CSTL.P:CC - Castlecap Announces Proposed Qualifying Transaction with Laiva Gold Inc.
(TheNewswire)
July 12, 2024 – TheNewswire - Calgary, Alberta– CastleCap Capital Inc. (TSXV: CSTL.P) (the" Company ") and Laiva Gold Inc. (" Laiva ", andtogether with the Company, the " Parties ") arepleased to announce the execution of a non-binding letter of intent dated July 10, 2024 (the " LOI ") regarding a proposed non- arm's length transaction (the " Proposed Transaction "), as such term is defined in Policy 2.4 - Capital Pool Companies (the " Policy ") of the TSX Venture Exchange (the" TSXV ") Corporate FinanceManual. The Parties intend to enter into a definitive agreement (the " Proposed Definitive Agreement ") in respect of the ProposedTransaction.
The Proposed Transaction
As will be set out in the Proposed DefinitiveAgreement, the Company is expected to acquire all of the issued andoutstanding common shares of Laiva (the " Laiva Shares ")pursuant to a business combination to be completed under the Business CorporationsAct (Alberta) (the " ABCA ") by theCompany and Laiva. The Proposed Transaction is expected to result inthe issuance, to each shareholder of Laiva (each, a " Laiva Shareholder "), of two (2) Common Share (as defined below) for eachone (1) Laiva Share held by such holder immediately prior to theclosing of the Proposed Transaction (the " Closing "). Aspart of the Proposed Transaction, all convertible securities of Laivaoutstanding immediately prior to the Closing are expected to bereplaced with or exchanged for equivalent convertible securities ofthe Company entitling the holders thereof to acquire Common Shares inlieu of Laiva Shares.
The Proposed Transaction will result in the reversetakeover of the Company by Laiva Shareholders, and will constitute theCompany's Qualifying Transaction (as defined by the TSXV). Followingthe completion of the Proposed Transaction, the Company, as the issuerresulting therefrom (the " Resulting Issuer "), is expected to carryon the current business of Laiva under the name "Laiva GoldInc." or such other name as may be determined by Laiva andapproved by the shareholders of the Company and which is acceptable tothe applicable regulatory authorities, including the TSXV(" Name Change "). The business of the Resulting Issuer will beprimarily focused on the re-start of mining operations at Laiva’sflagship gold mine in Finland.
Upon completion of the Proposed Transaction, it isanticipated that the Resulting Issuer will be listed as a Tier 1Mining Issuer on the TSXV.
The Parties hereby have agreed to work exclusively witheach other for a period of 60 days following the execution of the LOI.At this time, no finder’s fees, deposits, advances or loans havebeen or are intended to be made in connection with the ProposedTransaction. Laiva has agreed to pay the costs and expenses of theParties in connection with the Proposed Transaction and has alsoagreed to pay a ‘break fee’ of $200,000 to the Company in theevent that the Proposed Definitive Agreement is not entered into on orbefore September 30, 2024, or such date as may be mutually agreed toby the Parties, or if Laiva terminates the LOI prior to entering intothe Proposed Definitive Agreement.
The completion of the Proposed Transaction will besubject to the entry into of the Proposed Definitive Agreement as wellas a number of terms and conditions to be set forth in the ProposedDefinitive Agreement, including, among other things (i) there being nomaterial adverse change in respect of either of the Parties; (ii) thereceipt of all necessary consents, orders and regulatory andshareholder approvals, including the conditional approval of the TSXV,subject only to customary conditions of closing; (iii) the completionof the Name Change and the Laiva Financing, as defined below; and (iv)such other customary conditions of closing for a transaction in thenature of the Proposed Transaction. Accordingly, there can be noassurance that the Proposed Transaction will be completed on the termsproposed and described herein, or at all.
Proposed Financing
Pursuant to the terms of the LOI, Laiva anticipatescompleting a financing of 12,500,000 units (" Units ") at aprice of $0.80 per Unit for gross proceeds of $10,000,000 (the" LaivaFinancing "), with each Unit consisting ofone Laiva Share and one Laiva Share purchase warrant exercisable intoone Laiva Share at a price of $1.00 per Laiva Share for a period of 2years from the date of issuance. Laiva may retain a broker or payfinder’s fees to certain registrants or eligible persons exempt fromregistration on any portion of the Laiva Financing. The net proceedsof the Laiva Financing will be used: (a) to fund the business plan ofthe Resulting Issuer; (b) for Proposed Transaction expenses; and (c)for general working capital purposes. Additional details regarding theLaiva Financing will be provided in due course.
