Strongbow Exploration complete purchase agreement

Strongbow Exploration {TSX.V: SBW} have completed the purchase agreement for the South Crofty projects.

Largely a paper deal, linked to future success.



BULLETIN TYPE: Property-Asset or Share Purchase Agreement
BULLETIN DATE: September 16, 2016
TSX Venture Tier 2 Company


Property-Asset or Share Purchase Agreement

TSX Venture Exchange Inc. (the “Exchange”) has accepted for filing the purchase and sale agreement entered into by Strongbow Exploration Inc. {TSX.V: SBW} with the administrator managing the affairs of Western Union Mines Ltd. (“WUML”) and Cornish Minerals Limited (UK) (“CML”).

WUML and CML hold the rights to the South Crofty property, UK (the “Property”).

Material terms of the acquisition are as follows:

* The unsecured creditors approved the proposal on June 10, 2016. Strongbow paid #143,000 (C$249,000) for the exit from administration.

* Galena Special Situations Master Fund Limited (“Galena”), the only secured creditor, converted all debt owed to it into common shares of WUML and Strongbow acquired these shares, in return for future milestone payments, thereby completing the acquisition of 100% of the shares of WUML and CML.

* The UK holding company Cornish Minerals Limited (in administration) released the intra group indebtedness owed to it by WUML, amounting to #11,525,758.

* Upon closing of the acquisition, Strongbow reimbursed Tin Shield Production Limited $318,000 for operating costs incurred on the Property from November 1, 2015 to February 29, 2016.

* Strongbow assumed responsibility for the monthly project operating costs as of March 2016. Also upon closing, Strongbow made a payment of US$80,000 to Tin Shield to refund a shareholder loan made to Tin Shield.

* On July 11, 2016, Strongbow issued 2,000,000 common shares in aggregate to Galena and Tin Shield.

* Strongbow is to issue 1,000,000 common shares to in aggregate to Galena and Tin Shield upon receipt of a permit to increase water discharge from the old mine workings from 10,000m3 per day to 25,000m3 per day.

* Strongbow will make an aggregate payment of $2,000,000 to Galena and Tin Shield (cash and / or common shares at Strongbow’s election) on the second anniversary of the approval vote by creditors for WUML’s exit from administration (date set at June 10, 2018).

* Strongbow will issue 2,000,000 common shares in aggregate to Galena and Tin Shield on delivery of a positive feasibility study or commencement of commercial production, whichever occurs first.

* Strongbow will make an aggregate cash and / or common share payment to Galena and Tin Shield equal to 25% of the Net Present Value (“NPV”) of the project upon making a decision to go into production.

Insider / Pro Group Participation: N/A

For additional information please refer to the Company’s news releases dated March 17, 2016 and July 12, 2016.