VANCOUVER, BC, Oct. 1, 2024
/CNW/ - Eros Resources Corp. (TSXV: ERC) (OTCQB:
EROSF) ("Eros"), MAS Gold Corp.
(TSXV: MAS) ("MAS Gold") and Rockridge
Resources Ltd. (TSXV: ROCK) ("Rockridge") are pleased to
announce that they have entered into a business combination
agreement (the "Business Combination Agreement") to
combine the companies in a three-way merger transaction (the
"Transaction"). Pursuant to the Transaction, Eros will
acquire all of the issued and outstanding shares of both Rockridge
and MAS Gold that it does not already own by way of two plans of
arrangement under the Business Corporations Act (British Columbia).
Pursuant to the Transaction, shareholders of Rockridge will
receive 0.375 common shares of Eros (each full share, an
"Eros Share") for each
Rockridge common share (a "Rockridge Share") held and
shareholders of MAS Gold will receive 0.25 Eros Shares for each MAS
Gold common share (a "MAS Gold Share") held. Upon closing of
the Transaction, existing Eros shareholders will own approximately
42.37% of the combined company, existing MAS Gold shareholders will
own approximately 37.33% of the combined company, and existing
Rockridge shareholders will own approximately 20.30% (based on the
current issued and outstanding shares of each of the
companies).
Highlights of the Transaction:
- Proven Leadership Team: The combined company board
and management will bring decades of relevant experience, with a
track record of significant valuation creation for stakeholders,
capital markets expertise, and technical experience.
- Corporate Mandate: The combined company will focus
on the exploration and development of high-grade gold deposits in
Saskatchewan.
- Mineral Resources with Exploration Potential in Saskatchewan, Canada: The combined
company will consist of high-grade gold and copper assets in
Saskatchewan and the portfolio of
the combined company is expected to provide shareholders with
exposure to approximately 77,890 hectares of mineral claims,
offering the potential for new discoveries and potentially
attracting larger strategic partners.
- Strong Balance Sheet to Execute on Growth
Initiatives: The combined company will benefit from Eros'
portfolio of equities recently valued at over $7.5 million.
Jonathan Wiesblatt, Chief
Executive Officer of Rockridge, commented: "This is a very
compelling story and with the re-branding strategy we all have in
place, we are confident that the combined company will create
significant value to all stakeholders. We are excited to have such
an incredible opportunity to create one of Canada's premier exploration companies with
both gold and copper assets that will soon be back in high demand.
We are thrilled to be able to leverage the combined company's
technical and financial resources to maximize the value of this
opportunity by combining highly complimentary exploration assets
from across the exploration risk curve in top-tier Canadian mining
jurisdictions."
Robert Matthews, Director
of MAS Gold, commented: "I am very excited about the assembly
of these assets and a management team that can realize the inherent
values of those assets. Mr. Ron
Netolitzky, founder of MAS Gold assembled the gold
properties in Saskatchewan in
close proximity to existing infrastructure over 15 years ago.
The joining of Eros, MAS Gold and Rockridge with a mentoring
opportunity to utilize the knowledge and insights of Mr. Netolitzky
and his exploration associates is an opportunity where the
combination of the inputs are anticipated to result in a much
greater organization. The Transaction represents a truly symbiotic
situation for the three companies."
Tom MacNeill, Chief Executive Officer and Director of
Eros, commented: "This is a transformative transaction to create an
unparalleled exploration company with significant upside on
multi-fronts. The Transaction is expected to bring an immediate
increase in value for shareholders of all three companies with
ongoing exposure to one of the most robust portfolios of assets in
the sector. The combined company will be fully funded and boasts a
suite of highly prospective assets and is expected to have
increased scale and prospectivity."
Leadership and Governance
Following the closing of the Transaction, the board of directors
of the combined company will consist of five (5) directors,
comprised of three (3) directors from Rockridge, being Jordan Trimble, Jonathan
Wiesblatt and Joseph
Gallucci, ICD.D, one (1) director from Eros, being
Ross McElroy, and one (1) director
from MAS Gold, being Tim Termuende.
Management of the combined company will include Jordan Trimble as President, Jonathan Wiesblatt as Chief Executive Officer
and Chantelle Collins as Chief
Financial Officer.
Transaction Summary
Under the terms of the Business Combination Agreement, the
Transaction will be implemented by way of two court-approved plans
of arrangement involving Rockridge and MAS Gold under the
Business Corporations Act (British) (each, an
"Arrangement"). Pursuant to the Transaction, Eros will issue
approximately 86,246,640 Eros Shares to MAS Gold shareholders and
approximately 46,877,481 Eros Shares to Rockridge shareholders. On
completion of the Transaction, Eros shareholders will own
approximately 42.37% of the combined company, MAS Gold shareholders
will own approximately 37.33% of the combined company, and
Rockridge shareholders will own approximately 20.30%, on a
non-diluted basis.
