Romulus Resources Ltd. Announces Business Combinat

VANCOUVER, British Columbia, Sept. 20, 2017 (GLOBE NEWSWIRE) -- Romulus Resources Ltd. (NEX:ROM.H) (“Romulus" or the “Company”), is pleased to announce it has entered into a non-binding letter of intent dated as of September 20, 2017 (the "LOI") with Osino Resources Corp. ("Osino"), an arm’s length private company incorporated under the laws of British Columbia, whereby the Company will acquire all of the issued and outstanding common shares (the "Osino Shares") and securities convertible into common shares of Osino by way of a three-cornered amalgamation, or such other business combination transaction as the parties may agree upon (the "Transaction"), subject to the terms and conditions outlined below.  The Transaction will constitute a Reverse Take-over, as such term is defined in the policies of the TSX Venture Exchange (the “Exchange”).

Osino holds a portfolio of key licenses in central Namibia, including the Goldkuppe (formerly known as Gold Kop) prospect. The property has historically been explored by the various previous owners, with both RC and DD drilling, geophysical (IP) surveys, rock, soil and stream geochemistry, detailed geological mapping and historical data compilation undertaken on the property. Osino has further explored the property since its acquisition in February 2016 from Helio Resources Corp.  No resources have been identified on the property. Further drilling on Goldkuppe is expected later in 2017. Osino is preparing a NI 43-101 technical report with respect to the property. 

In connection with the Transaction, Romulus anticipates that the 31,557,000 shares in the capital of Romulus (the “Romulus Shares”), which are currently issued and outstanding, will be consolidated (the “Consolidation”) on the basis of 1 (new) Romulus Share for every 10 (old) Romulus Shares.

Summary of the Qualifying Transaction

The LOI contemplates Romulus and Osino completing a business combination transaction by way of a three-cornered amalgamation under the provisions of the British Columbia Business Corporations Act, pursuant to which a newly incorporated, wholly-owned subsidiary of Romulus will amalgamate with Osino, with Romulus acquiring all of the issued and outstanding Osino Shares in exchange for shares of Romulus on the basis of one post-Consolidation Romulus Share for each 5.4318 issued and outstanding Osino Share. All outstanding convertible securities of Osino will also be exchanged on the same ratio. Osino currently has 181,880,720 common shares issued and outstanding, with additional securities outstanding that are convertible into a further 50,408,051 common shares. Romulus may issue additional common shares pursuant to a financing that it is currently undertaking.

On completion of the Transaction, the current shareholders of Osino would own a majority of the issued and outstanding shares of the Resulting Issuer (as such term is defined in Exchange Policy 2.4) and Osino will become a wholly-owned subsidiary of the Resulting Issuer.  Application will be made to list the common shares of the Resulting Issuer for trading on the Exchange.

It is anticipated that shareholders of Romulus will be asked to approve certain matters required to enable the Company to complete the Transaction, including the Romulus Financing (as defined below), and the three-cornered amalgamation, an increase in the size of the board of directors and a change of name of the Company (the "Name Change").

Pursuant to the terms of the LOI, Osino and Romulus have agreed not to solicit or negotiate with any other entities in regard to a transaction similar to the Transaction (subject to exceptions in the event of a “Superior Proposal”).  Each of Romulus and Osino will bear its own costs in respect of the Transaction. 

The completion of the Transaction is subject to the satisfaction of a number of conditions, including (i) the completion of due diligence, (ii) the negotiation of a definitive agreement, (iii) the completion of the Romulus Financing; (iv) all requisite approvals from the shareholders of Romulus and Osino, (v) the absence of any material adverse change, material litigation, claims, investigations or other matters affecting Romulus or Osino, including any subsidiaries or related companies thereof; and (vi) receipt of all requisite regulatory, stock exchange, court or governmental authorizations and consents. There can be no assurance that the Transaction will be completed on the terms proposed above or at all.

Private Placement Financing

As part of the Transaction, Romulus intends to undertake an equity financing to raise up to $1,000,000 (the "Romulus Financing''), through the issuance of common shares at a price of $0.38 per common share.  The Company will make the offering available to existing shareholders using provisions of the Canadian existing security holder exemption pursuant to Multilateral CSA Notice 45-313 - Prospectus Exemption for Distributions to Existing Security Holders ("CSA 45-313") and the corresponding blanket orders and rules implementing CSA 45-313 in the participating jurisdictions in respect thereof (collectively with CSA 45-313, the "Existing Security Holder Exemption"). 

