Nebo Capital Corp. Announces Letter of Intent with Lara Exploration
Ltd. and Kiwanda Mines (NA) LLC
VANCOUVER, BRITISH COLUMBIA--(Marketwired - Dec 3, 2013) -
NOT FOR
DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE
UNITED STATES. ANY FAILURE TO COMPLY WITH THIS RESTRICTION MAY
CONSTITUTE A VIOLATION OF U.S. SECURITIES LAWS.
Nebo Capital Corp. (the "Corporation") (TSX-VENTURE:NBO.P) is
pleased to announce that it has entered into a letter of intent
dated November 29, 2013 (the "Letter of Intent") with Lara
Exploration Ltd. ("Lara") and privately held Kiwanda Mines (NA) LLC
("Kiwanda"), wherein the Corporation will acquire the interests
held by Lara and Kiwanda in certain mineral exploration properties
and assets (the "Properties") located in Colombia (the
"Acquisition"). Concurrent with the Acquisition, the Corporation
intends to consolidate its common shares on a 3-1 basis, change its
name and complete the Private Placement, as described below.
The Corporation is a capital pool company and intends for the
Acquisition to constitute the "Qualifying Transaction" of the
Corporation as such term is defined in the policies of the TSX
Venture Exchange (the "Exchange"). The Acquisition is an arm's
length transaction. Upon completion of the Acquisition, it is
expected that the Corporation will be a Tier 2 Mining Issuer.
Lara is a publicly traded mineral exploration company existing
under the laws of British Columbia whose shares trade on the TSX
Venture Exchange under the symbol "LRA". Kiwanda is a private
limited liability company existing under the laws of the State of
Oregon, USA.
Highlights of the
Acquisition
Under the terms of the Letter of Intent, the Corporation, Lara
and Kiwanda will negotiate and enter into a definitive agreement
incorporating the principal terms of the Acquisition as described
in this press release, and in addition, such other terms and
provisions of a more detailed nature as the parties may agree upon.
However, there is no assurance that a definitive agreement will be
successfully negotiated or entered into.
The Corporation intends to acquire the interests of Lara and
Kiwanda in the Properties (as described below) indirectly by the
acquisition of 100% of the issued and outstanding shares in a newly
incorporated company ( "BC Newco") in consideration for a total of
10,000,000 post consolidated common shares ("Post Consolidated
Common Shares") in the capital of the Corporation. The Post
Consolidated Common Shares will be issued at a deemed price of CAD
$0.50 per share representing a deemed acquisition value of
$5,000,000.
Upon completion of the Acquisition, the Corporation will be
engaged in the business of exploring for, with the ultimate goal of
developing and producing coal from the Properties. In addition, the
Corporation may explore and develop such other properties and
interests as may be subsequently acquired by the Corporation.
The Corporation currently has 2,320,000 Common Shares issued and
outstanding and options to acquire 250,000 Common Shares
outstanding. The Corporation intends to request approval from the
shareholders for the consolidation of the common shares on a 1 new
for every 3 old common shares issued and outstanding.
Given effect to the proposed 1 new for 3 old consolidation, upon
closing of the Acquisition and the completing the maximum amount of
the Private Placement (as described below), it is expected that the
Corporation will have approximately 20,783,333 Post Consolidated
Common Shares issued and outstanding and options plus warrants to
acquire 10,083,333 Post Consolidated Common Shares outstanding.
The
Properties
It is anticipated that Lara and Kiwanda will transfer the
following assets/rights into BC Newco that will then be acquired by
the Corporation. BC Newco is anticipated to hold:
- a 19.91% equity interest in Carbhid SAS ("Carbhid"), a Bogota,
Colombia-based coal producer which holds an operating contract on
the Escalones concession in the Boyaca district, where it is
developing underground coal mining operations targeting thermal-
and metallurgical-grade coal. During 2012, Carbhid completed the El
Diamante inclined shaft and related reserve development, which
began small-scale production for sale to a local thermoelectric
power plant in mid-2013. BC Newco will also have the option to
acquire a 51% interest in the Escalones coal mining lease.
- the option to acquire a 75% interest in the Pelaya exploration
prospect, in the Cesar district of northern Colombia. The
approximately 1,600-hectare Pelaya prospect lies at the southern
end of one of the principal coal-producing basins of Colombia,
covering an area not previously drill tested. The option calls for
cash payments of $3.8-million (U.S.) payable over five years. (see
Lara press release dated November 18, 2013.) and
- a 100% interest in Andean Coal Alliance (BVI) Ltd (the "Coal
Alliance").
Andre Gauthier, Lara's president, a member of the Quebec Order
of Engineers, is a qualified person as defined by National
Instrument 43-101 - Standards of Disclosure for Mineral Projects,
and has verified and approved the disclosure of the technical
information in this news release.
