SUDBURY, ON, March 4, 2013 /CNW/ - Transition Metals Corp. (XTM - TSX.V)
("Transition") and HTX Minerals Corp. ("HTX"), a private company
incorporated under the laws of Ontario, are pleased to announce that
they have entered into a letter of intent dated March 3, 2013 (the
"LOI") to combine the businesses. Transition and HTX ("the Parties")
intend to implement a plan of arrangement pursuant to which Transition
will acquire all of the securities of HTX in exchange for common shares
of Transition. It is expected that the business combination will be by
means of a plan of arrangement pursuant to Section 182 of the Business
Corporations Act (Ontario) (the "Proposed Transaction"). However, the
final structure of the Proposed Transaction will be determined
collectively by Transition and HTX based on taxation, securities and
corporate law, and other considerations.
"This is very positive for the shareholders, employees and partners of
both companies," said Scott McLean, CEO of both Transition Metals and HTX Minerals. "The combined entity will be a much larger project generator focused on
the discovery of gold, platinum and base metal deposits in Canada.
With an award-winning and highly experienced team of geologists,
strategic exploration alliances with Implats and the Nunavut Resources
Corporation, JV partnerships, and a portfolio of 20 projects in
Ontario, Nunavut, Saskatchewan and BC (Figure 1), the company will be further positioned for growth and success."
Highlights of the Combined Business:
The following are the key attributes of a combined business. The
contribution of each company is noted in parentheses as "Transition",
"HTX", or "Transition + HTX" in the event they contribute equally or
share the attribute.
Experienced Exploration & Management Team: (Transition + HTX) The team of eight geoscientists has extensive
experience exploring for Ni-Cu-PGE, gold and base metals in Canada, and
three of the senior geologists have been recognized for their key
contributions to the discovery of new deposits. In addition to its
exploration expertise, the management team has extensive joint venture
negotiation, financial and marketing expertise and has previous
operational experience at both small and large companies.
Project Generator: (Transition + HTX) The project generator business model maximizes
shareholder exposure to discovery, while minimizing shareholder equity
dilution by relying on partners to fund more expensive drilling and
Strategic / Regional Alliances: (HTX) Strategic alliance with Implats, the world's second largest
producer of platinum, to explore the Mid Continent Rift region in
Ontario for platinum group element deposits, with 2012 funding of $1.3
million. Strategic alliance with the Nunavut Resources Corp. (NRC) for
mineral project generation and exploration, including precious, base
and strategic metals, and diamonds in the Kitikmeot Region of the
Territory of Nunavut. As part of this agreement, which has an initial
term of five years, the NRC will seek a minimum of $18 million to be
spent on exploration within the region. NRC has currently raised $1
million and is actively seeking investment partners.
Joint Venture Partnerships: Exploration expenditures committed by HTX joint venture partner Implats
totaled approximately $400,000 in 2012, and by Transition JV partners
Gowest Gold and Abalor Minerals approximately $1 million.
Haultain Gold: (Transition) 2010/11 discovery of high-grade gold mineralization at
Haultain property in the southern Abitibi region exhibits geological
similarities to deposits in the Kirkland Lake area. A >1200m long gold
mineralized trend is open in all directions and appears to extend onto
the property recently acquired by Transition, which is adjacent to and
west of the Haultain discovery.
Abitibi Gold: (Transition) Strong pipeline of six gold projects, each with gold
mineralization at surface, in the southern Abitibi greenstone. This
area is seeing significant activity along the western extension of the
Cadillac-Larder break, including at AuRico Gold's new Young-Davidson
mine, and along the Ridout break (Iamgold's acquisition of Trelawney
Mining), which runs parallel to the Cadillac-Larder break.
Sedimentary-hosted Copper: (Transition) Janice Lake sedimentary-hosted copper project in northern
Saskatchewan has the potential to host large tonnage, near-surface
economic copper deposits. Drill intercepts by previous operators
include 33 metres @ 0.77% Cu, with surface grab samples collected by
Transition up to 9.4% Cu. Numerous untested targets remain.
