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OR FOR DISSEMINATION IN THE UNITED STATES.
Vancouver, British Columbia - (April 22, 2019) – Voltaic Minerals Corp. (TSX.V:VLT) (the "Corporation" or "Voltaic") is pleased to announce that it has entered into a binding Letter of Intent ("LOI") dated April 17, 2019 with 1146915 B.C. Ltd. ("PrivCo"). Pursuant to the terms of the LOI Voltaic and PrivCo will enter into a definitive Share Exchange Agreement (the "Definitive Agreement") whereby all outstanding securities of PrivCo will be exchanged for securities of Voltaic (the "Acquisition"). On or prior to closing of the Acquisition, Voltaic will have used reasonable efforts to complete one or more private placements (the "Private Placement") of units (the "Voltaic Units") on terms acceptable to PrivCo, acting reasonably, for minimum gross proceeds of $2,000,000 at a price of $0.25 per Voltaic Unit. Each Voltaic Unit shall be comprised of one Voltaic Share and one warrant to acquire an additional Voltaic Share (each a "PP Warrant") at an exercise price of $0.50 per PP Warrant (the Private Placement together with the Acquisition, the "Transaction"). The Transaction is expected to constitute a Fundamental Acquisition (as that term is defined in the policies of the TSX Venture Exchange (the "TSXV")) by Voltaic. The final structure of the Definitive Agreement is subject to applicable corporate, securities and tax considerations. The Acquisition is an arm's length transaction.
Prior to completion of the Transaction, PrivCo may complete one or more private placements (the "PrivCo Financing") of units (the "PrivCo Units") on terms acceptable to Voltaic, acting reasonably, for gross proceeds of up to $2,000,000 at a price of $0.25 per PrivCo Unit. Each PrivCo Unit shall be comprised of one common share of PrivCo (each a "PrivCo Share") and one warrant to acquire an additional PrivCo Share (each a "PrivCo Warrant") at an exercise price of $0.50 per PrivCo Warrant.
On closing of the Transaction, it is anticipated that Voltaic will change its name to "Alpha Lithium Corp.", or such other name as is satisfactory to Voltaic, PrivCo and the TSXV. On completion of the Transaction the Corporation will carry on with the development of PrivCo's lithium assets in Argentina in conjunction with development of its other projects.
PrivCo is a private company incorporated under the British Columbia Business Corporations Act and headquartered in Vancouver, British Columbia. PrivCo is a lithium exploration and development company focusing on the development of eight claims (the "Claims") covering approximately 20,699 ha in Salta Province, Argentina. Privco's claims when added to the two claims covering 6,778.02 ha acquired by Voltaic from PrivCo in December, 2017 (refer to Voltaic's news release dated December 27, 2019 for further details) would bring the total property of the combined companies to 27,477 ha in Salta, Argentina.
Upon completion of the Transaction, it is anticipated that certain of Voltaic's current board and management will resign and that representatives of PrivCo with the requisite experience will be appointed as Voltaic directors and officers, in order to satisfy the requirements of the TSXV. Voltaic will provide an update in respect of its proposed management in due course.
Share Exchange Transaction
On closing of the Transaction, the holders of the issued and outstanding PrivCo Shares will exchange their shares in consideration for Voltaic Shares on a 1:1 basis (the "Exchange Ratio"). In addition, to the extent any convertible securities of PrivCo remain outstanding on the date of closing the Transaction, Voltaic will issue replacement securities (the "Voltaic Replacement Securities") in consideration of the cancellation of the convertible securities of PrivCo, which Voltaic Replacement Securities shall be exercisable to acquire Voltaic Shares in lieu of PrivCo Shares based on the Exchange Ratio and otherwise bear the same terms and conditions as the convertible securities of PrivCo so cancelled.
