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TORONTO,
Oct. 3, 2013 /CNW Telbec/ - Further
to its preliminary news releases dated February 4, 2013, March 1, 2013 and
July 4, 2013, C Level III Inc. (TSXV:
CLV.P) (the "Corporation"), a TSX Venture Exchange (the
"TSXV") capital pool company, wishes to provide an update
with respect to the terms and conditions of the Qualifying
Transaction and Offering (as defined in the previous news
releases). The Corporation announces that it has signed an
updated definitive agreement with 2299895 Ontario Inc.
("OntarioCo") and which updated agreement replaces and
supersedes the previously announced Qualifying Transaction (the
"Re-Stated Qualifying Transaction") and has amended
the provisions of previously announced Offering.
The Re-Stated Qualifying Transaction will be carried out by
means of securities exchange agreements, pursuant to which Giyani
Gold Corp. ("Giyani Gold"), the majority shareholder of
OntarioCo, and two minority OntarioCo shareholders will
collectively receive an aggregate of 20,000,000 common shares
of the Resulting Issuer (the "Resulting Issuer Shares") in
exchange for their OntarioCo common shares (the "OntarioCo
Shares").
Upon completion of the Re-Stated Qualifying Transaction,
OntarioCo will be a direct, wholly-owned subsidiary of the
Resulting Issuer. The Re-Stated Qualifying Transaction will
constitute a reverse take-over of the Corporation inasmuch as the
current shareholders of OntarioCo will own approximately 52.2% of
the outstanding shares of the Resulting Issuer immediately upon
completion of the Qualifying Transaction (on a non-diluted basis
and assuming full subscription of the Amended Offering described
below).
As a result of the securities exchange agreements and the
Amended Offering described below, the Resulting Issuer will have
between 32,587,676 and 38,337,676 Resulting Issuer Shares, 483,392
options to acquire Resulting Issuer Shares, and between 5,840,417
and 14,266,667 share purchase warrants (including Brokers'
warrants) to acquire Resulting Issuer Shares outstanding. The
minimum and maximum amount of Resulting Issuer Shares issued above
is based upon $1.35 million (with
$500,000 of common shares and
$850,000 of flow through common
shares issued) vs. $2 million of
common shares issued and that such shares were not issued as flow
through common shares. As a result 17,820,000 Resulting Issuer
Shares will be subject to escrow and will be gradually released in
accordance with the policies of the TSXV.
Terms of the Amended Offering
In connection with the Re-Stated Qualifying Transaction, the
Corporation and OntarioCo will each carry out respective private
placements to raise a minimum of $1.35
million and a maximum of $2
million, which are expected to close on or
around October 25, 2013 (the "Amended Offering").
The Amended Offering will consist of a combination of: (i) common
shares of OntarioCo at a price of $1.05 per common share ("OntarioCo
Share"), (ii) subscription receipts for units of the Resulting
Issuer at a price of $0.15 per unit (the "Subscription
Receipts") with each unit consisting of one (1) Resulting
Issuer Share and a full share purchase warrant entitling the holder
to acquire one (1) Resulting Issuer Share at a price of
$0.25 per Resulting Issuer Share for
a period of 2 years (the "Common Share Purchase Warrant")
and (iii) units of the Resulting Issuer at a price
of $0.20 per unit (the
"FT Subscription Receipts") with each unit consisting of one
(1) Resulting Issuer Shares issued on a flow-through basis and
a one-half (1/2) share purchase warrant to acquire a Resulting
Issuer Shares with each full share purchase warrant entitling the
holder to purchase one (1) Resulting Issuer Share at a price of
$0.30 per Resulting Issuer Share for
a period of 2 years.
Each OntarioCo Share will automatically convert, without any
further action by the holder thereof, and without any additional
consideration upon completion of the Qualifying Transaction, into
seven (7) Resulting Issuer Shares and seven (7) Common Share
Purchase Warrants for each OntarioCo Share.
The Amended Offering will continue to be led by Portfolio
Strategies Securities Inc. (the "Agent") with the Agent's
entitlement to fees and brokers' warrants unchanged. Under the
terms of the Amended Offering, however, each Broker Warrant will
now entitle the Agent to acquire one Resulting Issuer Share
at $0.15 per Resulting
Issuer Share (for each OntarioCo Share and Subscription Receipt
sold) or $0.20 per Resulting Issuer
Share (for each FT Subscription Receipt sold); each such warrant
exercisable for a period of eighteen (18) months following the
satisfaction of the Release Conditions.
The gross proceeds from the (i) the OntarioCo common shares and
(ii) the Subscription Receipts and FT Subscription Receipts sold
pursuant to the Offering will be held in escrow in an interest
bearing account pending satisfaction of the Release Conditions (the
"Escrowed Proceeds"). If the Release Conditions are not
satisfied or waived on or before 5:00
p.m. (Toronto time) on the date that is four
(4) months and one (1) day from the closing date of the Amended
Offering, then the Subscription Receipts and FT Subscription
Receipts will immediately become null and void and C Level shall
distribute the Escrowed Proceeds and accrued interest to the
holders of the Subscription Receipts and FT Subscription Receipts
on a pro rata basis so that they are refunded
their full purchase price.
Required Approvals
Completion of the Re-Stated Qualifying Transaction is subject to
a number of conditions, including but not limited to receipt of
final approval of the Re-Stated Qualifying Transaction from the
TSXV. In addition, the Amended Offering is subject to final
approval from the TSXV.
