Golden Sun Capital Inc.
TSX VENTURE : GST.H
NEX BOARD : GST.H

Voyageur Industrial Minerals Ltd.

April 21, 2015 05:00 ET

Golden Sun Capital Inc. Announces Share Exchange Agreement With Voyageur Industrial Minerals Ltd.

CALGARY, ALBERTA--(Marketwired - April 21, 2015) -

NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES OF AMERICA. ANY FAILURE TO COMPLY WITH THIS RESTRICTION MAY CONSTITUTE A VIOLATION OF U.S. SECURITIES LAWS.

Golden Sun Capital Inc. (NEX:GST.H) ("Golden Sun") is pleased to announce that it has entered into a share exchange agreement dated April 20, 2015 (the "Agreement") whereby it will pursue an arm's length business combination with Voyageur Industrial Minerals Ltd. ("Voyageur" or the "Company") as described below (the "Proposed Transaction"). If completed, subject to the approval of the TSX Venture Exchange (the "Exchange"), the Proposed Transaction will constitute Golden Sun's Qualifying Transaction as set forth in Policy 2.4 of the Exchange. The Proposed Transaction is subject to Voyageur and Golden Sun raising at least $1,000,000 (up to a maximum of $2,500,000) in project financing to complete the first phase of its development program (the "Project Financing") and to certain other conditions.

The Proposed Transaction

Subject to any regulatory, director or other approvals that may be required, the completion of satisfactory due diligence by Golden Sun and Voyageur, and the satisfaction of other conditions contained in the Agreement, it is currently contemplated that the Qualifying Transaction will occur via an exchange of securities pursuant to which the shareholders of Voyageur will receive common shares in the capital of Golden Sun (the "Golden Sun Shares") in exchange for 100% of the common shares of Voyageur (the "Voyageur Shares") based on an exchange ratio (the "Exchange Ratio") of one Golden Sun Share for each Voyageur Share. The Proposed Transaction values all of the 43,700,000 currently issued Voyageur Shares at $4,370,000 implying a value of $0.10 per Voyageur Share.

Other than as set forth above, Voyageur has no other securities reserved for issuance other than up to 25,000,000 Voyageur Shares and 25,000,000 warrants to acquire Voyageur Shares that may be issued pursuant the Project Financing (such warrants being exchangeable for Golden Sun warrants on the same terms).

Pursuant to the Policy 2.4 of the Exchange, following closing of the Proposed Transaction all securities held by principals of the resulting issuer will be escrowed. It is expected that this will result in the escrow of approximately 41,200,000 new Golden Sun Shares representing 70.7% of the issued and outstanding shares of the resulting issuer, assuming the minimum Project Financing is completed.

Following completion of the Proposed Transaction and subject to Exchange approval, Golden Sun expects to change its name and carry on business as "Voyageur Industrial Minerals Ltd." and be classified as a Tier 2 natural resources issuer under the policies of the Exchange.

The Proposed Transaction is subject to a number of conditions, including the requirement to obtain the Project Financing on terms satisfactory to Voyageur. If the Project Financing minimum is not obtained by the Company then the Proposed Transaction may not proceed unless otherwise agreed to by the Exchange.

Voyageur Industrial Minerals Ltd.

Voyageur was incorporated under the Business Corporations Act (Alberta) on December 3, 2012 for the purpose of the identification, acquisition, exploration and development of mineral properties, primarily in the Province of British Columbia.

The Voyageur project area is composed of three non-contiguous groups of mining claims located in British Columbia within a 50 km radius of the town of Radium Hot Springs, B.C., totaling approximately 1815 hectares. The three project areas are known as the Frances Creek Prospect, the Jubilee Mountain Prospect and the Pedley Mountain Prospect (collectively, the "Prospects"). As of the date hereof exploration and mining permits are in place on the Frances Creek and Jubilee Mountain Prospects. Voyageur intends to initiate the exploration permitting process with respect to Pedley Mountain following closing of the Proposed Transaction.

Voyageur owns the claims, having acquired them from the former operator, Tiger Ridge Resources Ltd. ("Tiger Ridge"), a non-arm's length private company. Two executive officers and control persons of Voyageur (Mr. Brad Willis and Mr. Brent Willis of Calgary, Alberta) are also principals of Tiger Ridge.

Tiger Ridge retained a 3.5% net milled barite sales royalty, and a 3.5% net smelter return royalty on precious metals on each of the Prospects (the "Tiger Ridge Royalties"). In addition to the six Tiger Ridge Royalties, certain of the claims associated with the Prospects are also burdened by two previously existing arm's length royalties of $2.00/tonne on finished barite and $2.00/tonne on metals concentrate production (the "Third-Party Royalties"). The Tiger Ridge Royalties can be purchased anytime, at the option of the Corporation, for $2,000,000 per royalty until January 2019. The Third Party Royalties can be purchased from the royalty holder for $500,000 per royalty as it relates to the production of barite from the applicable claims, or for $1,000,000 per royalty for the royalty in its entirety.

