Ituna Capital (TUN-V)
www.itunacapital.com
3.8 million o/s
Looking to raise $1 million - $2 million
Key people:
Joe Martin - Cambridge House Mining Conference
Ituna to acquire Buena Vista Gold as QT
Oct 31, 2012 - News Release
Ituna Capital Corp. has entered into a non-binding letter of intent with Buena Vista Gold Inc. (BVG) dated Sept. 27, 2012. BVG is an Ontario provincial corporation and is a non-reporting private issuer. No party holds a controlling interest in BVG. The LOI contemplates that the parties will enter into a definitive agreement providing for the acquisition, by the company, of all of the issued and outstanding shares of BVG in exchange for shares of the company, on the basis of one Ituna share for every one BVG share, subject to the policies of the TSX Venture Exchange. Ituna is a reporting company incorporated in the province of British Columbia, listed for trading on the exchange as a capital pool company (CPC).
There are currently a total of 29,754,666 BVG shares issued and outstanding, and options to purchase 750,000 BVG shares at a price of 15 cents per share until Sept. 1, 2016, such that upon closing (as defined below), Ituna would issue a total of 29,754,666 shares and options to purchase 750,000 shares (the QT shares) pro rata to the existing shareholders of BVG. As contemplated by Ituna and BVG, this transaction will be considered a qualifying transaction for a CPC under the rules of the exchange.
Ituna and BVG contemplate a concurrent financing of a minimum of $1-million and a maximum of $2-million (the QTPP) for a phase 1 work program as recommended by an acceptable National Instrument 43-101 report of at least $500,000 on the Buena Vista property, completion of the exchange approval process and financing the operations of Ituna for the 12 months following the closing (as defined below). The resulting issuer will be a Tier 2 issuer in the mining industry segment of the exchange. Canaccord Genuity Corp. (agent) will conduct the private placement offering on a best-efforts basis.
Ituna will hold discussions with the exchange regarding the acceptability of the QT and the QTPP, and various other matters related to the structuring of the proposed transactions, and the LOI is subject to satisfactory results of that meeting. At this time a sponsor has not yet been retained, and Ituna will also be seeking a waiver to sponsorship from the exchange during its discussions. Completion of the QT and QTPP would close at the time of final exchange approval of the transaction.
Pursuant to the LOI, the transaction may involve:
- A consolidation or cancellation of certain of BVG's outstanding common shares in order for BVG's common shares issued at one cent to meet the exchange's five-cent minimum price requirement;
- An acquisition by Ituna of 100 per cent of the outstanding BVG shares from the shareholders of BVG in exchange for common shares of Ituna on the basis of one Ituna share for each postconsolidation BVG share held by way of an exempt takeover bid, and BVG will become a wholly owned subsidiary of Ituna.
BVG, a private Ontario corporation held by 50 shareholders, holds two properties, being the flagship Buena Vista gold-silver-copper property along the Oreana gold trend in central Nevada, across the valley from Midway Gold Corp.'s Spring Valley gold property (currently under option to Barrick Gold Exploration Inc.), and the Delamar gold-silver property in Lincoln county, Nevada. Subject to shareholder approval, BVG shall have the right to appoint two directors to the combined company. As of Sept. 1, 2012, BVG had minimal working capital and had spent approximately $2-million to acquire and develop its mineral properties. It is currently preparing audited financial statements.
The LOI sets out the Buena Vista gold-silver-copper property would be the qualifying 43-101 property for the QT, with preparation of the required NI 43-101 report currently being under way, such report to meet the requirements of the exchange. Upon completion of a binding, formal agreement pursuant to the terms of the LOI, the NI 43-101 report will be addressed to both BVG and Ituna, pursuant to the policies of the exchange.
The transaction will be considered a reviewable transaction under the policies of the exchange and is subject to certain industry standard closing conditions, including regulatory approval and the execution of a definitive agreement, and all related and ancillary documents. In addition, the transaction is also subject to the approval of the exchange, and, if required by the exchange, completion of the consolidation and shareholder approval, as well as the completion of an equity financing for the company to raise gross proceeds in the minimum amount of $1-million on or prior to the closing of the transaction. There are no non-arm's-length parties to Ituna that are insiders of BVG. The proposed QT does not constitute a non-arm's-length transaction.
Completion of the transaction is subject to a number of conditions, including but not limited to exchange acceptance and, if applicable pursuant to exchange requirements, majority of the minority shareholder approval. Where applicable, the transaction cannot close until the required shareholder approval is obtained. 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 or filing statement to be 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.
We seek Safe Harbor. |
