OneCap Investment Corporation announces its qualifying transaction and the nomination of an Interim Chief Financial Officer

/NOT FOR DISTRIBUTION IN THE UNITED STATES OR OVER UNITED STATES WIRE SERVICES/

MONTREAL, March 3, 2017 /CNW Telbec/ - OneCap Investment Corporation (TSXV: OIC.H) ("OneCap"), a capital pool company as defined under Policy 2.4 – Capital Pool Companies ("Policy 2.4") of the TSX Venture Exchange (the "TSXV"), is pleased to announce that it has entered into an agreement on February 24, 2017, with Rio Moche Exploration Inc. ("Rio"), a private company,  to acquire 100% of the issued and outstanding common shares of Rio through a three-cornered amalgamation (the "Transaction"), subject to the following terms and conditions.

Approximately 26,721,178 OneCap common shares will be issued to the shareholders of Rio based on an exchange ratio of one OneCap share for each 2.3 outstanding shares of Rio (the "Exchange Ratio"), at a deemed price of $0.20 per OneCap. The quantity of common shares issued may be adjusted to reflect interim additional capital raises in Rio.  All outstanding convertible securities of Rio (3,520,000 options and 6,000,000 warrants) shall be exchanged into OneCap's options and warrants having similar terms in accordance with the Exchange Ratio. The OneCap shares shall be issued pursuant to the provision of section 2.11(b) of National Instrument 45-106 – Prospectus Exemptions.

The proposed Transaction does not constitute a Non-Arms' Length Qualifying Transaction as this expression is defined under Policy 2.4 and will not be subject to OneCap's shareholders approval but must be approved by a special resolution of Rio's shareholders.

No Non-Arm's Length Party of OneCap has any direct or indirect beneficial interest in Rio.

No Non-Arm's Length Party of OneCap is otherwise an insider of Rio.

There are no relationship between or among the Non-Arm's Length Parties of OneCap and the Non-Arm's Length Parties of Rio.

No deposit, advance or loan by OneCap is proposed to be made by OneCap to Rio.

It is anticipated that the resulting issuer will be a Tier 2 Mining Issuer pursuant to the requirements of the TSXV.

The Transaction will be more fully described in the Filing Statement For a Qualifying Transaction to be submitted to the TSXV.

Conditions to the Transaction

Prior to the completion of the Transaction, and as a condition:

  • The shareholders of Rio must approve the Transaction by special resolution requiring 66.67% of the votes cast in favor.
  • All requisite regulatory approvals relating to the Transaction must have been obtained.
  • OneCap must complete the minimum amount of the concurrent private placement.
  • The TSXV must approve the listing of the OneCap shares.

Rio is expected to hold a special and general meeting of its shareholders on April 27th, 2017.  It is expected that the Transaction will be completed in the days following the approval of the special resolution.

Concurrent Financing

The Transaction is conditional upon the completion of a concurrent private placement for minimum gross proceeds of $1,000,000 and maximum gross proceeds of $2,000,000 through the issuance of units by OneCap at a price of $0.20 per unit. Each unit will be comprised of one common share and one half of one common share purchase warrant. Each full warrant will allow for the purchase of one OneCap share at a price of $0.25 for a period of 24 months.

The net proceeds of the financing will be used to complete Phase 1 and commence Phase 2 of the recommended work program as per the independent geological report of the Las Marias Property prepared in accordance with National Instrument 43-101 – Standards of Disclosure for Mineral Projects (the "Technical report").

Assuming the minimum financing, CA$600,000 will go towards completing Phase 1 and commencing Phase 2 on Las Marias and CA$300,000 will be allocated for working capital. If the maximum proceeds are attained, CA$750,000 will be spent on Las Marias, CA$350 000 will be allocated for acquisitions in Colombia and CA$700,000 will be used for general working capital.

About Rio

Rio is a private company continued under the Canada Business Corporations Act by articles of continuance dated December 31, 2011.  Its predecessor, Trinity Mining Holding A.G., was founded on April 26, 2007 under the laws of Switzerland. From the start, Rio has been engaged in mineral exploration with a focus on South America. Management's extensive international experience in mining projects, at all stages of development and its disciplined approach to exploration programs has led it to withdraw from other projects and focus on its main asset:  the Las Marias property (the "Property").

