DJIFF - Dajin Lithium Corp. Announces Execution of Arrangement Agreement with HeliosX Corp. and New Date for the Annual General and Special Meeting of Shareholders
(TheNewswire)
Vancouver, British Columbia – TheNewswire - October 2 1 ,2021 – Dajin Lithium Corp.(“ Dajin ”) (TSXV: DJI )(OTC: DJIFF ) (FSE: C2U1 ) is pleased toannounce that, further to the news release dated October 4, 2021, thecompanies have entered into an arrangement agreement dated October 20,2021 among Dajin, HeliosX Corp. (“ HeliosX ”), ESGTechnologies Inc. (“ ESG ”) and Helios Infrastructure Corp.(“ HeliosInfrastructure ”) (the “ Arrangement Agreement ”), which sets out the terms of the amalgamation of Dajinand HeliosX and reorganization transaction by way of a statutory planof arrangement under Section 288 the Business Corporations Act (British Columbia) (the “ BCBCA ”) involvingDajin, HeliosX, ESG and Helios Infrastructure (both ESG and HeliosInfrastructure being wholly-owned subsidiaries of HeliosX) (the“ Arrangement ”). It is anticipated that the Arrangement will constitutea Fundamental Acquisition (as such term is defined in Policy 5.3 – Acquisitions and Dispositionsof Non-Cash Assets of the Corporate FinanceManual of the TSX Venture Exchange (the “ TSXV ”)) of Dajinand Dajin is seeking conditional acceptance from the TSXV in respectof same.
The Arrangement Agreement
The Arrangement Agreement contemplates that, amongothers, the following conditions precedent be met prior to the closingof the Arrangement: (a) receipt of all required regulatory approvalswith respect to the Arrangement and listing of the common shares ofthe Resulting Issuer (the “ Resulting Issuer Shares ”) on the TSXV, asthe case may be; (b) all third party consents and corporate approvalsare obtained, including approval of Dajin shareholders and the SupremeCourt of British Columbia (the “ Court ”) bothnecessary to complete the Arrangement; (c) the continuance of HeliosXunder the BCBCA shall have occurred; (d) no adverse material change inthe business, affairs, financial condition or operations of Dajin orHeliosX has occurred between the date of entering into the ArrangementAgreement and the closing date of the Arrangement; (e) no order ordecree is in effect restraining closing of the Arrangement; (f) Dajinshareholders holding no more than 5% of the issued and outstandingcommon shares of Dajin (the “ Dajin Shares ”) have exercised dissentrights; and (g) the signature of voting agreements required of certainDajin shareholders.
No person who or which is a Non-Arm's Length Party (assuch term is defined in the policies of the TSXV) of Dajin has anydirect or indirect beneficial interest in HeliosX or its assets priorto giving effect to the Arrangement and no such person is an insiderof HeliosX. Similarly, there is no known relationship between or amongany person who or which is a Non-Arm's Length Party of Dajin and anyperson who or which is a Non-Arm's Length Party to HeliosX. Theproposed Arrangement transaction is at arm’s length.
