Caldas Gold to Acquire Juby Project in Abitibi Greenstone Belt in Ontario, Canada
May 21 2020 - 7:00AM
Caldas Gold Corp. (the “Company” or “Caldas Gold”) (TSX-V: CGC) is
pleased to announce that it has entered into a definitive agreement
(the “Acquisition Agreement”) pursuant to which Caldas Gold will
acquire all of the issued and outstanding shares of privately-held
South American Resources Corp. (“SARC”), to be effected by way of a
three-cornered amalgamation between Caldas Gold, SARC and a
wholly-owned subsidiary of Caldas Gold (the “Transaction”).
Pursuant to the terms of the Acquisition Agreement, Caldas Gold
will issue twenty million common shares of the Company (the
“Consideration Shares”) to current shareholders of SARC. Certain
shareholders of SARC have entered into voluntary lock-up agreements
with SARC pursuant to which such security holders, holding
approximately 87% of the Consideration Shares, have agreed to
voluntarily lock-up their Consideration Shares for a period of two
years from the closing date of the Transaction.
SARC is party to an acquisition agreement
pursuant to which SARC will acquire certain mining exploration
assets in Northeastern Ontario (the “Juby Acquisition”) held by
Lake Shore Gold Corp. ("LSGC"), a wholly owned subsidiary of Pan
American Silver Corp. The mining exploration assets comprise a 100%
interest in the Juby Project. In addition, SARC is party to an
acquisition agreement pursuant to which it will acquire from LSGC a
25% joint venture interest in certain claims adjoining the Juby
Project (the “Knight JV Acquisition”). The completion of the
Transaction is conditional on, among other things, the completion
by SARC of the Juby Acquisition and the Knight JV Acquisition.
Caldas Gold will be responsible for funding the cash payment of
US$9.5 million due to LSGC on closing of the Juby Acquisition and
the cash payment of US$0.5 million due to LSGC on closing of the
Knight JV Acquisition.
The Juby Project is an advanced
exploration-stage gold project located in Ontario, Canada,
approximately 15 km west-southwest of the town of Gowganda and 100
km south-southeast of the Timmins gold camp within the Shining Tree
area in the southern part of the Abitibi greenstone belt. Over
14,000 acres are controlled through the patented claims of the Juby
Project covering 10 km strike length on the mineralized trend.
The Transaction has been unanimously approved by
each of the boards of directors of Caldas Gold and SARC. It is
anticipated that Gran Colombia Gold Corp. will complete a private
placement with Caldas Gold prior to the closing of the Transaction
to fund the completion of the Juby Acquisition and the Knight JV
Acquisition.
The closing of the Transaction is subject to
customary closing conditions for a transaction of this nature
including, among other things, the listing of the Consideration
Shares on the TSX Venture Exchange (“TSX-V”). The closing of the
Transaction is expected to occur on or about June 15, 2020.
A copy of the Acquisition Agreement will be
filed by Caldas Gold with the Canadian securities regulators and
will be available for viewing on the Company’s profile on SEDAR at
www.sedar.com. A description of the Acquisition Agreement will also
be set forth in Caldas Gold’s material change report to be filed on
SEDAR.
About SARC
SARC is party to an acquisition agreement
pursuant to which it will acquire mining exploration assets
comprising a 100% interest in the Juby Project, located in
Northeastern Ontario. In addition, SARC is also party to an
acquisition agreement pursuant to which it will acquire a 25% joint
venture interest in certain claims adjoining the Juby Project.
About Caldas Gold
Caldas Gold is a Canadian junior mining company
currently advancing a prefeasibility study for a major expansion
and modernization of its underground mining operations at its
Marmato Project in the Department of Caldas, Colombia with mineral
resources of 2.0 million ounces of gold in the Measured and
Indicated categories and 3.3 million ounces in the Inferred
category. A Preliminary Economic Assessment study (Preliminary
Economic Assessment Report, Marmato Project, Colombia, dated
February 6, 2020 completed by SRK Consulting (U.S.), Inc.) is
available on the Company’s SEDAR profile at www.sedar.com.
Forward-Looking Information
This news release contains "forward-looking
information", which may include, but is not limited to, statements
regarding the expected benefits to result from the Transaction; the
effect of the Transaction; the satisfaction of closing conditions,
including, without limitation (i) certain termination rights
available to the parties under the Acquisition Agreement, (ii)
Caldas Gold obtaining the necessary approvals from the TSX-V for
listing the Consideration Shares to be issued in connection with
the Transaction, and (iii) receipt of required regulatory approvals
and other customary closing conditions; our ability to create
shareholder value and other statements that are not historical
facts.. Often, but not always, forward-looking statements can be
identified by the use of words such as "plans", "expects", "is
expected", "budget", "scheduled", "estimates", "forecasts",
"intends", "anticipates", or "believes" or variations (including
negative variations) of such words and phrases, or state that
certain actions, events or results "may", "could", "would", "might"
or "will" be taken, occur or be achieved. Forward-looking
statements involve known and unknown risks, uncertainties and other
factors which may cause the actual results, performance or
achievements of Caldas Gold to be materially different from any
future results, performance or achievements expressed or implied by
the forward-looking statements. Factors that could cause actual
results to differ materially from those anticipated in these
forward-looking statements are described under the caption "Risk
Factors" in the Company's Filing Statement dated as of February 19,
2020 which is available for view on SEDAR at www.sedar.com.
Forward-looking statements contained herein are made as of the date
of this press release and Caldas Gold disclaims, other than as
required by law, any obligation to update any forward-looking
statements whether as a result of new information, results, future
events, circumstances, or if management's estimates or opinions
should change, or otherwise. There can be no assurance that
forward-looking statements will prove to be accurate, as actual
results and future events could differ materially from those
anticipated in such statements. Accordingly, the reader is
cautioned not to place undue reliance on forward-looking
statements. Neither the TSX-V nor its Regulation Services
Provider (as that term is defined in the policies of the TSX-V)
accepts responsibility for the adequacy or accuracy of this news
release.
For Further Information, Contact:Mike
DaviesChief Financial Officer (416) 360-4653
investorrelations@caldasgold.ca
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