Dundarave Resources Inc.
TSX VENTURE : DDX

Dundarave Resources Inc.

December 02, 2014 09:30 ET

Dundarave Enters Into Definitive Agreement With Perfect Lithium Corp.

VANCOUVER, BRITISH COLUMBIA--(Marketwired - Dec. 2, 2014) -

NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR DISSEMINATION IN THE UNITED STATES

Dundarave Resources Inc. (TSX VENTURE:DDX) ("Dundarave" or the "Company") is pleased to announce that, further to the news release announcing the entering into a binding letter of intent (the "LOI") on September 24, 2014, it has entered into a definitive agreement (the "Agreement") dated November 25, 2014 with Perfect Lithium Corp. ("PLC"), which replaces the LOI and sets out the terms of a proposed business combination between Dundarave and PLC (the "Transaction"). Upon completion, the Transaction will constitute a reverse take-over of Dundarave by PLC, with the resulting company to be renamed "Nano One Materials Corp." (the "Resulting Issuer"). Dundarave and PLC are at arm's length to each other.

Summary of the Transaction

Pursuant to the Transaction, Dundarave, through its wholly-owned subsidiary, 1019491 B.C. Ltd., will acquire 100% of the issued and outstanding shares of PLC in exchange for 0.8 of a Post Consolidation Share (as defined below) (the "Exchange Ratio") for each outstanding share of PLC.

All outstanding warrants of PLC will be exchanged for Dundarave warrants to purchase Post Consolidation Shares with appropriate adjustments to the number and price of shares that may be acquired upon exercise thereof to reflect the Exchange Ratio. All stock options of Dundarave and PLC issued prior to the Agreement will be cancelled upon closing of the Transaction. The Resulting Issuer will grant 2,825,000 options to the new management and consultants of the Resulting Issuer upon completion of the Transaction.

Concurrent with the closing of the Transaction, Dundarave will consolidate all of its issued and outstanding common shares on the basis of two existing common share for one new common share (a "Post Consolidation Share") and one share purchase warrant. Each warrant will be exercisable at any time within 12 months following the closing date of the Transaction (the "Closing Date") to acquire one Post-Consolidation Share at an exercise price of $0.40 per whole Post-Consolidation Share and at any time between 12 and 24 months following the Closing Date to acquire one-half of one Post-Consolidation Share at an exercise price of $0.50 per whole Post-Consolidation Share.

Management

On closing of the Transaction, the board of directors of the Resulting Issuer will be comprised of Paul Matysek, who will also act as Chairman, Dan Blondal, who will also act as Chief Executive Officer, John Lando, who will also act as President, Lyle Brown, and Dr. Joseph Guy. Tammy Gillis will act as the Chief Financial Officer of the Resulting Issuer. Information on the backgrounds of Paul Matysek, Dan Blondal, and John Lando are set out in the press release dated September 24, 2014. Information on the remaining directors and management is set forth below.

Lyle Brown, Director

Mr. Brown is a CPA, CA and holds a Bachelor of Commerce from the University of British Columbia. Mr. Brown has been a partner since 1991 in the accounting firm of Culver & Co. in Vancouver, British Columbia, serving clients in a wide range of industries, and is familiar with the reporting requirements of public companies. Mr. Brown serves on the boards of Northern Lion Gold Corp. (TSXV), New World Resource Corp. (TSXV) and FEC Resources Inc. (Nasdaq OTC).

Dr. Joseph Guy - Director

Dr. Joseph Guy is a Patent Agent in Perkins Law Firm's Intellectual Property group focusing on complex technologies including material science, electronic components, pharmaceuticals and medical products. He has more than 23 years of experience prosecuting patents and serving as expert witness on intellectual property matters. Dr. Guy was awarded a Ph.D. in Chemistry from the University of Wisconsin-Milwaukee in physical inorganic chemistry with a focus on organometallic complexes. After a post-doctoral fellowship at Naval Research Laboratories, Dr. Guy joined E.I. duPont de Nemours & Co. in Brevard, North Carolina where he conducted research in medical imaging technologies. He later transitioned to intellectual property manager where his primary responsibility was management of the Intellectual Property portfolio and license negotiations for the Medical Products Division. The Medical Products Division was divested to Sterling Diagnostic Imaging, Inc. in 1996 and Dr. Guy was appointed corporate patent manager responsible for managing the intellectual property for a multinational corporation. Dr. Guy has authored numerous references in peer-reviewed journals and has written and prosecuted over 1000 U.S. and foreign patent applications, with more than 300 issued U.S. Patents and numerous foreign patents. His corporate research, management experience and intellectual property backgrounds merge to provide excellent experience in the development of an IP portfolio tailored to augment corporate strategies.

Tammy Gillis - CFO

Ms. Gillis is a CPA, CMA with over 15 years of experience in finance, reporting and regulatory requirements for both private and publicly traded companies. She started her career working at Thomas Rondeau LLP, a corporate and securities law firm. Ms. Gillis previously served as Corporate Accountant for Concert Industries Ltd., a manufacturing company with revenues in excess of $120 million and as Treasurer of Geologix Explorations Inc., a junior exploration company. Ms. Gillis is currently the CFO for New World Resource Corp. and Northern Lion Gold Corp., both junior exploration companies listed on the TSXV.

The closing of the Transaction is subject to various conditions, including obtaining the approval of the shareholders of Dundarave and PLC and obtaining all required regulatory and stock exchange approvals.

Dundarave and PLC are preparing a joint management information circular and proxy materials in respect of the Transaction to be sent to Dundarave shareholders and filed with the TSX Venture Exchange (the "Exchange").