If all conditions to the implementation of theArrangement have been satisfied or waived, Dajin, HeliosX, ESG andHelios Infrastructure will carry out the Arrangement. The followingsecurity exchanges, cancellations and issuances will occur or bedeemed to occur among Dajin, HeliosX, ESG, Helios Infrastructure andtheir respective securityholders sequentially upon completion of theArrangement:
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(a) each Subscription Receipt (asdefined below) will be exchanged for common shares of HeliosX(“ HeliosX CommonShares ”) on the basis of one HeliosX CommonShare for each Subscription Receipt held;
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(b) Dajin and HeliosX shallamalgamate (the “ Amalgamation ”) pursuant to the BCBCA andcontinue as one corporation (“ Amalco ”) on the terms prescribed by theArrangement;
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(c) on the Amalgamation, theissued and outstanding securities of each of Dajin and HeliosX shallbe converted or exchanged as follows:
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a. each share of Dajin(“ Dajin Share ”) outstanding shall be cancelled and, in considerationtherefor, the holder of such Dajin Share shall receive one (1) fullypaid and non-assessable share of Amalco (“ Amalco Share ”) forevery one (1) Dajin Share held by such Dajin shareholder;
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b. each option to purchase DajinShares (“ DajinOptions ”) shall be cancelled and, inconsideration therefor, the holder of such Dajin Option shall receiveone (1) option to purchase Amalco Shares for every one (1) DajinOption held;
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c. each HeliosX Common Shareoutstanding shall be cancelled and, in consideration therefor, theholder of such HeliosX Common Share shall receive 0.63 of one (1)fully paid and non-assessable Amalco Share issued by Amalco for everyone (1) HeliosX Common Share held by such HeliosX shareholder;and
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d. each warrant to purchaseHeliosX Common Shares (a “ HeliosX Warrant ”) shall be cancelled and, inconsideration therefor, the holder of such HeliosX Warrant shallreceive 0.63 of one (1) warrant to purchase Amalco Shares for everyone (1) HeliosX Warrant held;
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(d) Amalco shall reorganize itscapital within the meaning of Section 86 ofthe Tax Act such that each Amalco shareholder shall dispose of all ofthe Amalco shareholder’s Amalco Shares to Amalcoand in consideration therefor, Amalco shallissue (in respect of the securities referred to in (a) below) ordistribute (in respect of the securities referred to in (b) and (c)below) to the Amalco shareholder:
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a. the number of new class “B” common shares of Amalco(“ Amalco New CommonShares ”) equal to the product of the number ofAmalco Shares held;
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b. the number of shares of ESGequal to the number of Amalco Shares held;
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c. the number of shares of HeliosInfrastructure equal to the number of Amalco Shares held.
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(e) All securities of ESG andHelios Infrastructure held by Amalco shall be cancelled for noconsideration.
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(f) The authorized share structureof Amalco shall be reorganized and altered by
Upon completion of the Arrangement, it is anticipatedthat an aggregate of 17,010,000 Amalco New Common Shares will beissued to former holders of HeliosX Shares, an aggregate of 16,427,546Amalco New Common Shares will be issued to former holders of DajinShares and that an aggregate of 10,917,000 Amalco New Common Shareswill be reserved for issuance to former holders of Dajin Options andHeliosX Warrants pursuant to the terms and conditions of ArrangementAgreement.
No finder’s fees will be paid in connection with theArrangement, nor will any new control persons be created should theArrangement be completed in accordance with the terms of theArrangement Agreement.
The Arrangement requires approval by t he Court. Dajin intends to seek an interim order, which shall provide for thecalling and holding of the special meeting of the shareholders ofDajin (the “ DajinMeeting ”) and other procedural matters, and afinal order from the Court to approve the Arrangement.
In connection with the Dajin Meeting being held toapprove the Arrangement, Dajin has decided to postpone the AnnualGeneral and Special Meeting of shareholders that was previouslyannounced to November 19, 2021 at 10:00 a.m. in order to enable Dajinto host the Dajin Meeting virtually due to ongoing concerns resultingfrom the COVID-19 pandemic. An amended and restated informationcircular will be prepared, filed and sent to all shareholders of Dajinin accordance with the requirements of the BCBCA. The only securityholders entitled vote at the Dajin Meeting will be the holders of Dajin Shares asat the record date for Dajin Meeting.
In connection with the Arrangement, HeliosX has enteredinto voting and support agreements (the “ Voting and Support Agreements ”) with certain shareholders of the Company who own DajinShares, pursuant to which such shareholders have agreed, subject tothe terms and conditions of the Voting and Support Agreements, to votetheir Shares in favour of the Arrangement. Such shareholders of theCompany collectively beneficially own or exercise control over4,631,321 Dajin Shares, representing approximately 28% of the issuedand outstanding Dajin Shares.
