Rodocanachi Capital Inc.
TSX VENTURE : ROD.P

August 02, 2011 11:35 ET

Rodocanachi Capital Inc. Announces Termination of Agreement With Axcelon and Proposed Qualifying Transaction With the Marcotte Group

MONTREAL, QUEBEC--(Marketwire - Aug. 2, 2011) - Rodocanachi Capital Inc. ("Rodocanachi" or the "Corporation") (TSX VENTURE:ROD.P) announces that it has terminated its proposed business combination with Axcelon Biopolymers Corp. ("Axcelon"), previously announced on August 5, 2010. The Corporation's board has opted to terminate that transaction because Axcelon is unable to complete its obligations thereunder, despite having received several extensions from Rodocanachi.

Rodocanachi is pleased to also announce that it has entered into an agreement in principle dated August 1, 2011 (the "Agreement") to acquire the assets of the Marcotte Group (the "Acquisition"), a group of Canadian prospectors and private investors led by François Marcotte. The Group holds a 100% interest in the Montviel property (the "Montviel Property"), made up of 197 claims in Quebec's Abitibi region, and an option to acquire a 100% interest in the Victoria & Rail properties (the "Victoria & Rail Properties"), made up of 28 claims also in Quebec's Abitibi region, held under an option agreement dated November 18, 2010 with Globex Mining Enterprises Inc. ("Globex"; the "Option Agreement").

This acquisition, along with the Private Placement (as defined below), would constitute the Corporation's qualifying transaction (the "Qualifying Transaction") under Policy 2.4 of the TSX Venture Exchange (the "Exchange"). The Qualifying Transaction would not constitute a Non-Arm's Length Qualifying Transaction under the Exchange's policies and will not be subject to approval by the Corporation's shareholders.

The Proposed Qualifying Transaction

Under the Agreement, Rodocanachi will acquire the Montviel Property and the Group's interest in the Option Agreement by issuing to the members of the Group a total of 27,451,579 common shares of the Corporation (each a "Share") at a price of $0.095 per Share (the "Acquisition Price").

To complete its acquisition of the Victoria & Rail Properties under the Option Agreement, Rodocanachi shall issue shares and make cash payments to Globex and incur certain exploration expenditures as indicated below:

Date Cash Payment Shares Work Commitment
Closing Nil 2,000,000 Nil
1st anniversary $25,000 1,500,000 $200,000
2nd anniversary $50,000 Nil $250,000
3rd anniversary $50,000 Nil $250,000
4th anniversary $50,000 Nil $300,000
Total $175,000 3,500,000 1,000,000

All Shares held by members of the Group and Rodocanachi's Principals (as defined in the Exchange's policies) will be subject to a voluntary one-year escrow following the Qualifying Transaction.

The Proposed Private Placement

Concurrently with the Qualifying Transaction, a non-brokered private placement (the "Private Placement") in the minimum amount of $500,000 (being 5,263,158 Shares at a price of $0.095 per Share) and the maximum amount of $700,000 (being 7,368,422 Shares at a price of $0.095 per Share) shall be completed in Rodocanachi.

Sponsorship

The Qualifying Transaction will be subject to Exchange Policy 2.2 on sponsorship and sponsorship requirements. The parties are currently identifying potential sponsors. An agreement to sponsor should not be construed as any assurance with respect to the merits of the Qualifying Transaction or the likelihood of completion.

Completion of the Qualifying Transaction is subject to a number of conditions, including but not limited to, Exchange acceptance and if applicable pursuant to Exchange Requirements, majority of the minority shareholder approval. Where applicable, the transaction cannot close until the required shareholder approval is 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 management information circular or filing statement 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 a capital pool company should be considered highly speculative. The TSX Venture Exchange Inc. has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved the contents of this press release.

Rodocanachi expects to issue a further news release in the coming days providing additional information on the Victoria & Rail Properties and the Montviel Property as well as disclosing the Corporation's insiders following the Qualifying Transaction.

Cautionary Note Regarding Forward-looking Statements

Certain information in this press release may contain forward-looking statements. This information is based on current expectations that are subject to significant risks and uncertainties that are difficult to predict. Actual results may differ materially from results inferred or suggested in any forward-looking statements. Rodocanachi assumes no obligation to update the forward-looking statements, or to update the reasons why actual results may differ from those reflected in forward-looking statements unless and until required by applicable securities laws. Additional information identifying risks and uncertainties is contained in Rodocanachi's filings with the Canadian securities regulators, which filings are available at www.sedar.com.

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.

Contact Information

  • Mr. Richard Besner
    President and Chief Executive Officer
    Rodocanachi Capital Inc.
    (514) 824-5434

    Mr. Francois Marcotte
    Representative of the Marcotte Group
    (450) 536-0279