/NOT FOR DISTRIBUTION TO UNITED STATES NEWS SERVICES OR DISSEMINATION
IN THE UNITED STATES/
VANCOUVER, May 26, 2020 /CNW/ - Tilting Capital Corp.
("TLL" or the "Corporation") (NEX: TLL.H) is pleased
to announce that it has entered into a letter of intent dated
May 12th, 2020 (the
"LOI") with Gold Line Resources Ltd. ("GLR"), in
respect of a proposed reverse takeover transaction (the
"Proposed Transaction") pursuant to which TLL will acquire
all of the issued and outstanding common shares in the capital of
GLR. The Proposed Transaction will be an Arm's Length
Transaction (as that term is defined under TSXV Policy 1.1).
Background on Gold Line Resources Ltd.
GLR is a private Canadian company focused on acquiring gold
projects with exceptional exploration potential in the most
prolific gold-producing regions of Sweden. GLR is working in
one of the world's top mining jurisdictions and emerging
exploration frontiers due to its strong mineral endowment, stable
tenure, straightforward permitting, favorable tax regime and
supportive geopolitical landscape.
GLR currently holds a prospective portfolio of five gold
exploration projects in Sweden
with one project in the Skellefteå Belt of North Central Sweden and
four projects located within the Gold Line Mineral Belt of North
Central Sweden. The projects are located on a 200 kilometer [km]
Proterozoic greenstone-sedimentary belt that is host to multiple
gold showings and deposits. Technical information with
respect to the projects is available as a result of work done by
previous operators, as well as work conducted by GLR, and will be
disclosed in a future news release once it has been reviewed,
approved and, in some cases, verified, by Michael Dufresne, M.Sc., P.Geol., P.Geo. of APEX
Geoscience Ltd., a consultant to the Company and a Qualified Person
for the purposes of NI 43-101.
GLR was incorporated on October 11,
2018 under the Business Corporations Act
(British Columbia). No person
directly or indirectly holds a controlling interest in GLR. Summary
financial information of GLR, including total assets/liabilities
and net profits/losses, will be disclosed in a subsequent news
release when it becomes available.
Transaction Structure
The Proposed Transaction is expected to be completed by way of a
share exchange, three-cornered amalgamation or other form of
business combination determined by the legal and tax advisors to
each of TLL and GLR, acting reasonably, which will result in GLR
becoming a wholly-owned subsidiary of TLL or otherwise combining
its corporate existence with that of a TLL entity (the
"Resulting Issuer"). Upon completion of the Proposed
Transaction, it is expected that the Resulting Issuer will carry on
the business previously carried on by GLR.
Pursuant to the Proposed Transaction, TLL will acquire 100% of
the issued and outstanding shares of the GLR at a ratio of one TLL
common share (each, a "TLL Share") for every one GLR
common share (each, a "GLR Share"). Upon closing of the
Transaction, it is expected that TLL will issue approximately
35,415,210 TLL shares to shareholders of GLR, and 1,800,000
outstanding options of GLR will be exchanged or replaced with
equivalent securities of TLL.
Completion of the Proposed Transaction will be subject to a
number of conditions precedent set forth in the LOI, including: (i)
satisfactory completion of due diligence investigations by each of
TLL and GLR on or before May 25,
2020; (ii) the negotiation and execution of a definitive
agreement (the "Definitive Agreement") on or before
June 15, 2020; (iii) approval by the
directors of TLL and GLR; (iv) approval by the securityholders of
GLR and, if applicable, of TLL; (v) completion of the Financing (as
described below); (vi) filing of technical report(s) in respect of
the projects that are compliant with NI 43-101; (vii) receipt of
all requisite regulatory (including TSX Venture Exchange
("TSXV")) and third party approvals; (viii) immediately
prior to closing, TLL having cash of not less than C$620,000 and indebtedness of not more than
C$40,000; (ix) immediately prior to
closing, TLL having issued and outstanding not more than
approximately 18,323,191 TLL Shares (not including TLL Shares
issued pursuant to the Financing) and 7,600,000 warrants to
purchase TLL Shares. There can be no assurance that the
Proposed Transaction will be completed on the terms proposed in the
Letter of Intent or at all.
In connection with the Proposed Transaction, TLL and GLR will
enter into a pooling agreement under which TLL Shares issued
pursuant to the C$0.05 unit financing
disclosed in TLL's news release dated May 6,
2020, and all GLR Shares will be held in escrow and released
as follows (subject to any longer hold periods required under
applicable securities laws or TSXV policies): 40% of the applicable
TLL Shares and 40% of the applicable GLR Shares will be released on
closing of the Proposed Transaction, with the remaining 60% of each
released in tranches of 30% at 6 and 12 months after closing of the
Proposed Transaction.
