Toronto, Ontario–(Newsfile Corp. – October 12, 2021) – Aardvark Capital Corp. (TSXV: ACCA.P) (the “Company“) and 2766604 Ontario Ltd. (“GoldCo“, and together with the Company, the “Parties“) are pleased to provide an update on the Company’s previously announced arm’s length Qualifying Transaction (the “Qualifying Transaction“), as such term is defined in Policy 2.4 – Capital Pool Companies (the “Policy“) of the TSX Venture Exchange (the “TSXV“) Corporate Finance Manual (the “Manual“), and announce that the Parties have amended the non-binding letter of intent entered into by the Parties on July 15, 2021 (the “LOI“) to provide the Parties with additional time to enter into a definitive agreement (the “Proposed Definitive Agreement“) in respect of the Qualifying Transaction. The Parties are presently in advanced negotiations to finalize the Proposed Definitive Agreement, which will form the basis upon which the Parties will effect the Qualifying Transaction.

The Qualifying Transaction

Pursuant to the Proposed Definitive Agreement, the Company is expected to acquire all of the issued and outstanding common shares of GoldCo (the “GoldCo Shares“) pursuant to a three-cornered amalgamation to be completed under the Business Corporations Act (Ontario) by the Company, GoldCo, and a wholly-owned subsidiary of the Company (“Subco“) to be incorporated for the purpose of completing the amalgamation (the “Amalgamation“). The Amalgamation is expected to result in the issuance, to each shareholder of GoldCo (each, a “GoldCo Shareholder“), of one (1) Post-Consolidation Common Share (as defined below) for each one (1) GoldCo Share held by such holder immediately prior to the closing of the Qualifying Transaction (the “Closing“). As part of the Amalgamation, all convertible securities of GoldCo outstanding immediately prior to the Closing are expected to be replaced with or exchanged for equivalent convertible securities of the Company entitling the holders thereof to acquire Post-Consolidation Common Shares in lieu of Goldco Shares.

The Amalgamation will result in the reverse takeover of the Company by the GoldCo Shareholders, and will constitute the Company’s Qualifying Transaction. Following the completion of the Qualifying Transaction, the Company, as the issuer resulting therefrom (the “Resulting Issuer“), is expected to carry on the current business of GoldCo under the name “Paycore Minerals Inc.” or such other name as may be determined by GoldCo and approved by the shareholders of the Company and be acceptable to the applicable regulatory authorities. The business of the Resulting Issuer will be primarily focused on mineral exploration and development of the Property (as defined below).

Upon completion of the Qualifying Transaction, it is anticipated that the Resulting Issuer will be listed as a Tier 2 Mining Issuer on the TSXV.

Consolidation and Name Change

As will be further set out in the Proposed Definitive Agreement, the Company is expected to, prior to the Closing, (i) effect a consolidation (the “Consolidation“) of its outstanding common shares (the “Common Shares“) on the basis of up to five (5) pre-consolidation Common Shares for every one (1) (the “Consolidation Ratio“) post-consolidation Common Share (each, a “Post-Consolidation Common Share“), and (ii) effect a change of its corporate name to “Paycore Minerals Inc.” or such other name as determined by GoldCo and approved by the shareholders of the Company and is acceptable to the applicable regulatory authorities (the “Name Change“).

As of the date hereof, there are 6,800,000 Common Shares issued and outstanding. Upon completion of the Consolidation (assuming the maximum Consolidation Ratio), an aggregate of 1,360,000 Post-Consolidation Common Shares are expected to be issued and outstanding. Further, all outstanding incentive stock options (“Company Options“) and broker warrants of the Company will automatically adjust in accordance with their terms to give effect to the Consolidation such that, following the Consolidation, the holders thereof will be entitled to acquire Post-Consolidation Common Shares in lieu of Common Shares (with adjustments to account for the Consolidation Ratio). As will be further set out in the Proposed Definitive Agreement, the post-Consolidation exercise price of the Company Options shall be further amended such that immediately following the Closing, each Company Option will have an exercise price of C$1.00 per Post-Consolidation Common Share.

Concurrent Financing

In connection with the Qualifying Transaction, GoldCo is expected to undertake a brokered private placement (the “Concurrent Financing“) of subscription receipts of GoldCo (the “Subscription Receipts“) at a price per Subscription Receipt to be determined in the context of the market, for aggregate gross proceeds of not less than C$12,000,000, which proceeds will be held in escrow pending closing of the Qualifying Transaction by a subscription receipt agent to be appointed by GoldCo.

Upon satisfaction and/or waiver (where permitted) of certain escrow release conditions, which will include, among others, events in connection with the completion of the Qualifying Transaction, each Subscription Receipt is expected to be automatically converted, without payment of any additional consideration and without any further action on the part of the holder thereof, for the securities of GoldCo underlying the Subscription Receipts (which securities will, upon the Closing, be exchanged for Post-Consolidation Common Shares and/or replacement convertible securities of the Resulting Issuer, as applicable).

