Dec 26 2013
European Uranium Resources Ltd. ("EUU") and Portex Minerals Inc. ("PAX") are pleased to announce that, as contemplated by the binding letter of intent announced on December 9, 2013, they have executed an arrangement agreement dated December 20, 2013 (the "Arrangement Agreement") in respect of the proposed merger (the "Merger") of EUU and PAX through a plan of arrangement under which EUU will acquire all of the outstanding common shares of PAX.
Under the plan of arrangement, PAX shareholders will receive 0.6 of an EUU common share in exchange for each PAX common share. The Arrangement Agreement supersedes the previously announced binding letter of intent.
As previously announced, the merged company will be named European Minerals Inc. (the "merged company") and will be a Europe-focused company with a diverse, multi-commodity portfolio of exciting exploration and development projects.
The Merger will be classified as a reverse takeover under the rules of the TSX Venture Exchange (the "TSXV" or the "Exchange"). In accordance with the policies of the Exchange, trading in EUU's shares on the TSXV has been halted since December 6, 2013 in connection with the announcement of the Merger and will continue to be halted until TSXV requirements regarding the transaction are met. Trading in PAX's shares on the Canadian National Stock Exchange (the "CNSX") was also halted on December 6, 2013 and may remain halted for a similar period.
Upon completion of the Merger, PAX shareholders would hold approximately 65% of the merged company, with the remaining 35% being held by EUU Shareholders.
Completion of the Merger is subject to a number of conditions, including obtaining all necessary approvals from the PAX and EUU securityholders, the Superior Court of Justice of Ontario and the TSXV, including the TSXV's approval for the listing of the merged company's shares on completion of the Merger, completion of the Merger by April 30, 2014 (or such other date as EUU and PAX may agree) and such other closing conditions customary for transactions of this nature.
The Arrangement Agreement also contains customary non-solicitation provisions in respect of each party (subject to "fiduciary out" provisions that entitle either party to consider and accept a superior proposal and a 5-business day "right to match" period) and provisions that each of the parties will pay a termination fee of $400,000 upon the occurrence of customary termination fee events.
Copies of the Arrangement Agreement will be filed with Canadian regulators and will be available at the SEDAR website at www.sedar.com under EUU's and PAX's profiles. The terms and condition of the Definitive Agreement will also be disclosed in more details in the management information circulars of EUU and PAX which will be mailed to their respective shareholders in due course.
Additional Information
Dorian (Dusty) Nicol, a director and the President and CEO of EUU, holds approximately 5.4% of the issued and outstanding shares of PAX (pre-GRIT Financing). Peter Bojtos, a director of EUU, holds approximately 0.076% of the issued and outstanding shares of PAX (pre-GRIT Financing), respectively. Due to their respective interest in EUU, Messrs. Nicol and Bojtos abstained from voting on the EUU Board resolution to approve the Arrangement Agreement.
The Merger may require a sponsoring broker member of the TSVX. EUU is looking into whether an exemption from this requirement may be available.
Completion of the transaction is subject to a number of conditions, including Exchange acceptance and disinterested Shareholder approval. 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 Management Information Circular 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 EUU 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 press release.