VANCOUVER, BC, May 6, 2021 /CNW/ - Scottie Resources
Corp. (TSXV: SCOT) ("Scottie") and
AUX Resources Corporation (TSXV: AUX) (OTC: AUXRF)
("AUX") are pleased to announce that, further to their
proposed transaction announced on April 12,
2021, they have signed an amalgamation agreement dated
May 4, 2021 (the "Agreement")
pursuant to which a wholly-owned subsidiary of Scottie will
amalgamate with AUX and all of the issued and outstanding common
shares of AUX following the amalgamation will immediately be
exchanged for common shares of Scottie on a one-for-one
basis (the "Transaction"). The Transaction will
consolidate the contiguous gold-silver exploration assets of
Scottie's Cambria Project and AUX's Silver Crown, Independence,
American Creek, Lower Bear and Bear Pass Projects, all of which
will benefit from operational and geological synergies.
Upon completion of the Transaction, it is expected that the
shareholders of AUX will hold approximately 31% of Scottie's issued
and outstanding shares. The board of Scottie will remain the
same.
Anticipated Benefits of the
Transaction
- District scale 522 km2 100% owned in the heart of
the Stewart Mining Camp adjacent to Pretium Resources and Ascot
Resources Premier and Red Mountain deposits in the Golden Triangle
(Figure 1).
- Consolidation of AUX's Silver Crown, Independence, American
Creek, Lower Bear and Bear Pass Projects with Scottie's Cambria
Project. The expanded Cambria Project will cover 27,465 contiguous
hectares and includes five historical mines (Molly B, Bayview, Black Hills, Blue Grouse and
Terminus).
- Three advanced Projects in the Stewart Mining Camp – Scottie
Gold Mine, Georgia (including the
Georgia River Mine) and Cambria (including five historical mines).
All three Projects will be drilled in the 2021 field season
including a 12,500 metre three rig diamond drill program at the
Scottie Gold Mine.
- Scottie's significant infrastructure in Stewart will provide operational synergies to
AUX's projects.
- Scottie will be well-capitalized with over $6 million in cash.
"The 2021 field season will be a transformative one for the
combined company as we aggressively advance the total land package
with a combined 16,000 metres of diamond drilling coupled with
geophysics and property scale geochemical surveys," comments
Brad Rourke, Chief Executive Officer
of Scottie. "Due to the complementary land packages, consolidation
of Scottie and AUX is a clear value add for shareholders in both
companies."
Figure 1 – Scottie and AUX combined claims
Board of Directors' Recommendation
The Board of Directors of Scottie (with the exclusion of Mr.
Rourke, who also serves as a director of AUX) have determined that
the Transaction is in the best interests of Scottie and have
approved the Transaction.
The Board of Directors of AUX (with the exclusion of Mr. Rourke,
who also serves as a director of Scottie) have determined that the
Transaction is in the best interests of AUX and have approved the
Transaction. Further, AUX's Directors and certain shareholders have
entered into voting and support agreements to which they have
agreed to vote their AUX shares.
Transaction
Pursuant to the terms of the Agreement, the Transaction is
expected to be completed by way of a three-corner amalgamation
under the provisions of the Business Corporations Act
(British Columbia) whereby
1302688 B.C. Ltd. ("Subco"), a
wholly-owned subsidiary of Scottie, will amalgamate with AUX and
all of the issued and outstanding common shares of AUX following
the amalgamation will immediately be exchanged for common shares of
Scottie on a one-for-one basis. Warrants and options of AUX will be
exchanged into warrants and options, respectively, of
Scottie. Closing of the Transaction is subject to a number of
customary conditions being satisfied or waived by one or both of
Scottie and AUX, including the receipt of AUX shareholder approval,
together with any requisite minority approvals, and the receipt of
all necessary regulatory approvals, including the approval of the
TSX Venture Exchange.
Scottie and AUX are committed to consummating the Transaction in
an expedited manner and it is anticipated that the annual general
and special meeting of AUX shareholders to approve the proposed
Transaction will be held in July 2021
and, if approved and all other conditions have been met, it is
expected that the Transaction will close shortly thereafter.
Further information regarding the Transaction will be contained in
a management information circular to be mailed to shareholders of
AUX in connection with the annual general and special meeting. All
shareholders of AUX are urged to read the management information
circular once available, as it will contain important additional
information concerning the Transaction. Following completion of the
Transaction, the company formed by the amalgamation of AUX and
Subco will become a wholly owned subsidiary of Scottie. There can
be no assurance that the Transaction will be completed as proposed
or at all.
About Scottie Resources
Scottie owns a 100% interest in the high-grade, past-producing
Scottie Gold Mine and Bow properties and has the option to purchase
a 100% interest in Summit Lake
claims which are contiguous with the Scottie Gold Mine property.
Scottie also owns 100% interest in the Cambria Project properties
and the Sulu property. Scottie Resources holds more than
25,000 hectares of mineral claims in the Golden Triangle.
Scottie's focus is on expanding the known mineralization around
the past-producing mine while advancing near mine high-grade gold
targets, with the purpose of delivering a potential resource. All
of Scottie's properties are located in the area known as the Golden
Triangle of British Columbia which
is among the world's most prolific mineralized districts.
About AUX Resources
AUX holds more than 27,000 hectares of strategic claims in the
Stewart Mining Camp in the Golden Triangle of British Columbia, which is among the world's
most prolific mineralized districts, including the high-grade
Georgia Project and the past-producing Georgia River Mine. The
Georgia River Mine, which last operated in 1939 with a head grade
of 23 g/t gold, contains 1.2 kilometres of underground access on
three levels.
The technical disclosures in this release have been read and
approved by Dr. Thomas Mumford,
Ph.D., P.Geo., a qualified person as defined in National Instrument
43-101.
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. This news release includes
forward-looking statements that are subject to risks and
uncertainties. All statements within, other than statements of
historical fact, are to be considered forward looking, including,
but not limited to, statements regarding the entering into of a
definitive agreement between Scottie and AUX, the timing of the AUX
shareholder meeting and approval of AUX shareholders, closing of
the proposed Transaction and the anticipated benefits of the
Transaction. Although Scottie and AUX believe 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 forward-looking statements. Factors that
could cause actual results to differ materially from those in
forward-looking statements include market prices, exploitation and
exploration successes, continued availability of capital and
financing, and general economic, market or business conditions and
regulatory, shareholder and administrative approvals, processes and
filing requirements. There can be no assurances that such
statements will prove accurate and, therefore, readers are advised
to rely on their own evaluation of such uncertainties. We do not
assume any obligation to update any forward-looking
statements.
SOURCE AUX Resources Corporation