GoldCo may pay customary finder’s fees and commissions to one or more eligible persons in connection with the Concurrent Financing payable in cash or securities, in accordance with the policies of the TSXV.

The proceeds of the Concurrent Financing are expected to be used to fund (i) the exploration and other expenses relating to the Property, (ii) the expenses of the Qualifying Transaction and the Concurrent Financing, and (iii) the working capital requirements of the Resulting Issuer.

Proposed Creation of New Control Person

Pursuant to the terms of a master transaction agreement dated as of March 31, 2021 (as amended on May 14, 2021 and September 27, 2021, the “FAD Agreement“) among GoldCo, Golden Hill Mining LLC (“Golden Hill“), a wholly-owned subsidiary of GoldCo, and Waterton Nevada Splitter, LLC, Waterton Nevada Splitter II, LLC, and FAD Mining Company LLC (collectively, “Waterton“) (each of which are arm’s length to GoldCo and Golden Hill), Golden Hill has the option to acquire the Property (as defined herein), in connection with the Closing, for an aggregate purchase price comprised of: (a) a cash payment in the amount of US$5 million; (b) the issuance of such number of Post-Consolidation Common Shares (each, a “Payment Share“) as is equal to a minimum of 35% of the issued and outstanding Post-Consolidation Shares, on an undiluted basis, following the Closing; (c) the issuance of one Post-Consolidation Common Share purchase warrant for each two Payment Shares issued; and (d) certain contingent value rights, each as further described in the FAD Agreement. Subject to the approval of the TSXV and the Company’s shareholders, and the completion of the transactions contemplated by the FAD Agreement, it is expected that Waterton will be a Control Person (as defined in the Manual) of the Resulting Issuer.

Conditions Precedent

The completion of the Qualifying Transaction remains subject to a number of terms and conditions to be set forth in the Proposed Definitive Agreement, including, among other things (i) there being no material adverse change in respect of either of the Parties, (ii) the receipt of all necessary consents, orders and regulatory and shareholder approvals, including the conditional approval of the TSXV, subject only to customary conditions of closing, (iii) the completion of the Consolidation, Name Change, the Concurrent Financing, the amendment of the Master Transaction Agreement, and the implementation of the Management and Board Rollover (as defined below), and (iv) such other customary conditions of closing for a transaction in the nature of the Qualifying Transaction. Accordingly, there can be no assurance that the Qualifying Transaction will be completed on the terms proposed and described herein, or at all.

Additional Information

Further updates in respect of the Qualifying Transaction will be provided in a subsequent press release. Also, additional information concerning the Qualifying Transaction, the Company, GoldCo, and the Resulting Issuer will be provided in the filing statement (the “Filing Statement“) to be filed by the Company and Goldco in connection with the Qualifying Transaction, which will be available in due course under the Company’s SEDAR profile at www.sedar.com.

Proposed Directors and Officers of the Resulting Issuer

Upon the completion of the Qualifying Transaction, it is expected that the board of directors and officers of the Resulting Issuer will be reconstituted to be comprised of the following individuals nominated by GoldCo, subject to compliance with the requirements of the TSXV and applicable securities and corporate laws (the “Board and Management Rollover“):

Jim Gowans (Chairman, Director)

Mr. Gowans has more than 30 years of experience in mineral exploration, mine feasibility studies, mine construction and commissioning and the development of best practices in mine safety, operations and economic performance improvement. He served as President and Chief Executive Officer of Arizona Mining Inc. which was acquired by South32 Limited in 2018 for over $1.65 billion. Prior to that, he was with Barrick Gold Corporation as Senior Advisor to the Chairman from August to December 2015, Co-President from July 2014 to August 2015, and Executive Vice President and Chief Operating Officer from January to July 2014. From 2011 to 2014, Mr. Gowans served as the Managing Director of Debswana Diamond Company (Pty) Ltd., and has also held positions at various companies including De Beers SA, De Beers Canada Inc., PT Inco Indonesia, Placer Dome Inc., and Cominco Ltd. (now Teck Resources).

Mr. Gowans previously served as the President of the Canadian Institute of Mining, Metallurgy and Petroleum, the Chair of the Board of the Mining Association of Canada, and a director of the Conference Board of Canada. He currently holds multiple roles on boards of directors and/or advisory and technical committees for New Gold, Cameco Ltd., Trilogy Metals Inc. and Marathon Gold Corporation.

Mr. Gowans is a Professional Engineer, holds a Bachelor of Applied Science degree in mineral engineering from the University of British Columbia, and attended the Banff School of Advanced Management.