It is anticipated that TLL will not be required to obtain
shareholder approval of the Proposed Transaction because: (1) the
Proposed Transaction is not a Related Party Transaction (as that
term is defined under TSXV Policy 1.1) and no other circumstances
exist which may compromise the independence of TLL or other
interested parties with respect to the Proposed Transaction; (2)
TLL is without active operations; (3) TLL is not and is not
expected to be subject to a cease trade order or otherwise be
suspended from trading on completion of the Proposed Transaction;
and (4) the anticipated structure of the Proposed Transaction does
not require shareholder approval under applicable corporate or
securities laws. However, depending on the ultimate structuring of
the Proposed Transaction, TLL may be required to obtain shareholder
approval of the Proposed Transaction or of certain matters
ancillary thereto, in which case TLL will update the markets
accordingly.
On closing of the Proposed Transaction, TLL anticipates
graduating from the NEX to the TSXV as a "Tier 2" Mining Issuer
that will meet the TSXV's initial listing requirements applicable
therefor. A finder's fee of 1,800,000 TLL Shares and an
administration fee of 340,000 TLL Shares will be payable in
connection with closing of the Proposed Transaction.
Proposed Advances and Private Placement Financing
TLL has advanced a non-refundable deposit of C$25,000 to GLR. TLL anticipates completing a
private placement of TLL shares (the "Financing") at a price
of not less than C$0.20 per TLL share
for gross proceeds C$3 million, to
fund the operations of the Resulting Issuer. The size of the
Financing and the issue price will be determined by TLL in the
context of the market. The proposed Financing may be completed on a
non-brokered or brokered basis. In the event that the Financing is
brokered, the agent retained by TLL may be paid customary
compensation for such agency services. The Financing is subject to
TSXV approval.
Proposed Management and Directors
Subject to TSXV approval, on completion of the Proposed
Transaction, the board of the Resulting Issuer will be comprised of
five directors: three representatives from TLL; one representative
from GLR; and one representative from EMX Royalty Corp., GLR's
largest shareholder. It is expected that the board will include
Henrik Lundin (who will also be
appointed as Chairman), Adam
Cegielski (who will also be appointed as CEO), Dr.
Eric Jensen, and Joel Shacker – background details of these
individuals are set out below. Background details of the remaining
board member and the CFO will be set out in a future news release,
once the parties have determined which individuals will fill those
roles.
Henrik Lundin, Director and
Chairman
Mr. Henrik Lundin has
considerable global experience in the natural resource
sector. He has a strong understanding of the technical and
business side of the oil and gas industry and most recently held
the position of COO of TAG Oil Ltd. (TSX: TAO). At TAG Oil, Mr.
Lundin was responsible for the global operations of TAG Oil and led
the farm-in/farm-out processes in Australia and New
Zealand. Mr. Lundin is a Swedish citizen and has a B.Sc.
Petroleum Engineering degree from the Colorado
School of Mines in Golden,
Colorado.
Adam Cegielski, Chief
Executive Officer and Director
Mr. Cegielski has over 20 years of experience in the venture
capital industry ranging from mineral exploration, technology,
health care and education. He started his career developing an
industrial mineral project in Uganda that he later sold to Rio Tinto PLC in
2007. Mr. Cegielski was then founding director of Cayden Resources
Inc., which was sold to Agnico Eagle Mines Ltd. for $205 million in November, 2014. He is currently
founder, chief executive officer and director of Eyecarrot
Innovations Corp., a neurotechnology company focused on driving
higher levels of human performance through its Binovi technology.
Eyecarrot was founded in 2014 and has developed and commercialized
the Binovi platform, which is now used in over 20 counties and by
elite athletes globally.
Dr. Eric Jensen,
Director
Dr. Jensen has over 26 years of industry experience and is the
General Manager of Exploration at EMX Royalty Corporation. Dr.
Jensen is a co-founder of Bronco Creek Exploration and has
extensive experience in the planning and implementation of
regional- to project-scale exploration programs. He has relevant
exploration, research and academic experience in mineral deposits
related to alkaline magmatism, "high- and low-sulfidation"
epithermal gold deposits, porphyry-style deposits, mesothermal lode
gold systems, and iron-oxide-copper-gold (IOCG) systems. Dr. Jensen
graduated from Carleton College in
Northfield, Minnesota in 1993 with
a B.A. in Geology, and received his Ph.D. in Economic Geology at
the University of Arizona in 2003.
