TORONTO, ONTARIO--(Marketwired - Nov. 8, 2016) - Bison Gold Resources Inc. (the "Company") (TSX VENTURE:BGE) announced on November 2, 2016, that it has amended the terms of its previously announced private placement (see press release dated September 29, 2016) resulting in an even more dilutive transaction, despite the stated disapproval from certain concerned shareholders (who are supported by a majority of the shareholders). The concerned shareholders believe that this dilutive transaction is being pushed forward as a direct response to the requisition for a meeting of shareholders to remove 4 of the 5 incumbent directors and to replace them with the 4 nominee directors (the "Nominees") set out in the concerned shareholders' press release of October 22, 2016.
Only significant shareholder on Bison's Board resigned:
On October 27, 2016, Bison's Chairman, Dale Dunlop, resigned from the Board. Dale Dunlop is the son of the original founder of Bison Resources and he and his family are significant shareholders of Bison Resources. None of the remaining directors hold a meaningful number of Bison shares.
Negative implications of financing for shareholders:
The revised private placement terms announced on November 2, 2016 reduce overall proceeds to Bison from $1.5 million to $1.25 million but resulted in a 38.8% increase in issued shares over the previous terms. If fully subscribed and all underlying warrants are exercised, this placement will result in the issuance of 13.88 million shares. The $1.25 million financing is priced at $0.18 per unit (with each unit being comprised of one common shares and one full warrant with an exercise price of $0.24), representing a 25% discount to the closing price on November 1, 2016 of $0.24. Following the 1:25 roll back that this Board previously recommended to the shareholders and completed, Bison only has 4.7 million shares issued and outstanding. The revised pricing is approximately 40% below the financing announced on September 29, 2016.
Nominees secure financing and commitment for new management:
Investors should note that the Nominees have secured a Term Sheet from a company that is interested in a private placement at a higher cost per share than the amended private placement being issued by the incumbent directors. The Nominees have also received interest from established mineral exploration groups to further develop the properties. The Nominees caution the remaining directors of Bison not to proceed with their proposed financing (as amended) as it is deemed by the Nominees not to be in the best interest of shareholders.
The concerned shareholders have been disappointed in management's inability to increase shareholder value, coupled with a lack of transparency in its dealings, and these shareholders are asking the board of Bison to resign to be replaced by a new board, subject to compliance with all regulatory requirements. Once in place, this new board's immediate priority will be a review of current management and its strategies for adding shareholder value. Following this review the new board will decide whether it needs to implement changes to management.
The Nominees have advised the TSX Venture Exchange about their concerns, especially in light of the recently announced intent of Bison to complete the private placement financing, and will hold the Board of Bison and its management responsible for proceeding with any financing under the circumstances.