The Re-Stated Qualifying Transaction is not a "Non-Arm's Length
Re-Stated Qualifying Transaction", as the Corporation and OntarioCo
do not share any common "Control Persons", within the meaning of
those terms in Policy 2.4 of the TSXV. As such, the approval of the
Corporation's shareholders is not required in connection with the
Re-Stated Qualifying Transaction. The TSXV has waived its
sponsorship requirements in connection with the Re-Stated
Qualifying Transaction.
Both the Re-Stated Qualifying Transaction and the Amended
Offering are subject to TSXV approvals. In this respect, the
Corporation will amend the Filing Statement to reflect the
provisions of both the Re-Stated Qualifying Transaction and the
Amended Offering and the amended filing statement will be filed
with the TSXV for conditional approval (the "Amended Filing
Statement"). Once conditionally approved by the TSXV, the
Corporation will file the Amended Filing Statement, in accordance
with Policy 2.4 of the TSXV on SEDAR at www.sedar.com, at
least seven (7) business days prior to the commencement of trading
of the Resulting Issuer's shares on the TSXV.
About OntarioCo
OntarioCo is a majority owned subsidiary of Giyani Gold,
incorporated under the Business Corporations
Act (Ontario)
on September 23, 2011. The company has its head office in
Oakville, Ontario. OntarioCo is a
gold exploration company with assets in the Northwestern region of
the province of Ontario, including
its Iron Lake Gold Project (formerly known as the Abbie
Lake-Keating Property), and its rare earth projects in the province
Saskatchewan. According to the
independent technical report prepared by J.
Garry Clark, P. Geo. in respect of the Iron Lake Gold
Project, dated February 15, 2013 (as updated) (the
"Technical Report"), the Iron Lake Gold Project has the
potential to host significant gold resources and is a property of
merit, worthy of further exploration.
As described in the Technical Report, the Iron Lake Gold Project
covers a 38km section of the Kabenung Lake greenstone belt that
hosts the Iron Lake Deformation Zone (the "ILDZ") and
subsidiary shear zones which have been proven to contain
significant gold showings. The gold mineralization found associated
with the shears on the Abbie Lake and Keating East
portions of the Iron Lake Gold Project resembles gold bearing
structures found in the Timmins
camp area. Quartz eye porphyry zones located on the boundaries
between the Abbie Lake and
Keating townships are the likely heat engines that have driven gold
bearing fluid. Shears with pyrite and green mica that occur in
quartz eye sericite schists in the Keating East portion visually
resemble Hemlo-style alteration. The ILDZ and associated formation
and shear zones that are traced by geophysics and diamond drilling
across the area have the potential of hosting economic gold
mineralization.
An exploration budget of approximately $880,000 is recommended to further evaluate the
Iron Lake Gold Project. OntarioCo's exploration program will be
comprised of diamond drilling and Induced Polarization surveying to
extend the known gold bearing alteration zones.
About the Corporation
The Corporation is a capital pool company incorporated under the
provisions of the Canada Business Corporations
Acton June 10, 2011, with its registered and head
office in Toronto, Ontario.
It is a reporting issuer in the provinces of British Columbia, Alberta, Saskatchewan, Manitoba, and Ontario.
Proposed Management and Directors
As part of the completion of the Re-Stated Qualifying
Transaction, the identified management team and the proposed
nominees for directorships will be identical to those disclosed in
the July 4, 2013 news release.
Further Information
All information contained in this news release with respect to
the Corporation and OntarioCo was supplied by the parties
respectively, for inclusion herein, and each party and its
directors and officers have relied on the other party for any
information concerning the other party.
Completion of the transaction is subject to a number of
conditions, including but not limited to, TSXV acceptance. There
can be no assurance that the transaction will be completed as
proposed or at all.
Investors are cautioned that, except as disclosed in the
management information circular and filing statement prepared in
connection with the transaction, any information released or
received with respect to the transaction may not be accurate or
complete and should not be relied upon. Trading in the securities
of a capital pool company should be considered highly
speculative.
The TSX Venture Exchange Inc. has in no way passed upon the
merits of the proposed transaction and has neither approved nor
disapproved the contents of this press release.
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.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION: This
news release includes certain "forward-looking statements" under
applicable Canadian securities legislation. Forward-looking
statements include, but are not limited to, statements with respect
to: the terms and conditions of the Re-Stated Qualifying
Transaction; the terms and conditions of the proposed Amended
Offering; future exploration and testing; use of funds; and the
business and operations of the Resulting Issuer after the proposed
transaction. Forward-looking statements are necessarily based upon
a number of estimates and assumptions that, while considered
reasonable, are subject to known and unknown risks, uncertainties,
and other factors which may cause the actual results and future
events to differ materially from those expressed or implied by such
forward-looking statements. Such factors include, but are not
limited to: general business, economic, competitive, political and
social uncertainties; delay or failure to receive board,
shareholder or regulatory approvals; and the results of current
exploration and testing. There can be no assurance that such
statements will prove to be accurate, as actual results and future
events could differ materially from those anticipated in such
statements. Accordingly, readers should not place undue reliance on
forward-looking statements. The Parties disclaim any intention or
obligation to update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise,
except as required by law.
SOURCE C LEVEL III