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Black Sea completes acquisition, rollback, name change

2016-09-28 14:51 ET - News Release

Mr. Vince Sorace reports

ALTERNATIVE EARTH RESOURCES ANNOUNCES COMPLETION OF ACQUISITION, FINANCING, CONSOLIDATION AND NAME CHANGE TO BLACK SEA COPPER & GOLD CORP.

Black Sea Copper & Gold Corp., formerly Alternative Earth Resources Inc., has completed the acquisition of Black Sea Copper & Gold Corp. (BSCG) as disclosed in the company's news releases dated Aug. 31 and Sept. 23, 2016. The company has also closed the concurrent private placement financing, which generated gross proceeds of $2-million. Following completion of the acquisition and the financing, the company has 43,727,156 common shares issued and outstanding, and the company's cash reserves are approximately $3.5-million.

Immediately prior to closing the acquisition, the company completed the consolidation of 1.24 existing shares for one postconsolidation share, and the name of the company was changed to Black Sea Copper & Gold. The new Cusip for the shares of the company is 09225W109 and the new ISIN is CA09225W1095. Registered shareholders of the company may contact the company's registrar and transfer agent, Computershare Investor Services Inc., in order to exchange existing share certificates for new share certificates. Shareholders who hold their shares through a broker or other intermediary and do not have shares registered in their own name need take no further action.

A total of 23,190,002 common shares were issued to former BSCG shareholders under the acquisition to acquire BSCG, as well as 2.05 million replacement stock options, 2.01 million replacement warrants and $237,500 of convertible debentures. An aggregate of 6.4 million common shares issued to certain BSCG shareholders are subject to restrictions on resale in accordance with the following release schedule: 15 per cent -- four months after closing, 35 per cent -- 12 months after closing, 25 per cent -- 18 months after closing and 25 per cent -- 24 months after closing. The replacement options have exercise prices of 20 cents to 25 cents and expire on dates from November, 2016, to August, 2021. The replacement warrants all have an exercise price of 20 cents, and expire in October and November, 2019. The replacement convertible debentures are due on Aug. 29, 2017, and are convertible into units of the company at 20 cents per unit, with each unit comprising one common share and one-half of one warrant, with each warrant exercisable until Aug. 29, 2019, at an exercise price of 20 cents.

A total of 10 million units were issued under the financing, with each unit comprising one common share and one common share purchase warrant. Each warrant entitles the holder to acquire one common share at an exercise price of 35 cents for a period of two years, subject to acceleration in the event that the company's common shares have a closing price of 60 cents for 10 consecutive trading days, in which case the company may elect to accelerate the expiry date of the warrants by giving the holders 30 days notice. In addition, the company issued an aggregate of 383,250 finder's warrants to certain finders in connection with the financing and paid those finders a 7-per-cent cash fee on certain subscriptions (aggregate $76,750 cash fees paid). Each finder's warrant entitles the holder to acquire one common share at an exercise price of 35 cents for a period of one year, subject to acceleration on the same basis as the unit warrants. All securities issued pursuant to the private placement are subject to a four-month hold period.

Pursuant to the acquisition, Brian D. Fairbank resigned as the chief executive officer and director of the company, and Edward Low resigned as chief financial officer. Vince Sorace was appointed as a director and CEO, and Gavin Cooper was appointed as the CFO of the company.

Roderick McKeen, the lead director of the company, thanked Mr. Fairbank, the founder of the company, and Mr. Low for their long and dedicated service to the company.

The company will now proceed with exploration of the mineral properties acquired through the acquisition of BSCG.

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