Goldstrike Announces Proposed Spin-Off of White GOLD District Properties
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TSX-V: GSR
APRAF.PK
Frankfurt: KCG1
GOLDSTRIKE RESOURCES LTD.
1010 - 1130 West Pender Street
Vancouver, British Columbia
Canada, V6E 4A4
Telephone: 604 681 1820
Facsimile: 604 681 1864
IR: 604 210 2150
GoldStrikeResources.com
GOLDSTRIKE ANNOUNCES
PROPOSED SPIN-OFF OF WHITE GOLD DISTRICT PROPERTIES
Highlights:
Goldstrike's six 100% owned properties with no underlying royalties or property
payments in the White Gold District, Yukon to be spun -out as a standalone public
company, Luckystrike Resources Ltd.
Transaction intended to maximize value, allowing the White Gold District properties to
be advanced on a standalone basis, while giving shareholders the optionality of
participating in both companies.
On completion, Luckystrike will have a strong balance sheet with a $2.5 million
investment from G oldstrike as well as potential additional third-party private
placement financing of up to $2.5 million.
Goldstrike shareholders to receive Luckys trike shares on a 1 for 7 basis. On a pro
forma basis, Goldstrike shareholders are expected to own approximately 76% and
Goldstrike is expected to ow n approximately 24% of the outstanding Luckystrike
shares.
May 16, 2018 – Goldstrike Resources Ltd. ("Goldstrike" or the "Company") (GSR.V) is
pleased to announce the proposed spin-off of its six 100% owned properties located in the White
Gold District, Yukon by way of a plan of arrangement (the " Arrangement") under the Business
Corporations Act (British Columbia).
In furtherance thereof, the Company has entered i nto an arrangement agreement (the
"Agreement") with Luckystrike Resources Ltd. (" Luckystrike"), a wholly-owned subsidiary of
the Company. Pursuant to the Arrangement, among other things:
Goldstrike shareholders will receive one common share of Luckystrike (a "Luckystrike
Share") for every seven common shares of Goldstrike held; and
Luckystrike will indirectly acquire the Company's six 100% owned White G old District
properties, being the Lucky Strike , Hotspot, the Bull’s Eye , BRC, Gold Source and
King’s Ransom properties.
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In addition, prior to completion of the Arrangement , Goldstrike will invest an aggregate of $2.5
million in Luckystrike, by subscribing for 8,333,334 units (the " Units") of Luckystrike at a
subscription price of $0.30 per Unit, with each Unit consisting of one Luckystrike Share and one
warrant exercisable into a Luckystrike Share at a subscription price of $ 0.60 or such other price
as may be acceptable to the Company and Luckystrike for a period of three years after closing ,
subject to acceleration if the Luckystrike Shares trade at a price of $1.00 or more for 10
consecutive trading days. The Agreement also contemplates the completion of an additional non -
brokered private placement of subscription receipts by Luckystrike in the amount of up to $2.5
million, with each Subscription Receipt converting into Units upon closing of the Arrangement.
The board of directors of Goldstrike has determined that the Arrangement is in the best intere sts
of Goldstrike. Among other things, the separation of the White Gold District properties into a
separate public company will position such assets to be valued on a standalone basis. In addition,
the transaction will allow Goldstrike management to focus their efforts on the Company's existing
strategic partnership regarding the Plateau project with Newmont Mining Corporation with
Luckystrike's management focused on exploring and developing the White Gold District
properties.
Terrence King, Chairman, Pre sident and Chief Executive Officer of Goldstrike stated: "We are
pleased to announce the Arrangement, which we believe will help unlock and maximize value for
our shareholders. On completion, Luckystrike will be positioned well to advance our efforts in the
White Gold District, with a strong balance sheet and experienced management team. We look
forward to updating shareholders on this transaction as it progresses."
