July 12, 2024 – TheNewswire - Calgary, Alberta – CastleCap Capital Inc. (TSXV: CSTL.P) (the "Company") and Laiva Gold Inc. ("Laiva", and together with the Company, the "Parties") are pleased to announce the execution of a non-binding letter of intent dated July 10, 2024 (the "LOI") regarding a proposed non-arm's length transaction (the "Proposed Transaction"), as such term is defined in Policy 2.4 - Capital Pool Companies (the "Policy") of the TSX Venture Exchange (the "TSXV") Corporate Finance Manual. The Parties intend to enter into a definitive agreement (the "Proposed Definitive Agreement") in respect of the Proposed Transaction.

 

The Proposed Transaction

 

As will be set out in the Proposed Definitive Agreement, the Company is expected to acquire all of the issued and outstanding common shares of Laiva (the "Laiva Shares") pursuant to a business combination to be completed under the Business Corporations Act (Alberta) (the "ABCA") by the Company and Laiva. The Proposed Transaction is expected to result in the issuance, to each shareholder of Laiva (each, a "Laiva Shareholder"), of two (2) Common Share (as defined below) for each one (1) Laiva Share held by such holder immediately prior to the closing of the Proposed Transaction (the "Closing"). As part of the Proposed Transaction, all convertible securities of Laiva outstanding immediately prior to the Closing are expected to be replaced with or exchanged for equivalent convertible securities of the Company entitling the holders thereof to acquire Common Shares in lieu of Laiva Shares.

 

The Proposed Transaction will result in the reverse takeover of the Company by Laiva Shareholders, and will constitute the Company's Qualifying Transaction (as defined by the TSXV). Following the completion of the Proposed Transaction, the Company, as the issuer resulting therefrom (the "Resulting Issuer"), is expected to carry on the current business of Laiva under the name "Laiva Gold Inc." or such other name as may be determined by Laiva and approved by the shareholders of the Company and which is acceptable to the applicable regulatory authorities, including the TSXV ("Name Change"). The business of the Resulting Issuer will be primarily focused on the re-start of mining operations at Laiva’s flagship gold mine in Finland.

 

Upon completion of the Proposed Transaction, it is anticipated that the Resulting Issuer will be listed as a Tier 1 Mining Issuer on the TSXV.

 

The Parties hereby have agreed to work exclusively with each other for a period of 60 days following the execution of the LOI. At this time, no finder’s fees, deposits, advances or loans have been or are intended to be made in connection with the Proposed Transaction. Laiva has agreed to pay the costs and expenses of the Parties in connection with the Proposed Transaction and has also agreed to pay a ‘break fee’ of $200,000 to the Company in the event that the Proposed Definitive Agreement is not entered into on or before September 30, 2024, or such date as may be mutually agreed to by the Parties, or if Laiva terminates the LOI prior to entering into the Proposed Definitive Agreement.

 

The completion of the Proposed Transaction will be subject to the entry into of the Proposed Definitive Agreement as well as a number of terms and conditions to be set forth in the Proposed Definitive Agreement, including, among other things (i) there being no material adverse change in respect of either of the Parties; (ii) the receipt of all necessary consents, orders and regulatory and shareholder approvals, including the conditional approval of the TSXV, subject only to customary conditions of closing; (iii) the completion of the Name Change and the Laiva Financing, as defined below; and (iv) such other customary conditions of closing for a transaction in the nature of the Proposed Transaction. Accordingly, there can be no assurance that the Proposed Transaction will be completed on the terms proposed and described herein, or at all.

 

Proposed Financing

 

Pursuant to the terms of the LOI, Laiva anticipates completing a financing of 12,500,000 units ("Units") at a price of $0.80 per Unit for gross proceeds of $10,000,000 (the "Laiva Financing"), with each Unit consisting of one Laiva Share and one Laiva Share purchase warrant exercisable into one Laiva Share at a price of $1.00 per Laiva Share for a period of 2 years from the date of issuance. Laiva may retain a broker or pay finder’s fees to certain registrants or eligible persons exempt from registration on any portion of the Laiva Financing. The net proceeds of the Laiva Financing will be used: (a) to fund the business plan of the Resulting Issuer; (b) for Proposed Transaction expenses; and (c) for general working capital purposes. Additional details regarding the Laiva Financing will be provided in due course.

Proposed Directors and Officers of the Resulting Issuer

 

Upon the completion of the Proposed Transaction, it is expected that the board of directors and officers of the Resulting Issuer will be reconstituted to be comprised of individuals nominated by Laiva and the Company subject to compliance with the requirements of the TSXV, and applicable corporate and securities laws. Laiva and the Company will make further announcements as appointments of its respective officers and director are made. Additional information regarding Insiders (as defined by the TSXV) of the Company upon completion of the Proposed Transaction and/or any financing(s) will also be disclosed, if required.

 

Shareholder Approval & Non-Arm’s Length Transaction

 

Mr. Charles Chebry is a director and officer of the Company and of Laiva, as such, the Proposed Transaction is being considered a Non-Arm's Length Transaction (as defined by the TSXV) and "related party transaction" pursuant to the provisions of Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions, and accordingly requisite disclosures will be made and procedures followed. The Company and Laiva will be required to obtain certain approvals, including but not limited to, directors’ approvals, regulatory approvals, TSXV approvals, and approvals of its respective shareholders, including approvals from disinterested shareholders of the Parties, for the Proposed Transaction.

 

Sponsorship

 

The TSXV requires sponsorship of a Proposed Transaction of a capital pool company, unless exempt in accordance with the policies of the TSXV. The Parties are currently reviewing the requirements for sponsorship and may apply for an exemption from the sponsorship requirements pursuant to the policies of the TSXV. However, there can be no assurance that the Parties will ultimately obtain such exemption.

