TORONTO, ONTARIO (TSX VENTURE: YSC.P) is pleased to announce
that it has entered into a letter of intent with Tamaka Holdings
Inc. ("Tamaka" or the "Private Company") dated November 19, 2007
(the "LOI") to complete an arm's-length business combination with
Tamaka (the "Proposed Amalgamation") to continue Tamaka s gold
exploration business.
About the Proposed Amalgamation
Yonge Street and Tamaka propose to combine pursuant to a reverse
take-over transaction (the "RTO") by amalgamating into a new
corporation (the "Amalgamated Company") to be named Tamaka Gold
Inc., if available, or such other name as the Private Company may
determine.
As part of the completion of the RTO, it is proposed that:
(a) Yonge Street will transfer from its current federal
jurisdiction and be continued under the laws of the Province of
Ontario,
(b) the Yonge Street common shares will be consolidated on a one
for two basis on the Proposed Amalgamation (reducing to
approximately 1,514,375 common shares (1,717,250 fully diluted) of
the Amalgamated Company), and
(c) the shareholders of Tamaka will receive one common share of
the Amalgamated Company in exchange for each issued and outstanding
common share of the Private Company.
Yonge Street has approximately 3,028,750 common shares issued
and outstanding. The Company s shares are currently listed for
trading on the TSX Venture Exchange (the "Exchange"). The Company
has a stock option plan and there are 302,875 exercisable options
outstanding under such plan with an exercise price of $0.20 per
share. The agents of the Company s initial public offering also
hold 102,875 non-transferable options exercisable at $0.20 per
share. There are no other exercisable rights, warrants or options
currently outstanding to acquire shares of the Company.
Prior to the closing of the RTO, Tamaka proposes to continue its
current private placement of up to 8,000,000 "flow-through" common
shares and up to 2,500,000 common shares at a price of $0.65 per
flow-through share and $0.50 per common share (of which 1,538,461
flow-through shares and 1,540,000 common shares have already been
issued for gross proceeds of $1,770,000). The proceeds of this
private placement will be used to fund exploration activities and
working capital for Tamaka or, upon completion of the RTO, for the
Amalgamated Company (the "Continuing Private Placement").
At or about the time of closing of the RTO, Tamaka and Yonge
Street will use their reasonable best efforts to arrange for a
private placement for the Amalgamated Company to provide financing
of up to $20,000,000 comprised of up to approximately $5,000,000 of
flow-through financing (at a price in excess of $0.65 per
flow-through share) and up to $15,000,000 of financing (at a price
in excess of $0.50 per common share) for the further exploration
and development of the Rundle/Swayze and Goldlund properties or
such other amounts and terms as Tamaka may determine, acting
reasonably (the "Concurrent Private Placement").
It is proposed that the Amalgamated Company will issue to a
third party who is currently arm s length to Yonge Street and
Tamaka (namely Donald A. Sheldon or his nominee) 150,000 common
shares of the Amalgamated Company at a deemed issue price of $0.50
per share and warrants entitling the holder to acquire up to
150,000 common shares at an exercise price of $0.50 per share at
any time within 2 years after the listing of the Amalgamated
Company s shares on the TSXV, as finder s fees and for structuring
and corporate finance advice in regards to the completion of the
RTO transaction.
Frank Zoebelein of King City, Ontario, a shareholder of Tamaka
and a proposed director of the Amalgamated Company, will likely be
the largest shareholder of the Amalgamated Company, holding or
controlling 56,250,000 shares (approximately 60% of the outstanding
shares (or approximately 55% fully diluted)). It is not anticipated
that any other person will own or control more than 10% of the
Amalgamated Company.
Yonge Street is a "capital pool company" and intends that the
Proposed Amalgamation shall constitute the "Qualifying Transaction"
of the Company as such terms are defined in the policies of the
Exchange The Proposed Amalgamation will be an arm's length
transaction.
The completion of the Proposed Amalgamation is subject to
Exchange approval and any other necessary regulatory approvals. It
is also subject to additional conditions precedent, including such
security holder approvals of both Yonge Street and Tamaka as may be
required by applicable corporate or securities laws; satisfactory
completion of due diligence reviews by both parties; approvals of
the boards of directors of Yonge Street and Tamaka; completion of a
definitive agreement setting forth the terms and conditions of the
Proposed Amalgamation consistent with the LOI; and certain other
conditions customary for transactions of this nature.
