ESV Resources Announces Increase of Concurrent Equity Financing in Connection With Change of Business and Reverse-Takeover Transaction

VANCOUVER, BC, Oct. 30, 2020 /CNW/ - ESV Resources Ltd. (the "Company") (TSXV: ESV.H), further to its news release dated September 24, 2020, is pleased to announce that the non-brokered private placement financing (the "Concurrent Financing") of 1255269 B.C. Ltd. (the "Guia Antigua Vendor") will be increased from the previously announced 15,555,000 subscription receipts, for gross proceeds of up to $7,000,000, to 18,666,667 subscription receipts for gross proceeds of up to $8,400,000. The subscription receipts will be issued by the Guia Antigua Vendor at a price of $0.45.  The Concurrent Financing is a condition to completing the Company's previously announced acquisition of the outstanding share capital of the Guia Antigua Vendor, which controls the Guia Antigua project (the "Guia Antigua Acquisition").   

The proceeds of the Concurrent Financing will be held in escrow, pending the Company receiving all applicable regulatory approvals and completing the Guia Antigua Acquisition.  Upon satisfaction of the escrow release conditions, immediately prior to completion of the Guia Antigua Acquisition, each subscription receipt will automatically convert into one common share of the Guia Antigua Vendor for no additional consideration and will be exchanged for common shares of the Company on a one-for-one basis.  If the Guia Antigua Acquisition is not completed on or before February 28, 2021, the proceeds of the Concurrent Financing will be returned to the subscribers. A finder's fees of six percent cash may be payable to certain arm's length parties who introduce subscribers to the Concurrent Financing, in accordance with the policies of the TSX Venture Exchange (the "Exchange"). 

Concurrently with (and conditional upon) closing of the Guia Antigua Transaction, the Company also intends to complete the previously announced acquisition of the Zancudo project from Gran Colombia Gold Corp. ("Gran Colombia") (the "Zancudo Acquisition") and together with the Guia Antigua Acquisition, the "Transaction"), which such project is currently under option to IAMGOLD Corp.

Following completion of the Transaction, it is anticipated that the proceeds from the Concurrent Financing will be utilized principally to undertake an exploration program at the Guia Antigua project, for the general and administrative expenses of the Company, and for the purposes of identifying and conducting due diligence in respect of additional project acquisitions. As the Company will hold a carried interest in the Zancudo project (pursuant to the terms of the option agreement with IAMGOLD Corp.), the Company does not anticipate that any material portion of the proceeds will be incurred on or in respect of the Zancudo project.

Under the terms of the Transaction, shareholders of the Guia Antigua Vendor will be issued 15,000,000 common shares of the Company in exchange for all of the outstanding share capital of the Guia Antigua Vendor, and concurrently Gran Colombia will be issued 27,000,000 common shares of the Company in consideration for the assignment of its interest in the Zancudo project.  In addition to any escrow restrictions imposed by the policies of the Exchange, all common shares issued to the shareholders of the Guia Antigua Vendor and to Gran Colombia will be subject to a voluntary pooling arrangement from which one-quarter of the shares will be released on each of March 27, 2021, June 27, 2021, September 27, 2021 and December 28, 2021.

The Guia Antigua Vendor is a privately-held British Columbia corporation, established for the purposes of holding an interest in the Guia Antigua Project. Aside from its interest in the Guia Antigua Project, the Guia Antigua Vendor has no assets or material financial liabilities or obligations.  The Zancudo project is presently held by Gran Colombia Gold Titiribi Corp. ("GCG Titiribi"), a Panamanian corporation and a subsidiary of Gran Colombia.  It is anticipated that the Zancudo Acquisition will involve the acquisition of GCG Titiribi by the Company.  Aside from its interest in the Zancudo project, GCG Titiribi has no assets or material financial liabilities or obligations.

Following the closing of the Transaction and the Concurrent Financing, the Company expects to have approximately 92,269,529 common shares issued and outstanding.

Management Changes

Further to the Company's news release dated September 24, 2020, while the Company is continuing to evaluate candidates for the role of Chief Executive Officer and Chief Financial Officer (and such candidates may not be identified prior to closing of the Transaction), it is currently anticipated that Mr. Frederic Leigh will continue to serve as the Company's Chief Executive Officer on an interim basis. Mr. Leigh is the principal of a private British Columbia company providing fundraising, investor relations and advisory services. He has over 10 years of experience with companies in the mining and technology sectors worldwide, acting in an investor relations and advisory role for a number of publicly listed companies.

On Behalf of the Board of Directors,

ESV RESOURCES LTD.

The TSX Venture Exchange has in no way passed upon the merits of the proposed 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 release.

Completion of the Transaction is subject to a number of conditions, including but not limited to Exchange acceptance and shareholder approval, if applicable. The Transaction and Concurrent Financing cannot be completed until such approvals are 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 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.

Statements included in this announcement, including statements concerning our plans, intentions and expectations, which are not historical in nature are intended to be, and are hereby identified as, "forward?looking statements". Forward?looking statements may be identified by words including "anticipates", "believes", "intends", "estimates", "expects" and similar expressions. The Company cautions readers that forward?looking statements, including without limitation those relating to the Company's future operations and business prospects, are subject to certain risks and uncertainties that could cause actual results to differ materially from those indicated in the forward?looking statements.

SOURCE ESV Resources Ltd.