Steve Filipovic (Chief Financial Officer)

Mr. Filipovic is a Chartered Professional Accountant with more than 23 years’ financial management and oversight experience. Most recently, he was a member of Premier Gold Mines Limited’s executive team as its Chief Financial Officer (June 2012 – April 2021), Vice President, Finance (April 2008 – June 2012), and Controller (May 2006 – April 2008). Previously, he served as Chief Financial Officer of Zinifex Canada Inc. (May 2007 – May 2008), Vice President, Finance of Wolfden Resources Inc. (October 2004 – May 2007) and was a director and/or senior officer of Greenstone Gold Mines, Mega Precious Metals Inc., Source Exploration Corp., Kings Bay Gold Corporation and T.B. Mining Ventures Inc. and, prior to entering the mining sector, practiced as an Audit Manager with Ernst & Young LLP in their Calgary based Oil & Gas group.

Mr. Filipovic holds an Honours Bachelor of Commerce Degree from Lakehead University, is a member in good standing with the Chartered Professional Accountants of Ontario, Chartered Professional Accountants of Alberta and is an ICD.D designated member of the Institute of Corporate Directors.

Christina McCarthy (Director)

Ms. McCarthy is a geologist with over 13 years of experience in the resource capital markets. Ms. McCarthy served as Director of Corporate Development for McEwen Mining Inc. from December 2014 to December 2019. Ms. McCarthy is currently Vice President of Corporate Development for New Oroperu Resources Inc which recently announced a business combination with First Light Capital to combine and create Anacortes Mining Corp. She spent the past 13 years in various roles including building an exempt market dealer focusing on resources, equity research at Euro Pacific and Institutional Sales at Haywood Securities. Prior to entering the resource capital markets, she worked in Scandinavia for a junior exploration company managing the exploration programs on multiple projects throughout Norway and Sweden. Christina was also influential in building and supporting New Found Gold Corp. to bring the company to the public markets in August of 2020.

Ms. McCarthy is a geologist and holds a Bachelors of Science degree in Earth Sciences/Geology from Brock University.

John Begeman (Director)

Mr. Begeman is a professional mining engineer with over 40 years of mining experience. He is currently a director of Yamana Gold Inc., i-80 Gold Corp. and African Gold Group, Inc. Previously, Mr. Begeman has served as Executive Chairman and a director of Premier (2015 – 2021), President, Chief Executive Officer and Director of Avion Gold Corp. (2008 – 2012), and as Chief Operating Officer of Zinifex Canada Inc. (formerly Wolfden Resources Inc.), where he was responsible for managing the day-to-day operations of the company. Mr. Begeman is a Leadership Fellow member of the National Association of Corporate Directors and has attained the Institute of Corporate Directors ICD.D designation.

Insiders

In the event that the transactions contemplated by the FAD Agreement are completed, as described above, it is expected that, in addition to the above-noted directors and senior officers of the Resulting Issuer, Waterton will be an Insider (as defined in the Manual) of the Resulting Issuer by virtue of holding not less than 35% of the Post-Consolidation Common Shares.

Shareholder Approval

The Qualifying Transaction is not a Non Arm’s Length Qualifying Transaction (as defined in the Policy) and, accordingly, the Company is not required to obtain the approval of its shareholders for the Qualifying Transaction. However, the Company intends to hold a special meeting of its shareholders on October 14, 2021 (together with any adjournment thereof, the “Special Meeting“) to approve certain matters ancillary to the Qualifying Transaction, including the Name Change, the Consolidation, proposed directors of the Resulting Issuer, the adoption of a new stock option plan for the Resulting Issuer, and the potential creation of the Proposed Control Person as a Control Person of the Resulting Issuer.

For more information about the Special Meeting, please see the Company’s management information circular dated September 15, 2021 (the “Circular“). The Company would also like to confirm that the record date for the determination of shareholders entitled to receive notice of, and to vote at, the Special Meeting or any adjournments or postponements thereof is September 14, 2021 as set out in the Company’s notice of meeting and record date filed on SEDAR on September 1, 2021 as opposed to August 16, 2021 as was set out in the Circular.

Sponsorship

The TSXV requires sponsorship of a Qualifying Transaction of a capital pool company, unless exempt in accordance with the policies of the TSXV. The Parties are currently reviewing the requirements for sponsorship and may apply for an exemption from the sponsorship requirements pursuant to the policies of the TSXV. However, there can be no assurance that the Parties will ultimately obtain such exemption.

The Parties intend to provide any additional information regarding sponsorship at a later date, once determined by the Parties. In the event that the TSXV does not grant an exemption from the sponsorship requirements of the TSXV, the Parties would be required to engage a sponsor.