 

The Parties intend to provide any additional information regarding sponsorship at a later date, once determined by the Parties. In the event that the TSXV does not grant an exemption from the sponsorship requirements of the TSXV, the Parties would be required to engage a sponsor.

 

Trading Halt

 

In accordance with the policies of the TSXV, the Company has requested a trading halt of its Common Shares and such halt has been granted. It is expected that the Common Shares will remain halted until completion of the Proposed Transaction.

 

About Laiva Gold Inc.

 

Laiva is a Canadian mining company, incorporated under the ABCA, and with a subsidiary company own its flagship operation, the Laiva mine ("Laiva Mine") in Finland. The Laiva Mine is an open pit operation, fully equipped with state of the art infrastructure including one of the largest gold plants in Europe (6,000 tonnes per day capacity) and a sizeable proven resource estimate, which Laiva intends to bring into production in the near term.

 

About CastleCap Capital Inc.

 

The Company is a capital pool company created pursuant to the policies of the TSXV. The Company has not commenced operations and has no assets other than cash. The Company’s principal business is the identification and evaluation of assets or businesses with a view to completing a "Qualifying Transaction" under the Policy. As of the date hereof the Company has 4,000,000 Common Shares issued and outstanding and 400,000 options exercisable on or before June 12, 2029 at a price of $0.10 per Common Share.

 

Further Information

 

Further updates in respect of the Proposed Transaction will be provided in a subsequent news release. Also, additional information concerning the Proposed Transaction, the Company, Laiva, and the Resulting Issuer will be provided in the requisite management information circular and/or filing statement to be filed by the Company and Laiva in connection with the Proposed Transaction, which will be available in due course under the Company's SEDAR+ profile at www.sedarplus.ca.

 

Upon entering into the Proposed Definitive Agreement, the Company will issue a further comprehensive news release disclosing details of the Proposed Transaction disclosing including any financial information respecting Laiva, the issued and outstanding securities of each of Parties and the definitive terms of the exchange of securities of the Company and Laiva.

 

All information contained in this news release with respect to the Company and Laiva was supplied by the respective Party for inclusion herein, and each Party and its directors and officers have relied on the other Party for any information concerning the other Party.

 

For further information please contact:

 

CastleCap Capital Inc.                                        Laiva Gold Inc.

Charles Chebry                                                Jeremy Gray

Director, President, Chief Executive Officer and Secretary        Chief Executive Officer and Director

Email: charleschebry@outlook.com                        Email: jeremy.gray@laivagold.com

Telephone: (403) 680-8511                                Telephone: +44 7769 388 376

 

Cautionary Statements

 

This news release contains forward-looking statements and forward-looking information (collectively, "forward-looking statements") within the meaning of applicable securities laws. Any statements that are contained in this news release that are not statements of historical fact may be deemed to be forward- looking statements. Forward-looking statements are often identified by terms such as "may", "should", "anticipate", "will", "estimates", "believes", "intends" "expects" and similar expressions which are intended to identify forward-looking statements. More particularly and without limitation, this news release contains forward- looking statements, including statements concerning the Proposed Transaction (including the Name Change), the Laiva Financing, the Special Meeting, the Proposed Definitive Agreement, and the proposed structure by which the Proposed Transaction is to be completed. Forward-looking statements are inherently uncertain, and the actual performance may be affected by a number of material factors, assumptions and expectations, many of which are beyond the control of the Parties, including expectations and assumptions concerning (i) the Company, Laiva, the Resulting Issuer, and the Proposed Transaction, (ii) the ability of the Parties to negotiate and enter into the Proposed Definitive Agreement on satisfactory terms as proposed, (iii) the timely receipt of all required shareholder, court and regulatory approvals (as applicable), including the approval of the TSXV, (iv) if the Proposed Definitive Agreement is entered into, the satisfaction of other closing conditions in accordance with the terms of the Proposed Definitive Agreement, and (v) the ability of the Parties (as applicable) to complete the Laiva Financing and/or the Proposed Transaction on the terms outlined in this news release (or at all). Readers are cautioned that assumptions used in the preparation of any forward- looking statements may prove to be incorrect. Events or circumstances may cause actual results to differ materially from those predicted as a result of numerous known and unknown risks, uncertainties and other factors, many of which are beyond the control of the Parties. Readers are further cautioned not to place undue reliance on any forward-looking statements, as such information, although considered reasonable by the respective management of the Parties at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated.

 

The forward-looking statements contained in this news release are made as of the date of this news release, and are expressly qualified by the foregoing cautionary statement. Except as expressly required by securities law, neither Party undertakes any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise.

 

Completion of the Proposed Transaction is subject to a number of conditions, including but not limited to, TSXV acceptance and if applicable pursuant to the requirements of the TSXV, majority of the minority shareholder approval. Where applicable, the Proposed Transaction cannot close until the required shareholder approval is obtained. 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 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 news release.

 

This news release shall not constitute an offer to sell or the solicitation of an offer to buy any securities in any jurisdiction.

 

This news release does not constitute an offer to sell or a solicitation of an offer to buy the securities described herein in the United States or in any other jurisdiction, nor shall there be any sale of the securities in any state in which such offer, solicitation or sale would be unlawful. The securities have not been and will not be registered under the U.S. Securities Act, or any state securities laws, and accordingly, may not be offered or sold in the United States except in compliance with the registration requirements of the U.S. Securities Act and applicable state securities requirements or pursuant to exemptions therefrom.

 

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. No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein.

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