Grasslands Entertainment Inc. (TSX VENTURE:GEE) ("Grasslands"), a company listed
on the TSX Venture Exchange (the "Exchange"), is pleased to announce that it has
entered into an arm's length binding letter agreement (the "Agreement") dated
January 20th, 2011 with Lakeside Minerals Corp. ("Lakeside" or "TargetCo."), a
non-reporting issuer incorporated under the laws of the Province of Ontario on
August 21, 2007, pursuant to which Grasslands will, subject to a number of
conditions, acquire all of the issued and outstanding securities of Lakeside.
The transaction will constitute a reverse take-over (the "RTO") of Grasslands
under the policies of the TSX Venture Exchange (the "Exchange"). Foundation
Opportunities Inc. ("FOI") is a controlling shareholder of Lakeside, and this
Agreement shall supersede and terminate any prior agreements between Grasslands
and Foundation Financial Holding Corp. (the parent company of FOI) in respect of
any potential reverse takeover transaction. FOI is controlled by Jeremy Goldman
(of North York, Ontario), Yannis Banks (of Toronto, Ontario) and the Goomie
Trust, a trust formed under the laws of the province of Ontario, who together
hold a 95% interest in FOI.
Pursuant to the Agreement, Grasslands has agreed to form a new corporation
("Newco") for the purpose of amalgamating with TargetCo. Newco will be a
wholly-owned subsidiary of Grasslands and will be created under the Business
Corporations Act (Ontario). As a condition of the amalgamation, Grasslands will
hold a meeting (the "Meeting") of the shareholders (the "Grasslands
Shareholders") of Grasslands to approve the RTO pursuant to the rules and
policies of the Exchange. The shareholders will also be asked to approve a
consolidation (the "Share Consolidation") of the Class A voting shares of
Grasslands on a five (5) old shares ("Pre-Consolidated Shares") for one (1) new
share basis (a "Consolidated Share"). If approved, the Share Consolidation shall
become effective prior to completion of the RTO. At the meeting, Lakeside shall
have the right to nominate up to six (6) new directors for a board of directors
of Grasslands (the "Board") comprised of seven (7) directors.
Upon the amalgamation of TargetCo. and Newco, holders of common shares in the
capital of TargetCo. ("TargetCo. Shares") will be entitled to receive one (1)
Consolidated Share for each TargetCo. Share (the "Consideration Ratio"). The
foregoing Consolidated Shares will be issued at an ascribed price of $0.175 per
Consolidated Share. Currently, TargetCo has 10,005,100 shares issued and
outstanding as at the date hereof. TargetCo has options on 7 properties in
Quebec, Canada which are described below:
Dufay Property - Gold property located roughly 38 km west of Rouyn-Noranda,
Quebec. The Dufay Property has a total of 49 claims over approximately 7,800
acres. The Dufay Property can be accessible using Highway 117 and access roads;
it is surrounded by larger industry players including IAMGOLD Corp. and Richmont
Mines. An aeromagnetic survey conducted by Raven Resources in 1993 revealed two
sizeable magnetic anomalies. There has been approximately 18,000 ft of
historical drilling with Au results up to 36.0 grams/ton over 19.68 ft. Lakeside
has the option to acquire 100% of the property on the following terms: on
October 19th, 2010, $25,000 was paid and 1,000,000 common shares of Lakeside
were issued upon the execution of the option agreement; 250,000 common shares
and $50,000 are payable to the vendors on October,19th, 2011; 250,000 common
shares and $75,000 are payable to the vendors on October 19th, 2012; and
1,000,000 common shares and $100,000 are payable to the vendors on October 19th,
2013.
Launay Property - Gold property located less than 45 minutes drive away from
Rouyn-Noranda. Most gold mineralization is found within the approximately
200-700 meter wide, 40km long Macamic Deformation Zone within the Abitibi
Greenstone Belt, of which 6km lies within this property. The drill results of
this property include: 70.0 g/t Au over 1.5 m, 35.0 g/t Au over 1.0 m, 35.63 g/t
Au over 1.0 m, and 10.37 g/t Au over 2.44 m. Lakeside has the option to acquire
100% of the property on the following terms: on December 7th, 2010, $10,000 was
paid and 250,000 common shares of Lakeside were issued upon the execution of the
option agreement; 250,000 common shares and $20,000 are payable to the vendors
on December 7th, 2011; 250,000 common shares and $25,000 are payable to the
vendors on December 7th, 2012; and 1,000,000 common shares and $30,000 are
payable to the vendors on December 7th, 2013.