As at the date hereof, the Existing Security Holder Exemption is available in each of the provinces of Canada, with the exception of Newfoundland and Labrador. Subject to applicable securities laws, the Company will permit each person or company who, as of September 20, 2017 (being the record date set by the Company pursuant to CSA 45-313), holds common shares as of that date (a "Current Shareholder") to subscribe for the common shares that will be distributed pursuant to the Romulus Financing, provided that the Existing Security Holder Exemption is available to such person or company.

Pursuant to CSA 45-313, each subscriber relying on the Existing Security Holder Exemption may subscribe for no more than $15,000 value of securities, unless a subscriber is resident in a jurisdiction of Canada and has obtained advice regarding the suitability of the investment from a registered investment dealer (in which case such maximum subscription amount will not apply).

In the event that aggregate subscriptions for common shares under the Romulus Financing exceed the maximum number of securities to be distributed, then common shares will be sold to qualifying subscribers on a pro rata basis based on the number of common shares subscribed for.

In addition to conducting the Offering pursuant to the Existing Security Holder Exemption, the Company will also accept subscriptions for common shares where other prospectus exemptions are available, including the Investment Dealer Exemption (as defined below). Any Current Shareholder subscribing for common shares pursuant to a prospectus exemption other than the Existing Security Holder Exemption will not be limited to a maximum of $15,000 value of securities.

In addition to the Existing Security Holder Exemption and other available prospectus exemptions, a portion of the Romulus Financing may be completed pursuant to Multilateral CSA Notice 45-318 - Prospectus Exemption for Certain Distributions through an Investment Dealer ("CSA 45-318") and the corresponding blanket orders and rules implementing CSA 45- 318 in the participating jurisdictions in respect thereof (collectively with CSA 45-318, the "Investment Dealer Exemption"). As at the date hereof, the Investment Dealer Exemption is available in each of Alberta, British Columbia, Saskatchewan, Manitoba and New Brunswick. Pursuant to CSA 45-318, each subscriber relying on the Investment Dealer Exemption must obtain advice regarding the suitability of the investment from a registered investment dealer.

There is no material fact or material change of the Company that has not been generally disclosed.

The securities issued pursuant to the Romulus Financing will be subject to statutory hold periods.

Further information about the Financing will be provided in a subsequent news release.

The net proceeds of the Financing will be used to fund (i) the ongoing exploration and development of Osino’s Namibian projects, and (ii) corporate and general working capital purposes.

Sponsorship of the Qualifying Transaction

Sponsorship of the Transaction is expected to be required by the Exchange. Further information regarding sponsorship will be provided in a subsequent news release.

The Resulting Issuer

Upon completion of the Transaction, the Resulting Issuer is expected to change its name to Osino Resources Corp. or such other name as determined by Osino and to continue the exploration and development of Osino's properties.

Concurrent with the completion of the Transaction, it is expected that all directors and officers of Romulus will resign and be replaced by the directors and officers of Osino listed below. Additional directors will be added to the board of directors of the Resulting Issuer (the "Board"). Once identified, information with respect to the proposed additional directors will be included in subsequent news releases.

The management and Board of the Resulting Issuer will include the persons identified below:

Heye Daun– Chief Executive Officer. Co-Founder & Director

Mr. Daun is the former President & CEO of Ecuador Gold & Copper Corp. which merged with Odin Mining in December 2016 to become Lumina Gold Corp. He is the co-founder and President of Auryx Gold Corp., which was sold to B2 Gold Corp. in 2012 in a $180 million transaction. Prior to that he worked at Nedbank Capital and Old Mutual Investment Group and started his career with Rio Tinto, Anglo Gold and Gold Fields, building and operating mines in Africa.

Alan Friedman – President, Co-Founder & Director

Mr. Friedman is a South African trained lawyer who is actively involved in acquisition, financing and listing transactions for many resource companies on the TSX and the AIM market. He is the co-founder and a director of TSXV-listed Eco (Atlantic) Oil and Gas Ltd. and was co-founder and director of Auryx Gold Corp. before it was sold to B2 Gold Corp.