The Arrangements will each require the approval of at least 66
2/3% of the votes cast by the shareholders of each of MAS Gold and
Rockridge, and if required under applicable securities law, a
simple majority of votes cast by shareholders of each of MAS Gold
and Rockridge excluding votes cast by certain holders of MAS Gold
Shares and Rockridge Shares, as applicable, that are required to be
excluded pursuant to Multilateral Instrument 61-101 – Protection
of Minority Security Holders in Special Transaction,
voting at special meetings of those companies. Eros
shareholders will be asked to approve the Transaction by a simple
majority of votes cast by the shareholders, in accordance with the
rules of the TSX Venture Exchange, at a special meeting of Eros
shareholders.
The directors and executive officers of each of Eros, MAS Gold
and Rockridge have entered into customary voting and support
agreements and have agreed to, among other things, vote their
securities in favour of the Transaction. Total Eros Shares under
such support agreements represent approximately 11.96% of the
issued and outstanding Eros Shares, MAS Gold Shares under such
support agreements represent approximately 28.65% of the issued and
outstanding MAS Gold Shares and Rockridge Shares under such support
agreements represent approximately 7.14% of the issued and
outstanding Rockridge Shares.
The Business Combination Agreement includes non-solicitation
provisions for each of Eros, MAS Gold and Rockridge, and contains
fiduciary outs to allow each party to accept a superior proposal,
subject to rights to match and other customary exceptions.
Under the terms of the Arrangements, any outstanding MAS Gold
stock options and Rockridge stock options will be exchanged for
Eros stock options based on the applicable exchange ratio with
equivalent economic terms and vesting provisions, and any
outstanding MAS Gold warrants and Rockridge warrants will be
adjusted in accordance with their terms such that, upon the
exercise of a MSA Gold warrant or Rockridge warrant, the holder
will receive such number of Eros Shares had such holder been a
holder of MAS Gold shares or Rockridge shares underlying such
warrants, as applicable, immediately prior to the completion of the
Transaction.
Pursuant to the Business Combination Agreement, and subject to
approval of its shareholders, Eros will amend its articles to
create a new class of preferred shares which are redeemable and
retractable upon certain conditions and bear a cumulative dividend
of 4% per annum (each, an "Eros Preferred Share"). As part
of the Transaction, Ronald
Netolitzky, a director of Eros and Interim Chief Executive
Officer of MAS Gold, will convert a promissory note issued by Eros
in the outstanding principal amount of $2,352,000 into Eros Preferred Shares at a price
of $1 per Eros Preferred Share.
Immediately following the completion of the Transaction, the
combined company expects to complete a consolidation of the
outstanding Eros Shares on the basis of ten (10) pre-consolidation
Eros Shares for every one (1) post-consolidation Eros Share.
The Transaction will constitute a "Reviewable Transaction", as
defined in TSXV Policy 5.3 – Acquisitions and Dispositions of
Non-Cash Assets. As a result, the completion of the Merger is
subject to approval by the TSXV. The Transaction is also subject to
receipt of court and other applicable regulatory approvals and the
satisfaction of certain other closing conditions customary in
transactions of this nature. Following completion of the
Transaction, the common shares of the combined company are expected
to trade on the TSXV, subject to approval or acceptance of each
exchange in respect of the Transaction.
Board of Directors' Recommendations
Evans and Evans has provided a fairness opinion to the special
committee of independent MAS Gold directors established to review
the Transaction that, as of the date of such opinion and subject to
the assumptions, limitations and qualifications set out in such
fairness opinion, the consideration to be received by MAS Gold
shareholders in connection with the Transaction is fair, from a
financial point of view, to the MAS Gold shareholders.
Evans and Evans has provided a fairness opinion to the special
committee of independent Rockridge directors established to review
the Transaction that, as of the date of such opinion and subject to
the assumptions, limitations and qualifications set out in such
fairness opinion, the consideration to be received by Rockridge
shareholders in connection with the Transaction is fair, from a
financial point of view, to the Rockridge shareholders.
Following their review and in consideration of, among other
things, their respective fairness opinions and the recommendation
of their respective special committees of independent directors
established to review the Transaction, the board of directors of
each of Eros, MAS Gold and Rockridge (with any conflicted directors
abstaining from voting) have approved the Transaction and
determined that the Transaction is fair to its shareholders and is
in the best interest of Eros, MAS Gold and Rockridge, respectively
and as applicable, and each board of directors recommends to its
shareholders that they vote in favour of the Transaction.
Additional Information
Full details of the Transaction are set out in the Business
Combination Agreement, which will be filed by each of Eros, MAS
Gold and Rockridge (together, the "Companies") under its
respective profile on SEDAR+ at www.sedarplus.ca. In addition,
further information regarding the Transaction will be contained in
a joint management information circular to be prepared in
connection with the shareholder meetings of each of the Companies
to be held for purposes of approving the Transaction and filed on
each of the Companies' respective SEDAR+ profile at
www.sedarplus.ca at the time that it is mailed to shareholders of
the Companies. All shareholders are urged to read the joint
management information circular once it becomes available as it
will contain additional important information concerning the
Transaction.
About Eros Resources Corp.
Eros Resources Corp. is a Canadian public company listed on the
TSXV. Eros' business objective is the identification, acquisition,
and exploration of advanced-stage projects with a North American
focus. In addition, Eros plans to make strategic investments with a
global focus on a diverse commodity base.
