Falco Resources Ltd. (TSXV:FPC) entered into a letter of intent to acquire Golden Queen Mining Consolidated Ltd. (TSXV:GQM.H) for CAD 5 million on January 8, 2020. Falco Resources Ltd. entered into a definitive arrangement agreement to acquire Golden Queen Mining Consolidated Ltd. on February 10, 2020. As per the terms, Golden Queen's shareholders will be entitled to receive 1.18 shares of Falco Resources in exchange for each share of Golden Queen held immediately prior to the effective time of the arrangement. Falco Resources will issue 15.97 million common shares as a consideration. As of March 19, 2020, the consideration was increased to 1.35 common shares of Falco Resources for each common share of Golden Queen. All securities of Golden Queen convertible in shares of Golden Queen will have either been converted or cancelled prior to the closing of the arrangement. The shares of Golden Queen, which are currently listed for trading on the NEX and quoted on the OTCQB, are expected to be delisted from the NEX and no longer quoted on the OTCQB following completion of the arrangement. Upon completion, shares of Golden Queen will own approximately 7.1% of the post-arrangement Falco Resources' shares on an undiluted basis. Golden Queen shall pay a termination fee of CAD 0.2 million to Falco Resources, representing approximately 3% of the aggregate value of the consideration.

The completion of the arrangement will also be subject to obtaining required regulatory, stock exchange, court and other approvals, and satisfaction of closing customary conditions. The arrangement will also require the approval of Golden Queen's shareholders at a special meeting expected to take place at the end of March 2020. To become effective, the arrangement must be approved at the Golden Queen Meeting by at least 66 2/3% of the votes cast by Golden Queen's shareholders. The Board of Directors of Golden Queen, on the recommendation of its special committee comprised of independent directors, has unanimously approved the arrangement, and will recommend that Golden Queen shareholders vote for the arrangement. The shareholders representing 19% of the issued and outstanding shares of Golden Queen have entered into voting and support agreements in favor of the transaction. As of February 14, 2020, the transaction was approved by TSX Venture Exchange. As of February 26, 2020, Golden Queen's shareholders meeting will be held on March 24, 2020. As of March 24, 2020, the transaction has been approved the shareholders of Golden Queen. As of March 26, 2020, the Supreme Court of British Columbia granted the final order, thus approving the transaction. The transaction is now expected to close on March 27, 2020. Maxit Capital LP is the financial advisor to Golden Queen. Evans & Evans has provided a fairness opinion to the independent special committee of the Board of Directors of Golden Queen. Andrew McLeod and Sean K. Boyle of Blake, Cassels & Graydon LLP acted as legal advisor to Golden Queen. Josianne Beaudry of Lavery, de Billy, L.L.P. acted as legal advisor to Falco.


Falco Resources Ltd. (TSXV:FPC) completed the acquisition of Golden Queen Mining Consolidated Ltd. (TSXV:GQM.H) on March 27, 2020. Falco intends to cause the Golden Queen Shares to be delisted from the NEX Board (expected on or about March 31, 2020).