Tiger Ridge explored the Frances Creek Prospect and explored and produced barite from the Jubilee Mountain Prospect between 1998 and 2005. The mine was closed due to low prices for barite in 2005, which have since recovered. Consequently, Voyageur is contemplating re-opening the Tiger Ridge mine on the Jubilee Mountain Prospect and also opening barite mining operations at the Frances Creek and Pedley Mountain Prospects once regulatory approval has been obtained.

Based on the report completed by Henkle & Associates pursuant to the provisions of NI 43-101 - Standards of Disclosure for Mineral Projects, with an effective date of February 10, 2015, in respect of the Prospects, Voyageur has proposed the following exploration expenditures:

2015 Exploration Season
Minimum Offering of $1,000,000 Maximum Offering of $2,500,000
Jubilee Mountain Francis Creek Pedley Mountain Jubilee Mountain Francis Creek Pedley Mountain
Drilling $95,800 $100,000 $0 $435,000 $570,950 $0
Geophysics $0 $21,500 $0 $15,000 $0 $0
Geochemistry $0 $0 $0 $0 $30,000 $20,000
Camp $7,500 $7,500 $0 $40,000 $40,000 $5,000
Prospecting $15,000 $0 $33,200 $15,000 $30,000 $15,000
Trenching $0 $950 $0 $0 $10,000 $12,000
Trail construction $7,500 $7,500 $0 $30,000 $30,000 $0
Engineering $50,000 $50,800 $10,000 $115,200 $115,200 $57,600
Assays $17,500 $12,500 $0 $20,000 $50,000 $12,000
Transportation $12,500 $12,500 $6,500 $27,000 $25,000 $11,000
Geology & Consulting $40,000 $22,000 $20,000 $70,000 $70,000 $30,000
Subtotal $245,800 $235,250 $69,700 $767,200 $971,150 $162,600
Total $550,750 $1,900,950

Project Financing

Voyageur is undertaking a non-brokered private placement by offering up to 25,000,000 units ("Units") at a price of $0.10 per Unit (the "Unit Offering") for aggregate gross proceeds of up to $2,500,000 (the "Maximum Offering"), subject to a minimum offering of $1,000,000 (the "Minimum Offering"). Each Unit is comprised of one Voyageur Share and one Voyageur Share purchase warrant (each a "Voyageur Warrant"). Each Voyageur Warrant will entitle the holder thereof to acquire one Voyageur Share at an exercise price of $0.18 at any time prior to 5:00 pm. (Calgary time) on the date that is 24 months from the issuance of the Unit. Provided, however, that if the Voyageur Shares (or the Golden Sun Shares for which they are exchanged pursuant to the Proposed Transaction) trade on the Exchange or comparable exchange at a weighted average trading price of $0.25 or higher for 20 consecutive trading days, the resulting issuer will have the right to accelerate the time of expiry of the Voyageur Warrants provided that it delivers a notice to the warrantholders not less than 30 days prior to the date fixed as the new expiration date.

In addition, it is anticipated that a maximum of 10,000,000 common shares will be issued on a "flow-through basis" pursuant to the Income Tax Act (Canada) ("Flow-Through Shares") at a price of $0.12 per Flow-Through Share (the "Flow-Through Offering") in such combination with the Unit Offering that the aggregate funds raised through the Unit Offering and the Flow-Through Offering will be no more than the Maximum Offering and no less than the Minimum Offering. If only the Minimum Offering is completed, no less than $500,000 must come from the sale of 5,000,000 Units.

Subscribers of Flow-Through Share will be entitled to renunciation, effective on or before December 31, 2015, of "Canadian exploration expenses" as such term is defined in the Income Tax Act (Canada) in an amount equal to the aggregate subscription price for the Flow-Through Shares paid by such subscriber, incurred (or be deemed to incur), on or before December 31, 2016.

Selected Financial Information

The following table sets out selected financial information for Voyageur for the period and as at the dates indicated. All of the financial information presented below has been prepared by management in accordance with International Financial Reporting Standards.

Item For the year ended
November 30, 2014
(unaudited)
For the period from incorporation
on December 3, 2012
to November 30, 2013
(unaudited)
Total Revenue Nil Nil
Net Loss $132,290 $13,069
Net Loss Per Share $0.01 Nil
Assets
Current $142,972 $594
Total Assets $156,972 $594
Liabilities
Current $106,231 $3,663
Equity
Share Capital $196,100 $10,000
Contributed Surplus Nil Nil
Deficit $(150,359 ) $(13,069 )
Total Liabilities and Equity $156,972 $594

Golden Sun Capital Inc.