About MAS Gold Corp.
MAS Gold Corp. is a Canadian mineral exploration company focused
on advancing its gold exploration projects in the prospective La
Ronge Gold Belt of Saskatchewan.
MAS Gold is exploring on four properties in the belt, including the
Preview-North, Greywacke Lake, Elizabeth
Lake and Henry Lake Properties totaling 35,175.6 hectares
(86,920.8 acres). These properties extend along the geologically
prospective La Ronge, Kisseynew
and Glennie Domains that make up the La Ronge Gold Belt in
north-central Saskatchewan.
About Rockridge Resources Ltd.
Rockridge Resources Ltd. is a public mineral exploration company
focused on the acquisition, exploration and development of mineral
resource properties in Canada,
specifically copper and gold. Rockridge's 100% owned Knife Lake
Project is located in Saskatchewan
which is ranked as a top mining jurisdiction in the world by the
Fraser Institute. The project hosts the Knife Lake Deposit, which
is a VMS, near-surface Cu-Co-Au-Ag-Zn deposit open along strike and
at depth. There is strong discovery potential in and around the
deposit area as well as at regional targets on the large property
package. Rockridge's gold asset is its 100% owned Raney Gold
Project, which is a high-grade gold exploration project located in
the same greenstone belt that hosts the world class Timmins and Kirkland
Lake lode gold mining camps. Additional information about
Rockridge and its project portfolio can be found on the Company's
website at www.rockridgeresourcesltd.com.
NEITHER THE TSXV NOR ITS REGULATION SERVICES PROVIDER ACCEPTS
RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THE CONTENT OF THIS
NEWS RELEASE.
None of the securities to be issued pursuant to the Transaction
have been, nor will be, registered under the United States
Securities Act of 1933, as amended (the "U.S. Securities Act") or
any U.S. state securities laws, and may not be offered or sold in
the United States or to, or for
the account or benefit of, United
States persons absent registration or an applicable
exemption from the registration requirements of the U.S. Securities
Act and applicable U.S. state securities laws. This press release
does not constitute an offer to sell or the solicitation of an
offer to buy securities in the United
States, nor in any other jurisdiction.
Forward-Looking Information and Statements
This press release contains certain "forward-looking
information" and "forward-looking statements" within the meaning of
applicable securities legislation. Such forward-looking information
and forward-looking statements are not representative of historical
facts or information or current condition, but instead represent
only the beliefs of each of the Companies regarding future events,
plans or objectives, many of which, by their nature, are inherently
uncertain and outside of the Companies' control. Generally, such
forward-looking information or forward-looking statements can be
identified by the use of forward-looking terminology such "could",
"intend", "expect", "believe", "will", "projected", "planned",
"estimated", "soon", "potential", "anticipate" or variations of
such words. By identifying such information and statements in this
manner, the Companies are alerting the reader that such information
and statements are subject to known and unknown risks,
uncertainties and other factors that may cause the actual results,
level of activity, performance or achievements of the Companies
and/or the combined company to be materially different from those
expressed or implied by such information and statements. In
addition, in connection with the forward-looking information and
forward-looking statements contained in this press release, the
Companies have made certain assumptions. Among the key factors that
could cause actual results to differ materially from those
projected in the forward-looking information and statements are the
following: the inability of the Companies to integrate successfully
such that the anticipated benefits of the Transaction are realized;
the inability to realize synergies and cost savings at the times,
and to the extent, anticipated; the inability of the Companies to
obtain the necessary regulatory, stock exchange, shareholder and
other approvals which may be required for the Transaction; the
inability of the Companies to close the Transaction on the terms
and timing described herein, or at all; the inability of the
Companies to work effectively with strategic partners and any
changes to key personnel; inability of the combined company to
successfully complete a private placement or other financing upon
completion of the Transaction; and material adverse changes in
general economic, business and political conditions, including
changes in the financial markets. These risks are not intended to
represent a complete list of the factors that could affect the
Companies and/or the combined company; however, these factors
should be considered carefully. Should one or more of these risks,
uncertainties or other factors materialize, or should assumptions
underlying the forward-looking information or forward-looking
statements prove incorrect, actual results may vary materially from
those described herein. The impact of any one assumption, risk,
uncertainty, or other factor on a particular forward-looking
statement cannot be determined with certainty because they are
interdependent and the combined company's future decisions and
actions will depend on management's assessment of all information
at the relevant time.
Although the Companies believe that the assumptions and factors
used in preparing, and the expectations contained in, the
forward-looking information and forward-looking statements are
reasonable, undue reliance should not be placed on such information
and forward-looking statements, and no assurance or guarantee
can be given that such forward-looking information and
forward-looking statements will prove to be accurate, as actual
results and future events could differ materially from those
anticipated in such information and statements. The forward-looking
information and forward-looking statements contained in this press
release are made as of the date of this press release, and the
Companies do not undertake to update any forward-looking
information and/or forward-looking statements that are contained or
referenced herein, except in accordance with applicable securities
laws.
SOURCE Eros Resources Corp.