It is presently anticipated that (excluding the exchange of any securities which may be issued pursuant to the PrivCo Financing), the Acquisition share exchange will result in:
Furthermore, following (i) completion of the Transaction and (ii) completion of any mineral resource estimate (each an "Estimate") prepared in accordance with national Instrument 45-106 Standards of Disclosure For Mineral Projects ("NI 43-101") over any or all of the property comprised in the Claims, Voltaic shall issue to the holders of PrivCo Shares as at the date of the LOI (on a pro rata basis) a bonus equal to 1 Voltaic Share for each 1 tonne of Lithium Carbonate Equivalent (LCE) included in the applicable Estimate(s) as either a "measured mineral resource" or an "indicated mineral resource", as those terms are defined in NI 43-101, to an aggregate maximum of 5,000,000 Voltaic Shares.
Upon completion of the Transaction, Voltaic will assume certain share and cash based payment obligations of PrivCo to the persons in Argentina from whom PrivCo acquired the Claims, and failure to do so may result in forfeiture of the right to the Claims. Particulars of these payments will be set out in detail in a subsequent news release prior to closing.
Voltaic CEO, Darryl Jones, commented, "After completing the small acquisition in Argentina in December, we worked extremely hard to sign up this latest acquisition with the goal to establish Voltaic as a major participant in Argentina's lithium brine exploration industry. Argentine lithium production would position Voltaic exceptionally well in the battery metals market."
Upon closing, Voltaic will assume the following obligations of PrivCo to persons with interest in mineral claims in Argentina: under agreement 1, payment of USD$1,000,000 payable in shares of Voltaic over 18 months, subject to the right of the claim holder to get a portion in cash under certain conditions, cash payments of USD$210,000 over 3 years, and expend $USD1,000,000 on the property in the first 12 months after approval of the Environmental Impact Study; under agreement 2, USD$1,050,000 payable in shares of Voltaic over 18 months. Both agreements have net smelter royalties payable on production.
The Transaction is subject to a number of standard conditions of closing, including necessary board, shareholder and regulatory approvals, as well as completion of satisfactory due diligence.
The securities to be issued in connection with the Transaction have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States or to U.S. Persons (as defined in Regulation S promulgated under the U.S. Securities Act) unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.
Unless agreed between the Corporation and PrivCo, the LOI will terminate on the execution of the Definitive Agreement.
Completion of the Transaction is subject to a number of conditions, including TSXV acceptance. The Transaction cannot close until the required approvals are obtained. There can be no assurance that the Transaction will be completed as proposed or at all.
The TSX Venture Exchange has in no way passed upon the merits of the proposed Transaction and has neither approved nor disapproved the contents of this press release.
ON BEHALF OF THE BOARD OF VOLTAIC MINERALS CORP.
(Signed) "Darryl Jones"
President, CEO and Director
Forward Looking Statements
This news release contains "forward-looking information" within the meaning of applicable securities laws relating to the proposal to complete the Transaction and associated transactions, including statements regarding the terms and conditions of the Transaction and the outlook of the business of PrivCo; that Voltaic or PrivCo may complete a private placement; that Voltaic may achieve its goal to be established as a major participant in Argentina's lithium brine exploration industry; and that Argentine lithium production would position Voltaic exceptionally well in the battery metals market. Although the Corporation believes in light of the experience of its officers and directors, current conditions and expected future developments and other factors that have been considered appropriate that the expectations reflected in this forward-looking information are reasonable, undue reliance should not be placed on them because the Corporation can give no assurance that they will prove to be correct. Actual results and developments may differ materially from those contemplated by these statements depending on, among other things, the risks that the parties will not proceed with the Transaction and associated transactions, that the ultimate terms of the Transaction or private placements will differ from those that currently are contemplated, and that the Transaction or private placements will not be successfully completed for any reason (including the failure to obtain the required approvals or clearances from regulatory authorities). The terms and conditions of the Transaction may change based on the Corporation's due diligence and the receipt of tax, corporate and securities law advice for both the Corporation and PrivCo. Even if the Transaction and the private placements close, they may not prove to be successful and no lithium operations may be possible. Voltaic may not be able to comply with its obligations to claim owners assumed from PrivCo, and the Claims may be repossessed. There may not be any commercial quantities of lithium in the Claims, and even if there is, they may not be minable profitably. The statements in this press release are made as of the date of this release. The Corporation undertakes no obligation to comment on analyses, expectations or statements made by third-parties in respect of the Corporation, PrivCo, their securities, or their respective financial or operating results (as applicable).
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.