Getty Copper signs definitive deal for 1390120 B.C.

Executive Summary

• Getty Copper Inc. has signed a definitive amalgamation agreement to acquire 1390120 B.C. Ltd. (Numberco), which holds the Dot property in the Highland Valley, by amalgamating it with Getty's wholly owned subsidiary.
• Concurrent with the amalgamation, Getty is conducting a brokered private placement financing of up to $15 million via 125 million subscription receipts priced at 12 cents each.
• The transaction involves the exchange of Numberco’s shares, warrants, and options for Getty securities, adds two new directors to the board, and utilizes financing proceeds to retire approximately $3.7 million in existing debt and fund property development.

Key Details

• Amalgamation Structure:
  • Numberco will amalgamate with Getty’s wholly owned subsidiary, 1560326 B.C. Ltd.
  • Numberco shareholders will receive Getty common shares on a one-for-one basis for their 65 million outstanding shares.
  • Numberco’s 2 million warrants (exercisable at 7.5 cents) will be exchanged for Getty warrants on identical terms.
  • Numberco’s 6.5 million options (exercisable at 5 cents) will be exchanged for equivalent Getty options.
  • Issued securities are subject to TSX Venture Exchange escrow requirements.
• Financing Terms:
  • Type: Brokered private placement via subscription receipts.
  • Size: Up to 125 million subscription receipts.
  • Price: 12 cents per subscription receipt.
  • Gross Proceeds: Up to $15 million.
  • Agents: Clarus Securities Inc. and Velocity Capital Partners (co-lead agents).
  • Commission: 6% cash commission on gross proceeds.
  • Warrants: Agents receive non-transferable broker warrants equal to 6% of the number of subscription receipts sold.
  • Warrant Terms: Exercisable at 12 cents per share for 12 months post-closing.
  • Conversion: Subscription receipts convert to one common share each upon satisfaction of escrow release conditions. If conditions are not met within six months of closing, receipts are cancelled and proceeds (plus interest) returned.
• Use of Proceeds:
  • Retire existing indebtedness of approximately $3.7 million.
  • Continue development of Getty mineral properties.
  • General corporate purposes.
• Board Changes:
  • Board will consist of five members.
  • Incoming Directors: Charles Funk (Chairman) and Mahesh Liyanage.
  • Continuing Directors: Tom MacNeill (CEO) and Brent Lepinski.
  • A fifth director will be agreed upon by Getty and Numberco.
• Closing Conditions:
  • Approval from the TSX Venture Exchange.
  • Completion of not less than $12 million of the concurrent financing.
  • Customary closing conditions.
• Regulatory Status:
  • Not considered a reverse takeover under TSX-V policies as fewer shares are issued than currently outstanding.
  • Classified as a reviewable transaction requiring TSX-V approval.
  • Shareholder approval not required as it is an amalgamation of a subsidiary, does not result in a change of control/business, is at arm's length, and creates no new control persons.
• Asset Details:
  • Numberco holds the "Dot property" located in the Highland Valley, with significant prior exploration work completed.

Notable Quotes

• "Getty management determined to proceed with the transactions for a number of reasons, including: The addition of the Dot property to the Getty's portfolio of Highland Valley holdings; The addition of needed experienced mining management to the board of directors of Getty; The fact that the concurrent financing will allow Getty to resolve all of its corporate indebtedness and advance the development of its Highland Valley properties."