forward-Looking Statements
The information contained herein contains “forward-looking statements ” within the meaning of
applicable securities legislation. “Forward-looking information ” includes, but is not limited to,
statements with respect to the activities, events or developments that Archer expects or
anticipates will or may occur in the future. Generally, but not always, forward-looking information
and statements can be identified by the use of words such as “plans”, “expects”, “is expected”,
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“budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates”, or “believes” or the
negative connotation thereof or variations of such words and phrases or state ments that certain
actions, events or results “may”, “could”, “would”, “might” or “will be taken ”, “occur” or “be
achieved” or the negative connotation thereof. These forward -looking statements or information
may relate to: the use of proceeds from the Concurrent Financing; the tax treatment of the FT
Units and Charity FT Units; timing of the renunciation of the Qualifying Exp enditures; final
approval from the CSE; filing of the Listing Statement; and re-commencement of trading of the
Common Shares and timing thereof.
Such forward-looking information and statements are based on numerous assumptions, including
among others, that the results of planned exploration activities are as anticipated, the anticipated
cost of planned exploration activities, that general business and economic conditions will not
change in a material adverse manner, that financing will be available if and when needed and on
reasonable terms, that third party contractors, equipment and supplies and governmental and
other approvals required to conduct Archer’s planned exploration activities will be available on
reasonable terms and in a timely manner. Although the assumptions made by Archer in providing
forward-looking information or making forward-looking statements are considered reasonable by
management at t he time, there can be no assurance that such assumptions will prove to be
accurate.
By their nature, forward-looking statements involve known and unknown risks, uncertainties and
other factors which may cause our actual results, performance or achievements , or other future
events, to be materially different from any future results, performance or achievements expressed
or implied by such forward -looking statements. Such factors and r isks include, among others:
risks associated with the conduct of the Compan y's mining activities; regulatory, consent or
permitting delays; risks relating to reliance on the Company's management team and outside
contractors; risks relating to project financing and equity issuances; risks and unknowns inherent
in all mining projec ts; laws and regulations governing the environment, health and safety; the
ability of the communities in which the Company operates to manage and cope with the
implications of COVID-19; the economic and financial implications of COVID-19 to the Company;
operating or technical difficulties in connection with mining or development activities; employee
relations, labour unrest or unavailability; the Company's interactions with surrounding
communities; the Company's ability to successfully integrate acquired assets; the speculative
nature of exploration and development; stock market volatility; conflicts of interest among certain
directors and officers; lack of liquidity for shareholders of the Company; litigation risk; the ongoing
military conflict in Ukraine; general economic factors (including inflationary pressure); the price of
commodities; and the factors identified under the caption "Risk Factors" in the Company’s public
disclosure documents.
The forward-looking information contained in this ne ws release represents the expectations of
Archer as of the date of this news release and, accordingly, is subject to change after such date.
Readers should not place undue importance on forward -looking information and should not rely
upon this information as of any other date. Archer does not undertake any obligation to update
these forward-looking statements in the event that management’s beliefs, estimates or opinions,
or other factors, should change.