The completion of the Proposed Amalgamation is also conditional
on the completion of the Continuing Private Placement and the
Concurrent Private Placement in an aggregate amount of not less
than $2,000,000 (excluding funds raised by Tamaka prior to the date
of the LOI) or such greater amounts as Tamaka may determine.
The Company will be applying to have the Amalgamated Company
listed as a Tier 2 Mining Issuer on the Exchange upon completion of
the Proposed Amalgamation.
On completion of the Proposed Amalgamation, the Amalgamated
Company will be in the mineral exploration industry in the Province
of Ontario. Further information on the business of Tamaka is
detailed below.
Sponsorship of a Qualifying Transaction of a capital pool
company is required by the Exchange unless an issuer is granted an
exemption in accordance with Exchange policies. The Company intends
to apply for an exemption from sponsorship requirements. However,
there is no assurance that the Company will obtain an
exemption.
About Yonge Street
Yonge Street is a company incorporated under the Canada Business
Corporations Act. It is a reporting issuer in the Provinces of
Alberta, British Columbia, Manitoba, and Ontario.
Further information concerning Yonge Street can be found in the
prospectus of Yonge Street dated March 27, 2006 and is available at
www.sedar.com.
About Tamaka
The following information relating to Tamaka has been provided
to the Company by Tamaka. Tamaka was incorporated pursuant to the
Business Corporations Act (Ontario). Tamaka is a private
corporation with its head office located in King City, Ontario.
Business of Tamaka
Tamaka carries on the business of mineral exploration in the
Province of Ontario. It currently has agreements to acquire, from
corporations wholly-owned by Frank Zoebelein, the following gold
exploration properties:
- South Rundle, located some 72 km south of Foleyet, Ontario,
along a year-round lumber road, which comprises in excess of 324
hectares. South Rundle is a well-advanced property complete with
underground development and infrastructure including a development
campsite as well as a number of pieces of major mining equipment. A
mine closure plan has been accepted for this project by the
Province of Ontario and a certificate of approval has been issued
for its tailings disposal areas; it is designated under the Mining
Tax Act (Ontario) as a remote mine . Further information about the
South Rundle property will be provided in information to be sent to
shareholders for the meeting to be called to approve the Qualifying
Transaction.
- North Rundle, located in close proximity to the South Rundle
property, comprises in excess of 525 hectares. It is a grass-roots
exploration property.
- Swayze, located 14 km north the South Rundle property,
comprising in excess of 453 hectares. The Swayze property also has
underground development in place. Further information about the
Swayze property will be provided in information to be sent to
shareholders for the meeting to be called to approve the Qualifying
Transaction.
- Goldlund Group and Greater Goldlund, located midway between
Dinorwic and Sioux Lookout, Ontario, consisting of a total of
approximately 20,500 hectares. The Goldlund Group property has an
underground development on three levels; it operated from July 1982
until February 1985 producing approximately 17,500 ounces of gold.
Some infrastructure and milling equipment has been acquired by
Tamaka for this project. Greater Goldlund is a grass-roots
exploration property. Tamaka has completed approximately 8,500
metres of drilling on these projects in 2007 but has not received
or compiled all of the assay results. Further information about the
Goldlund Group will be provided in information to be sent to
shareholders for the meeting to be called to approve the Qualifying
Transaction.
Management and Board of Directors of the Amalgamated Company
Upon completion of the Proposed Amalgamation, it is proposed
that the board of directors of the Amalgamated Company will
initially be comprised of approximately 5 members, including the
following:
Frank Zoebelein,
Gerald Ruth,
Donald A. Sheldon, and
Eric Zoebelein.
