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Redtail Metals Corp. and Northern Tiger Resources Inc. Expand Merger


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2013-12-17 21:26:43 -

Vancouver, British Columbia CANADA, December 17, 2013 /FSC/ - Redtail Metals Corp. (RTZ - TSX Venture"Redtail") and Northern Tiger Resources Inc. (TSX-V: NTR) ("Northern Tiger") are pleased to announce they have agreed with Americas Bullion Royalty Corp. (TSX: AMB) ("AMB") to expand the terms of the previously announced Northern Tiger and Redtail merger ("Merger") to include the acquisition by Northern Tiger of AMB's Brewery Creek Project and a $2.25 million investment by AMB in the merged company. In addition, Northern Tiger has today completed the previously announced acquisition of AMB's interest in the Grew Creek gold project located in Yukon, Canada (the "Grew Creek Project") and related drill and core data for $900,000. Northern Tiger will be the surviving entity

upon completion of the Merger and will be renamed "Golden Predator Mining Corp

"We are excited to add Brewery Creek, a previously operating gold mine with significant oxide resources, to our portfolio of promising properties, including 3Ace and Grew Creek", says Greg Hayes, President of Northern Tiger. "The financing provided by AMB means we are well-funded to continue advancing our projects while seeking a joint venture partner for Brewery Creek as we continue to move it through the mine permitting process."

ACQUISITION OF BREWERY CREEK PROJECT, YUKON

Under the terms of the amended and restated business combination agreement among the parties and concurrent with the Merger, Northern Tiger will acquire the balance of AMB's Yukon mineral properties, including the Brewery Creek Project (collectively, the "Yukon Assets and AMB's accumulated tax losses, for a purchase price equal to $5,250,000 and the grant by Northern Tiger to AMB of a royalty interest in each of its properties held at closing (the "AMB Acquisition

To facilitate the AMB Acquisition, AMB will complete a pre-closing reorganization, following which AMB will be a wholly-owned subsidiary of a new company ("Newco the common shares of which will continue to be listed on the TSX. On completion of the reorganization, AMB's sole assets will be the Yukon Assets and AMB's accumulated tax losses. Newco will then transfer all of the outstanding shares of AMB to Northern Tiger.

Northern Tiger will satisfy the purchase price in part by the issue to Newco, at closing, of such number of Northern Tiger shares having an aggregate value of $550,000 and a convertible promissory note in the principal amount of $4,700,000 bearing interest at 6% per annum and payable over a period of three years (the "AMB Acquisition Note The balance of the purchase price will be satisfied by the grant to Newco of a royalty interest in each of its properties held at the closing of the AMB Acquisition.

The Northern Tiger shares issued at closing will be issued at a deemed price per share equal to the greater of: (i) the volume weighted average trading price (VWAP) of the Northern Tiger shares on the TSX Venture Exchange (TSXV) for the seven trading days immediately preceding the date of the Northern Tiger shareholder meeting called to approve the Merger (the "NTR Meeting and (ii) $0.35.

Under the terms of the AMB Acquisition Note the principal amount will become due as follows: $1,100,000 on the first anniversary of the Merger, $1,600,000 on the second anniversary and $2,000,000 on the third anniversary, in each case with interest accumulated under the note as at such date. Northern Tiger may elect to pay the amount then due (including interest) either in cash or by the issue of Northern Tiger shares (or any combination thereof), at the election of Northern Tiger. Any Northern Tiger shares issued will be deemed issued at a price per share equal to the greater of: (i) the VWAP of the Northern Tiger shares on the TSXV for the fourteen trading days immediately preceding the date that is two days before the date of issue, and (ii) $0.35; subject to a 10% discount in the event the VWAP is equal to or greater than $0.20 but less than $0.35, and a 20% discount in the event the VWAP is $0.35 or more.

Northern Tiger has agreed that, until such time as it has paid the AMB Acquisition Note in full, it will not sell, assign, transfer, joint venture, option or in any way encumber the AMB shares acquired or any of the Yukon Assets without first obtaining the prior written consent of Newco (such consent not to be unreasonably withheld, conditioned or delayed). In addition, Northern Tiger's right to elect to make payments in shares will cease, and become the right of Newco, in the event that Northern Tiger enters into a binding agreement for the sale, option, joint venture or like transaction in respect of the Brewery Creek Project.

If at any time Northern Tiger fails to make a payment under the AMB Acquisition Note when due, Northern Tiger will be required to transfer the AMB shares back to Newco and Northern Tiger will be deemed to have forfeited to Newco, without compensation, any portion of the purchase price then paid to Newco. In addition, Newco would also retain, without compensation to Northern Tiger, all of the royalty interests granted to Newco at the closing of the AMB Acquisition.

