TORONTO, ONTARIO -- (Marketwire) -- 03/07/13 -- Halo Resources Ltd. (TSX VENTURE: HLO)(FRANKFURT: HRLN) ("Halo") and QRS Capital Corp. (TSX VENTURE: QRS) ("QRS") announce that they have entered into a letter of intent to merge and form a combined exploration and development company that will focus on the exploration of the 7,960 hectare Aurum Copper Project (the "Aurum Project") in Chile recently optioned by QRS (see news release of QRS dated February 19, 2013 ). The Aurum Project is situated on the same San Felix fault system that hosts Teck Resources Ltd.'s El Relincho deposit. It is expected that QRS w will begin work shortly on the re-classification and expansion of the historical resources at the Aurum Project and commence the systematic exploration of two identified drill targets.
Merged Entity Highlights
-- The acquisition by QRS of the Aurum Project is the culmination of an 18- month process to assess the potential of some 150 exploration properties throughout South America.-- QRS completed extensive due diligence work on the Aurum Proeject and believes that it has exploration potential to supplement the existing copper deposit.-- Halo has sufficient cash to facilitate the commencement of an structured exploration program at Aurum while continuing to work with its strategic partners to explore its gold and copper-zinc properties in Canada.-- The merger will substantially benefit the capacity of the newly established exploration Company to explore its flagship Aurum Project with the potential to enhance shareholder value.
Marc Cernovitch, President & CEO of Halo, commented that, "This merger brings together the strengths of two promising junior exploration companies, by combining the copper exploration potential of the Aurum project and the financial resources of Halo. We are very excited about this merger and look forward to beginning exploration in the near future."
QRS's CEO, John Seaman, states: "The merger with Halo provides a value-added financial solution at a time when it is increasingly difficult to find funds for exploration, and is a solution that enables us to take forward the exploration of Aurum in a timely manner and ultimately create value for our shareholders."
Terms of the Merger
The merger (the "Merger") is expected to be completed by way of a plan of arrangement under the Business Corporations Act (British Columbia). Under the plan of arrangement, QRS will acquire all of the outstanding common shares of Halo in exchange for units of QRS (the "QRS Units"). Each QRS Unit will consist of one common share of QRS and one half of one whole QRS warrant. Each whole QRS Warrant will entitle the holder to acquire one additional QRS Share for two years from the closing of the transaction at a price equal to the price of any concurrent financing, or such other price as may be subsequently agreed by Halo and QRS. As a result, Halo will become a wholly-owned subsidiary of QRS. QRS will also acquire all other outstanding options and warrants of Halo in exchange for options and warrants of QRS, adjusted for the applicable exchange ratio. The share exchange ratio on the Merger will be such that upon completion of the Merger, QRS (or the "Resulting Entity") will be owned 50% by shareholders of Halo and 50% by shareholders of QRS.
