Business
Flagship announces proposed acquisition of coal interests in Kazakhstan
/NOT FOR DISSEMINATION IN THE UNITED STATES OF AMERICA/ TRADING SYMBOL: TSX-V: FII VANCOUVER, Apr...
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[{"type":"text","content":"\n\n\n\n/NOT FOR DISSEMINATION IN THE UNITED STATES OF AMERICA/\n\nTRADING SYMBOL: TSX-V: FII\n\n\nVANCOUVER, April 8 /CNW/ - Flagship Industries Inc. (TSXV: FII)\n("Flagship" or the "Company") is pleased to announce that it has entered into\nan arm's length letter agreement dated April 7, 2009 with Charonga Financial\nCorp. ("Charonga") with a view to completing a business combination which will\nresult in Flagship acquiring certain coal interests located in Kazakhstan (the\n"Business Combination").\n\n\nInformation Concerning the Business Combination\n\n\nFlagship and Charonga have entered into a letter agreement dated April 7,\n2009 setting out certain terms and conditions pursuant to which the proposed\nBusiness Combination will be completed whereby Flagship will acquire an\ninterest in the Orlovskoe coal deposit in Kazakhstan (the "Orlovskoe\nDeposit"). The Business Combination is subject to the successful negotiation\nand entering into of a definitive agreement.\n\n\nIt is currently anticipated that the Business Combination will be\ncompleted pursuant to the acquisition by Flagship of all of the issued and\noutstanding shares of Charonga in consideration for which Flagship shall pay\nan aggregate of US$3,000,000 (the "Cash Consideration") and issue an aggregate\nof 40,000,000 common shares of Flagship (the "Consideration Shares"). Flagship\nwill also reimburse the amount of approximately US$250,000 (the "Reimbursement\nFunds") for expenses relating to the acquisition by Charonga of an interest in\nthe Orlovskoe Deposit (the "Property Acquisition").\n\n\nWhile the completion of the Property Acquisition is a condition to the\ncompletion of the Business Combination, Flagship may agree to complete the\nBusiness Combination prior to Charonga completing the Property Acquisition. In\nsuch event, Flagship shall issue an aggregate of 40,000,000 subscription\nreceipts of Flagship in lieu of the Consideration Shares. Each subscription\nreceipt will be automatically exercised into one common share of Flagship upon\ncompletion of the Property Acquisition, provided that if Charonga does not\ncomplete the Property Acquisition within 120 days of the closing of the\nBusiness Combination, such subscription receipts will be cancelled and the\ntransactio...