Cautionary Note

As noted above, completion of the Transaction is subject to a number of conditions, including completion of due diligence and the negotiation of a definitive agreement, the approval of the Exchange, approval of the shareholders of Osino and Romulus, court approval of the Transaction (if required), completion of the Consolidation by Romulus and completion of the Romulus Financing.  Where applicable, the Transaction cannot close until the required approvals have been 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 continuous disclosure document containing full, true and plain disclosure regarding the Transaction, required to be filed with the securities regulatory authorities having jurisdiction over the affairs of the Company, 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 common shares of the Company is presently halted and is expected to remain halted pending closing of the Transaction. While halted, the common shares of the Company may only trade upon Exchange approval and the filing of required materials with the Exchange as contemplated by Exchange policy.

CONTACT INFORMATION

Romulus Resources Ltd. Alnesh Mohan CFO 604-677-1766

Disclaimer for Forward-Looking Information

Although the Company believes, in light of the experience of its officers and directors, current conditions and expected future developments and other factors that have been considered appropriate that the expectations reflected in this forward-looking information are reasonable, undue reliance should not be placed on them because the Company can give no assurance that they will prove to be correct. When used in this press release, the words "estimate", "project", "belief", "anticipate", "intend", "expect", "plan", "predict", "may" or "should" and the negative of these words or such variations thereon or comparable terminology are intended to identify forward-looking statements and information. The forward-looking statements and information in this press release include information relating to the business plans of Romulus and Osino, the Romulus Financing, the Transaction (including Exchange approval, court approval, and the closing of the Transaction) and the board of directors and management of the Resulting Issuer upon completion of the Transaction. Such statements and information reflect the current view of Romulus and/or Osino, respectively. Risks and uncertainties that may cause actual results to differ materially from those contemplated in those forward-looking statements and information.

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:

• there is no assurance that the Romulus Financing will be completed or as to the actual proceeds to be raised in connection with the Romulus Financing or as to the offering price to be realized. In particular, the amount raised may be significantly less than the amounts indicated if investors are not prepared to invest;
• there is no assurance that Romulus and Osino will obtain all requisite approvals for the Transaction, including the approval of its respective shareholders, the approval of the Exchange for the Transaction (which may be conditional upon amendments to the terms of the Transaction) or court approval of the Transaction (if required);
• following completion of the Transaction, the Resulting Issuer may require additional financing from time to time in order to continue its operations. Financing may not be available when needed or on terms and conditions acceptable to the Resulting Issuer;
• new laws or regulations could adversely affect the Resulting Issuer's business and results of operations;
• the stock markets have experienced volatility that often has been unrelated to the performance of companies. These fluctuations may adversely affect the price of the Resulting Issuer's securities, regardless of its operating performance;

There are a number of important factors that could cause Romulus and Osino's actual results to differ materially from those indicated or implied by forward-looking statements and information. Such factors include, among others: currency fluctuations; limited business history of Romulus; disruptions or changes in the credit or security markets; results of operation activities and development of projects; project cost overruns or unanticipated costs and expenses, fluctuations in commodity prices, and general market and industry conditions. The terms and conditions of the Transaction may be based on the Company's due diligence and the receipt of tax, corporate and securities law advice for both the Company and Osino. The Company undertakes no obligation to comment on analyses, expectations or statements made by third parties in respect of the Company, Osino, their securities, or their respective financial or operating results (as applicable).

Romulus cautions that the foregoing list of material factors is not exhaustive. When relying on Romulus's forward-looking statements and information to make decisions, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. Romulus has assumed that the material factors referred to in the previous paragraph will not cause such forward-looking statements and information to differ materially from actual results or events. However, the list of these factors is not exhaustive and is subject to change and there can be no assurance that such assumptions will reflect the actual outcome of such items or factors. The information about Osino contained in this press release has not been independently verified by the Company.

THE FORWARD-LOOKING INFORMATION CONTAINED IN THIS PRESS RELEASE REPRESENTS THE EXPECTATIONS OF ROMULUS AS OF THE DATE OF THIS PRESS 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 ROMULUS MAY ELECT TO, IT DOES NOT UNDERTAKE TO UPDATE THIS INFORMATION AT ANY PARTICULAR TIME EXCEPT AS REQUIRED IN ACCORDANCE WITH APPLICABLE LAWS.

This press release is not an offer of the securities for sale in the United States.  The securities have not been registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an exemption from registration.  This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any state in which such offer, solicitation or sale would be unlawful.

Completion of the Transaction is subject to a number of conditions, including but not limited to, Exchange acceptance and if applicable pursuant to Exchange requirements, majority of the minority shareholder approval. Where applicable, 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 or filing statement 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 the Company should be considered highly speculative.

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

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 press release.