Private Placement

In connection with the Transaction, Dundarave will conduct a brokered private placement (the "Private Placement") of units of Dundarave, which will be offered at a price of $0.25 per unit for gross proceeds of up to $3,000,000, subject to minimum proceeds of $2,000,000. Up to $2,000,000 of the Private Placement will be offered by way of a TSXV short form offering document in applicable jurisdictions, excluding Ontario.

Each unit will consist of one Post Consolidation Share and one-half of a share purchase warrant. Each whole warrant is exercisable into one Post Consolidation Share for a period of 2 years at an exercise price of $0.40 per share during the first year from the Closing Date and at an exercise price of $0.50 per share during the second year from the Closing Date. The use of proceeds of the Private Placement will be used to accomplish the objectives described in PLC's business plan and for general working capital.

Dundarave has engaged Mackie Research Capital Corporation ("Mackie") to act as the agent to the Private Placement. As consideration, the Company has agreed to pay to Mackie a commission of 6.5% of the proceeds of the Private Placement in cash and 6.5% of the number of units sold in warrants. Dundarave has also engaged Mackie to act as an advisor and has agreed to pay Mackie a finder's fee in the amount of 225,000 Post Consolidation Shares on closing of the Transaction.

About Perfect Lithium Corp.

Perfect Lithium Corp. (www.perfectlithium.com) is a private British Columbia company, founded in 2011. PLC is focused on developing novel, scalable and low-cost processing technology for the production of high performance nano-structured materials. PLC's mission is to establish its patent pending technology as the de facto platform for the production of a new generation of high volume, high performance advanced materials.

PLC's primary market is the multi-billion dollar cathode materials supply chain for lithium ion batteries that are used in consumer electronics, electric vehicles and industrial storage. Testing in 2014 by Canada's National Research Council has validated the efficacy of materials supplied by PLC. Based on these tests, PLC believes their enhanced processing technology has the potential to address demand for cheaper higher performing batteries. The three-stage proprietary process uses common industrial equipment that is designed to commercialize high volume production of nano-structured materials.

PLC has six patents pending in the US, five worldwide (PCT) and one in Taiwan.

PLC intends to use the proceeds of the Private Placement for full cell battery testing, technology development, pilot production, commercialization efforts and general working capital. While PLC's processing technology will initially be focused on lithium ion batteries, it also proposes to leverage its platform technology in health sciences, 3D printing, catalysts, ceramics, pharmaceuticals, agriculture, aerospace, communications and other materials markets.

PLC is building an experienced technology development and production team to advance the technology. Team members include Dr. Byron Gates and Dr. Ulrich von Sacken as advisors and Russell Barton as a principal engineer, all providing expertise in the areas of materials science, lithium ion batteries, intellectual property and systems engineering.

Dr. Gates is a Tier II Canada Research Chair in the Department Chemistry at Simon Fraser University, investigating the surface and interface chemistry of nanomaterials and is the principle investigator for the Centre for Soft Materials in 4D LABS, a materials research institute at SFU. Dr. von Sacken has 20 years' experience as GM of R&D at E-One Moli Energy Canada and VP of Technology at BAK Battery Canada. Russell Barton has over 40 years' experience designing mechanical and electrochemical systems and fuel cell products for Ballard Power Systems, Energizer, PolyFuel, the University of North Florida and Neptune Dynamics. Russell is credited with 30 patents issued in Canada, the United States and foreign jurisdictions.

PLC is launching collaborative relationships with NORAM Engineering and Constructors Ltd. and its subsidiary BC Research Inc. NORAM and BCRI are globally recognized in process engineering and will be valuable contributors to PLC's technology development, scale-up and commercialization. They will provide incubation and piloting facilities along with support in laboratory, design, engineering and industrial know-how.

PLC also has had financial support from Canada's National Research Council Industrial Research Assistance Program (NRC-IRAP) for two projects and is working to expand its valuable relationship with IRAP.

Trading Halt

Trading in Dundarave's shares has been halted and the halt is expected to remain in place until the closing of the Transaction.

Completion of the Transaction is subject to a number of conditions, including Exchange acceptance and shareholder approval. The Transaction cannot close until all required shareholder approvals are 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 joint management information circular to be prepared in connection with the Transaction, any information released or received with respect to the Transaction may not be accurate or complete and should not be relied upon. Trading in the securities of Dundarave 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 news 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.

Dundarave and PLC caution the reader that there is no guarantee that any of the potential outcomes from the Agreement will actually occur or be finalized. Certain information contained herein constitutes "forward-looking information" under Canadian securities legislation. Forward-looking information includes, but is not limited to, statements with respect to: the completion of the Transaction; completion of the Private Placement and the commercialization of PLC's technology and patents. Generally, forward-looking information can be identified by the use of forward-looking terminology such as "expects" or "it is expected", or variations of such words and phrases or statements that certain actions, events or results "will" occur. Forward-looking statements are based on the opinions and estimates of management as of the date such statements are made and they are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of Dundarave or PLC to be materially different from those expressed or implied by such forward-looking statements or forward-looking information, including: the receipt of all necessary regulatory approvals, the ability to conclude the Transaction, capital expenditures and other costs, and financing and additional capital requirements. Although management of Dundarave and PLC have attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements or forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements and forward looking information. Neither Dundarave nor PLC undertakes to update any forward-looking statements or forward-looking information that are incorporated by reference herein, except as required by applicable securities laws.

This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.

Contact Information

  • Dundarave Resources Inc.
    Paul Matysek, M.Sc., P.Geo.
    President & CEO
    1 (604) 351-9012