Joel Shacker, Director
Mr. Shacker has acted as both a director and officer of various
public and private companies. Mr. Shacker is currently President of
Mota Ventures Corp. (CSE:MOTA). He has overseen the expansion of
Mota throughout Latin America,
Europe and North America. Under his leadership the
company has become a global ecommerce retailer with sales of over
$29,000,000 in 2019, and over
$10,000,000 already in 2020. Mr.
Shacker is currently the CEO of RewardStream Solutions Inc. Mr.
Shacker served as a director of Weekend Unlimited Inc., while
overseeing overseas developments and leading the company's
expansion into international markets. Mr. Shacker holds an Honors
Business Administration degree from Ivey Business School,
specializing in finance, and has also served as Chief Operating
Officer of CanPac Investment Corp. and as an Associate at Stadnyk
and Partners.
Filing Statement and Information Circular
In connection with the Proposed Transaction and pursuant to the
requirements of the TSXV, TLL will file a filing statement or a
management information circular on its issuer profile on SEDAR at
www.sedar.com, which will contain details regarding the Proposed
Transaction, the Financing and GLR.
Sponsorship
Sponsorship of the Proposed Transaction is required by the TSXV
unless an exemption from the sponsorship requirement is available.
The parties will be seeking a waiver of any requirement for a
sponsor, but in the event a waiver is not obtained, the parties
will update the markets accordingly.
Trading Halt
Trading in the common shares of TLL is currently halted in
compliance with the policies of the TSXV. TLL anticipates that
trading will remain halted pending the review of the Proposed
Transaction by the TSXV.
General
TLL will issue additional news releases relating to the Proposed
Transaction if and when the parties enter into a Definitive
Agreement.
About Tilting Capital Corp.
TLL is incorporated under the provisions of the Business
Corporations Act (British
Columbia) with its registered and head office in
Vancouver, British Columbia. TLL
is a "reporting issuer" in the provinces of Ontario, British
Columbia and Alberta.
Completion of the Proposed Transaction is subject to a number
of conditions, including but not limited to, TSXV acceptance and if
applicable, disinterested shareholder approval. Where applicable,
the Proposed Transaction cannot close until the required
shareholder approval is obtained. There can be no assurance that
the Proposed Transaction 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 Proposed Transaction, any information
released or received with respect to the Proposed Transaction may
not be accurate or complete and should not be relied upon. Trading
in the securities of Tilting Capital Corp. should be considered
highly speculative.
The TSXV has in no way passed upon the merits of the Proposed
Transaction and has neither approved nor disapproved the contents
of this news release.
Neither the TSXV nor its Regulation Services Provider (as
that term is defined in the policies of the TSXV) accepts
responsibility for the adequacy or accuracy of this
release.
Cautionary Statements Regarding Forward-Looking
Information
This news release contains forward-looking information within
the meaning of Canadian securities laws. Such information includes,
without limitation, information regarding the terms and conditions
of the Proposed Transaction, the terms of the Financing and the
composition of the board of directors of the Resulting Issuer upon
completion of the Proposed Transaction. Although TLL believes that
such information is reasonable, it can give no assurance that such
expectations will prove to be correct.
Forward looking information is typically identified by words
such as: "believe", "expect", "anticipate", "intend", "estimate",
"postulate" and similar expressions, or are those, which, by their
nature, refer to future events. TLL cautions investors that any
forward-looking information provided by TLL is not a guarantee of
future results or performance, and that actual results may differ
materially from those in forward looking information as a result of
various factors, including, but not limited to: TLL's ability to
complete the Proposed Transaction; the expected timing and terms of
the Proposed Transaction and the Financing; the state of the
financial markets for TLL's securities; the state of the natural
resources sector in the event the Proposed Transaction is
completed; recent market volatility and potentially negative
capital raising conditions resulting from the continued COVID-19
pandemic and risks relating to the extent and duration of such
pandemic and its impact on global markets; TLL's ability to raise
the necessary capital or to be fully able to implement its business
strategies; and other risks and factors that TLL is unaware of at
this time.
The forward-looking statements contained in this news release
are made as of the date of this news release. TLL disclaims any
intention or obligation to update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise, except as required by law.
The securities referred to in this news release have not
been, nor will they be, registered under the United States
Securities Act of 1933, as amended, and may not be offered or sold
within the United States or to, or
for the account or benefit of, U.S. persons absent U.S.
registration or an applicable exemption from the U.S. registration
requirements.
This news release does not constitute an offer for sale of
securities, nor a solicitation for offers to buy any
securities.
SOURCE Tilting Capital Corp.