Proposed Directors and Officers ofthe Resulting Issuer
Upon the completion of the Proposed Transaction, it isexpected that the board of directors and officers of the ResultingIssuer will be reconstituted to be comprised of individuals nominatedby Laiva and the Company subject to compliance with the requirementsof the TSXV, and applicable corporate and securities laws. Laiva andthe Company will make further announcements as appointments of itsrespective officers and director are made. Additional informationregarding Insiders (as defined by the TSXV) of the Company uponcompletion of the Proposed Transaction and/or any financing(s) willalso be disclosed, if required.
Shareholder Approval &Non-Arm’s Length Transaction
Mr. Charles Chebry is a director and officer of theCompany and of Laiva, as such, the Proposed Transaction is beingconsidered a Non-Arm's Length Transaction (as defined by the TSXV) and"related party transaction" pursuant to the provisions ofMultilateral Instrument 61-101 - Protection of Minority Security Holders inSpecial Transactions , and accordingly requisitedisclosures will be made and procedures followed. The Company andLaiva will be required to obtain certain approvals, including but notlimited to, directors’ approvals, regulatory approvals, TSXVapprovals, and approvals of its respective shareholders, includingapprovals from disinterested shareholders of the Parties, for theProposed Transaction.
Sponsorship
The TSXV requires sponsorship of a Proposed Transactionof a capital pool company, unless exempt in accordance with thepolicies of the TSXV. The Parties are currently reviewing therequirements for sponsorship and may apply for an exemption from thesponsorship requirements pursuant to the policies of the TSXV.However, there can be no assurance that the Parties will ultimatelyobtain such exemption.
The Parties intend to provide any additionalinformation regarding sponsorship at a later date, once determined bythe Parties. In the event that the TSXV does not grant an exemptionfrom the sponsorship requirements of the TSXV, the Parties would berequired to engage a sponsor.
Trading Halt
In accordance with the policies of the TSXV, theCompany has requested a trading halt of its Common Shares and suchhalt has been granted. It is expected that the Common Shares willremain halted until completion of the Proposed Transaction.
About Laiva Gold Inc.
Laiva is a Canadian mining company, incorporated underthe ABCA, and with a subsidiary company own its flagship operation,the Laiva mine (" LaivaMine ") in Finland. The Laiva Mine is anopen pit operation, fully equipped with state of the artinfrastructure including one of the largest gold plants in Europe(6,000 tonnes per day capacity) and a sizeable proven resourceestimate, which Laiva intends to bring into production in the nearterm.
About CastleCap Capital Inc.
The Company is a capital pool company created pursuantto the policies of the TSXV. The Company has not commenced operationsand has no assets other than cash. The Company’s principal businessis the identification and evaluation of assets or businesses with aview to completing a "Qualifying Transaction" under thePolicy. As of the date hereof the Company has 4,000,000 Common Sharesissued and outstanding and 400,000 options exercisable on or beforeJune 12, 2029 at a price of $0.10 per Common Share.
Further Information
Further updates in respect of the Proposed Transactionwill be provided in a subsequent news release. Also, additionalinformation concerning the Proposed Transaction, the Company, Laiva,and the Resulting Issuer will be provided in the requisite managementinformation circular and/or filing statement to be filed by theCompany and Laiva in connection with the Proposed Transaction, whichwill be available in due course under the Company's SEDAR+ profile at www.sedarplus.ca.
Upon entering into the Proposed Definitive Agreement,the Company will issue a further comprehensive news release disclosingdetails of the Proposed Transaction disclosing including any financialinformation respecting Laiva, the issued and outstanding securities ofeach of Parties and the definitive terms of the exchange of securitiesof the Company and Laiva.
All information contained in this news release withrespect to the Company and Laiva was supplied by the respective Partyfor inclusion herein, and each Party and its directors and officershave relied on the other Party for any information concerning theother Party.
For further information please contact:
CastleCap Capital Inc. Laiva Gold Inc.
