/NOT FOR DISTRIBUTION TO A US NEWSWIRE SERVICE OR FOR THE DISSEMINATION IN THE UNITED STATES./ TSXV-NEX Trading Symbol: AGN.H
VANCOUVER, March 25 /CNW/ - Angus Ventures Corp. ("Angus" or the "Company") wishes to provide an update to its news release of November 27, 2008, in which it announced a proposed merger with Encanto Potash Corp. ("Encanto").
Encanto is a private company that has to date, obtained exploration Permits from the Federal Department of Indian and Northern Affairs Canada ("INAC") and three First Nation Bands which allow Encanto to explore on three prospective First Nation Reserve areas in South Eastern Saskatchewan. Preliminary environmental approval has been received and 2D seismic exploration has been concluded over most of these areas. Encanto has MOU's with 8 bands in total, and is pursuing permits to explore on these Reserves as well. Potash is used for the creation of fertilizer, as well as other commercial and industrial products. Saskatchewan is the world's leading producer of potash and has the world's largest proven reserves.
The prospects are all located within the confines of the First Nations lands and reserves, are all regionally located within a radius of 80 kilometres, and cover an aggregate area of approximately 75,000 hectares. The agreements entered into provide that, in due course and subject to the terms and conditions set out therein, all minerals (excluding oil and gas) on the subject lands will be farmed out to Encanto.
Amalgamation
It is now proposed to amalgamate Encanto with a wholly-owned subsidiary of Angus (the "Amalgamation"). Therefore, it will not be necessary to convene a meeting of Angus's shareholders. Shareholder approval will be achieved by obtaining the consent of holders of more than 51% of Angus's shares. Currently, Encanto's financial statements for the period from incorporation to December 31, 2008 are being audited. Once this audit is complete, Angus will be able to finalize its amalgamation agreement with Encanto, as well as its filing statement containing detailed disclosure of the proposed transactions to be filed with the TSX Venture Exchange and on SEDAR. Angus has filed a draft 43-101 technical report with the Exchange.
Encanto Brokered Financing with Canaccord
Angus has been advised that Encanto has engaged Canaccord Capital Corporation (the "Agent") to conduct a private placement on an agency basis to raise gross proceeds of up to $2,000,000 by the sale of units ("Units") at $0.125 per Unit and flow-through shares ("FT Shares") at $0.15 per FT Share (the "Base Offering"). Each Unit shall consist of one share and one half of one warrant, with each full warrant entitling the holder to buy an additional share of Encanto for a period of 24 months from closing at a price of $0.20.
Encanto has agreed to grant to the Agent an option (the "Agent's Option") to sell up to an additional $1,000,000 in Units and/or FT Shares at the respective issue price per Unit or FT Share and on the same terms and conditions as under the Base Offering (together with the Base Offering, the "Offering"). The Agent's Option is exercisable any time, in whole or in part, up to 48 hours prior to closing.
The gross proceeds from the sale of the FT Shares will be used for Canadian Exploration Expenses related to the exploration of Encanto's potash properties in Saskatchewan. Encanto will renounce such Canadian Exploration Expenses with an effective date of no later than December 31, 2009.
The Agent will be paid a cash fee equal to 7% of the gross proceeds raised in the Offering. In addition, the Agent will receive broker warrants exercisable for common shares of Encanto equal in number to 10% of the number of Units and FT Shares sold under the Offering at a price of $0.20 per share for a period of 24 months after the closing of the private placement. Upon closing, the Agent will also be paid a corporate finance fee in Units or cash at its direction.
It is anticipated that the closing of the private placement will occur prior to the closing of the Amalgamation.
New Directors
At the Company's annual general meeting held on March 6, 2009 (the "AGM"), Messrs. James Hutton, Robert McMorran and Tyler Cran were elected as directors of the Company, joining James Walchuck, Gordon Keep and John Reynolds.
Mr. Hutton was the founder, President and Chief Executive Officer of the Canada Dominion Resources Group of companies, one the largest and most successful flow through share funds in Canada. During Mr. Hutton's tenure, the Canada Dominion Resources Group completed in excess of $800,000,000 in offerings, which subsequently focused their investments on mining and energy issuers actively exploring for resources in Canada. The Canada Dominion Resources Group was acquired from Mr. Hutton by the Dundee/Dynamic Mutual fund organization. Mr. Hutton also served as the President of the CMP Group from 2003 to 2005. Mr. Hutton also serves as the President and Chief Executive Officer of Hutton Capital Corporation, Hutton Capital Management and Hutton Development Corp, companies engaged in investment banking, structured finance and real estate development. He is currently the Chairman of Terra Ventures Inc., a junior Uranium exploration company listed on the Exchange.
Mr. McMorran is a chartered accountant with over 25 years experience in the mining industry. Mr. McMorran has held numerous board positions and senior officer appointments with various public companies.
Mr. Cran is the President of Border Petroleum Inc., the Vice-Chairman and founder of Andora Energy Corporation, a director and founder of Black Mountain Energy Corp. and Chairman, President, director and a founder of Sentinel Rock Oil Corporation. He is also the Chairman and founder of Oilsands Real Estate Development Corporation, a company involved in the development of large scale real estate holdings in Fort McMurray, Alberta.
Grant of Stock Options
At the AGM, shareholders also approved the Company's 10% rolling Stock Option Plan. Pursuant to that Plan and in conjunction with the closing of the Amalgamation and subject to shareholder and regulatory approval of the Amalgamation, the Company has granted 9,500,000 options exercisable at $0.15 per share for a term of 10 years.
Escrow Share Cancellation
The Company is taking steps to cancel and return to treasury 35,157 shares that were issued between 1986 and 1993 subject to escrow agreements which contain provisions pursuant to which the shares are required to be cancelled due to a lapse of time.
Cautionary Statements
Completion of the transaction is subject to a number of conditions, including the completion and execution of a formal amalgamation agreement, Exchange acceptance and Shareholder approval for both Angus and Encanto. The transaction cannot close until the required Shareholder approval is obtained. There can be no assurance that the transaction will be completed as proposed or at all.
Investors are cautioned that, except as disclosed in the Filing Statement to be prepared in connection with the transaction, any information released or received with respect to the transaction may not be accurate or complete and should not be relied upon. Trading in the securities of Angus and Encanto should be considered highly speculative.
The TSX Venture Exchange has in no way passed upon the merits of the
proposed transaction and has neither approved nor disapproved the
contents of this news release
ON BEHALF OF THE BOARD OF DIRECTORS
"James Walchuck"
Per: ----------------
James Walchuck
President & CEO
THE TSX VENTURE EXCHANGE HAS NOT REVIEWED AND DOES NOT ACCEPT
RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS PRESS RELEASE.