Itchen Lake: (HTX) The ~200 km2 Itchen Lake gold property is located 365 km northeast of Yellowknife in
Nunavut and is wholly owned by HTX. The Lupin gold mine, which produced
in excess of 3.3 million troy ounces of gold at an average grade of 9
g/t, from 1982-2004 (Harron, 2012) is located approximately 85 km east
of the Itchen Lake property1. Historical exploration at Itchen between 1960 and 1993 resulted in the
identification of numerous gold occurrences associated with banded iron
formation. Results from bedrock grab sample assays by HTX include 3.6
g/t Au, 11.8 g/t Au and 59.0 g/t Au, and support the validity of
historical assays and the prospectivity of the area.
Aer-Kidd: (HTX) This 260 ha Ni-Cu-PGE property is situated along the Worthington
offset dyke ~25 km southwest of Sudbury, Ontario. Although the property
has been mined intermittently from 1916 to 1968, there are numerous
untested targets below the mine workings, and at depth. Vale and KGHM
are each spending upwards of $750 million to develop or mine orebodies
that were discovered at depth below surface workings, within ~2 km to
the west and 4 km to the east, respectively, of Aer-Kidd.
Directors and Officers
The parties anticipate that upon completion of the Transaction and
subject to the approval of the TSX-V, the board of directors of the
combined business shall consist of seven members, including all of the
non-executive board members of both Transition and HTX, as follows:
Scott McLean, H.BSc., P.Geo.: Scott is an award-winning exploration geologist and the co-founder and
CEO of Transition Metals and HTX Minerals with over 25 years of
experience in all facets of exploration. During his 22 years at
Falconbridge Limited, Scott's responsibilities included base metal
exploration and underground production geology in Timmins, and most
recently as Sudbury exploration manager, where he was responsible for
underground and surface exploration. In 2004, he was a co-recipient of
the PDAC Prospector of the Year Award for the discovery of the Nickel
Rim South (Ni-Cu-PGE) mine, in Sudbury. Scott graduated with an Honours
B.Sc from the University of Western Ontario in 1985, is a P.Geo and is
also past-president of APGO, the Association of Professional
Geoscientists of Ontario.
Tom Atkins, B.Sc., MBA: Mr. Atkins is an accomplished mining executive who has successfully lead
exploration and development initiatives in the Americas over the past
28 years. He has an extensive background in geology, investment
banking, investor relations, management and corporate governance. As a
director of investment banking for CIBC World Markets, Mr. Atkins
participated in raising over $1.7 billion in combined equity and debt
related capital for numerous small to large capitalization companies
and advised on numerous M&A mandates. Mr. Atkins was formerly the CEO
of such companies as Rockex Ltd (now Rockex Mining, TSX listed iron ore
company), Castle Gold Corp. (acquired in 2010 by Argonaut Gold Inc, TSX
listed gold producer), and Crowflight Minerals Inc. (now TSX-listed
CaNickel Mining Ltd.). Mr. Atkins holds a Bachelor of Science degree in
Geology from McMaster University, and a Masters of Business
Administration degree from the University of Western Ontario (now Ivey
Jon G. Baird, B.Sc., P.Eng.: Jon has been in the exploration and mining industry for over 40 years.
He made his mark as the geophysicist responsible for the discovery of
the Pyramid Mine, the largest lead-zinc ore body in the Pine Point NWT
camp and later as Vice-President and Director of Scintrex Limited,
where he led a world-wide marketing and sales campaign that helped make
the company a leader in the field of mineral exploration geophysical
instrumentation. He is also past President of the Prospectors and
Developers Association of Canada and is currently Managing Director for
the Canadian Association for Mining Equipment and Services for Export
Jason Marks, B.E.Sc., MBA: Jason oversees firm and individual portfolios at GMP Investment
Management, including overall allocation strategy and risk management.
Prior to GMPIM, he was a Vice Chair at TD Securities and a Senior Vice
President at TD Bank. Over his 11 years at TD Securities, Jason was
responsible for various businesses including international proprietary
trading, equity derivatives, interest rate derivatives, energy trading
and structured products, risk management and credit policy. Prior to
being employed at TD Bank, he was a Vice President at Citibank Canada
where he was responsible for a number of derivative and structured
product businesses. He has a M.B.A. from Harvard University (1989) and
a B.E.Sc. (engineering) from the University of Western Ontario (1986).
