Colonial Coal International Corp. to Acquire Tuya Energy Inc.
VANCOUVER, BRITISH COLUMBIA--(Marketwired - Jan 28, 2015) - Colonial Coal International Corp. (TSX VENTURE:CAD) ("Colonial") and Tuya Energy Inc. ("Tuya") are pleased to announce that they have entered into an arrangement agreement (the "Arrangement Agreement") whereby Colonial will, by way of an amalgamation between Tuya and a wholly-owned subsidiary of Colonial, acquire all of the issued and outstanding common shares of Tuya ("Tuya Shares") pursuant to a court approved plan of arrangement under the Business Corporations Act (British Columbia) (the "Transaction").
Under the terms of the Transaction, each Tuya shareholder will be entitled to receive 0.5 of a common share of Colonial ("Colonial Share") for each Tuya Share held. Based on the current outstanding share capital of Tuya, if the Transaction is completed, Colonial will issue approximately 31,716,500 Colonial Shares to acquire all of the outstanding Tuya Shares. Upon completion of the Transaction, current Colonial shareholders and current Tuya shareholders will hold approximately 67% and 33%, respectively, of the total issued and outstanding Colonial Shares.
Colonial and Tuya are non-arm's length parties by virtue of the fact that they have the same directors and management. As a result, pursuant to applicable corporate law requirements and TSX Venture Exchange (the "Exchange") policies, the Transaction must be approved by at least (i) 662/3% of the votes cast by Colonial shareholders present in person or by proxy at a meeting of Colonial shareholders, and (ii) a simple majority of the votes cast in person or by proxy by Colonial shareholders excluding the Colonial Shares held by insiders of Tuya and Colonial. In addition, the Transaction must be approved by at least (i) 662/3% of the votes cast by Tuya shareholders present in person or by proxy at a meeting of Tuya shareholders, and (ii) a simple majority of the votes cast in person or by proxy by Tuya shareholders excluding the Tuya Shares held by insiders of Tuya and Colonial. The meetings of Colonial and Tuya shareholders to, among other things, approve the Transaction are both expected to be held on or about March 19, 2015. Completion of the Transaction is also subject to the approval of the Supreme Court of British Columbia and the Exchange. In addition, the Transaction is conditional on Tuya having no less than $2.5 million of working capital at the time of closing (including amounts owing from Colonial to Tuya under an existing loan) and the satisfaction of certain other closing conditions customary for transactions of this nature.
The boards of directors of Colonial and Tuya have reviewed the proposed Transaction with advice from independent financial advisors and legal counsel. Colonial has retained Evans & Evans, Inc. and Tuya has retained Ross Glanville & Associates Ltd. and Bruce McKnight Minerals Advisor Services, jointly, in order to provide a fairness opinion in connection with the Transaction. Having received a fairness opinion from their respective financial advisors, legal advice and after careful consideration of such other matters as they considered relevant, the boards of directors of Colonial and Tuya have each approved the Transaction and will recommend to their respective shareholders to vote in favour of the Transaction.
A copy of the Arrangement Agreement will be filed on SEDAR under Colonial's profile. Full details of the Transaction will be included in a joint management information circular of Colonial and Tuya to be filed with applicable Canadian securities regulatory authorities and expected to be mailed to shareholders in February 2015.
About Tuya Energy Inc.
Tuya is a privately held, Vancouver-based, coal exploration and development company. Tuya's principal property is the Tuya River Coalfield property located between Telegraph Creek and Dease Lake in northwestern British Columbia, a thermal coal property.
About Colonial Coal International Corp.
Colonial is a publicly traded pure-play coking coal company in British Columbia. The northeast Coal Block of British Columbia, within which Colonial's projects are located, hosts a number of proven deposits and has been the subject of M&A activities by Xstrata, Walter Energy, Anglo and others.
Additional information can be found on Colonial's website www.ccoal.ca or by viewing Colonial's filings at www.sedar.com.
Forward-Looking Information
Information set forth in this news release may involve forward-looking statements. Forward-looking statements are statements that relate to future, not past, events. In this context, forward-looking statements often address a company's expected future business and financial performance, and often contain words such as "anticipate", "believe", "plan", "estimate", "expect", and "intend", statements that an action or event "may", "might", "could", "should", or "will" be taken or occur, or other similar expressions. By their nature, forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements, or other future events, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among others, the following risks: risks associated with marketing and sale of securities; the need for additional financing; reliance on key personnel; the potential for conflicts of interest among certain officers or directors with certain other projects; and the volatility of common share price and volume. Forward-looking statements are made based on management's beliefs, estimates and opinions on the date that statements are made and except as required by law, Colonial and Tuya undertake no obligation to update forward-looking statements if these beliefs, estimates and opinions or other circumstances should change. Investors are cautioned against attributing undue certainty to forward-looking statements.
THE FORWARD-LOOKING INFORMATION CONTAINED IN THIS NEWS RELEASE REPRESENTS THE EXPECTATIONS OF COLONIAL AND TUYA AS OF THE DATE OF THIS NEWS RELEASE AND, ACCORDINGLY, IS SUBJECT TO CHANGE AFTER SUCH DATE. READERS SHOULD NOT PLACE UNDUE IMPORTANCE ON FORWARD-LOOKING INFORMATION AND SHOULD NOT RELY UPON THIS INFORMATION AS OF ANY OTHER DATE. WHILE THE COMPANY MAY ELECT TO, IT DOES NOT UNDERTAKE TO UPDATE THIS INFORMATION AT ANY PARTICULAR TIME EXCEPT AS REQUIRED IN ACCORDANCE WITH APPLICABLE SECURITIES LEGISLATION.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