Golden Sun is a capital pool company incorporated under the provisions of the Business Corporations Act (Alberta) with its registered and head office in Calgary, Alberta. Golden Sun is a "reporting issuer" in the provinces of Saskatchewan, British Columbia and Alberta and held approximately $111,516 cash net of all accrued expenses and liabilities, as at September 30, 2014.

The Proposed Transaction is an arm's length transaction subject to requisite regulatory approval, including the approval of the Exchange. The parties will prepare a Filing Statement in accordance with the rules of the Exchange, outlining the terms of the Proposed Transaction.

Golden Sun currently has 4,614,800 Golden Sun Shares issued and outstanding and 571,480 stock options issued to directors and officers of Golden exercisable at $0.10 per share which expire on May 18, 2017. Golden Sun does not intend to seek shareholder approval for the Proposed Transaction in accordance with the rules of the Exchange.

Trading Halt

Trading in the Golden Sun Shares has been halted and may remain halted pending the review of the Proposed Transaction by the TSXV. There can be no assurance that trading in the Golden Sun Shares will resume prior to the completion of the Proposed Transaction.

Resulting Issuer

Upon closing of the Proposed Transaction and assuming completion of the Minimum Offering, it is anticipated that Golden Sun will have 58,314,800 Golden Sun Shares issued and outstanding on an undiluted basis, being the aggregate of (i) 43,700,000 Golden Sun Shares to be issued for all of the issued and outstanding Voyageur Shares; (ii) up to 10,000,000 Golden Sun Shares to be issued for Voyageur Shares acquired pursuant to the Project Financing; and (iii) 4,614,800 Golden Sun Shares that are currently issued and outstanding. If the Maximum Offering is completed there will be an aggregate of up to 73,314,800 Golden Sun Shares issued and outstanding on an undiluted basis. Furthermore, options (assuming no options are exercised prior to the closing of the Proposed Transaction) to acquire an aggregate of up to 571,480 Golden Sun Shares will continue as options to acquire Golden Sun Shares and up to 25,000,000 Voyageur Warrants issued to subscribers of Units under the Project Financing will be exchangeable for Golden Sun warrants on the same terms. Upon completion of the Proposed Transaction, the shareholders of Voyageur (including those shareholders who acquired Voyageur Shares pursuant to the Project Financing) will hold approximately 92.1% of the issued and outstanding capital of Golden Sun, on an undiluted basis, if the Minimum Offering is achieved and approximately 93.7% if the Maximum Offering is achieved.

Board of Directors and Management

Upon completion of the Proposed Transaction, the directors, senior officers and insiders of resulting issuer are expected to be as follows:

John M. Rucci, - President, Chief Executive Officer and Chairman of the Board - Mr. Rucci graduated from the University of Calgary in 1977 with a Bachelor of Commerce degree. From June 2000 to February 28, 2013, Mr. Rucci was the President and Chief Executive Officer of Peruvian Precious Metals Corp. (formerly Sienna Gold Inc.), following which, Mr. Rucci was a retired business man.

Gordon A. Forbes - Chief Financial Officer - Mr. Forbes graduated as a Chartered Accountant in 1967. He was Chief Financial Officer Peruvian Precious Metals Corp. (formerly Sienna Gold Inc.) from May 2009 until February 28, 2013, following which Mr. Forbes was a retired businessman.

Declan B. Livesey - Director - Dr. Livesey is an independent engineering consultant, receiving his doctorate in Mining from the University of Wales in 1974. Dr. Livesey also holds a Bachelor of Science degree from the University of Wales. He is currently a Reservoir Advisor for Connacher Oil & Gas Ltd. and was previously the President of Fios Consulting Corp., a private organizational development consulting firm.

D. Richard Skeith - Director and Corporate Secretary - Mr. Skeith received his Bachelor of Arts (Honours) in Economics in 1975 and his law degree in 1978, both from the University of Alberta. He has practiced law in Calgary since then. He is currently a partner with a large international law firm, with a practice focused on public company matters. He has been an officer or director of various public companies in the mining, industrial minerals, oil and gas, pharmaceutical and real estate fields. Mr. Skeith has both sat on and chaired the audit committees of a number of public companies.

Andrew S. Burgess - Director - Mr. Burgess has a Bachelor of Commerce (Honours) degree from the University of Manitoba and is a Chartered Accountant (Alberta). He is currently the President of Jacktek Systems Inc., a private oilfield technology and services company, and has served in this role since 2006. From July 2009 until July 2013, Mr. Burgess served as Chief Financial Officer of Goldnev Resources Inc., a public oil and gas company. From January 2005 until June 2013, Mr. Burgess served as a director of Peruvian Precious Metals Corp. (formerly Sienna Gold Inc.). Currently, he serves as a director of Trius Investments Inc. and has been in this role since October 15, 1997.

