DIEPPE, NB, April 3, 2017 /CNW/ - (CBI: TSX-V) Further
to its news release of December 16,
2016, Colibri Resource Corporation ("Colibri" or the
"Company") wishes to announce that, subject to regulatory and
shareholder consent, it has reached a definitive agreement with
Ontop Capital Limited (the "Vendor") regarding the acquisition of
Canadian Gold Resources Ltd. ("CGR") from the Vendor (the
"Transaction"). Under the terms of a letter of intent dated
December 15, 2016, the Company
originally had anticipated issuing up to 26,666,667 common shares
at a price of $0.15 per share for all
of the issued and outstanding shares of CGR. Following a due
diligence review of CGR and its properties, Colibri has agreed to
issue 24,242,425 common shares (the "Consideration Shares") at a
price of $0.165 per share to the
Vendor for an aggregate acquisition cost of $4,000,000.
Immediately after closing, the Vendor intends to distribute the
Consideration Shares to its shareholders by way of a dividend in
kind. As a result of such distribution, a new Control Person will
be created as one of the shareholders of the Vendor, John Schiavi, will be holding or controlling
Consideration Shares equal to more than 20% of the issued and
outstanding common shares of the Company after giving effect to the
Transaction. In accordance with TSXV rules, the Company will be
seeking shareholder approval to this aspect of the Transaction.
The Transaction is also a "related party transaction" within the
meaning of Multilateral Instrument 61-101 Protection of Minority
Shareholders in Special Transactions ("MI 61-101") as
Ronald J. Goguen, a director,
officer and shareholder of the Company, is also a significant
shareholder of the Vendor, holding more than 19% of its shares. As
a consequence, the Transaction is subject to minority shareholder
approval requirements.
Although the Transaction is exempt from the formal valuation
requirements pursuant to section 5.5(a) (Issuer not Listed on
Specified Markets) of MI 61-101, the independent directors
nonetheless commissioned a 3rd party valuation of CGR
(the "Valuation") by Harris Capital Corporation of Toronto, Ontario to assist them in their
review of the Transaction and to provide protection for minority
shareholders. The Valuation, dated March 8,
2017, provided the board of directors with, amongst other
things, a discussion of various methodologies to value CGR as well
as a range of possible values.
Further details of the Transaction (including a summary of the
Valuation) and the matters requiring shareholder approval will be
provided in the management information circular to be issued in
connection with an upcoming annual and special meeting of the
Company's shareholders. A further announcement will be made when
this meeting has been formally called.
The independent directors who reviewed the Transaction included
Edward Stringer, William Macdonald, Roger
Doucet, Paul Bartos,
Jacques F. Monette.
Qualified Persons
As disclosed in the Company's news release of December 16, 2016, an NI 43-101 report was
prepared for the Pilar property which is one of the principal
assets of CGR. Jamie Lavigne M.Sc.,
P.Geo., a Qualified Person under NI 43-101 and independent of the
Pilar Gold Project, prepared the report dated November 9, 2016. A summary of the report will be
provided in the management information circular while a full copy
of the report will be posted on SEDAR.
About Colibri Resource Corporation:
Colibri is a Canadian mineral exploration company listed on the
TSX-V (CBI) focused on acquiring and exploring properties in
Mexico.
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as the term is defined in the policies of the TSX Venture
Exchange) accepts responsibility for the adequacy or accuracy of
this release.
This news release may contain forward looking statements
concerning future operations of Colibri Resource Corporation (the
"Company"). All forward looking statements concerning the Company's
future plans and operations, including management's assessment of
the Company's project expectations or beliefs may be subject to
certain assumptions, risks and uncertainties beyond the Company's
control. Investors are cautioned that any such statements are
not guarantees of future performance and that actual performance,
exploration and financial results may differ materially from any
estimates and projections.
SOURCE Colibri Resource Corporation