Trading Halt

In accordance with the policies of the TSXV, the Common Shares, which are currently listed on the TSXV under the symbol “ACCA.P”, are currently halted from trading and it is expected that the Common Shares will remain halted until completion of the Qualifying Transaction.

About GoldCo

GoldCo is a private company incorporated under the Business Corporations Act (Ontario) which has the option to acquire a 100% interest in the “FAD Property” (the “Property“) located on the Eureka-Battle Mountain trend in Nevada, USA. The Property is host to the high-grade poly-metallic FAD Deposit that was partially delineated with surface and underground drilling in the 1940s and 1950s. There has been no modern-day exploration or drilling completed on the Property since the 1950s.

Nevada accounts for nearly 80% of annual gold production in the United States and was ranked as a tier one jurisdiction by the Fraser Institute. The Property is located less than 3 miles from Eureka, Nevada and has established infrastructure, including a shaft, roads and old buildings.

About Aardvark Capital Corp.

The Company is a capital pool company (within the meaning of the Policy) incorporated under the Business Corporations Act (Ontario) on January 29, 2021. It is a reporting issuer in the provinces of British Columbia, Alberta, Ontario, New Brunswick and Nova Scotia, with its registered and head office located in Toronto, Ontario. The Company has no commercial operations and no assets other than cash.

Cautionary Statements

This news release contains forward-looking statements and forward-looking information (collectively, “forward-looking statements“) within the meaning of applicable securities laws. Any statements that are contained in this news release that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking statements are often identified by terms such as “may”, “should”, “anticipate”, “will”, “estimates”, “believes”, “intends” “expects” and similar expressions which are intended to identify forward-looking statements. More particularly and without limitation, this news release contains forward-looking statements concerning the Qualifying Transaction (including the Name Change, the Consolidation, the Board and Management Rollover, the potential creation of the Proposed Control Person as a Control Person of the Resulting Issuer and who the Proposed Control Person may be), the Concurrent Financing, the Special Meeting, the Proposed Definitive Agreement, and the proposed structure by which the Qualifying Transaction is to be completed. Forward-looking statements are inherently uncertain, and the actual performance may be affected by a number of material factors, assumptions and expectations, many of which are beyond the control of the Parties, including expectations and assumptions concerning (i) the Company, GoldCo, the Resulting Issuer, and the Qualifying Transaction, (ii) the ability of the Parties to negotiate and enter into the Proposed Definitive Agreement on satisfactory terms as proposed, (iii) the timely receipt of all required shareholder, court and regulatory approvals (as applicable), including the approval of the TSXV, and (iv) the satisfaction of other closing conditions in accordance with the terms of the Proposed Definitive Agreement. Readers are cautioned that assumptions used in the preparation of any forward-looking statements may prove to be incorrect. Events or circumstances may cause actual results to differ materially from those predicted as a result of numerous known and unknown risks, uncertainties and other factors, many of which are beyond the control of the Parties. Readers are further cautioned not to place undue reliance on any forward-looking statements, as such information, although considered reasonable by the respective management of the Parties at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated.

The forward-looking statements contained in this news release are made as of the date of this news release, and are expressly qualified by the foregoing cautionary statement. Except as expressly required by securities law, neither Party undertakes any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise.

Completion of the Qualifying Transaction is subject to a number of conditions, including but not limited to, TSXV acceptance and if applicable pursuant to the requirements of the TSXV, majority of the minority shareholder approval. Where applicable, the Qualifying Transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the Qualifying 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 Qualifying Transaction, any information released or received with respect to the Qualifying Transaction may not be accurate or complete and should not be relied upon. Trading in the securities of a capital pool company should be considered highly speculative.

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

This news release shall not constitute an offer to sell or the solicitation of an offer to buy any securities in any jurisdiction.

This news release does not constitute an offer to sell or a solicitation of an offer to buy the securities described herein in the United States or in any other jurisdiction, nor shall there be any sale of the securities in any state in which such offer, solicitation or sale would be unlawful. The securities have not been and will not be registered under the U.S. Securities Act, or any state securities laws, and accordingly, may not be offered or sold in the United States except in compliance with the registration requirements of the U.S. Securities Act and applicable state securities requirements or pursuant to exemptions therefrom.

Further Information

All information contained in this news release with respect to the Company and GoldCo was supplied by the respective Party for inclusion herein, and each Party and its directors and officers have relied on the other Party for any information concerning the other Party.

For further information please contact:

Aardvark Capital Corp.
Zachary Goldenberg
C.E.O, and Director
Telephone: 647-987-5083
Email: [email protected]

2766604 Ontario Ltd.
Christina McCarthy
President, CEO, Director
Telephone: 416-712-6151
Email: [email protected]

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 news release. No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein.

Not for distribution to United States newswire services or for release, publication, distribution or dissemination, directly or indirectly, in whole or in part, in or into the United States.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/99324