Joe Scarlett - Director - Mr. Scarlett has a diploma in Exploration Technology from the Northern Alberta Institute of Technology. From January 2012 until January 2015, Mr. Scarlett was in Executive Sales in the Drilling Services branch of Secure Energy Services. Prior to that he served as President of New West DLRG Fluids from November 2006 until January 2012.

Bradley Willis - Vice President Exploration - Mr. Willis received a diploma from SAIT in Petroleum Technology followed by a Bachelor of Science in Engineering Mining in 1992 from South Dakota School of Mines and Technology. Since May 2007, Mr. Willis has served as Vice President of Blackfire Exploration Ltd and since April 1999 Mr. Willis served as the Vice President of Tiger Ridge Resources Ltd.

Brent Willis - Vice President Corporate Development - Mr. Willis received a degree in Engineering in 1994 from the University of Wyoming and has a diploma in Petroleum Technology from the Southern Alberta Institute of Technology. Mr. Willis has served as the President of Blackfire Exploration Ltd. since May 2007 and has served as President of Tiger Ridge Resources Ltd. since April 1999.

Sponsorship

Sponsorship of the Qualifying Transaction is required unless an exemption is available or a waiver from this requirement can be obtained in accordance with the policies of the Exchange. The Corporation intends to apply for a waiver to the sponsorship requirement. There is no assurance that a waiver from this requirement will be granted.

Significant Conditions to Completion of the Proposed Transaction

Completion of the Proposed Transaction is subject to a number of conditions, including but not limited to: (a) closing conditions customary to transactions of the nature of the Proposed Transaction, including applicable board and shareholder approvals; (b) approvals of all regulatory bodies having jurisdiction in connection with the Proposed Transaction; (c) Exchange regulatory approval; (d) if applicable pursuant to Exchange requirements, majority of the minority shareholder approval; and (d) the completion of the Voyageur Project Financing. There can be no assurance that the Proposed 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 Proposed Transaction, any information released or received with respect to the Proposed 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 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.

Mr. Bradley Willis, P. Eng, Vice President, Exploration of Voyageur and a qualified person under National Instrument 43-101 has reviewed and approved the scientific, technical and economic information contained in this news release.

Cautionary Note Regarding Forward-Looking Statements

This news release contains forward-looking statements relating to the Proposed Transaction, including statements regarding the exchange ratio for the Proposed Transaction, Golden Sun obtaining an exemption from the Exchange's sponsorship requirement, details of Voyageur's exploration program, plans for the Prospects, completion of the Project Financing, expected pro forma financial results, the composition of the board of directors and management, the receipt of all necessary regulatory and other approvals and satisfaction of all other closing conditions in connection with the Proposed Transaction and other statements that are not historical facts. Readers are cautioned not to place undue reliance on forward-looking statements, as there can be no assurance that the plans, intentions or expectations upon which they are based will occur. By their nature, forward-looking statements involve numerous assumptions, known and unknown risks and uncertainties, both general and specific, that contribute to the possibility that the predictions, forecasts, projections and other forward-looking statements will not occur, which may cause actual performance and results in future periods to differ materially from any estimates or projections of future performance or results expressed or implied by such forward-looking statements. These assumptions, risks and uncertainties include, among other things: the risk that the Proposed Transaction will not be completed or that the necessary approvals and/or exemptions are not obtained or some other condition to the closing of the Proposed Transaction is not satisfied; the risk that closing of the Proposed Transaction could be delayed if Golden Sun and Voyageur are not able to obtain the necessary approvals on the timelines planned; the risk that the Voyageur Project Financing will not be completed, the assumptions relating to the Proposed Transaction, its structure, and the timing thereof, the timing of obtaining required approvals and satisfying closing conditions for the Proposed Transaction, state of the economy in general and capital markets in particular, investor interest in the business and future prospects of Golden Sun and Voyageur.

The forward-looking statements contained in this news release are made as of the date of this news release. Except as required by law, Golden Sun and Voyageur disclaim any intention and assume no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable securities law. Additionally, Golden Sun and Voyageur undertake no obligation to comment on the expectations of, or statements made, by third parties in respect of the matters discussed above.

Neither the 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 news release.

Contact Information

  • Golden Sun Capital Inc.
    Christopher M. Wolfenberg
    President and Chief Executive Officer
    (403) 267-8222
    wolfenberg@hotmail.com

    Voyageur Industrial Minerals Ltd.
    John Rucci
    Chief Executive Officer
    (403) 383-8588
    john.rucci@gmail.com