Mr. Guy Goulet reports
GENIUS PROPERTIES LTD. CLOSES $1.5M FIRST TRANCHE FINANCING, ANNOUNCES AMENDMENT TO MT. CAMERON OPTION AGREEMENT AND PROVIDES UPDATE ON PROPOSED TRANSACTION
Genius Properties Ltd. has closed a $1,556,000 non-brokered private placement of 10,373,335 units of the corporation, each unit consisting of one common share and one-half of one share purchase warrant, at a price of 15 cents per unit. Each warrant will entitle its holder to purchase one additional share at a price of 25 cents for a period of 12 months from the date of closing of the offering.
The corporation will use the net proceeds of the offering for its working capital and as a cash contribution in connection with the proposed transaction with Cerro de Pasco Resources SA, as previously described in the corporation's news releases dated Nov. 9, 2017, Dec. 7, 2017, and Jan. 23, 2018. Such cash contribution will be expended, based on the joint determination of Genius and Cerro de Pasco, on the development of the property owned by Cerro de Pasco, for metallurgical testing and to cover capital requirements related to community relations, permitting, and general and administrative expenses.
Any securities issued pursuant to the offering will be subject to a hold period under applicable securities laws, which will expire four months and one day from the date of their issuance.
In connection with the offering, Genius paid finder's fees to arm's-length third parties in the amount of $14,250.
Insiders of the corporation purchased a total of 200,000 units. Their participation in the offering constitutes a related party transaction as defined under National Instrument 61-101 -- Protection of Minority Security Holders in Special Transactions. However, such participation is exempt from the valuation and minority shareholder approval requirements of NI 61-101 based on the fact that neither the fair market value of the offering, nor the consideration paid by such persons, exceeds 25 per cent of the corporation's market capitalization. The corporation did not file a material change report at least 21 days prior to the closing of the offering as participation of the insiders had not been established at that time.
Amendment to Mt. Cameron option agreement
The corporation is pleased to announce that it has entered into an amendment agreement to the option agreement entered into with Mt. Cameron Minerals Inc. on March 8, 2017, pursuant to which the corporation has an option to acquire from MCM an undivided 100-per-cent interest in and to the leases, licences, claims, permits and authorities relating to the Mt. Cameron property located in Nova Scotia.
Pursuant to the terms and conditions of the option agreement, the corporation has the option to acquire the tenements, upon, among other things, incurring not less than $1-million of direct expenditures (including exploration, evaluation and development of the tenements) on the tenements, as follows: $500,000 on or before Dec. 31, 2017, and $500,000 on or before Dec. 31, 2018. MCM and the corporation agreed to amend the option agreement to extend the period granted to the corporation to incur the direct expenditures and postpone the above mention deadlines by a year each.
In consideration for the postponement of the deadlines to incur the direct expenditures, the corporation issued an aggregate of 200,000 common shares of its capital stock to shareholders of MCM, at a deemed value of 15 cents per common share. These common shares are subject to a hold period under applicable securities laws, which will expire four months and one day from the date of their issuance.
Update of the proposed transaction
The corporation and Cerro de Pasco continue to work toward the completion of a listing statement regarding the proposed transaction, which they expect to file with the Canadian Securities Exchange for review on April 20, 2018.
A formal notice of meeting will be filed tomorrow announcing the June 6, 2018, annual and special meeting of the shareholders of Genius. At the meeting, the shareholders of Genius will be asked to, among other things, consider and, if deemed advisable, approve the previously announced spin-off of Genius's properties and the proposed transaction with Cerro de Pasco.
About Genius Properties Ltd.
Genius is a Canadian mineral exploration company focused on developing projects with some of the world's most critical metals and minerals.
We seek Safe Harbor.
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