Normal Course Issuer Bid
The Company further announces that it has allocated up to
Acquisition of American Consolidated Minerals Corp.
Starcore is also pleased to announce the signing of a letter of intent with American Consolidated Minerals Corp. ("AJC") (TSX VENTURE:AJC) (the "LOI") that would see the Company acquire all of the outstanding securities of AJC in an all-share transaction (the "Transaction") to be completed pursuant to a court approved Plan of Arrangement under the Business Corporations Act (
AJC is a
Highlights of the Acquisition
-- AJC's portfolio of exploration properties presents Starcore with attractive low-risk/high reward exploration opportunities in
North America. -- AJC's shareholders will be able to participate in a larger, well capitalized Starcore, which has cash holdings of approximately $9.5 million, a portion of which will be available to fund advancement of the AJC properties. -- The AJC properties will provide SAM with the potential to increase its resource base in North Americautilizing the current cash flow of the San Martinmine. There is the potential for any of the AJC properties to have a significant discovery which would greatly increase SAM's resources and have a significant effect on the valuation of SAM with a relatively small capital cost.
AJC Property Portfolio
AJC is currently focused on the Toiyabe property. With an indicated mineral resource of over 173,000 ounces of gold (Summary Report and Mineral Resource Estimate on the Toiyabe Gold Property,
Located within the historically productive Sierra Madre Occident geological province in the northern Mexican state of
Previous production and exploration work within and just adjacent to this property demonstrate the opportunity for development through exploration of the
The LOI provides that AJC shareholders will be entitled to receive one common share of Starcore (a "Starcore Share") for three (3) common shares of AJC (the "AJC Shares") held by such AJC shareholder (the "Exchange Ratio"), subject to adjustment, pursuant to a plan of arrangement under the Business Corporations Act (
Currently, there are 17,569,191 AJC Shares, 660,000 AJC Options and 1,671,416 common share purchase warrants outstanding. In connection with the Transaction, Starcore will issue approximately 5,856,397 Starcore Shares, 220,000 Starcore Options and 557,139 common share purchase warrants. Following completion of the Transaction, former AJC shareholders would hold approximately 4% of the outstanding Starcore Shares.
The Transaction is subject to the execution of a definitive Arrangement Agreement. The definitive agreement will include covenants, representations and warranties customary for transactions such as the Transaction, as well as deal protection measures and provisions for exclusive dealing similar to those contained in the LOI. Starcore expects to execute a definitive agreement in respect of the Transaction within 30 days.
The Transaction will be subject to the approval of the
Deal Protection Measures
The Letter of Intent includes deal-protection provisions in favour of Starcore, including a non-solicitation covenant from AJC (except for certain unsolicited approaches) and a break fee upon signing the definitive agreement of
Voting lock-up agreements
Pursuant to the Letter of Intent, AJC has agreed to seek voting agreements from directors, officers and shareholders holding in aggregate a minimum of 25% of the outstanding shares of AJC as a condition to the execution of the definitive Arrangement Agreement.
The Board of Directors of each company has approved the terms of the Transaction.
Officers and Directors of Starcore hold in aggregate 2,246,791 AJC Shares and 555,000 AJC Options, and have agreed to participate in the Transaction.
Starcore is engaged in exploring, extracting and processing gold and silver through its wholly-owned subsidiary,
About American Consolidated
American Consolidated is dedicated to the principles of environmentally sound mining practices and believes that environmental stewardship and mining can co-exist.
For details on the Company and its properties, visit the Company's website at www.americanconsolidatedminerals.com.
(1) This estimate was prepared as at
May 27, 2009. Indicated Resources consist 173,562 ounces of gold in 4,975,000 tons of rock, for a calculated average grade of 0.0349 ounces per ton (opt) at a 0.01 opt cut-off. See technical report entitled "Summary Report and Mineral Resource Estimate on the Toiyabe Gold Property Lander County, Nevadafor American Consolidated Minerals Corporation" dated May 27, 2009filed by American Consolidated Minerals Corporation on its SEDAR profile at www.sedar.com prepared by Paul Noland, P. Geo., for information regarding the key assumptions, parameters and methods used to estimate the mineral resources. The technical report was reviewed by Mr. David Gunning, P. Eng, on behalf of the Company. To the Company's knowledge, information and belief, there is no new scientific or technical information that would make disclosure of the mineral resources inaccurate or misleading.
This press release contains forward-looking statements that involve risks and uncertainties. These forward-looking statements relate to, among other things, receipt of approval from the TSX for the normal course issuer bid, completion of the acquisition of AJC, expectations with respect to the AJC properties, payment of the dividend to shareholders of Starcore and other expectations, intentions and plans contained in this press release that are not historical fact. When used in this press release, the words "plan," "expect," "believe," and similar expressions generally identify forward-looking statements. These statements reflect our current expectations. They are subject to a number of risks and uncertainties, including, but not limited to, changes in market conditions. Factors that could cause future events to differ from those anticipated in forward looking statements include: inability to negotiate a definitive agreement for the AJC transaction; delays in obtaining, or inability to obtain, required approvals, including the approval of the
ON BEHALF OF STARCORE INTERNATIONAL MINES LTD.
FOR FURTHER INFORMATION PLEASE CONTACT:
Starcore International Mines Ltd. Robert EadieExecutive Chairman, President & CEO 1-604-602-4935 or Toll Free: 1-866-602-4935 1-604-602-4936 (FAX) firstname.lastname@example.org Source: Starcore International Mines Ltd.