VANCOUVER, BC / ACCESSWIRE / June 23, 2022 / Canagold Resources Ltd. ("Canagold" or the "Company") (TSX:CCM, OTCQB:CRCUF, Frankfurt:CANA) today addresses multiple false and misleading statements made by a dissident minority shareholder, SunValley Company DMCC ("SunValley" or the "Dissident"). The Dissident has nominated three new directors out of five total directors (the "Dissident Nominees") in an attempt to seize control of the Company's board of directors and assets without paying any premium to shareholders. SunValley, based in Dubai, UAE, made multiple statements that are either FALSE, INACCURATE, MISLEADING OR LACK CONTEXT.
It is clear the Dissident is willing to promote misinformation to cloak their true intention: that being to take control of your company. While we believe that their baseless accusations have absolutely no merit, we find it necessary to inform our shareholders of the FACTS and TRUTH of these matters.
False Statement - Directors Rejected Multiple Financing Offers
FACT - Canagold received one offer a week ago, did not reject it, and will consider it in the final review of all of their financing alternatives
Canagold received ONE offer from the Dissident seven days ago, and it was NOT rejected. Canagold simply reminded the Dissident that we have a process underway to generate and evaluate offers of financing and we would get back to them. It is our fiduciary duty to complete that process so as to select the best offer for the Company, one which would benefit ALL shareholders, not just ONE shareholder. The Dissident demanded that your board immediately accept their offer, which would result in them owning over 35% of the company, and abandon our process to generate multiple offers, all while they are running a HOSTILE TAKEOVER ATTEMPT TO CONTROL THE COMPANY, BOARD AND NEW POLARIS PROJECT.
In fact, Canagold's board of directors and management team maintained open communications and a positive relationship with the Dissident Shareholder, just as management tries to do with all shareholders. The Board's fiduciary duties involve acting in the best interest of the Company and taking into consideration the interests of ALL stakeholders, whereas the Dissident has NO such duty. By demanding that the Board accept their offer of financing and abandon the industry standard process of generating multiple financing offers, the Dissident Shareholder has demonstrated that it is only acting IN ITS OWN BEST INTEREST which prejudices the interests of all other shareholders.
The Dissident offered a flow through financing at $0.42 per share which is a 16% DISCOUNT to our last flow through financing at $0.50 per share, and a non-flow through financing at $0.32 per share which is a 20% DISCOUNT to our last non-flow through financing of $0.40 per share.
False Statement - Directors Tried to Encumber the Project with a Second Royalty
FACT - Canagold advised the Dissident that they were not pursuing a royalty sale - in May and again in June - but the Dissident continued to pursue its hostile attempt to hijack control of your board.
Canagold's management NEVER TRIED TO SELL A ROYALTY; they simply exercised their fiduciary responsibility to investigate the red-hot royalty market at the time to assess if this form of financing was in the best interests of the Company. As a result of their diligent search, management found that royalty companies had no interest in buying a royalty at this early stage of project development. In a letter dated May 18, 2022 addressed to Vikram Sodhi, SunValley's Managing Director, we informed Sun Valley of this, and confirmed it again in June. However, they continue to perpetuate the fiction that we were trying to sell a royalty. We believe these false statements are to distract from their true intention, which is a creeping takeover attempt of the board, company and project without paying any premium to all Canagold shareholders.
False Statement - Canagold Forced a Costly Proxy Fight
FACT - Canagold did everything in their power to avoid a costly and disruptive proxy battle
In the first two weeks of June, Canagold and the Dissident engaged in discussions about the Dissident's advance notice to nominate a majority of the directors to the board. At the time of those discussions, the Dissident Shareholder held 9.4% of Canagold's shares. After reviewing the Dissident's proposed nominees and in an effort to avoid a costly and distracting proxy battle, Canagold was willing to include two of the Dissident nominees for election to the board. Canagold reached a verbal agreement with the Dissident whereby the Dissident would withdraw its advance notice and in return management would propose two of their nominees. However, instead of withdrawing their advance notice, the Dissident immediately BREACHED THE AGREEMENT, bought 7,140,371 Canagold shares in a private transaction from 2176423 Ontario Ltd. (a company beneficially owned by Eric Sprott) and informed Mr. Cooke that their advance notice would stand.
These actions reveal the Dissident's agenda is not to promote good governance or board renewal for the benefit of the Company, but to seize control of your Company by nominating three hand-picked and interconnected directors to control the board, and advance their creeping takeover attempt without offering any premium to Canagold shareholders.
