NGEx Resources (NGQ-T) July 14, '16 is pleased to report that, further to its news release dated June 13, 2016, the Company has filed its Notice of Special Meeting (the "Notice") of shareholders and optionholders of the Company (together, the "NGEx Securityholders"), and the related Management Information Circular (the "Circular"), which describes, amongst other things, the proposed spin-out of the Company's wholly owned Filo del Sol property (the "Filo del Sol Project") into a wholly owned subsidiary of NGEx, Filo Mining Corp. ("Filo Mining"), through a Plan of Arrangement under the Canada Business Corporations Act (the "Arrangement").
Upon completion of the Arrangement, Filo Mining will hold a 100% interest in the Filo del Sol Project and will focus on the advancement of this project. Over time it is expected that Filo Mining may add new exploration stage projects to its portfolio. NGEx will retain and focus on the advancement of its 60% owned Constellation Project. The Constellation Project is comprised of the Los Helados property in Chile, and the Josemaría property in Argentina. Los Helados is part of a joint venture in which the Company holds 60.72% and Pan Pacific Copper Co., Ltd. holds 39.28%, and Josemaría is part of a joint venture in which the Company holds 60% and Japan Oil, Gas, and Metals National Corporation holds 40%.
The board of directors of NGEx Resources Inc. (the "Board") has determined that the Arrangement is fair and is in the best interests of NGEx and the NGEx Securityholders and recommends that the NGEx Securityholders vote in favour of the Arrangement. In addition, the Corporation has received a fairness opinion from its financial advisor, Evans & Evans, Inc., that the terms of the Arrangement are fair, from a financial point of view, to the NGEx shareholders. The Board notes that the Arrangement is expected to allow NGEx to focus on the further advancement of the Constellation Project and minimize dilution of that project. In addition, the Arrangement is expected to allow the market to value the Constellation Project independently of the earlier stage Filo del Sol Project, permit the independent development of both projects and provide capacity for new acquisitions.
The Circular, which sets out the terms of the Arrangement, together with the Notice and related proxy documents for the special meeting (the "Meeting") of NGEx Securityholders voting as a single class, scheduled for August 11, 2016, has been mailed to all NGEx Securityholders of record as of July 8, 2016 and is available under NGEx's profile on SEDAR at www.sedar.com and has also been filed on the Company's web site at www.ngexresources.com.
Technical Report
Concurrently with the filing of the Circular, NGEx announces that an updated National Instrument 43-101 ("NI 43-101") Technical Report (the "Technical Report"), for the Filo del Sol Project has been completed and filed on SEDAR.
The Technical Report titled "Geological Report for the Filo del Sol Property, Region III, Chile and San Juan Province, Argentina" dated June 10, 2016, was prepared for Filo Mining by Fionnuala Devine, M. Sc., P.Geo., of Merlin Geosciences Inc., Diego Charchaflié, M. Sc., P.Geo. of LPF Consulting SRL, and James N. Gray, P.Geo. of Advantage Geoservices Ltd., all of whom are Qualified Persons as defined by NI-43-101 and are independent of the Company and Filo Mining. The Technical Report is available for review under the Company's profile on SEDAR at www.sedar.com and on the Company's website at www.ngexresources.com.
The Transaction
The Arrangement will include a transfer of the Filo del Sol Project, along with $3 million in cash, to Filo Mining. Pursuant to the Arrangement, NGEx will distribute 100% of the common shares of Filo Mining it receives to NGEx shareholders on a pro rata basis. NGEx shareholders will be entitled to receive one common share of Filo Mining for every four common shares of NGEx held as of the effective date of the Arrangement, expected to be in mid-August, 2016. There will be no change in shareholders' holdings in NGEx as a result of the Arrangement.
Each outstanding stock option of NGEx will be deemed to be exchanged for a fully-vested replacement stock option of NGEx (an "NGEx Replacement Option") and one quarter of one fully-vested stock option of Filo Mining (a "Filo Option"), and the exercise prices for the NGEx Replacement Options and the Filo Options will be adjusted to reflect the relative value of the shares.
The Arrangement will be subject to Toronto Stock Exchange ("TSX"), regulatory and court approval, as well as approval by not less than two-thirds of the votes cast at the Meeting by the NGEx Securityholders voting as a single class.
The new Filo Mining Board will consist of Mr. Lukas Lundin, Mr. Ashley Heppenstall, Mr. Paul McRae, Mr. Alessandro Bitelli, and Mr. Wojtek Wodzicki. Information concerning each director of Filo Mining is set out in the Circular.
The management team of Filo Mining will consist of Wojtek Wodzicki as CEO, Joyce Ngo as Interim CFO, Bob Carmichael as VP Exploration and Julie Kemp as Corporate Secretary. Changes and additions to the management team will be made as needed and as the Filo del Sol Project progresses.
The Company intends to apply for a listing of the shares of Filo Mining on the TSX Venture Exchange ("TSX-V"). Any such listing will be subject to Filo Mining fulfilling all of the requirements of the TSX-V. The Company also expects to apply for a listing of the shares of Filo Mining on the Nasdaq First North Exchange in Stockholm, Sweden. Any such listing will be subject to Filo Mining fulfilling all the requirements of the Nasdaq First North Exchange.
About NGEx
NGEx is a Canadian mineral exploration company with exploration projects in Chile and Argentina. The Company's shares are listed on the TSX and on Nasdaq Stockholm under the symbol "NGQ". The Company's focus is on three advanced exploration stage copper-gold systems located on a contiguous land package that the Company holds in Chile's Region III and adjacent San Juan Province, Argentina. Los Helados is part of a joint venture in which the Company holds approximately a 60.72% interest and Pan Pacific Copper Co., Ltd. holds approximately a 39.28% interest. Josemaría is part of a joint venture in which the Company holds 60% and Japan Oil, Gas, and Metals National Corporation (JOGMEC) owns 40%. NGEx holds a 100% interest in the Filo del Sol Project. In addition to these more advanced projects, the Company holds a portfolio of 100% owned early stage exploration projects located in Chile and Argentina.
Additional Information
The information in this release is subject to the disclosure requirements of NGEx under the Swedish Securities Market Act and/or the Swedish Financial Instruments Trading Act. This information was publicly communicated on July 13, 2016 at 7:00p.m. Pacific Time.
On behalf of the board
Wojtek Wodzicki, President and CEO
CONTACT INFORMATION:
NGEx Resources Inc.
Sophia Shane
Corporate Development
(604) 689-7842
www.ngexresources.com
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