Completion of the AMB Acquisition on the terms described above is subject to stock exchange regulatory approval and approval of the AMB shareholders.

CONCURRENT FINANCINGS

AMB has also agreed to invest an aggregate of $2,250,000 in Northern Tiger common shares in connection with the Merger, $450,000 of which will be made immediately available pursuant to a non-revolving credit line (the "Interim Loan") convertible into Northern Tiger shares at closing. This Interim Loan replaces the $150,000 bridge loan announced in Northern Tiger's and Redtail's October 28, 2013 joint news release, and will be advanced in tranches of $50,000 based on the working capital needs of Northern Tiger through to closing. AMB has also advanced $32,500 to Redtail for transaction related expenses. Both loans bear interest at 6% per annum (compounded annually) and are payable in Northern Tiger common shares at completion of the Merger at a price equal to $0.21 per share.

Concurrent with the completion of the Merger, Newco will subscribe, on a private placement basis, for Northern Tiger shares having a value equal to $2,250,000 less the amount then drawn under the Interim Loan (the "Concurrent Financing The Northern Tiger shares sold to Newco in the Concurrent Financing will be issued at a price per share equal to the greater of: (i) the VWAP of the Northern Tiger shares on the TSXV for the seven trading days immediately preceding the date of the NTR Meeting; and (ii) $0.28.

Northern Tiger may also raise up to an additional $100,000 at the same time as, and on the same terms as, the Concurrent Financing.

Completion of the Concurrent Financing on the terms described above, including the conversion of the interim loans into Northern Tiger shares, is subject to stock exchange regulatory approval and approval of the AMB shareholders.

ACQUISITION OF GREW CREEK PROJECT, YUKON

At the closing of the Grew Creek Acquisition, Northern Tiger paid $200,000 for the Grew Creek Property and $700,000 for the Data. The purchase price for each was satisfied by the issue to AMB of a promissory note (together, the "Grew Creek Notes") in the same principal amount. The Grew Creek Notes bear interest at 6% per annum (compounded annually) and are payable on demand. The terms of the notes permit Northern Tiger to satisfy up to $800,000 of the principal in Northern Tiger common shares at a per-share price of $0.21 at closing of the Merger. The remaining $100,000 is payable in cash. In the event the Merger is terminated or Northern Tiger defaults in payment under the notes, AMB is entitled to repurchase the Grew Creek Property and the Data at the same purchase price.

The Grew Creek Project is under option from a third party. Northern Tiger may exercise the option and acquire a 100% interest in the Grew Creek Project, subject to a 4% NSR in favor of the optionor, upon making a final cash payment to the optionor of $100,000. The Grew Creek Project is located 32 km southwest of Faro and 24 km northwest of Ross River, Yukon. The property's 135 square km encompass 666 quartz claims, extending along both sides of the Robert Campbell Highway for approximately 27 km, with power lines traversing the project area.

COMPLETION OF THE MERGER

All share prices disclosed above assume completion of the previously announced 7:1 consolidation of Northern Tiger shares at closing of the Merger (the "Consolidation

Upon completion of the Merger and the related transactions disclosed herein and assuming the maximum number of Northern Tiger shares issued on conversion of the Grew Creek Notes, it is anticipated that Newco will hold up to 54% of the outstanding shares of Northern Tiger and will be a "control person" of Northern Tiger (as such term is defined in the policies of the TSXV) at closing. It is intended that, immediately following closing, Newco will distribute to its shareholders such number of Northern Tiger shares then held by it in order to reduce its post-Merger share position in Northern Tiger to 49% of the outstanding Northern Tiger shares. Accordingly, it is anticipated that upon completion of this distribution by Newco, current Northern Tiger shareholders will hold as a group 30% of the merged company and current Redtail Metals shareholders will hold as a group, 17% of the merged company.

Neither AMB nor RTZ are "Non-Arms' Length Parties" (as such term is defined in TSXV policies) to NTR, as a result of common directors and officers. It is anticipated that the Merger will be exempt from the sponsorship requirements contained in TSXV policies. The Merger will not constitute a "reverse takeover" for Northern Tiger under the applicable TSXV policies.

Completion of the transaction is subject to, among other conditions customary for a transaction of this nature, the approval of the TSXV, approval of the Redtail, Northern Tiger and AMB shareholders, completion of the AMB Acquisition, Consolidation and Concurrent Financing, and completion of the entire transaction by not later than March 14, 2014. Transaction expenses plus a $100,000 break fee is payable by a terminating party if the agreement is terminated by that party to complete an alternative transaction deemed by such party's board of directors to be superior to the transaction.