The Dissident abruptly withdrew from the agreement and took the following actions:
The Dissident's actions over the last three weeks are completely incompatible with an entity that "did not want a proxy fight". The acts of breaching a verbal agreement, soliciting proxies for the election of a majority of directors to the board, and acquiring shares with the intent that they be voted at the Company's impending annual and special meeting are the actions of a shareholder intent onINITIATING a proxy contest rather than avoiding one.
Other False, Misleading and Inaccurate Statements in The Dissident's Press Release
The Dissident Shareholder's press release is riddled with other false, inaccurate and misleading statements that Canagold would like to address, as follows:
Canagold's Board of Directors Is Committed to Canagold's Success and the Interests of ALL Shareholders
Canagold's Board continues to be committed to advancing the Company's material mineral property, the New Polaris gold project (the "New Polaris Project"), in northern British Columbia. The next steps in the process include progressing towards an updated resource estimate, to be followed by updated economic studies, project permitting and a feasibility study. The completion of these next steps will put Canagold on the path to mine development, unlocking value of the New Polaris Project which our drill hole sample results show has gold grades that are amongst the highest in western Canada.
VOTE your shares today to stop the Dissident Shareholder from taking control of your company.
Make the Right Choice - Vote FOR Canagold's Management Nominees Today
We urge shareholders to read Canagold's management information circular and visit our website www.canagoldresources.com for further details related to Canagold's annual and special meeting of shareholders scheduled for July 19, 2022. Your vote has never been more important. ACT TODAY to protect your investment by voting FOR Canagold's management nominees using only the YELLOW proxy that was mailed to shareholders with the management information circular on June 15, 2022. Voting is easy. You may vote online, by telephone or other methods found on the YELLOW proxy. Canagold may also utilize Broadridge's QuickVote™ service to assist eligible beneficial shareholders with voting their shares directly over the phone.
Shareholder Questions and Voting Assistance
If you have questions or require assistance with voting your shares, please contact Canagold's strategic advisor and proxy solicitation agent:
Laurel Hill Advisory Group
North American Toll Free: 1-877-452-7184 (416-304-0211 Outside North America)
Founder and Chairman of the Board
CANAGOLD RESOURCES LTD.
Chief Executive Officer
CANAGOLD RESOURCES LTD.
About Canagold - Canagold Resources Ltd. is a growth-oriented gold exploration company focused on generating superior shareholder returns by discovering, exploring and developing strategic gold deposits in North America. Canagold shares trade on the TSX: CCM and the OTCQB: CRCUF.
Shareholder Questions/Voting Assistance
Laurel Hill Advisory Group
North America Toll Free: 1-877-452-7184
Collect Calls Outside North America: 1-416-304-0211
Cautionary Note Regarding Forward-Looking Statements
This news release contains "forward-looking statements" within the meaning of the United States private securities litigation reform act of 1995 and "forward-looking information" within the meaning of applicable Canadian securities legislation. Statements contained in this news release that are not historical facts are forward-looking information that involves known and unknown risks and uncertainties. Forward-looking statements in this news release include, but are not limited to, statements with respect to the Company and the New Polaris gold mine project; the advancement of the Company's mineral properties; the steps and expected timing in developing the New Polaris gold mine project, including updated resource estimates, updated economic studies, project permitting and a feasibility study; and the ability of the Company to execute on its proposed steps to put the Company on the path to mine development and unlocking value of the New Polaris gold mine project and for shareholders. In certain cases, forward-looking statements can be identified by the use of words such as "plans", "has proven", "expects" or "does not expect", "is expected", "potential", "appears", "budget", "scheduled", "estimates", "forecasts", "at least", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "should", "might" or "will be taken", "occur" or "be achieved".
Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such risks and other factors include, among others risks related to the uncertainties inherent in the estimation of mineral resources; commodity prices; changes in general economic conditions; market sentiment; currency exchange rates; the Company's ability to continue as a going concern; the Company's ability to raise funds through equity financings; risks inherent in mineral exploration; risks related to operations in foreign countries; future prices of metals; failure of equipment or processes to operate as anticipated; accidents, labor disputes and other risks of the mining industry; delays in obtaining governmental approvals; government regulation of mining operations; environmental risks; title disputes or claims; limitations on insurance coverage and the timing and possible outcome of litigation. Although the Company has attempted to identify important factors that could affect the Company and may cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, do not place undue reliance on forward-looking statements. All statements are made as of the date of this news release and the Company is under no obligation to update or alter any forward-looking statements except as required under applicable securities laws.
SOURCE: Canagold Resources Ltd.