Disson Property - Gold property located on a fault zone up to 60 meters wide
with surrounding alteration zones generally 25 to 50 meters on either side of
the fault. Some alteration zones are up to 200 meters wide. Formally owned by
Barrick Gold, the Disson Property has excellent historic drill results up to 173
g/t AT over 1.0m with several new zones identified. The Disson Property also
shows indicators for manifestations of strong fe-carbonate or strong
silicification. Lakeside has the option to acquire 100% of the property on the
following terms: on December 7th, 2010, $20,000 was paid and 250,000 common
shares of Lakeside were issued upon the execution of the option agreement;
250,000 common shares and $35,000 are payable to the vendors on December 7th,
2011; 250,000 common shares and $50,000 are payable to the vendors on December
7th, 2012; 250,000 common shares and $60,000 are payable to the vendors on
December 7th, 2013; and 500,000 common shares and $80,000 are payable to the
vendors on December 7th, 2014.
Other Properties - Lakeside also controls four other gold, uranium and rare
earth properties in Quebec named Kippawa, Quevillon, 12M16 and 22B15.
Capital Structure of Grasslands
Grasslands has 16,997,696 Pre-Consolidated Shares issued and outstanding and no
options, warrants, or other convertible securities currently issued or
outstanding.
Contemplated Financings
Grasslands may also complete a financing of up to $3 million worth of Grasslands
securities (the "RTO Financing") in conjunction with the completion of the RTO
to achieve the minimum listing requirements of the Exchange for a Mining Issuer
(as defined in the Manual). Grasslands reserves the right to issue up to a
further 10% of the units issued pursuant to the RTO financing to any agent,
underwriter and/or finder, such brokers warrants to be exercisable into units
identical in exercise terms to those issued under the RTO Financing and
exercisable for a period of two years from the date of issue.
TargetCo. Agrees that other than an interim financing of $200,000 completed at a
price of $0.10 per unit of a share and 1/2 share purchase warrant, it will not,
prior to the completion of the RTO of the expiration or termination of the
Agreement, issue from treasury any TargetCo. Shares or otherwise grant or issue
any options, warrants or other securities convertible into TargetCo. Shares
without the prior approval of Grasslands.
Resulting Issuer Capital Structure
The proposed amalgamation, assuming the closing of the full interim financing,
and assuming the completion of the contemplated 5:1 consolidation of the shares
of Grasslands; Newco will have 15,403,639 Consolidated Shares, 2,382,500
warrants and 1,400,000 stock options issued and outstanding.
Closing Conditions
The closing of the RTO with Lakeside is subject to a number of conditions,
including, but not limited to the following:
1. Receipt of an exemption or waiver of sponsorship; if not available, a
sponsor for the RTO shall have conducted due diligence and filed with
the Exchange a sponsorship report satisfactory to the Exchange;
2. Receipt of all required regulatory approvals, including the approval of
the Exchange, of the RTO;
3. Completion of all due diligence reviews by both Grasslands and TargetCo.
by February 28th, 2011;
4. No adverse material change in the business affairs, financial condition
or operations of TargetCo. and Grasslands shall occur between the date
of the latest available financial statements and the closing of the RTO;
excepting that TargetCo acknowledges that Grasslands has provided for a
director's fee of $10,000 to be paid for each director (for an aggregate
of $40,000) payable prior to Grasslands' year end;
5. Satisfaction of the Minimum Listing Requirements of the Exchange and all
requirements under the Exchange rules relating to completion of a
"Reverse Take-Over"; and
6. Completion of the RTO on or before May 31, 2011.
Sponsorship of a reverse take-over is required by the Exchange unless exempt in
accordance with Exchange policies. Grasslands intends to apply for an exemption
from sponsorship requirements, however, there is no assurance that Grasslands
will obtain this exemption. In addition, the stock will likely remain halted
pending completion of the RTO.
A management information circular in respect of the proposed RTO will be
prepared and filed in accordance with Policy 5.2 of the Exchange on SEDAR at
www.sedar.com no less than seven business days prior to the closing of the
proposed Reverse Take-Over. A press release will be issued once the filing
statement has been filed as required pursuant to Exchange policies.
