Alpha Copper Corp. (CSE: ALCU) (OTC: ALCUF) (FSE: PP0) and CAVU Energy Metals Corp. (CSE: CAVU) (OTC: CAVVF) (FSE: 5EO) are pleased to announce a non-binding Letter of Intent dated August 18, 2022 pursuant to which Alpha will acquire all of the issued and outstanding shares of CAVU. The Proposed Transaction is an arm’s length transaction, and provides CAVU shareholders with a premium of 60% based on each company’s respective 20-day volume-weighted average price.
After the Proposed Transaction, the combined entity of Alpha and CAVU will become a premier copper exploration company with an expanded portfolio of prospective base and precious metals assets in BC and the Yukon.
Highlights of the Transaction and Strategic Rationale:
Darryl Jones, CEO of Alpha Copper, stated “We believe the addition of CAVU and its Star and Hopper assets to Alpha’s significant project portfolio of properties in British Columbia will be highly accretive for the shareholders of both Alpha and CAVU. With the current interest in copper assets, both for traditional uses and to support the expanding demand for battery metals, Alpha will be aggressively pursuing all four assets. We look forward to working with the excellent team at CAVU throughout this transaction, and look forward to maximizing the potential of a robust portfolio of high value assets on completion.”
Dr. Jacob Verbaas, CEO of CAVU, commented “CAVU is pleased to enter into this proposed transaction, which is at a significant premium to CAVU’s market price. We believe Alpha’s regional focus, financing capabilities, and exploration capacity, combined with CAVU’s strong project portfolio of mature exploration assets and technical expertise, create a scenario that mutually benefits CAVU and Alpha. In addition, we believe that this proposed arrangement will allow our highly prospective Star and Hopper properties to reach their full potential.”
Proposed Transaction Details
Alpha proposes to issue 0.7 Alpha shares for each share of CAVU. The Consideration values CAVU at approximately $0.33 per share, representing a premium of approximately 60.67% to CAVU shareholders, based on the 20-day VWAP of each company as of the close of trading on August 17, 2022. Upon completion of the Transaction, CAVU shareholders will hold approximately 30% of Alpha shares on an outstanding basis.
In addition, it is anticipated that CAVU will appoint a nominee to Alpha’s Board of Directors, and CAVU’s CEO, Dr. Jaap Verbaas, and VP Exploration, Dr. Luke Bickerton, will assume operational roles with Alpha.
The LOI for the Proposed Transaction includes customary provisions, including an exclusivity period ending on October 31, 2022. The final structure of the Proposed Transaction will be determined by the parties, based upon tax, securities and corporate law considerations, and will be governed by the terms of a definitive and binding agreement governing the Proposed Transaction. Completion of the Proposed Transaction is subject to, among other conditions, satisfactory completion of due diligence, voting support of key shareholders, shareholder approval, and conditional approval by the Canadian Securities Exchange. Both Alpha and CAVU expect to work towards entering into a definitive agreement by September 30, 2022.
It is anticipated that any securities to be issued under the Arrangement will be offered and issued in reliance upon the exemption from the registration requirements of the U.S. Securities Act of 1933 provided by Section 3(a)(10) thereof. This press release does not constitute an offer to sell, or the solicitation of an offer to buy, any securities.
Technical information related to results produced by CAVU in this news release has been approved by Roger Hulstein, P.Geo, a qualified person for CAVU as defined by the National Instrument 43-101.
Technical information herein related to Alpha and its projects has been reviewed and approved by Mr. J.W. Morton, P. Geo., who is the Qualified Person within the context of National Instrument 43-101 and takes responsibility for its technical content.
About Alpha Copper Corp.
Alpha Copper is focused on contributing to the green economy by finding and developing copper resource assets in stable jurisdictions. The company is positioned to earn a 60% interest in the Indata copper-gold project located in north central British Columbia and a 100% interest in the Okeover copper-molybdenum project located near the coastal community of Powell River, British Columbia.
About CAVU Energy Metals Corp.
CAVU Energy Metals Corp. is a mining company engaged in the acquisition, exploration and development of mineral projects containing metals used in green technologies and the renewable energy sector. The Company is currently focused on the exploration of its Hopper Copper-Gold Project in Yukon and recently acquired Star Copper-Gold Porphyry Project in BC.
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