Spearmint Resources Inc. Announces Plan of Arrangement and Letter of Intent

Spearmint Resources Inc. (SRJ) announced in May 2014 that it had entered into an arrangement agreement with the Sheslay Mining Inc. (“Spinco”) a private British Columbia company in which SRJ held a nominal interest. SRJ also announced that it had entered into a non-binding letter of intent (the “LOI”) with Alliance Growers Corp. (“Alliance”) another private British Columbia company.
SRJ agreed to transfer $20,000 cash to Spinco in exchange for 800,000 (or 24.2 per-cent) of Spinco’s common shares. These shares would be distributed to SRJ’s shareholders on a pro-rata basis according to a ‘Plan of Arrangement’ under the Business Corporations Act (British Columbia).
SRJ sought approval of the Plan of Arrangement at an annual and special general meeting of its shareholders held on September 8, 2014. Copies of the Arrangement Agreement and LOI were to be filed on SEDAR.spearmint_resources
Should the Plan of Arrangement receive approval at the Meeting, it is expected that the Plan of Arrangement will become effective soon after. Upon completion of the Plan of Arrangement, Spinco will become a reporting issuer in British Columbia and Alberta. Upon completion of the Plan of Arrangement, it is also intended that Spinco will enter into a final agreement to acquire a business. Completion of the Plan of Arrangement is subject to certain conditions, including shareholder approval, the approval of the Supreme Court of British Columbia and the TSX Venture Exchange.
Should the Plan of Arrangement be implemented, it is anticipated that shareholders of SRJ will retain their current interest in SRJ and obtain a 24.2 per-cent interest in Spinco, which will be a reporting issuer in British Columbia and Alberta and will have approximately $20,000 in cash to be used to acquire a business.
The directors of SRJ, led by CEO Conrad Clemiss, have unanimously concluded that the Arrangement is in the best interests and is fair to all shareholders of SRJ.

Spinco and Alliance

Once the Plan of Arrangement is agreed, the LOI will enable Spinco and Alliance to enter into a “Definitive Agreement” where Spinco will pursue a transaction involving a potential business combination of Spinco and Alliance, although a number of conditions will need to be confirmed before finalising the deal. These conditions include the completion of satisfactory financial, legal and business due diligence in respect of Alliance and finalization of all key terms. Should Spinco and Alliance enter into the Definitive Agreement, the deal would remain subject to some further conditions. Both SRJ and Alliance are independent and on equal footing. In contract law terms they are “at arm’s length”.
Clemiss, President and Director of SRJ issued a cautionary note about the press release at the time.
“This press release contains projections and forward-looking information that involve various risks and uncertainties regarding future events. Such forward-looking information can include without limitation statements based on current expectations involving a number of risks and uncertainties and are not guarantees of future performance of Spearmint.”
Clemiss went on to add “Actual results and future events could differ materially from those anticipated in such information. These and all subsequent written and oral forward-looking information are based on estimates and opinions of management on the dates they are made and are expressly qualified in their entirety by this notice.”