It is anticipated that Northern Tiger and Redtail will complete the Merger by way of a plan of arrangement under the Business Corporations Act (British Columbia). Full details of the Merger and the related transactions disclosed herein will be included in the joint management information circular to be filed with the regulatory authorities and mailed to Northern Tiger and Redtail shareholders in relation to their respective meetings called to approve the transaction and related matters.

Completion of the Merger and the related transactions disclosed herein is subject to a number of conditions, including TSX Venture Exchange acceptance and disinterested shareholder approval. The Merger cannot close until the required shareholder approval is obtained. There can be no assurance that the Merger will be completed as proposed or at all.

The TSX Venture Exchange has in no way passed upon the merits of the proposed Merger and has neither approved nor disapproved the contents of this press release.

The securities referenced in this news release have not been registered and may not be sold in the United States absent registration or an exemption from registration.

About Redtail Metals Corp.

Redtail Metals Corp. is a British Columbia corporation focused on advancing quality precious metal enriched copper, lead and zinc mineral deposits in Yukon, Canada. Its common shares trade on the TSX Venture Exchange under the symbol "RTZ". The company currently controls the Marg and Clear Lake massive sulfide deposits, both with resources prepared in accordance with National Instrument 43-101. Additional information regarding Redtail, including financial information, is available on the SEDAR website under the company's issuer profile, at www.sedar.com.

About Northern Tiger Resources Inc.

Northern Tiger Resources Inc. is an Alberta incorporated resource exploration company focused on gold and copper exploration in the Yukon, where it has a strong portfolio of projects. Drilling has intersected 4.6 g/t gold over 35.0 metres (including 106.2 g/t gold over 1.0 metre) at the company's flagship 3Ace Project in southeast Yukon. The Sonora Gulch copper-gold-silver porphyry project in central Yukon also has also returned significant drill results, including 0.45 g/t gold and 3.0 g/t silver over 234.0 metres. The foregoing information has been reviewed and approved by Dennis Ouellette, B.Sc., P.Geol., a Qualified Person as defined by NI 43-101.

Americas Bullion Royalty Corp.

Americas Bullion Royalty Corp. invests in undervalued natural resource assets seeking to provide superior investment returns. Americas Bullion's assets include royalty holdings across Mexico, Nevada, Wyoming, Oregon and California; the Springer Tungsten Mine and Mill; the Taylor mill and Humboldt mill site in Nevada; the Brewery Creek project, and a portfolio of Yukon exploration properties. The company provides shareholders with the potential for exploration success through equity positions in related companies while continuing to advance and monetize its holdings. Additional details regarding AMB's proposed reorganization are disclosed in AMB's December 16, 2013 press release, a copy of which is available on the SEDAR website under the AMB's issuer profile, at www.sedar.com.

ON BEHALF OF THE BOARD OF
REDTAIL METALS CORP.

"William M. Sheriff"

William M. Sheriff
Interim CEO
(208) 635 5415
info@redtailmetals.com
www.redtailmetals.com

ON BEHALF OF THE BOARD OF
NORTHERN TIGER RESOURCES INC.

"Greg Hayes"

Greg Hayes
President & CEO
587-524-1599
info@northern-tiger.com
www.northern-tiger.com

References:

1. Joint News Release of Northern Tiger and Redtail Metals dated October 28, 2013

Cautionary Note Regarding Forward-Looking Statements

Information set forth in this news release may involve forward-looking statements under applicable securities laws. Forward-looking statements are statements that relate to future, not past, events. In this context, forward-looking statements often address 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. All statements, other than statements of historical fact, included herein including, without limitation; statements about the terms and completion of the Merger and related transactions are forward-looking statements. By their nature, forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the 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: failure to satisfy all conditions precedent to the Merger, including shareholder approval, approval of the TSX Venture Exchange and completion of the Concurrent Financing, the Consolidation and the AMB Acquisition, and the additional risks identified in the management discussion and analysis section of Redtail Metal Corp.'s or Northern Tiger Resources Inc.'s interim and most recent annual financial statement or other reports and filings with the TSX Venture Exchange and applicable Canadian securities regulators. Forward-looking statements are made based on management's beliefs, estimates and opinions on the date that statements are made and the respective companies undertakes no obligation to update forward-looking statements if these beliefs, estimates and opinions or other circumstances should change, except as required by applicable securities laws. Investors are cautioned against attributing undue certainty to forward-looking statements.

Neither the 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, and no securities regulatory authority has either approved or disapproved of the contents of this release.

To view the press release as a PDF file, please click on the following link:
www.usetdas.com/pr/redtail12172013.pdf


Source: Redtail Metals Corp. (TSX-V)
Maximum News Dissemination by FSCwire. www.fscwire.com


Author:
Fred Gautreau
e-mail
Web: www.fscwire.com
Phone: 14037173898

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