Canadian Gold Resources Ltd. entered into a binding letter of intent to acquire Amseco Exploration Ltd. (TSXV:AEL.H) in a reverse merger transaction for CAD 4 million on December 18, 2023. Pursuant to the transaction, it is anticipated that Amseco will acquire all of the issued and outstanding Canadian Gold Shares, and shareholders of Canadian Gold will receive post-consolidation Amseco common shares in exchange for their Canadian Gold shares. Prior to the closing of the proposed transaction, Amseco will consolidate its outstanding Amseco Shares on the basis of one (1) new Amseco Share for each 5 old Amseco Shares. It is intended that Amseco Shares will be issued to holders of Canadian Gold Shares on the basis of one (1) post-consolidation Amseco Share for every one (1) Canadian Gold Share, resulting in the issuance of an aggregate 20,000,000 post-consolidation Amseco Shares to the shareholders of Canadian Gold. In connection with the Proposed Transaction, Canadian Gold will arrange a concurrent non-brokered private placement for sufficient gross proceeds for the Resulting Issuer to meet the Exchange?s listing requirement at a minimum price of CAD 0.25 per post-consolidation Amseco Share (the ?Concurrent Financing?). It is anticipated that the resulting entity (the ?Resulting Issuer?) will continue the business of Canadian Gold under a name to be determined by Canadian Gold. Upon completion of the Proposed Transaction, it is anticipated that the Resulting Issuer will be listed as a Tier 2 Mining Issuer on the Exchange, with Canadian Gold as its primary operating subsidiary.
In conjunction with and upon closing of the transaction, the board of directors of the Resulting Issuer are expected to consist of four directors, each of whom will be nominated by Canadian Gold. If applicable, the existing directors and officers of Amseco shall resign at or prior to the closing of the transaction. The first directors of the Resulting Issuer are expected to be Ron Goguen, Ken Booth, Mark Smethurst and Ian Mcgavney, and such other directors as determined by Canadian Gold. These directors shall hold office until the first annual meeting of the shareholders of the Resulting Issuer following closing, or until their successors are duly appointed or elected. The first officers of the Resulting Issuer are expected to be Ron Goguen (Executive Chairman and President), Camilla Cormier (Chief Financial Officer and Corporate Secretary), and such other officers as determined by Canadian Gold.
The completion of the transaction remains subject to a number of terms and conditions, among other standard conditions for a transaction of this nature, including, among other things: (i) the negotiation and execution of the Definitive Agreement; (ii) Canadian Gold delivering a NI 43-101 compliant technical report for the Property that is acceptable to the Exchange and Amseco; (iii) the delivery of audited, unaudited and pro forma financial statements of each party that are compliant with Exchange policies; (iv) if required by the Exchange, Canadian Gold delivering a title opinion for each of its material international properties in form and content satisfactory to the Exchange and Amseco; (v) no material adverse changes occurring in respect of either Amseco or Canadian Gold; (vi) the parties obtaining all necessary consents, orders and regulatory approvals and approval of the shareholders of Canadian Gold, including the conditional approval of the Exchange subject only to customary conditions of closing; (vii) if required by the Exchange, delivery of a sponsor report and an independent valuation satisfactory to the Exchange; (viii) the Consolidation, Name Change and any other corporate changes requested by Canadian Gold, acting reasonably, shall have been implemented; (ix) completion of the Concurrent Financing described below; (x) completion of satisfactory due diligence by each Party of the other Party; (xi) if the Exchange deems any property of Canadian Gold, other than the Property, to be a material property of Canadian Gold, Canadian Gold shall either deliver a technical report prepared in accordance with NI 43-101 for such property, or divest any interest or ownership it holds in such property; and (xii) Exchange acceptance.