Aurcana has announced the closing of its previously announced acquisition of Ouray Silver Mines, which holds the Revenue-Virginius Mine, located in Colorado.
The acquisition has been completed pursuant to an arrangement agreement dated September 20, 2018 with LRC-FRSM and LRC-FRSM II (collectively, the LRC Group).
Aurcana acquired all of the issued and outstanding shares of common stock of Ouray from the LRC Group on a debt free basis in exchange for newly issued common shares of Aurcana (Aurcana Shares) pursuant to a plan of arrangement under the Business Corporations Act (British Columbia) (the Arrangement).
Pursuant to the terms of the Arrangement, the Company has completed the following:
- a) the purchase of certain equipment owned by an affiliate of Orion Mine Finance (Orion) located at Aurcana’s Shafter project in exchange for US$500,000 and 23,894,545 pre-Share Consolidation (as defined below) Aurcana Shares;
- b) a consolidation (the Share Consolidation) of the Aurcana Shares on a 5:1 basis; and
- c) the acquisition of all of the issued and outstanding shares of common stock of Ouray and a related amended and restated metal prepay agreement between Ouray and the LRC Group in exchange for an aggregate of 83,240,359 post-Share Consolidation Aurcana Shares, as a result of which Ouray has become a wholly-owned indirect subsidiary of Aurcana.
Concurrently with the completion of the Arrangement, the 5,621,800 subscription receipts issued by the Company on December 19, 2018 automatically converted into 5,621,800 units (each, a Unit) of the Company, with each Unit consisting of: (i) one post-Share Consolidation Aurcana Share and (ii) a warrant to purchase one post-Share Consolidation Aurcana Share (a Warrant). Each Warrant entitles the holder thereof to acquire, on payment of C$1.25, one post-Share Consolidation Aurcana Share for a three year period.
Additionally, a further 670,200 Units were purchased by Orion for gross proceeds of US$500,000. As a result, an aggregate of 116,309,028 post-Share Consolidation Aurcana Shares are now issued and outstanding.
The Arrangement was approved by a resolution (the Arrangement Resolution) of the shareholders of Aurcana (the Aurcana Shareholders) at a special meeting (the Meeting) of shareholders of the Company on December 20, 2018.
The Arrangement Resolution was approved by approximately: (i) 99.47% of the votes cast by the Aurcana Shareholders present in person or represented by proxy at the Meeting, and (ii) 98.92 of the votes cast by the Aurcana Shareholders present in person or represented by proxy at the Meeting, excluding votes cast by persons considered to be interested parties, related parties and joint actors of the Company.
In addition to obtaining shareholder approval, the Company has obtained the final order of the Supreme Court of British Columbia approving the Arrangement on December 24, 2018, and the TSX Venture Exchange has confirmed that Aurcana Shares will recommence trading on December 31, 2018.
Source: Company Press Release