Rio holds the option to acquire 100% of the Property which covers over 512 ha in the Province of San Lucas, Department of Bolivar, in Colombia. The option acquired in July 2016 is valid for 5 years and during such time Rio must carry out exploration work for the aggregate total of US$4,350,000 and make cash payments totaling US$1 million dollars, over the five year period.

The Property is located in a favorable geological mineral and structural setting for gold mineralization. Local government reports refer to over 40,000 artisan miners working in the area, on high grade gold bearing veins.  No systematic exploration using modern tools, nor any drilling, has ever been completed on the Property. However, there are 14 active and inactive small scale operations on site, where artisanal miners are, or have been, extracting high grade gold ore which can be observed and followed over a distance of 2 km and a width of 400 meters, which may be indicative of a viable gold operation.

With political and social conditions steadily improving and an abundance of unexplored small scale gold producing properties, Rio expects to develop a strong presence in Colombia, starting with the planned exploration program on the Property.

The Resulting Issuer

Following completion of the Transaction, the board of directors of OneCap will be composed of Mssrs Jean Depatie, M.Sc., Réjean Gosselin, , Jacques Trottier Ph.D., Jacques Authier, CPA, and Pierre Colas, B.Com. Mr. Réjean Gosselin will act as Chief Executive Officer.

 







Insider

Position with Rio

Position
with
Resulting
Issuer

Number of
Rio Shares
and
Percentage of
RIO

Number of
OneCap Shares

Percentage of
OneCap Shares

Minimum Financing

(38,635,278 Shares)

Maximum Financing

(43,635,278 Shares)

Jean Depatie

(Province of Québec)

Chairman of
the Board

Chairman of
the Board

9,770,000

15.89%

4,247,019

10.99%

9.73%

GoldCorp.

(Province of B.C.)

Insider

n/a

8,000,000

13%

3,477,600

9.00%(1)

7.97%

Réjean Gosselin

(Province of Québec)

Director &

President

Director &

President

5,100,000

8.3%

2,216,970

5.74%

5.08%

Jacques Trottier

(Province of Quebec)

Director

Director

2,381,182

3.9%

1,035,100

2.68%

2.37%

Jacques Authier

(Province of Quebec)

n/a

Director

1,000,000

1.6%

434,700

1.13%

1.00%

Pierre Colas

(Province of Quebec)

n/a

Director

1,150,000

1.9%

499,905

1.29%

1.15%

(1) GoldCorp also holds warrants in Rio to be exchanged for 2,608,696 OneCap share purchase warrants, having an
exercise price of $0.20 and a term of 24 months from the closing date of the Transaction.

 

Jean Depatie

Internationally recognised expert in the mining world in financing, takeovers, and mergers and acquisitions, Mr. Depatie has been at the forefront of the mining industry for the past 45 years. He has been a director of Glamis Gold Ltd. that was sold to Goldcorp Inc., creating a $21.3-billion entity, a past Director of Novicourt Inc. (acquired by Xstrata plc, now Glencore plc), and a past Director of Consolidated Thomson Iron Mines Ltd. (acquired by Cliffs Natural Resources Inc. in a $4.9-billion transaction in 2011). As the Vice-President of Exploration for Sullivan Mines, Mr. Depatie was directly involved in the reactivation of the Win-Eldrich gold mine. As the President and CEO of Louvem Mines Inc. he was instrumental in the discovery of the Louvicourt base metal mine and the development of the Beaufor gold mine in Québec (later sold to Richmond Mines Inc.). In Peru, as a Director of Gold Hawk Resources Inc. Mr. Depatie was involved in the acquisition and reactivation of the Cobre San Juan base metal mine located in San Mateo (later sold to Nyrstar NV, a Dutch Company). Jean Depatie put the world's largest graphite mine into production, the Stratmin Lac-des-Îles Graphite Mine in Québec (now Timcal of Imrey's SA), for which he was awarded the Prix d'Excellence by the Government of Québec.   Mr. Depatie has served many public companies at the highest levels and has been actively involved in exploration and economic geology; including, Vice-President of Exploration for SNC-Lavalin Group Inc. for 7 years. Mr. Depatie is also Chairman of Dynacor Gold Mines Inc. A past President of the L'association professionnelle des géologues et des géophysiciens du Québec (The Professional Association of Geologists and Geophysicists of Québec), Mr. Depatie holds a Bachelor of Arts degree in Mathematics and Physics from the University of Montréal, and both Bachelor of Science and Master of Science degrees in Geology from Laval University.