The following are bios for the propsed officers and directors of the resulting
issuer:
Yannis Banks, President & CEO - Mr. Banks is Managing Director of Foundation
Markets Inc., a Toronto-based merchant and investment bank, focused on financing
and incubating growth companies primarily in the energy and natural resource
sectors. Mr. Banks has been instrumental in financing numerous companies and
advising on project acquisitions in North and South America and Asia. He is a
director of Caldera Geothermal, a geothermal exploration and development company
focused in the Great Basin of the Western U.S., and was instrumental in founding
and financing Quia Resources, a gold exploration company focused in Colombia, as
well as Alpaca Resources Inc., a copper and gold exploration and development
company focused on the Western U.S. and Peru.
Gary Hokkanen, CFO - Mr. Hokkanen is President of Cavalry Corporate Solutions
Ltd. and is a professional executive level accountant with over fifteen years
experience in senior level financial management within various industries. Prior
to jointly forming Cavalry Corporate Solutions, Mr. Hokkanen was CFO to a group
of six development stage public companies led by entrepreneurial management.
Entities were publicly listed in North America on the TSX, TSX Venture Exchange,
CNSX, and the NASD Over-the-Counter Bulletin Board. Mr. Hokkanen holds a
Bachelor of Arts degree from the University of Toronto and is a Certified
Management Accountant ("CMA") and a member of the Society of Management
Accountants of Ontario.
Scott Jobin-Bevans, Director - Mr. Jobin-Bevans is a geologist with more than 20
years of mineral exploration industry experience. Mr. Jobin-Bevans is co-Founder
and Director of Caracle Creek International Consulting Inc. (CICC), President of
Treasury Metals Inc., Director of Mukuba Resources Ltd., and President of
Prospectors and Developers Association of Canada (PDAC).
Richard Cleath, Director - Mr. Cleath has more than 25 years of experience as a
geologist and in managing, organizing, budgeting, planning and executing various
mining exploration projects globally. Mr. Cleath is the VP Exploration for
Alpaca Resources (with US based copper and gold projects); and previously played
an integral role as VP Exploration with U3O8 Corporation ("U3O8"). Prior to
U3O8, Mr. Cleath was Vice President, Exploration with Absolut Resources where he
negotiated and acquired the Chaparra mesothermal gold vein project in southern
Peru and led the acquisition of the advanced-stage Andorinhas high-grade gold
project in Brazil.
Andres Tinajero, Director - Mr. Tinajero has extensive experience working with
TSX and TSXV listed junior resource companies. Mr. Tinajero's current and
previous involvements include serving as CFO of Vena Resources Inc., Trelawney
Mining & Exploration Inc., and Quia Resources Inc.
Adam Szweras, LLB, Director, Corporate Secretary - Mr. Szweras is a partner with
law firm Fogler, Rubinoff LLP and Chairman of Foundation Markets Inc, a
Toronto-based investment bank and Exempt Market Dealer. Mr. Szweras has
practiced securities law for over 14 years and focuses on financing and going
public transactions. He works with mid-market companies looking to raise capital
or make acquisitions and assists private companies in the going public process.
About Lakeside Minerals Inc.
Lakeside is focused on exploring and developing gold and other mineral deposits
in the mining friendly jurisdiction of Quebec. The company's portfolio consists
of seven projects including the Dufay project which is 3.5 km from the historic
world class Kerr-Addisson mine and where historical drill results demonstrated
significant potential. Lakeside's management and board have extensive experience
in exploring and developing mineral deposits and building shareholder value.
About Grasslands Entertainment Inc.
Grasslands Entertainment Inc. is headquartered in Calgary, Alberta and is
publicly traded on the TSX Venture Exchange under the symbol GEE. It creates,
develops, finances, produces and distributes proprietary television programming
for worldwide markets. Grasslands have a proven track record of producing
quality, cost-effective programming with worldwide audience appeal.
All technical information in this press release has been review and approved by
Richard Cleath, who is a Qualified Person ("QP") under National Instrument
43-110.
Completion of the Reverse Take-Over 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 Reverse Take-Over cannot close until the required shareholder
approval is obtained. There can be no assurance that the Reverse Take-Over will
be completed as proposed, or at all.
Investors are cautioned that, except as disclosed in the 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.
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.
Neither TSX Venture Exchange Inc. nor its Regulation Services Provider (as that
term is defined in the policies of the TSX Venture Exchange Inc.) accepts
responsibility for the adequacy or accuracy of this release.
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