Concurrent Financing
In connection with the Arrangement, HeliosX will complete a non-brokered private placementfinancing of subscription receipts (the “ Subscription Receipts ”), at an issue price of $0.44 per Subscription Receipt(the “ PurchasePrice ”), for aggregategross proceeds of up to $10,010,000 (the“ ConcurrentFinancing ”). The Subscription Receipts will begoverned by the terms of a subscription receipt agreement (the“ Subscription ReceiptAgreement ”) to be entered into between HeliosXand Odyssey Trust Company, as subscription receipt agent (the“ Subscription ReceiptAgent ”). Each Subscription Receipt will beautomatically exchanged, without any further action by the holder ofsuch Subscription Receipt, and for no additional consideration, forone (1) HeliosX Share upon the satisfaction of certain Escrow ReleaseConditions (as defined below). Upon completion of the Arrangement,each underlying HeliosX Share issued at $0.44 per SubscriptionReceipt, pursuant to exchange of the Subscription Receipts, will thenbe exchanged for 0.63 of one (1) Amalco Share, valued at $0.70 pershare.
Proceeds of the Concurrent Financing will be held inescrow pending satisfaction of certain escrow release conditions (the“ Escrow ReleaseConditions ”), including completion of theArrangement, as will be set forth in the Subscription ReceiptAgreement to entered into.
It is anticipated that net proceeds of the ConcurrentFinancing will be used: (a) to fund the business plan of HeliosX; (b)for Arrangement expenses; (c) ongoing exploration work on the 560,000acres of Lithium brine assets in Alberta (Canada), Nevada (USA) andJujuy (Argentina); (d) feasibility study and engineering design of agold concentrate extraction facility in British Columbia; and (e) forgeneral corporate purposes and future working capital of Amalco.Although HeliosX intends to use the net proceeds of the ConcurrentFinancing as described herein, the actual allocation of proceeds mayvary from the uses set forth herein, depending on future operations orunforeseen events or opportunities.
About Dajin Lithium Corp.
Dajin Lithium Corp. is a Lithium exploration companywith brine-based Lithium exploration projects located in Argentina and Nevada. Dajin has announced exceptionalLithium brine assay results from 25 shallow pits ranging from 281mg/litre to 1,353 mg/litre, averaging 591 mg/litre on the SalinasGrandes salar in Jujuy province, Argentina (geochemicalmap ). Dajin holds a 49%Joint Venture interest in 230,000 acres in Jujuy province with LiticaResources S.A., an operating subsidiary of Pluspetrol ResourcesCorporation, a major international Argentinian oil and gascompany.
In Nevada, Dajin holds a 100% interest in 403 placermining claims covering 7,914 acres in the Teels Marsh valley ofMineral County, Nevada. Dajin has acquired the water rights in theTeels Marsh valley and has received all of the necessary permits fordrilling, with engineered access roads and two large drill padsconstructed. Dajin holds an earn-in agreement with Lone MountainResources LLC, an affiliate of Lilac Solutions, Inc., to earn a 75%interest in Dajin’s 100% owned Alkali Lake Lithium project located 7miles from Albemarle’s Silver Peak Lithium brine operation inClayton Valley, Esmeralda County, Nevada. The TSX Venture Exchange norits Regulation Services Provider (as that term is defined in thepolicies of the TSX Venture Exchange) do not accept any responsibilityfor the adequacy or accuracy of this news release.
About HeliosX Corp.
HeliosX Corp. is a private ESG focused mineralexploration and mining technology company holding 311,900 acres ofLithium brine exploration rights in Alberta, Canada and two high valuemetal extraction Consulting and License agreements. One agreement isfor the application of electrochemistry for a process to recover up to98% of the residual high value metals from refractory mine tailingsand a second agreement is for a patented chemistry technology thatextracts valuable metals from conventional mine concentrates. HeliosXis currently undertaking a feasibility study for a gold concentrateextraction facility in British Columbia.
Technical Disclosure
John Gorham, B.Sc., P.Geol., of Dahrouge GeologicalConsulting Ltd., a Permit holder with the Association of ProfessionalEngineers and Geoscientists of Alberta, and Qualified Person asdefined by National Instrument 43- 101 –Standards of Disclosure for Mineral Projects, reviewed the technicalinformation contained in this news release.
Further Information
Dajin will provide further details inrespect of the Arrangement and Concurrent Financing in due course byway of a subsequent news release, however, Dajin will make availableto the TSXV, as the case may be, all information, including financialinformation, as may be requested or required by the TSXV.
