VANCOUVER, Dec. 3, 2015 /CNW/ - Alternative Earth
Resources Inc. ("AER") (TSX.V: AER) is pleased to announce that
it has signed a definitive and binding Share Exchange Agreement
dated December 2, 2015, among AER,
Black Sea Copper & Gold Corp. ("BSCG") and all of
the securityholders of BSCG (the "Agreement"), whereby AER
shall acquire all of the outstanding securities of BSCG (the
"Acquisition"). The Acquisition is expected to close on or
before December 18, 2015. Refer to
the News Release dated October 20,
2015 for details.
BSCG is a non-reporting British
Columbia corporation that holds interests in various mineral
properties located in Eastern
Europe. The principal property of BSCG is an option to
acquire 100% of the Alankoy copper-gold project located in
Turkey (the "Alankoy
Project"). A director of AER serves as the CFO and is a minor
shareholder of BSCG, therefore at the outset of this matter AER
formed a special committee of disinterested directors to deal with
all aspects of the Acquisition.
Under the Agreement, AER will acquire the all of the common
shares of BSCG in exchange for the issuance to the thirty-seven
shareholders of BSCG of a total of 32,912,115 common shares in the
capital of AER, based upon an exchange ratio of 1.7 shares of AER
for each share of BSCG (the "Exchange Ratio"). The Exchange
Ratio was determined after completion of AER's due diligence review
of BSCG, and is supported by a fairness opinion prepared by a
qualified independent consultant. AER will also acquire all
outstanding convertible securities of BSCG (options, warrants and
convertible debt) in exchange for the issue of replacement
securities by AER based upon the Exchange Ratio.
Concurrently with the acquisition of BSCG, AER will complete a
non-brokered private placement of 8,000,000 units at a price of
$0.06 per unit, with each unit
consisting of one (1) common share, and one (1) warrant to purchase
an additional common share exercisable for two (2) years at a price
of $0.115 per share, to raise gross
proceeds of $480,000 (the
"Financing"). AER will, in appropriate circumstances, pay
finder's fees (10% cash and 10% warrants) in connection with the
Financing. The Financing has been fully subscribed.
Pending completion of the Acquisition, AER has agreed to loan
BSCG the sum of $100,000, which shall
be applied to an option payment on the Alankoy Project and costs
related to the technical report and title opinion. The loan shall
accrue interest at a rate of 10% per annum and is repayable in
three (3) months with a $10,000 bonus
payment.
After completion of the Acquisition and the Financing, AER will
have approximately 66 M shares outstanding (87 M fully diluted) and
the directors and officers of AER will be reconstituted to consist
of four (4) directors, with two (2) nominees from each of AER and
BSCG. The Acquisition and the Financing will not result in a change
of control of AER.
AER has obtained conditional acceptance from the TSX Venture
Exchange (the "Exchange") for both the Acquisition and the
Financing. An NI 43-101 compliant technical report on the Alankoy
Project, and a title opinion on the Alankoy Project are currently
being reviewed by the Exchange.
AER has formally opposed the claim brought by Jaguar Financial
Corporation in its petition to the British Columbia Supreme Court,
and its legal representatives shall appear at a hearing on
December 4, 2015, to oppose the
relief sought. Refer to the News Release dated November 26, 2015 for details.
In addition, and subject to receipt of applicable regulatory
approvals, AER plans to complete up to a 2:1 share consolidation
following completion of the Acquisition. The 2015 annual general
meeting of shareholders of AER was deferred, with an extension from
the British Columbia Registrar of Companies, until early 2016,
pending completion of due diligence on BSCG. AER has convened an
annual and special meeting of shareholders of AER in order to elect
directors, consider the share consolidation and ratify the existing
shareholder rights plan, which will be held on February 26, 2016.
Further information concerning the progress of the
Acquisition and the Financing will be disclosed
in due course. Take note that the Acquisition contemplated by the
Agreement is subject to numerous conditions, and there is no
certainty that will be completed on the schedule, or in accordance
with the terms described in this News Release, or at all.
Accordingly, investors should use caution when trading in the
securities of AER.
Forward Looking Statements: This news release contains
forward looking statements that are subject to a number of known
and unknown risks, uncertainties and other factors that may cause
actual results to differ materially from those anticipated in our
forward looking statements. Forward-looking statements in this
release include statements regarding the timing and completion of
the Financing, closing of the Acquisition, the outcome of the Court
proceedings and completion of a share consolidation. Factors that
could cause such differences include: an order issued by the Court,
the Financing, the Acquisition and the share consolidation may not
be completed for any reason whatsoever, including that the
regulators may not approve them, changes in world commodity
markets, equity markets, costs and supply of materials relevant to
the mining industry, change in government and changes to
regulations affecting the mining industry. In addition to other
factors and assumptions which may be identified in this press
release, assumptions have been made regarding and are implicit in,
among other things, the timely receipt of any required regulatory
approvals. Although we believe the expectations reflected in our
forward looking statements are reasonable, results may vary, and we
cannot guarantee future results, levels of activity, performance or
achievements.
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.
SOURCE Alternative Earth Resources Inc.