Brian L. Montgomery, B.A., LLB: Brian is a lawyer with Weaver Simmons in Sudbury and is considered a
local expert in all aspects of Mining, Corporate, Real Estate and
Business Law. Brian was called to the Ontario Bar in 1973 and has a
strong community focus in Sudbury having sat on numerous boards
including Greater Sudbury Utilities Inc., Idylwylde Golf & Country
Club, Sudbury Theatre Centre, Sudbury Chamber of Commerce, and Sudbury
Bill Pearson, Ph.D: Bill is a professional economic geologist with over 35 years of
experience in the national and international mining industry in all
phases from grassroots exploration through to advanced projects and
mine development. He has carried out exploration programs in 15
countries in North and South America, Europe, East Asia and Australia,
and is on the Board of several public junior mining companies. Bill is
the former Vice President, Exploration for Desert Sun Mining Corp.
(prior to April 2006 takeover by Yamana Gold Inc.), and was also
previously the Executive Vice President, Exploration for Central Sun
(prior to April 2009 takeover by B2Gold Inc.). He received a B.Sc. in
Geology Honours in 1974 from UBC and M.Sc. and Ph.D. degrees in
Economic Geology in 1977 and 1980 respectively from Queen's University.
W.S. (Steve) Vaughan, B.Sc, M.A. LLP.: Steve is a partner at Heenan Blaikie and a leading expert on mining and
natural resources law. For more than four decades, Steve has advised
and represented Canadian and international companies, served on many
governmental advisory committees and, in recent years, has been
involved in natural resources transactions in more than 65 countries.
Steve is or has been a member or director of natural resource and
mining companies such as Algoma Central Corporation, Pure Nickel, Inc.,
Solomon Resources Limited, and Western Troy Capital Resources, among
others, as well as numerous professional and trade associations
including the Toronto Branch of the Canadian Institute of Mining,
Metallurgy and Petroleum, the Prospectors and Developers Association of
Canada and the joint Toronto Stock Exchange/Ontario Securities
Commission Mining Standards Task Force.
In addition, it is anticipated that following completion of the Proposed
Transaction the officers of the combined business will be Scott McLean
(President and CEO), Greg Collins (Chief Operating Officer), Kevin
Stevens (VP and Chief Geophysicist), and Anna Ladd (Chief Financial
Under the Proposed Transaction, and upon receipt of the requisite
approvals, including regulatory and shareholder approvals, the parties
will implement a plan of arrangement whereby all common shares of
Transition will be consolidated on a 2:1 basis. HTX shareholders will
receive shares of Transition at an exchange ratio of 0.8
post-consolidation Transition shares for each HTX share, and all shares
of Transition held by HTX will be cancelled.
The Transaction, when completed, will be considered to be a reverse
take-over for the purposes of the TSX Venture Exchange (the "TSXV") and
the Resulting Issuer will be a Tier 2 Mining Issuer on the TSXV. For
the purposes of the press release the term "Resulting Issuer" means the
Company upon completion of the Transaction.
Transition Metals was spun out of HTX Minerals in 2010 to capitalize on
the market for gold-focused resource companies, and went public in
August, 2011 to provide HTX shareholders with some liquidity. While the
two companies operate independently, they each follow the project
generator business model, and have common CEOs, CFOs and IR/Marketing
The current (unaudited) combined cash position for HTX Minerals and
Transition Metals Corp. is $2.2 million, as of March 1, 2013.
Completion of the Proposed Transaction shall be subject to satisfactory
completion by each party of due diligence, the negotiation of
definitive agreements, the receipt of regulatory and required consents
and approvals, including the approval of the Transition and HTX
shareholders. The Parties acknowledge that the definitive agreement
will contain customary and detailed conditions precedent,
representations and warranties, covenants and provisions dealing with
the mechanics of completing the Proposed Transaction as are typical for
a transaction similar in nature to the Proposed Transaction. Neither
Party is under any obligation to enter into any definitive agreement.
