Vancouver - VAR Resources Corp. (the 'Company') is pleased to announce that the Company has received conditional approval from the TSX Venture Exchange ('TSXV') with respect to its previously announced reverse takeover transaction with Grounded Lithium Corp., a private arm's length company incorporated under the Business Corporations Act ('ABCA'), pursuant to the terms of an amalgamation agreement dated February 10, 2022 among the Company, Grounded and VAR Resources (Newco) Corp., a wholly-owned subsidiary of Company ('NewCo').
The Transaction will be completed by way of 'three-cornered' amalgamation whereby NewCo and Grounded will amalgamate under the provisions of the ABCA to form a new entity ('AmalCo'), and AmalCo will be a wholly-owned subsidiary of the Company. The combined company (thereafter, the 'Resulting Issuer') that will result from the completion of the Transaction (the 'Closing') will be renamed 'Grounded Lithium Corp.' or such other name as agreed to by the Company and Grounded. Subject to the final approval of the TSXV, the common shares of the Resulting Issuer (each, a 'Resulting Issuer Share') will trade on the TSXV under the symbol 'GRD' and the business of the Resulting Issuer will be the business of Grounded.
It is expected that the Resulting Issuer will be listed on the TSXV as a Tier 2 mineral exploration issuer. In connection with the Transaction, the Company will be filing a management information circular (the 'Information Circular') prepared in accordance with the policies of the TSXV on TSXV Form 3D1 - Information Required in an Information Circular for a Reverse Take-Over or Change of Business. Once finalized, the Information Circular will be filed on the Company's profile on SEDAR and provide more specifics on meeting date of the annual general and special meeting of shareholders of the Company to approve, among other things, the Transaction. The Information Circular will also provide more fulsome and detailed information with respect to the Company, Grounded and the Transaction as a whole.
Grounded Lithium Corp.
Grounded is a private lithium brine exploration and development company incorporated pursuant to the laws of Alberta. Grounded holds mineral leases over 249 net sections of land in Saskatchewan, prospective for lithium opportunities. Grounded was incorporated in October 2020 with the intent to participate in the energy transition shift, specifically targeting lithium resource development in Western Canada. To date, Grounded has been successful in acquiring land holdings both through government land sales in addition to contractual arrangements with certain freehold landowners. In total, Grounded has 64,416 net hectares of land holdings. Grounded has not generated sales to date and does not anticipate commercial production of its lithium resources for several years. Grounded is well capitalized in conjunction with the Grounded Financing (as defined below) to execute on early stages of its business plan and remains debt-free. The following list sets forth selected management prepared historical financial information of Grounded for the three month period ended March 31, 2022 and selected balance sheet data as of such date (unaudited): General Terms of the Transaction Amalgamation The Transaction will be effected by way of a three-cornered amalgamation, without court approval, under the ABCA, pursuant to which, following the acquisition of all the issued and outstanding securities of Grounded, NewCo and Grounded will amalgamate (the 'Amalgamation') to form AmalCo, and AmalCo will be a wholly-owned subsidiary of the Company. At the time of Closing: each of the common shares in the capital of Grounded (each, a 'Grounded Share') will be cancelled and, in consideration for such Grounded Shares, each Grounded shareholder (collectively, the 'Grounded Shareholders') will receive one (1) common share in the capital of the Company (each, a 'Share') at a deemed price of $0.18 per Share for each one (1) Grounded Share held by such Grounded Shareholder; all of the holders of share purchase warrants of Grounded (each, a 'Grounded Warrant') outstanding immediately prior to the Amalgamation shall receive, in exchange for their Grounded Warrants, an equal number of Share purchase warrants of the Company (each, a 'VAR Replacement Warrant'), each on the same terms and conditions as such Grounded Warrants; the holder of share purchase warrants of Grounded issued in connection with the Grounded Financing (each, a 'Grounded Finder Warrant') outstanding immediately prior to the Amalgamation shall receive, in exchange for the Grounded Finder Warrants, an equal number of Share purchase warrants of the Company (each, a 'VAR Finder Replacement Warrant'), each on the same terms and conditions as such Grounded Finder Warrants and each of the stock options of Grounded (each, a 'Grounded Option') outstanding immediately prior to the Amalgamation shall receive, in exchange for their Grounded Options, an equal number of stock options of the Company (each, a 'VAR Replacement Option'), each on the same terms and conditions as such Grounded Options
Contact:
Gregg Smith
Email: gregg.smith@groundedlithium.com
Disclaimer for Forward-Looking Information
Certain statements in this news release are forward-looking statements, which reflect the expectations of management regarding the Company's completion of the Transaction and related transactions. Forward-looking statements consist of statements that are not purely historical, including any statements regarding beliefs, plans, expectations or intentions regarding the future, including but not limited to, the Company completing the Transaction, the completion of the Grounded Financing, statements regarding the prospective lithium opportunities of Grounded's mineral assets, the anticipated use of proceeds of the Grounded Financing, the conditions to be satisfied for completion of the Transaction, completion of the Continuation, the name and business carried on by the Resulting Issuer, the capitalization of the Resulting Issuer, the Board Reconstitution, the Management Reconstitution, and the reliance on a prospectus exemption for the issuance of the Shares. Such statements are subject to assumptions, risks and uncertainties that may cause actual results, performance or developments to differ materially from those contained in the statements, including risks related to factors beyond the control of the Company. The risks include the following: the requisite corporate and shareholders approvals of the directors and shareholders of the Company or Grounded, as applicable, may not be obtained; Grounded may be unable to close the Grounded Financing in full or in part; the TSXV may not provide final approval for the Transaction; that the parties may be unable to satisfy the closing conditions in accordance with the terms and conditions of the Amalgamation Agreement and other risks that are customary to transactions of this nature. The novel strain of coronavirus, COVID-19, and ongoing dispute between the sovereign state of Ukraine and Russia also pose risks that are currently indescribable and immeasurable. No assurance can be given that any of the events anticipated by the forward-looking statements will occur or, if they do occur, what benefits the Company will obtain from them. The reader is cautioned not to place undue reliance of any forward-looking statements. Such information, although considered reasonable by management at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated. Forwardlooking statements contained in this news release are expressly qualified by this cautionary statement. The forwardlooking statements contained in this news release are made as of the date of this news release. The Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
VAR RESOURCES