The officers of the Amalgamated Company are to include the
following:
President and CEO to be designated by the Private Company
Gerald Ruth Interim CFO
Karel Pieterse, A.C.S.M., P.Eng COO
Frank Zoebelein Director
Mr. Zoebelein is an independent businessman who has devoted
substantial time and funds to mining related projects. Previously,
Mr. Zoebelein, together with two brothers and a cousin, was a
private owner of a highly successful furniture manufacturing
business known as REFF. REFF were leaders in the field of
innovation and mechanization and were very progressive and forward
thinking. REFF concepts were used in the furnishing of Habitat at
the time of Expo 67. REFF became a public company in 1986 and its
shares were listed on the Toronto Stock Exchange until December,
1989, when REFF was acquired by Westinghouse.
Gerald Ruth Director, and Interim Chief Financial Officer
Mr. Ruth is a seasoned financial professional with 20 years
experience in the Canadian capital markets. He provides strategic
advisory services to companies in a broad range of industries
focusing on going public, corporate finance, capital markets,
corporate governance and stock exchange related matters. Mr. Ruth
is currently a Director of Western Goldfields, Inc., a gold mining
company listed on the Toronto Stock Exchange and American Stock
Exchange, and a Director and Chief Financial Officer of Greenwich
Global Capital Inc., a capital pool company that is listed on the
TSX Venture Exchange, President, CEO and Director of Yonge Street
and CFO and Director of Stans Energy Corp., a uranium exploration
and development company.
From 1988 to 2003, Mr. Ruth held various positions at the
Toronto Stock Exchange, serving as the head of Listings Department
from 1997 to 2003 where he was responsible for all operations,
policy development and general management within the Listings
Group. Mr. Ruth is a Chartered Accountant who was employed in
private practice with KPMG Peat Marwick and Coopers and Lybrand
prior to joining the Toronto Stock Exchange. Mr. Ruth received a
Bachelor of Business Administration (Honors) from Wilfrid Laurier
University.
Donald A. Sheldon, B.A.Sc., M.A.Sc., LL.B., P.Eng, -
Director
Mr. Sheldon is a securities lawyer with the law firm of Sheldon
Huxtable Professional Corporation in Toronto. He has been called to
the bar in Ontario and Alberta. He has been practising corporate
and commercial law for over 30 years, with an emphasis on corporate
finance and securities regulation, particularly in the mining and
mineral exploration fields. He has appeared as counsel before
numerous securities regulatory authorities, including the Ontario
Securities Commission, British Columbia Securities Commission,
Alberta Securities Commission and appeal panels of stock exchanges.
During the past 20 years he has been a director and/or officer of
other public companies listed on Canadian exchanges, including
Multimedia Nova Corporation, Cavell Energy Corporation, Vedron Gold
Inc., Wolfden Resources Inc. and currently, Metalcorp Limited,
Greentree Gas & Oil Ltd. and Fletcher Nickel Inc.
Eric Zoebelein - Director
Mr. Eric Zoebelein is an independent businessman who was,
together with two brothers and a cousin, a private owner of a
highly successful furniture manufacturing business known as REFF.
REFF were leaders in the field of innovation and mechanization and
were very progressive and forward thinking. REFF concepts were used
in the furnishing of Habitat at the time of Expo 67. REFF became a
public company in 1986 and its shares were listed on the Toronto
Stock Exchange until December, 1989, when REFF was acquired by
Westinghouse. Since that time, Mr. Eric Zoebelein has pursued
personal business interests.
Karel Pieterse Chief Operating Officer
Mr. Pieterse is a mining engineer. He has had considerable mine
construction and operating experience. He advanced through various
stages of mine operations from shift-boss to general manager at
various operations. During a decade and a half (1980 s to mid-1990
s) Mr. Pieterse, at a senior level, was involved with the
construction of David Bell and Golden Giants mines at Hemlo,
reactivation of Inco s Shebandowan mine and start-up of Inco s
Whistle open-pit mine. Mr. Pieterse has the distinction of being
the lead during construction of "The deepest single-lift shaft in
the Western Hemisphere" at Agnico-Eagle Laronde No. 3 mine.
General Qualifications
Completion of the 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 Proposed Amalgamation, 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.
Contacts: Yonge Street Capital Corp. Gerald Ruth President &
CEO (416) 899-3304 Tamaka Holdings Inc. Frank Zoebelein (905)
833-3711
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