Delta Gold Corporation (TSXV:DLT) and Commonwealth Silver and Gold Mining Inc. have announced that, further to their joint news release issued of April 24, 2014, both parties have signed a definitive arrangement agreement regarding the proposed business combination which would result in a reverse takeover of Delta Gold by Commonwealth Silver, thereby resulting in a going-public transaction for Commonwealth Silver. The resulting issuer is intended to be named “Commonwealth Silver and Gold Mining Inc.”, and will be headquartered in Toronto and listed on the Toronto Venture Exchange.
As quoted in the press release:
Under the terms of the Agreement, Delta Gold’s outstanding common shares (each, a “Delta Share”) will be consolidated on a 20:1 basis (the “Consolidation”). In connection with the Transaction, Commonwealth Silver expects to complete a concurrent financing of between $3 million and $10 million (the “Financing”), the terms of which are discussed in greater detail below. Shares of Commonwealth Silver (each, a “Commonwealth Share”) will be valued based on the price and terms established for the Financing. As a result, it is expected that Shareholders of Commonwealth Silver will receive 0.6 Delta Shares (post-Consolidation) for every one Commonwealth Share held. On a post-Transaction, pre-Financing basis, it is expected that existing Commonwealth Silver and Delta Gold shareholders will own approximately 79.5% and 20.5% of the combined company (the “Resulting Issuer”), respectively.
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