VANCOUVER, Oct. 27, 2016 /PRNewswire/ - Northcliff Resources
Ltd. ("Northcliff" or the "Company") (TSX: NCF) is pleased to
announce that it has entered into a Subscription Agreement (the
"Agreement") with a subsidiary of Todd Corporation ("Todd"),
pursuant to which Todd has agreed to complete a non-brokered
private placement (the "Private Placement") under which it will
purchase 27.2 million common shares in the capital of the Company
("Common Shares") at a price of $0.11
per Common Share for gross proceeds to the Company at $3 million.
Todd currently owns 21,268,889 Common Shares, representing
19.99% of the Company's outstanding Common Shares. Upon completion
of the Private Placement, Todd will own a total of 48,541,616
Common Shares in the capital of Northcliff, representing 36.3% of
the Company's outstanding Common Shares.
The Private Placement requires shareholder approval under the
rules and policies of the Toronto Stock Exchange ("TSX"). The
Company intends to obtain shareholder approval for the Private
Placement at a special meeting of shareholders that is scheduled to
occur in December 2016 in
Vancouver (the "Meeting").
Assuming shareholder approval is obtained and if other conditions
precedent to the Private Placement are met, the Private Placement
is scheduled to close shortly after the Meeting.
The Common Shares to be issued to Todd will be subject to
applicable resale restrictions, including a four month hold period
under Canadian securities rules.
Pursuant to Multilateral Instrument 61-101 – Protection of
Minority Security Holders in Special Transactions ("MI 61-101"),
the Private Placement constitutes a "related party transaction" as
Todd is a related party of the Company. The Company is relying on
exemptions from the formal valuation and minority approval
requirements of MI 61-101, on the basis that the fair market value
of the Private Placement at the time the transaction was agreed to
did not exceed 25% of the Company's market capitalization pursuant
to Sections 5.5 (a) and 5.7 (a) of MI 61-101.
The Common Shares issuable to Todd will be acquired pursuant to
an exemption from the prospectus requirements under section 2.10 of
National Instrument 45-106.
Under the terms of the Agreement, upon the closing of the
Private Placement Todd will have the right to appoint an additional
nominee to the Company's Board of Directors (for a total of two
nominees), and Todd will continue to have its pre-emptive right to
maintain its percentage shareholding in Northcliff by participating
pro rata in future common share offerings of Northcliff.
The net proceeds of the Private Placement will be used to fund
at least $1.5 million of the
Company's share of expenditures related to the Sisson Project and
for working capital and general corporate purposes, including
repayment by the Company of the loan made by one of its
directors.
The Private Placement is subject to a number of conditions,
including without limitation, the approval of the TSX and the
receipt of shareholder approval, including shareholder approval of
the waiver and amendment of the Company's Amended and Restated
Shareholder Rights Plan Agreement dated effective April 21, 2016, the day on which it was approved
by the Company's shareholders.
A management information circular containing the terms and
conditions of the Private Placement in detail will be mailed to the
Company's shareholders in connection with the Meeting.
Northcliff and a subsidiary of Todd entered into a limited
partnership agreement on October 16,
2013 to advance and operate the Sisson Project under the
Sisson Project Limited Partnership. Todd acquired the right to an
initial 11.5% interest in the Sisson Project Limited Partnership by
investing $14 million on a staged
basis. This earn-in was completed in 2014 and Todd now holds a
fully vested 11.5% interest in the Sisson Project Limited
Partnership and a 19.99% shareholding in the Company. Todd also
holds an option to acquire an additional 10% interest in the Sisson
Project Limited Partnership (for a total potential interest of
21.5% in the Sisson Project Limited Partnership) by investing
$20 million in the Sisson Project
Limited Partnership upon a final investment decision to commence
construction of the Sisson Project.
About Northcliff Resources Ltd.
Northcliff, associated with Hunter Dickinson Inc. (HDI), is a
mineral resource company focused on advancing the feasibility-stage
Sisson Tungsten-Molybdenum Project located in New Brunswick, Canada, to production. The
results of the Feasibility Study, completed in January 2013, confirm that the Sisson Project is
technically and economically feasible and can move on to the next
stage of development.
As part of the environmental review process applicable to the
Sisson Project, the Sisson Environmental Impact Assessment Report
(the "EIA Report") was submitted to both the federal Canadian
Environmental Assessment Agency ("CEAA") and the New Brunswick
Department of Environment and Local Government in July 2013. The Company received provincial EIA
Report approval on December 3, 2015.
A federal decision from CEAA is pending. Permit applications for
construction and operation will be finalized and submitted
following a positive federal decision.
Christopher Zahovskis
President & CEO
This release includes certain statements that may be deemed
"forward-looking statements". All statements in this release, other
than statements of historical facts, that address the in-progress
financing, permitting, exploration drilling, exploitation
activities and events or developments that the Company expects, are
forward-looking statements. Although the Company believes the
expectations expressed in such forward-looking statements are based
on reasonable assumptions, such statements are not guarantees of
future performance and actual results or developments may differ
materially from those in the forward-looking statements.
Assumptions used by the Company to develop forward-looking
statements include the following: the proposed financing will be
completed, the Sisson Project will obtain all required
environmental and other permits for construction of the mine, the
Sisson Project will achieve targeted production levels; the
Company's study and development of the Sisson Project will continue
to be positive; contracted parties provide goods and/or services on
the agreed timeframes; equipment necessary for construction and
development is available and does not incur unforeseen breakdowns;
no material labour slowdowns or strikes are incurred; plant and
equipment functions as specified; geological or financial
parameters do not necessitate future mine plan changes; and no
geological or technical problems occur. Factors that could
cause actual results to differ materially from those in
forward-looking statements include uncertainty of shareholder
support, the need for judicial and regulatory approvals,
fluctuations in market prices, exploitation and exploration
successes, continuity of mineralization, potential environmental
issues and liabilities associated with exploration, development and
mining activities, uncertainties related to the ability to obtain
necessary environmental, land use and other permits, approvals,
licenses and title on a timely basis and delays due to third party
opposition, and development of properties located within First
Nations treaty and asserted territories may affect or be perceived
to affect treaty and asserted aboriginal rights and title, which
may cause permitting delays or opposition by First Nations
communities, changes in government policies regarding mining and
natural resource exploration and exploitation, continued
availability of capital and financing, and general economic, market
or business conditions. Investors are cautioned that any such
statements are not guarantees of future performance and actual
results or developments may differ materially from those projected
in the forward-looking statements. For more information on the
Company, investors should review the Company's continuous
disclosure filings that are available at www.sedar.com.
SOURCE Northcliff Resources Ltd.