OSISKO MINING TO ACQUIRE BEAUFIELD RESOURCES
NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES
Toronto, Ontario (August 14, 2018) – Osisko Mining Inc. (TSX: OSK) (“Osisko”) and Beaufield Resources Inc. (TSX-V: BFD) (“Beaufield”) are pleased to announce that they have entered into a definitive arrangement agreement dated August 14, 2018 (the “Arrangement Agreement”) pursuant to which Osisko has agreed to acquire all of the issued and outstanding common shares of Beaufield (collectively, the “Beaufield Shares” and each whole share, a “Beaufield Share”) which it does not already own (the “Acquisition”). The Acquisition is expected to be completed by way of a statutory plan of arrangement under the Canada Business Corporations Act (the “Arrangement”).
John Burzynski, President and Chief Executive Officer of Osisko, stated: “We are very pleased to announce today’s proposed transaction with Beaufield. By joining Osisko in our large scale exploration and development program at Windfall, Beaufield Shareholders have the opportunity to capitalize on the strong premium offered today and to benefit from the future growth of our project.”
Ron Stewart, President and Chief Executive Officer of Beaufield, stated: “We are very pleased to be joining forces with Osisko, which continues to demonstrate its leadership and strength in advancing its portfolio of resource projects including the flagship Windfall district. We believe the combination of our projects will provide benefit to the shareholders of both companies and look forward to participating in the future success of Osisko.”
Particulars of the Transaction
Under the terms of the Arrangement Agreement, holders of Beaufield Shares (“Beaufield Shareholders”) will be entitled to receive 0.0482 of a common share of Osisko (each whole share, an “Osisko Share”) in exchange for each Beaufield Share held immediately prior to the effective time of the Arrangement, representing an implied offer price of $0.082 per Beaufield Share based on Osisko’s closing price as of August 14, 2018 and a premium of approximately 54% based on the 20-day volume weighted average price of both companies’ common shares on the Toronto Stock Exchange and TSX Venture Exchange, as the case may be, on August 14, 2018 (being the last trading day prior to the announcement of the Arrangement).
The Arrangement will require the approval of Beaufield Shareholders at a special meeting expected to take place in October 2018 (the “Beaufield Meeting”). In order to become effective, the Arrangement must be approved at the Beaufield Meeting by (i) at least 66⅔ percent of the votes cast by Beaufield Shareholders, and (ii) a simple majority of the votes cast by Beaufield Shareholders after excluding any Beaufield Shares held by any “interested party” or “related party” of an “interested party” (as such terms are defined in Multilateral Instrument 61-101 – Protection of Minority Shareholders in Special Transactions). Directors and officers of Beaufield and certain Beaufield Shareholders holding approximately 7.5% of the issued and outstanding Beaufield Shares have entered into voting and support agreements with Osisko in support of the Arrangement. The board of directors of Beaufield, on the recommendation of its independent special committee, has unanimously approved the Arrangement and will recommend that Beaufield Shareholders vote FOR the Arrangement.
The Arrangement Agreement includes representations, warranties and covenants typical of a transaction of this nature, including with respect to non-solicitation, a right to match, and a fiduciary-out. In addition, Beaufield has agreed to pay a termination fee to Osisko upon the occurrence of certain events. The Arrangement Agreement, which describes the full particulars of the Arrangement, will be made available on SEDAR under the issuer profile of Beaufield at www.sedar.com.
Full particulars of the Arrangement will also be included in a management information circular of Beaufield describing the matters to be considered at the Beaufield Meeting, which is expected to be mailed to the Beaufield Shareholders in September 2018 and made available on SEDAR under the issuer profile of Beaufield at www.sedar.com.
The distribution of the Osisko Shares in connection with the Arrangement (as defined herein) will not be registered under the United States Securities Act of 1933.
Advisors and Counsel
Eight Capital has acted as the exclusive financial advisor to Beaufield. Eight Capital has provided a fairness opinion to the special committee of the board of directors of Beaufield that, based upon and subject to certain assumptions, limitations and qualifications in the opinion, the consideration being offered by Osisko in respect of the Arrangement is fair, from a financial point of view, to Beaufield Shareholders. Lavery, de Billy, L.L.P. is acting as legal counsel to Beaufield.
Maxit Capital LP has acted as the exclusive financial advisor of Osisko. Bennett Jones LLP is acting as legal counsel to Osisko.
About Osisko Mining Inc.