The Company intends to apply for a listing of the Luckystrike Shares on the TSX Venture
Exchange (the "TSX-V"). Any such listing will be subject to Luckystrike fulfilling all of the
requirements of the TSX-V.
It is currently expected that the directors of Luckystrike on completion of the Arrangement, will
consist of William Chornobay, Yilu (Lu cy) Zhang, Terrence King, Reimar Ko ch and Ewan
Webster, with Mr. Chornobay acting as President and Chief Executive Officer and Ms. Zhang
acting as Chief Financial Officer.
In addition, pursuant to the Arrangement, holders of Goldstrike options and warran ts will
exchange such securities for new options and warrants of Goldstrike and Luckystrike, which are
exercisable into shares of such companies on their existing terms with necessary adjustments for
the Arrangement based on the proportionate value of the White Gold District properties.
The Arrangement is expected to be effected by way of a plan of arrangement under the Business
Corporations Act (British Columbia) and remains subject to customary conditions, including ,
among other things, the approval by the TSX -V, approval by an affirmative vote of 66 2/3% of
shareholders of Goldstrike in attendance at a shareholders’ meeting, and approval of the S upreme
Court of British Columbia.
Additional details of the Arrangement will be included in the information circular to be mailed to
shareholders of Goldstrike in connection with the Company’s shareholders meeting referred to
above.
ON BEHALF OF THE BOARD
Terrence E. King
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Chairman, President and
Chief Executive Officer
For new information f rom the Company’s programs, please visit Goldstrike’s website at
GoldstrikeResources.com or contact Jeff Stuart of King James Capital Corporation, handling
Investor Relations for the Goldstrike, by te lephone at (604) 210 -2150 or by email a t
Neither the 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.
Forward-Looking Statements
Statements contained in this news release that are not historical facts are “forward -looking
information” or “forward -looking statements” (collectively, “Forward -Looking Information”)
within the meaning of applicable Canadian securities legislation. Forwar d-Looking Information
includes, but is not limited to, the timing an d completion of the Arrangement and proposed
financings of Luckystrike, the satisfaction of the conditions under the Agreement and the expected
benefits of the Arrangement. In certain case s, Forward-Looking Information can be identified by
the use of words and phrases such as “anticipates”, “expects”, “understanding”, “has agreed to”
or variations of such words and phrases or statements that certain actions, events or results
“would”, “occu r” or “be achieved”. Although Goldstrike has attempted to identify important
factors and risks that could affect Goldstrike and may cause actual actions, events or results to
differ materially from those described in Forward -Looking Information, there may be other
factors and risks that cause actions, events or results not to be as anticipated, estimated or
intended, including, without limitation: not receiving the requisite shareholder or regulatory
approvals for completion of the Arrangement or otherwise satisfying the conditions thereto ;
failure to complete the proposed financings on acceptable terms or at all ; inherent risks involved
in the exploration and development of mineral properties; the uncertainties involved in
interpreting drill results and oth er exploration data; the potential for delays in exploration or
development activities; the geology, grade and continuity of mineral deposits; the possibility that
future exploration, development or mining results will not be consistent with Goldstrike’s
expectations; accidents, equipment breakdowns, title and permitting matters; labour disputes or
other unanticipated difficulties with or interruptions in operations; fluctuating metal prices;
unanticipated costs and expenses; uncertainties relating to the a vailability and costs of financing
needed in the future, including to fund any exploration programs on its projects; that Goldstrike
may not be able to confirm historical exploration results and other risks set forth in Goldstrike's
public filings at www.s edar.com. In making the forward -looking statements in this news release,
Goldstrike has applied several material assumptions, including the assumption that general
business and economic conditions will not change in a materially adverse manner. There can b e
no assurance that Forward -Looking Information 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 Forward -Looking Information. Except as required by
law, Goldstrike does not assume any obligation to release publicly any revisions to Forward -
Looking Information contained in this news release to reflect events or circumstances after the
date hereof or to reflect the occurrence of unanticipated events.