Private
Placement
The Acquisition is subject to the raising of gross proceeds of a
minimum of $4,000,000 and a maximum of $6,000,000 through the
issuance of subscription receipts of the Corporation (the
"Subscription Receipts") at a price of $0.50 per Subscription
Receipt. Each Subscription Receipt shall entitle the holder to
acquire a Unit (as described below) of the Corporation for no
additional consideration. Each Unit shall consist of one
Post-Consolidated Common Share and one common share purchase
warrant in the Corporation ("Warrants'). Each Warrant shall entitle
the holder to acquire a Post Consolidated Common Share at an
exercise price of $0.75 per Post Consolidated Common Share on the
date that is 5 years from the date of issuance.
The gross proceeds from the Private Placement shall be placed
with a subscription receipt agent and held until the completion of
the Acquisition at which time the Subscription Receipts will be
automatically converted into Post Consolidated Common Shares and
Warrants and the gross proceeds shall be released to the
Corporation. If the Acquisition is not completed within 150 days
from the date of completion of the Private Placement, the
subscription receipt agent shall return the gross proceeds, plus
accrued interest, to the holders of the Subscription Receipts and
the Subscription Receipts shall be cancelled and rendered null and
void.
It is also anticipated that, in connection with the Acquisition,
the proceeds from the Private Placement (as defined below) will be
used: (a) to fund the business of the Corporation, including,
exploration, development, repayment of a US$400,000 loan to Lara
and the general and administrative expenses; (b) for Acquisition
expenses; and (c) for general working capital purposes. The
securities issued pursuant to the Private Placement (as defined
below) may be subject to restricted resale periods in Canada
pursuant to applicable securities law and Exchange policy and
escrow pursuant to Exchange policy.
The Corporation may pay a cash finder's fee of up to 7% of the
proceeds of the Private Placement, if and only if the gross
proceeds are released to the Corporation.
Sponsorship of the
Acquisition
Sponsorship of a qualifying transaction of a capital pool
company is required by the Exchange unless exempt in accordance
with the policies of the Exchange.
Additional
Information
In accordance with Exchange policy, the Corporation's shares are
currently halted from trading and will remain so until such time as
the Exchange determines, which, depending on the policies of the
Exchange, may not occur until the completion of the
Acquisition.
If and when a definitive agreement between the Corporation and
Lara and Kiwanda is executed, the Corporation will issue a
subsequent press release in accordance with the policies of the
Exchange containing the details of the definitive agreement and
additional terms of the Acquisition, including information relating
to sponsorship, summary financial information in respect of BC
Newco, and to the extent not contained in this press release,
additional information with respect to the Private Placement, and
the proposed directors, officers, and insiders of the Corporation
upon completion of the Acquisition.
Completion of the Acquisition is subject to a number of
conditions including but not limited to, the closing of Private
Placement, Exchange acceptance and if required by Exchange
policies, majority of the minority shareholder approval. Where
applicable, the Acquisition cannot close until the required
shareholder approval is obtained. There can be no assurance that
the Acquisition will be completed as proposed or at all.
Investors are cautioned that, except as disclosed in the
management information circular or filing statement to be prepared
in connection with the Acquisition, any information released or
received with respect to the Acquisition may not be accurate or
complete and should not be relied upon. Trading in the securities
of a capital pool company should be considered highly
speculative.
A further press release will be prepared and disseminated
regarding the Acquisition and related transactions, in due course,
in compliance with the policies of the Exchange as information
becomes available.
The Exchange has in no way passed upon the merits of the
proposed Acquisition and has neither approved nor disapproved the
contents of this press release.
Cautionary
statements
This news release contains "forward-looking information"
within the meaning of applicable securities laws relating to the
proposal to complete the Acquisition and associated transactions,
including statements regarding the terms and conditions of the
Acquisition, the Private Placement, and the use of proceeds of the
Private Placement. Readers are cautioned to not place undue
reliance on forward-looking information. Actual results and
developments may differ materially from those contemplated by these
statements depending on, among other things, the risks that the
parties will not proceed with the Acquisition, the Private
Placement and associated transactions, that the ultimate terms of
the Acquisition, the Private Placement and associated transactions
will differ from those that currently are contemplated, and that
the Acquisition, the Private Placement and associated transactions
will not be successfully completed for any reason (including the
failure to obtain the required approvals or clearances from
regulatory authorities). The statements in this press release are
made as of the date of this release. The Corporation undertakes no
obligation to comment on analyses, expectations or statements made
by third-parties in respect of the Corporation, Lara, Kiwanda,
their securities, or their respective financial or operating
results or (as applicable).
Neither 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.
Nebo Capital Corp.K. Peter MillerDirector(604) 689-1428
Nebo Capital Corp (TSXV:NBO.P)
Historical Stock Chart
From Aug 2024 to Sep 2024
Nebo Capital Corp (TSXV:NBO.P)
Historical Stock Chart
From Sep 2023 to Sep 2024