TORONTO, May 28, 2013 /CNW/ - Guyana Precious Metals
Inc. ("GPM") (TSXV:GPM), is pleased to announce
that it has entered into a binding letter agreement (the "Letter
Agreement") dated May 24, 2013 for the acquisition of
100% of the common shares of DPG Resources Inc. ("DPG"), a
company incorporated under the laws of the Province of Ontario (the "Acquisition"). The terms
of the Letter Agreement require the completion of certain
conditions precedent to the Acquisition, including among other
things, satisfactory due diligence, execution of a definitive
agreement and receipt of all necessary regulatory and shareholder
approvals.
Upon closing of the Acquisition, (i) each common
share of DPG outstanding shall be exchanged for one common share of
GPM and one common share purchase warrant of GPM (each, a
"Warrant"); and (ii) there will be no convertible
securities of DPG outstanding. Each Warrant shall entitle the
holder thereof to acquire one additional common share of GPM at an
exercise price of $0.10 for a period
of two years from the date of issuance thereof. DPG has no
convertible securities outstanding. Based on the number of
securities of GPM and DPG currently outstanding, immediately
following the closing of the Acquisition, it is anticipated that
(i) there will be approximately 110,514,513 common shares of GPM
outstanding on a non-diluted basis, or which former shareholders of
DPG will own approximately 18,700,000 such common shares (or
approximately 16.9% of the outstanding shares of the resulting
issuer) and the current shareholders of GPM will own approximately
91,814,513 common shares (or 83.1% of the outstanding shares of the
resulting issuer); and (ii) there will be approximately 62,425,000
convertible securities of GPM outstanding, inclusive of the
Warrants.
Following the Acquisition, Peter Mullens, the President of DPG, will remain
in that capacity and will continue to seek out acquisitions of
mineral exploration properties. There will be no change to
the board of directors or the management of GPM as a result of the
Acquisition.
There are currently no shareholders of DPG who
own 20% or more of all of the issued and outstanding common shares
of DPG. There are no current non-arm's length parties of GPM who
are insiders of DPG or presently hold any direct or indirect
beneficial interest in either DPG or any of its assets, other than
Dan Noone and Patrick Sheridan. Dan Noone is a director of each of DPG and GPM,
and holds an aggregate of 2,000,000 common shares of DPG
(representing approximately 10.7% of all issued and outstanding
common shares of DPG as of the date of this release) and 665,000
common shares and 825,000 convertible securities of GPM
(representing less than 1% of all issued and outstanding common
shares of GPM on a non-diluted basis, as of the date of this
release). Patrick Sheridan is
a director and officer of GPM, and holds an aggregate of 1,000,000
common shares of DPG (representing approximately 5.3% of all issued
and outstanding common shares of DPG as of the date of this
release) and 18,090,250 common shares and 8,700,000 convertible
securities of GPM (representing approximately 19.7% of all issued
and outstanding common shares of GPM on a non-diluted basis, as of
the date of this release). Prior to signing the Letter
Agreement, GPM formed a special committee of independent directors
to review, consider and approve the Acquisition. The
Acquisition is not a "related party transaction" within the meaning
of Multilateral Instrument 61-101 or TSX Venture Exchange Policy
5.9, as a the time the Acquisition was agreed to, DPG and GPM were
not "related parties" within the meaning of such instruments.
About DPG Resources Inc.
DPG was incorporated on June
16, 2009, and is an Ontario-based private company engaged in the
conduct of research and negotiations for the acquisition of
properties which are prospective for mineral resources. As of
the date hereof, DPG has cash on hand of approximately Cdn$820,000 (unaudited), and no material debts or
obligations.
About GPM
GPM is led by an experienced management team
with demonstrable project generation and development talents in the
country of Guyana. GPM is
presently expanding the exploration and development of its Aremu
and Peters Mine gold properties; two of the four historical past
gold producers in the country of Guyana. GPM maintains an interest in acquiring
additional key mineral exploration and development properties in
the country of Guyana.
Forward Looking Statements
Completion of the Acquisition is subject to a
number of conditions, including TSX Venture Exchange acceptance and
the receipt of all applicable shareholder approvals. The
Acquisition cannot close until the required shareholder and
regulatory approvals are obtained. There can be no assurance that
the Acquisition will be completed as proposed or at all.
Investors are cautioned that, except as disclosed in the management
information circular, if applicable, to be prepared in connection
with the Acquisition, any information released or received with
respect to the Acquisition may not be accurate or complete and
should not be relied upon. Trading in the securities of GPM should
be considered highly speculative. The TSX Venture Exchange has in
no way passed upon the merits of the proposed Acquisition and has
neither approved nor disapproved the contents of this press
release.
All statements other than statements of
historical fact, included in this release, including, without
limitation, statements regarding potential acquisitions, completion
of the Acquisition and future plans and objectives of GPM are
forward-looking statements that involve various risks and
uncertainties. There can be no assurance that such statements will
prove to be accurate and actual results and future events could
differ materially from those anticipated in such statements.
Important factors that could cause actual results to differ
materially from the GPM's expectations are exploration risks
detailed herein and from time to time in the filings made by GPM
with securities regulators.
Neither the TSX Venture Exchange nor its
Regulation Services Provider accepts responsibility for the
adequacy or accuracy of this release.
SOURCE Guyana Precious Metals Inc.