Rejean Gosselin

Rejean Gosselin graduated from Laval University in 1979 with ad M.Sc. in Geology. He has worked as a consulting geologist on uranium, gold and base metals mining exploration projects in Canada, United States, and South America since 1979. For the past 35 years, Rejean acted as founder and promoter of numerous junior mining companies exploring for different commodities in Canada, West Africa, and Mexico. Rejean is responsible for gold, NiCuPGE and ZnCu discoveries in Canada and Mexico (Souart gold deposit, Abitibi, Delta NiCuPGE deposit, Ungava and Bolivar ZnCu mine in Mexico). Recent involvements include Dia Bras Exploration as President and CEO from 2003 to 2008 and most recently as Chairman of the Board of Maya Gold and Silver.

Jacques Trottier

Dr.Trottier, an expert geologist, is renowned for the quality and diversity of his research projects spanning the entire globe over the last 2 decades. His contribution to the reputation of the Quebec and Canadian mining industries, both locally and internationally, is worth mentioning.  Dr. Trottier received his Ph.D in Geological Engineering from l'École Polytechnique de Montréal (1987), a Bachelor's Degree in Geology (1978) and a Master's Degree in Geochemistry from UQAM (1982). Over the course of his academic career, Dr. Trottier has published numerous articles in several international publications such as Economic Geology and Mineralium Deposita. Recognized by his colleagues for his expertise in geology and his entrepreneurship, he was awarded the Annual Geoscience Award from the Association of Professional Geologists and Geophysicists of Quebec (APGGQ) in 1993. In 1996, he founded and was President of Sulliden Exploration Inc. and developed some promising partnerships in Peru. Among his realisations are the discovery of two cupro-auriferous porphyry systems (Cementerio and San Antonio) as well as a massive sulphide zone with a high concentration of Zn-Ag-Pb (PunaPuna) located in the north and central part of the country, respectively. This later discovery led him to be awarded the title of Peru's Prospector of the Year in 2000 by the Honor al Mérito Minero Expert Committee. Mr. Trottier is currently the Executive Chairman of the Board of Exploration Amex Inc.

Pierre Colas

Mr. Pierre Colas is a retired Quebec based investment banker and was most recently Vice-President & Managing Director Investment banking at Industrielle Alliance Securities Inc. ("IAS"). Prior to his appointment at IAS, he was First Vice-President Investment Banking at Desjardins Securities Inc. He has successfully transacted over $5B in equity financing and participated in the initial public offering of more than 100 new companies.  Mr. Colas was a member of the Advisory Committee on the small and midcap companies for the Autorité des marchés financiers ("AMF") in Québec and was a member of the TSX Venture Exchange Advisory Committees until recently. Mr. Colas holds a Bachelor degree in Commerce from the University of Concordia, Montreal.

Jacques Authier

Mr. Jacques Authier is a Chartered Professionnal Accountant, holding a M.Sc. Comm from the University of Sherbrooke, offering consulting services in the areas of tax planning, wealth management and corporate finance.  Mr. Authier was a partner at the international accounting firm Ernst & Young, from 1988 to 2009, where he developed extensive expertise in audit services, corporate finance and tax planning. Since then, he has acted as financial consultant for high net worth families and he has been involved in several privately owned enterprises, as partner and director.

OneCap will ask the TSXV for an exemption from the sponsorship requirements contemplated by Policy 2.2 - Sponsorship and Sponsorship Requirements of the TSXV.

Completion of the Qualifying 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 Qualifying Transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the Qualifying 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 Qualifying Transaction, any information released or received with respect to the Qualifying 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.

The TSX Venture Exchange Inc. has in no way passed upon the merits of the proposed Qualifying Transaction and has neither approved nor disapproved the contents of this press release.

Neither 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.

Mr. Pierre Bonin, currently a director of OneCap, has been appointed Interim Chief Financial Officer of OneCap on August 25, 2016.

_________________________
1 NI43-101 Technical Report on the Las Marias Gold Property, Department of Bolivar, Colombia with an Effective Date of August 12, 2016 prepared by Pierre O'Dowd, Pro. Geologist and independant qualified person.

 

SOURCE OneCap Investment Corporation

For further information: Pierre Setlakwe, President, Chief Executive Officer and Director, Telephone: (514) 878-3201


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