All information contained in this news release withrespect to Dajin or HeliosX was supplied by the respective party, forinclusion herein, without independent review by the other party, andeach party and its directors and officers have relied on the otherparty for any information concerning the other party.
Completion of the Arrangement is subject to a number ofconditions, including but not limited to, TSXV acceptance and ifapplicable pursuant to TSXV requirements, majority of the minorityshareholder approval. The Arrangement cannot close until the requiredDajin shareholder approval is obtained. There can be no assurance thatthe Arrangement or the Concurrent Financing will be completed asproposed or at all.
Investors are cautioned that, except as disclosed inthe management information circular of Dajin, any information releasedor received with respect to the Arrangement may not be accurate orcomplete and should not be relied upon. Trading in the securities ofDajin should be considered highly speculative.
The TSXV has not in any way passed upon the merits ofthe proposed Arrangement and has neither approved nor disapproved thecontents of this news release.
This news release does not constitutean offer to sell or a solicitation of an offer to buy any of thesecurities in the United States. The securities have not been and willnot be registered under the United States Securities Act of 1933, asamended (the “U.S. Securities Act”) or any state securities lawsand may not be offered or sold within the United States or to U.S.persons unless registered under the U.S. Securities Act and applicablestate securities laws or an exemption from such registration isavailable.
| For further information: Please contact : |
| Brian Findlay da |
| Christopher Brown, P.Eng |
Neither the TSXVnor its Regulation Services Provider (as that term is defined in thepolicies of the TSXV) accepts responsibility for the adequacy oraccuracy of this release.
Notice on Forward Looking Information
Certain statements and informationherein, including all statements that are not historical facts,contain forward-looking statements and forward-looking informationwithin the meaning of applicable securities laws. Such forward-lookingstatements or information include but are not limited to statements orinformation with respect to: the Concurrent Financing, includingamounts anticipated to be raised thereunder, the Escrow ReleaseConditions and the use of net proceeds therefrom; the terms andconditions of the Arrangement, including receipt of TSXV and Dajin shareholder approval; mailingof the Dajin information circular; holding the Dajin shareholdermeeting; the details of any securities issuances, conversions,exchanges or cancellations; obtaining the interim order and finalorder from the Court to approve the Arrangement. Often, but notalways, forward-looking statements or information can be identified bythe use of words such as “estimate”, “project”, “belief”,“anticipate”, “intend”, “expect”, “plan”,“predict”, “may” or “should” and the negative of thesewords or such variations thereon or comparable terminology areintended to identify forward-looking statements and information.
With respect to forward-lookingstatements and information contained herein, Dajin has made numerousassumptions including among other things, assumptions about generalbusiness and economic conditions of HeliosX and the market in which itoperates. The foregoing list of assumptions is not exhaustive.
Although management of Dajin andHeliosX believe that the assumptions made and the expectationsrepresented by such statements or information are reasonable, therecan be no assurance that forward-looking statements or informationherein will prove to be accurate. Forward-looking statements andinformation by their nature are based on assumptions and involve knownand unknown risks, uncertainties and other factors which may causeactual results, performance or achievements, or industry results, tobe materially different from any future results, performance orachievements expressed or implied by such forward-looking statementsor information. These factors include, but are not limited to: risksrelating to the Concurrent Financing; risks relating to the receipt ofall requisite approvals for the Arrangement, including the approval ofDajin shareholders and the TSXV; risks associated with the business ofHeliosX; business and economic conditions in the lithium industrygenerally; changes in commodity prices; changes in interest andcurrency exchange rates; government action or delays in the receipt ofgovernment approvals, industrial disturbances or other job action, andunanticipated events related to health, safety and environmentalmatters); changes in general economic conditions or conditions in thefinancial markets; changes in laws; risks related to the direct andindirect impact of COVID-19 including, but not limited to, its impacton general economic conditions, the ability to obtain financing asrequired; and other risk factors as detailed from time to time. Dajinand HeliosX do not undertake to update any forward-lookinginformation, except in accordance with applicable securitieslaws.
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