Completion of the Proposed Transaction is subject to a number of
conditions, including TSXV acceptance and disinterested shareholder
approval. 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 to be prepared in connection with the transaction, any
information released or received with respect to the Proposed
Transaction may not be accurate or complete and should not be relied
upon. Trading in the securities of Transition Metals should
be considered highly speculative. 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.
The Parties will use their reasonable commercial efforts to negotiate
and complete the Formal Agreement in Q1, 2013, and plan to close the
Proposed Transaction in Q2, 2013.
The technical elements of this press release have been approved by Mr.
Greg Collins (Transition), P.Geo (APGO), and by Mr. Kevin Stevens
(HTX), P.Geo (APGO), each a Qualified Person under National Instrument
About Transition Metals Corp
Transition Metals Corp (XTM -TSX.V) is a Canadian-based, gold-focused
project generator that specializes in converting new exploration ideas
into Canadian discoveries. The team has over 60 years of collective
exploration experience in the established, emerging and historic mining
camps of northern Ontario, and actively develops and tests new ideas
for discovering gold mineralization in places that others have not
looked, which often allows the company to acquire properties
inexpensively. The team is rigorous in its fieldwork, and combines
traditional techniques with newer ones to help unearth compelling
prospects and drill targets. Transition's business model is to acquire
and advance multiple grassroots exploration projects simultaneously,
thereby maximizing shareholder exposure to discovery and capital gain.
Joint venture partners fund a significant portion of higher-risk
drilling and exploration, allowing Transition to conserve capital and
minimize shareholder's equity dilution. The company, which went public
in 2011, has an expanding portfolio that currently includes 11 early
stage gold projects in Ontario and British Columbia, two additional
gold properties that are being explored by partners, and one sediment
hosted copper project in Saskatchewan.
About HTX Minerals Corp.
HTX is a privately held Canadian exploration company that specializes in
the discovery of new mineral deposits using a project-generator
business model. This approach provides investors with the greatest
growth potential and minimizes shareholder dilution through
joint-venture funding partnerships and revenue generating
opportunities. HTX was selected as the partner of choice by the Nunavut
Resources Corporation and has a three-year $4.1 million strategic
alliance with Implats, the world's second largest producer of platinum
group metals. The company's founders have a +20 year track record of
success, having discovered over 50 Mt of resources. HTX leverages this
deep expertise with a proven methodology that combines custom-built
digital compilations, advanced 3D geoscience modeling and interpretive
techniques, and rigorous fieldwork to systematically identify
economically attractive targets, including many that would otherwise go
Cautionary Note on Forward-Looking Information
Except for statements of historical fact contained herein, the
information in this news release constitutes "forward-looking
information" within the meaning of Canadian securities law. Such
forward-looking information may be identified by words such as "plans",
"proposes", "estimates", "intends", "expects", "believes", "may",
"will" and include without limitation, statements regarding estimated
capital and operating costs, expected production timeline, benefits of
updated development plans, foreign exchange assumptions and regulatory
approvals. There can be no assurance that such statements will prove to
be accurate; actual results and future events could differ materially
from such statements. Factors that could cause actual results to differ
materially include, among others, metal prices, competition, risks
inherent in the mining industry, and regulatory risks. Most of these
factors are outside the control of the Company. Investors are cautioned
not to put undue reliance on forward-looking information. Except as
otherwise required by applicable securities statutes or regulation, the
Company expressly disclaims any intent or obligation to update publicly
forward-looking information, whether as a result of new information,
future events or otherwise.
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.
1 Mineralization at the Lupin Mine may not be representative of
mineralization on the Itchen Lake property.
PDF available at: http://stream1.newswire.ca/media/2013/03/04/20130304_C9956_DOC_EN_24231.pdf
SOURCE: Transition Metals Corp.
For further information:
Further information is available on the Company websites at: www.transitionmetalscorp.com and www.htxminerals.com or by contacting:
President and CEO
Transition Metals Corp. & HTX Minerals Corp.
Tel: (705) 669-0590
VP Investor Relations & Marketing - Transition Metals Corp.
Marketing & Communications Officer - HTX Minerals Corp.
Tel: (705) 669-0590