Charles Chebry Jeremy Gray
Director, President, Chief Executive Officer andSecretary Chief Executive Officer and Director
Email: charleschebry@outlook.com Email:jeremy.gray@laivagold.com
Telephone: (403) 680-8511 Telephone: +44 7769 388 376
CautionaryStatements
This news release containsforward-looking statements and forward-looking information(collectively, "forward-looking statements") within themeaning of applicable securities laws. Any statements that arecontained in this news release that are not statements of historicalfact may be deemed to be forward- looking statements. Forward-lookingstatements are often identified by terms such as "may","should", "anticipate", "will","estimates", "believes", "intends""expects" and similar expressions which are intended toidentify forward-looking statements. More particularly and withoutlimitation, this news release contains forward- looking statements,including statements concerning the Proposed Transaction (includingthe Name Change), the Laiva Financing, the Special Meeting, theProposed Definitive Agreement, and the proposed structure by which theProposed Transaction is to be completed. Forward-looking statementsare inherently uncertain, and the actual performance may be affectedby a number of material factors, assumptions and expectations, many ofwhich are beyond the control of the Parties, including expectationsand assumptions concerning (i) the Company, Laiva, the ResultingIssuer, and the Proposed Transaction, (ii) the ability of the Partiesto negotiate and enter into the Proposed Definitive Agreement onsatisfactory terms as proposed, (iii) the timely receipt of allrequired shareholder, court and regulatory approvals (as applicable),including the approval of the TSXV, (iv) if the Proposed DefinitiveAgreement is entered into, the satisfaction of other closingconditions in accordance with the terms of the Proposed DefinitiveAgreement, and (v) the ability of the Parties (as applicable) tocomplete the Laiva Financing and/or the Proposed Transaction on theterms outlined in this news release (or at all). Readers are cautionedthat assumptions used in the preparation of any forward- lookingstatements may prove to be incorrect. Events or circumstances maycause actual results to differ materially from those predicted as aresult of numerous known and unknown risks, uncertainties and otherfactors, many of which are beyond the control of the Parties. Readersare further cautioned not to place undue reliance on anyforward-looking statements, as such information, although consideredreasonable by the respective management of the Parties at the time ofpreparation, may prove to be incorrect and actual results may differmaterially from those anticipated.
The forward-looking statementscontained in this news release are made as of the date of this newsrelease, and are expressly qualified by the foregoing cautionarystatement. Except as expressly required by securities law, neitherParty undertakes any obligation to update publicly or to revise any ofthe included forward-looking statements, whether as a result of newinformation, future events or otherwise.
Completion of the ProposedTransaction is subject to a number of conditions, including but notlimited to, TSXV acceptance and if applicable pursuant to therequirements of the TSXV, majority of the minority shareholderapproval. Where applicable, the Proposed Transaction cannot closeuntil the required shareholder approval is obtained. There can be noassurance that the Proposed Transaction will be completed as proposedor at all.
Investors are cautioned that, exceptas disclosed in the management information circular or filingstatement to be prepared inconnection with the Proposed Transaction, any information released orreceived with respect to the Proposed Transaction may not be accurateor complete and should not be relied upon. Trading in the securitiesof a capital pool company should be considered highlyspeculative.
The TSX Venture Exchange Inc. has inno way passed upon the merits of the proposed Transaction and hasneither approved nor disapproved the contents of this newsrelease.
This news release shall notconstitute an offer to sell or the solicitation of an offer to buy anysecurities in any jurisdiction.
This news release does notconstitute an offer to sell or a solicitation of an offer to buy thesecurities described herein in the United States or in any otherjurisdiction, nor shall there be any sale of the securities in anystate in which such offer, solicitation or sale would be unlawful. Thesecurities have not been and will not be registered under the U.S.Securities Act, or any state securities laws, and accordingly, may notbe offered or sold in the United States except in compliance with theregistration requirements of the U.S. Securities Act and applicablestate securities requirements or pursuant to exemptionstherefrom.
Neither the TSX Venture Exchange norits Regulation Services Provider (as that term is defined in thepolicies of the TSX Venture Exchange) accepts responsibility for theadequacy or accuracy of this news release. No stock exchange,securities commission or other regulatory authority has approved ordisapproved the information contained herein.
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