TORONTO, April 29, 2015 /CNW/ - Sulliden Mining Capital
Inc. ("Sulliden" or the "Company") (TSX: SMC) and Coastal Gold
Corp. ("Coastal Gold") (TSXV: COD) have signed an amendment to the
definitive arrangement agreement entered into among the parties on
March 1, 2015 (see Press release
dated March 1, 2015) (the "Amendment
Agreement") pursuant to which Sulliden will acquire all of the
issued and outstanding common shares of Coastal Gold by way of a
plan of arrangement under the Business Corporations Act
(Ontario) (the
"Transaction"). Under the Terms of the Amendment Agreement,
Sulliden has included an additional cash component to its offer to
acquire each outstanding Coastal Gold common share.
Pursuant to the Amendment Agreement, Sulliden will acquire each
outstanding Coastal Gold common share for 0.05 of a Sulliden common
share and a cash payment of CDN$0.01
per outstanding Coastal Gold common share. The implied transaction
value is approximately $5.4 million, including the assumption
of $1.50 million in debt. Upon
completion of the Transaction, Coastal Gold will be a wholly-owned
subsidiary of Sulliden. The directors of each company have
unanimously approved the Amendment Agreement.
It is anticipated that the Coastal Gold special shareholder
meeting to approve the Transaction will proceed as scheduled on
May 6, 2015 at 10am EST.
Justin Reid, President and CEO of
Sulliden commented, "We look forward to continuing the work that
has already been initiated with the Coastal Gold team at Hope
Brook. Sulliden's goal will be to advance the asset
immediately to the next stage of development via engineering, and
to continue de-risking the project. Our team along with our
strong balance sheet will allow us to accomplish this."
Loan Agreement to Coastal Gold
On February 28, 2015, Sulliden and Coastal Gold
entered into a loan agreement whereby Sulliden made available to
Coastal Gold up to $150,000 (the
"Loan"). The Loan will accrue interest at the rate of 10% per
annum. Sulliden and Coastal Gold have amended the Loan to provide
that it will mature on the earlier of: (i) the completion of the
Transaction; (ii) termination by Coastal Gold following the
acceptance of a superior proposal; and (iii) the date that is
twelve months following the termination of the Agreement (the
"Maturity Date"). The Loan was also amended to provide that in the
event the proposed acquisition is not completed and the arrangement
agreement is not terminated, Coastal Gold shall have the option at
any time following six months from the date hereof to repay in full
all of the principal amount of the loan outstanding together with
all accrued and unpaid interest thereon by issuing common shares at
a price equal to $0.05, to cover the
principal amount, and in the case of accrued and unpaid interest,
the amount of common shares to be issued will be subject to
TSX-Venture Exchange approval.
About Sulliden Mining Capital
Sulliden Mining Capital is a venture capital company focused on
investments, acquisitions and the development of brownfield,
development-stage and early production-stage mining projects in the
Americas.
About Coastal Gold
Coastal Gold is a mineral exploration and development company
advancing the Hope Brook Gold Project located in southwestern
Newfoundland.
Sulliden Mining Capital Inc.
On behalf of the Board
"Justin Reid"
President & Chief Executive Officer
Caution regarding forward-looking information:
Certain information contained in this press release,
including any information relating to the Transaction (including
the anticipated benefits of the Transaction), the Amendment
Agreement, the amended loan and statements that address events or
developments that Sulliden or Coastal Gold expects to occur, are
"forward-looking information". Forward-looking information includes
statements that are not historical facts and are generally, but not
always, identified by the words "expects", "does not expect",
"plans", "anticipates", "does not anticipate", "believes",
"intends", "estimates", "projects", "potential", "scheduled",
"forecast", "budget" and similar expressions, or that events or
conditions "will", "would", "may", "could", "should" or "might"
occur. Forward-looking information includes, but is not limited to,
statements relating to completion and timing of the acquisition of
Coastal Gold, the delivery of the Hope Brook PEA, the upside
potential of Hope Brook and the Hope Brook mineral
resource estimate and its potential to be increased. All such
forward-looking information is subject to important risk factors
and uncertainties, many of which are beyond Sulliden's or Coastal
Gold's ability to control or predict. Forward-looking
information is necessarily based on estimates and assumptions
that are inherently subject to known and unknown risks,
uncertainties and other factors that may cause Sulliden's or
Coastal Gold's actual results, level of activity, performance or
achievements to be materially different from those expressed or
implied by such forward-looking information. Assumptions upon which
such forward-looking information is based on include the
estimation of mineral resources, the availability of necessary
financing and materials to continue to explore and
develop Hope Brook, that Sulliden and Coastal Gold will be
able to satisfy the conditions contained in the Letter of Intent,
that the required approvals will be obtained from the shareholders
of Coastal Gold, that all third party, court, regulatory and
governmental approvals to the Transactions will be obtained,
including from the Exchange and all other conditions to completion
of the Transaction will be satisfied or waived. Many of these
assumptions are based on factors and events that are not within the
control of Sulliden and Coastal Gold and there is no assurance they
will prove to be correct. Such factors include, without limitation:
capital requirements; fluctuations in the international currency
markets and in rates of exchange of metal prices; changes in
national and local government legislation in Canada or
any other country in which Sulliden and Coastal Gold currently or
may in the future carry on business; taxation; controls,
regulations and political or economic developments in the countries
in which Sulliden and Coastal Gold do or may carry on business;
competition; loss of key employees; and additional funding
requirements.
Any forward-looking information speaks only as of the date on
which it is made and Sulliden and Coastal Gold expressly disclaim
any intention or obligation to update or revise any forward-looking
information, whether as a result of new information, events or
otherwise, except in accordance with applicable securities laws.
Although each of Sulliden and Coastal Gold believe that the
assumptions inherent in the forward-looking information are
reasonable, forward-looking information is not a guarantee of
future performance and accordingly undue reliance should not be put
on such statements due to the inherent uncertainty therein.
SOURCE Sulliden Mining Capital