Osisko is a mineral exploration company focused on the acquisition, exploration, and development of precious metal resource properties in Canada. Osisko holds a 100% in the high-grade Windfall Lake gold deposit located between Val-d’Or and Chibougamau in Québec and holds a 100% undivided interest in a large area of claims in the surrounding Urban Barry area and nearby Quevillon area (over 3,300 square kilometres), a 100% interest in the Marban project located in the heart of Québec’s prolific Abitibi gold mining district, and properties in the Larder Lake Mining Division in northeast Ontario, including the Jonpol and Garrcon deposits on the Garrison property, the Buffonta past producing mine and the Gold Pike mine property. The Corporation also holds interests and options in a number of additional properties in northern Québec and Ontario.
For further information about Osisko please contact:
President and Chief Executive Officer
Telephone: (416) 363-8653
About Beaufield Resources Inc.
Beaufield is a mineral exploration company with its exploration activity focused in Québec and Ontario. Please refer to Beaufield’s website at www.beaufield.com to view the Beaufield’s properties in Urban, Eléonore-Opinaca, Tortigny, Hemlo and Launay.
For further information about Beaufield please contact:
President and Chief Executive Officer
Telephone: (647) 409 0293
Cautionary Note Regarding Forward-Looking Information
This news release contains “forward-looking information” and “forward-looking statements” (collectively, “forward-looking statements“) within the meaning of the applicable Canadian securities legislation. All statements, other than statements of historical fact, are forward-looking statements and are based on expectations, estimates and projections as at the date of this news release. Any statement that involves discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions, future events or performance (often but not always using phrases such as “expects”, or “does not expect”, “is expected”, “anticipates” or “does not anticipate”, “plans”, “budget”, “scheduled”, “forecasts”, “estimates”, “believes” or “intends” or variations of such words and phrases or stating that certain actions, events or results “may” or “could”, “would”, “might” or “will” be taken to occur or be achieved) are not statements of historical fact and may be forward-looking statements. In this news release, forward-looking statements relate, among other things, to: the anticipated benefits of the Arrangement to Osisko, Beaufield and their respective shareholders; the exchange ratio and value of the Osisko Shares being delivered as arrangement consideration; the timing and receipt (if at all) of the required shareholder, court, stock exchange and regulatory approvals for the Arrangement; the timing and ability (if at all) of Osisko and Beaufield to satisfy the conditions precedent to completing the Arrangement; the anticipated timing to mail the management information circular to the Beaufield Shareholders and hold the Beaufield Meeting; the closing of the Arrangement (if at all); the length of the current market cycle and requirements for an issuer to survive in the current market cycle; future growth potential of Osisko and Beaufield and their respective business; and future mine development plans.
These forward-looking statements are based on reasonable assumptions and estimates of management of Osisko and Beaufield, as the case may be, at the time such statements were made. Actual future results may differ materially as forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Osisko or Beaufield, as the case may be, to materially differ from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors, among other things, include: satisfaction or waiver of all applicable conditions to closing of the Arrangement (including receipt of all necessary shareholder, court, stock exchange and regulatory approvals or consents and the absence of material changes with respect to the parties and their respective businesses, all as more particularly set forth in the Arrangement Agreement); the synergies expected from the Arrangement not being realized; business integration risks; fluctuations in general macroeconomic conditions; fluctuations in securities markets and the market price of Osisko Shares and Beaufield Shares; fluctuations in spot and forward prices of gold, silver, base metals or certain other commodities; fluctuations in currency markets (such as the Canadian dollar to United States dollar exchange rate); change in national and local government, legislation, taxation, controls, regulations and political or economic developments; risks and hazards associated with the business of mineral exploration, development and mining (including environmental hazards, industrial accidents, unusual or unexpected formations pressures, cave-ins and flooding); inability to obtain adequate insurance to cover risks and hazards; the presence of laws and regulations that may impose restrictions on mining; employee relations; relationships with and claims by local communities and indigenous populations; availability of increasing costs associated with mining inputs and labour; the speculative nature of mineral exploration and development (including the risks of obtaining necessary licenses, permits and approvals from government authorities); and title to properties. Although the forward-looking statements contained in this news release are based upon what management of Beaufield and/or Osisko, as the case may be, believes, or believed at the time, to be reasonable assumptions, Beaufield and/or Osisko, as the case may be, cannot assure shareholders that actual results will be consistent with such forward-looking statements, as there may be other factors that cause results not to be as anticipated, estimated or intended.
Readers should not place undue reliance on the forward‐looking statements and information contained in this news release. Except as required by law, Beaufield and Osisko assume no obligation to update the forward‐looking statements of beliefs, opinions, projections, or other factors, should they change, except as required by law.
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 of the information contained herein.