Orla Mining Ltd. (TSXV:OLA) entered into a definitive arrangement agreement to acquire Pershimco Resources Inc. (TSXV:PRO) from Sentient Group Limited, Agnico Eagle Mines Limited (NYSE:AEM) and others for CAD 47.7 million on September 14, 2016. Under the terms agreement which will be a court-approved plan of arrangement, each Orla shareholder will receive one common share in the new company (NewCo) for each Orla common share held. Each Pershimco shareholder will receive 0.19 of a NewCo share for each Pershimco common share held. In addition, each Pershimco shareholder will receive 0.04 of a Class A common share of NewCo for each Pershimco Share held. Each class A common share of NewCo will entitle its holder to receive, without payment of additional consideration, one NewCo share conditional upon the issuance of a ministerial resolution by the Ministry of Environment of Panama, accepting the Environmental and Social Impact Study (ESIA) for Pershimco's Cerro Quema project on or prior to January 31, 2017. Each holder of Pershimco RSU will be entitiled to receive cash at a minimum price of CAD 0.3325 per share. Each option of Pershimco will be exchanged for Orla options. If a ministerial resolution accepting the ESIA for the Cerro Quema project is not received prior to January 31, 2017, the right to receive NewCo shares will terminate.

In connection with the transaction, Orla intends to rise up to CAD 50 million via a private placement of subscription receipts at a price of CAD 1.75 per subscription receipt. Pierre Lassonde and certain insiders of Orla intend to participate in the financing in an amount of up to CAD 30 million. Upon completion of the transaction and assuming the approval of the ESIA, it is anticipated that NewCo will have approximately 126.7 million NewCo shares issued and outstanding. Existing Pershimco shareholders will hold approximately 44.7% of the NewCo shares on a fully diluted in-the-money basis. Existing Orla shareholders will hold approximately 36.2% of the NewCo shares on a fully diluted in-the-money basis with the remaining 19.1% to be held by investors participating in the Private Placement. Post the transaction, NewCo, will continue to operate under the name Orla Mining Ltd. Following completion of the arrangement, Orla had approximately 115.86 million common shares issued and outstanding with approximately 53.1% of the common shares being held by former shareholders of Orla and 46.9% of the common shares being held by former shareholders of Pershimco. Additionally, Orla had approximately 11.44 million Class A shares issued and outstanding, which were all held by former shareholders of Pershimco. The 12.1 million Pershimco Shares held by Orla were cancelled in connection with the arrangement.

A reciprocal termination fee in the amount of CAD 3 million will be paid, should the arrangement agreement not be completed in certain circumstances. Marc Prefontaine, President and Chief Executive Officer of Orla will lead the combined company as President and Chief Executive Officer. Paul Robertson will be the Chief Financial Officer and Hans Smit will be the Chief Operating Officer of the NewCo. Troy Fierro will be the Chairman of the Board of Directors and Richard Hall, Alain Bureau, Marc Prefontaine, Jean Robitaille, Kerry Sparkes, Hans Smit and Aaron Wolfe will be the Directors of NewCo. Agnico Eagle entered into support agreement wherein it will vote all of the common shares of Pershimco owned by Agnico in favour of the agreement. The transaction is subject to approval by Pershimco and Orla shareholders and optionholders, court approval and regulatory approvals, including TSX Venture Exchange. The transaction will also require the approval by at least 50% of the minority shareholders of Pershimco and Orla, respectively and Orla will require the approval of its shareholders to continue to the Canada Business Corporations Act from the Business Corporations Act (Ontario). Pershimco and Orla's Board of Directors unanimously approved the terms of the transaction and recommends that their respective shareholders vote in favor of the transaction. Additionaly dissenter's rights are limited to 5%, support agreements should be executed and Orla should complete private placement of CAD 30 Million. The closing of the transaction will take place in mid-November 2016.

GMP Securities L.P. acted as the financial advisor and Jennifer Hansen of Cassels Brock & Blackwell LLP acted as the legal advisor for Orla Mining. Minvisory Corp. and Primary Capital Inc. acted as the financial advisors and Pierre-Hubert Séguin of Seguin Racine, Ltd and Dentons Canada LLP acted as the legal advisors for the special committee of Pershimco Resources. Olivier Désilets of Davies Ward Phillips & Vineberg LLP acted as the legal advisor for Sentient Group Limited in the transaction.

Orla Mining Ltd. (TSXV:OLA) completed the acquisition of Pershimco Resources Inc. (TSXV:PRO) from Sentient Global Resources Fund 4, fund of Sentient Group Limited, Agnico Eagle Mines Limited (NYSE:AEM) and others on December 6, 2016.