Alberta Star Proposes Change of Business
VANCOUVER, BRITISH COLUMBIA--(Marketwired - May 22, 2014) -
Alberta Star Development Corp.
(TSX-VENTURE:ASX)(OTCBB:ASXSF)(FRANKFURT:QLD) (the "Company") is
pleased to announce that it will be pursuing a proposed change of
business to a tier 2 investment company (the "Proposed COB") listed
on the TSX Venture Exchange ("TSXV").
Summary of the Proposed
COB
The Company has Company determined to refocus its business
operations from a "mining issuer" to an "investment issuer" after a
strategic review. The Company believes that the experience and
contacts of its board of directors and management will enable it to
identify and capitalize upon investment opportunities as an
"investment issuer". Upon completion of the Proposed COB, the
Company's primary focus will be to seek returns through investments
in the securities of other companies and other assets.
Investment Objectives
In connection with the Proposed COB, the Company intends to
adopt an investment policy (the "Investment Policy") to govern its
investment activities and investment strategy. A copy of the
Investment Policy will be posted on the Company's profiled at
www.sedar.com.
The Investment Policy will provide, among other things, that:
(a) the Company will seek high return investment opportunities in
privately held and in publicly traded companies with a focus on
publicly traded resource issuers; (b) the Company will seek to
preserve capital and limit downside risk which achieving a
reasonable rate of capital appreciation; and (c) the Company will
seek investments that provide liquidity.
Investment Strategy
In pursuit of the investment objectives stated above, the
Company, when appropriate, shall employ the following disciplines:
(a) investments shall focus on resource companies, concentrating on
advanced stage companies, but also early stage and senior companies
where appropriate; (b) the Company will obtain detailed knowledge
of the relevant business the investment shall be made in, as well
as the investee company. The Company will work closely with the
investee company's management and directors, and in some cases
assist in sourcing experienced and qualified persons to add to the
directors and/or management of the investee companies; (c) the
Company will limit 25% of its investment capital (at the time of
the investment) to any one investment; and (d) a minimum of 50% of
the Company's available funds will be allocated to a minimum of two
specific investments.
The Investment Policy will provide the Company with broad
discretion with respect to the form of investment taken. The
Company may employ a wide range of investment instruments,
including: equity, bridge loans, secured loans, unsecured loans,
convertible debentures, warrants, options, royalties, net profit
interests and other hybrid instruments. The Company may acquire
interests in real property and mineral claims, including carried
interests, royalty interests or joint venture interests. Where
appropriate the Company may act as a third party advisor of
opportunities in target or other companies, in exchange for a fee.
The Investment Policy shall not permit the Company to invest in
physical commodities, derivatives, "short" sales or other similar
transactions. Notwithstanding the above, the Company may authorize
investments outside of these disciplines for the benefit of the
Company and its shareholders.
Investment Evaluation Process
The Company will establish an investment committee ("Investment
Committee") of at least two members of its directors to monitor its
investment portfolio on an ongoing basis and to review the status
of each investment at least once a month or on an as-needed basis.
Nominees for the Investment Committee shall be recommended by the
Board.
The members of the Investment Committee shall be appointed
annually by the Board at the first Board meeting subsequent to the
annual meeting of shareholders or on such other date as the Board
shall determine. Members of the Investment Committee may be removed
or replaced by the Board. Officers of the Company may be members of
the Investment Committee. Each member of the Investment Committee
shall be financially literate.
It is anticipated that upon completion of the Proposed COB, the
Investment Committee shall be comprised of Stuart Rogers,
President, Chief Executive Officer and director, Guido Cloetens,
director and Martin Burian, director.
Composition of Investment Portfolio
The Company further intends to seek additional investment
opportunities in accordance with the policies and processes
described herein and the policies of the TSXV applicable to an
"investment issuer".
Initial Investments
Currently, the Company has the following assets, which it
proposes shall comprise part of its initial investment portfolio:
(a) 1,300,000 common shares in the capital of TerraX Minerals Inc.
("TerraX"); (b) 650,000 warrants to purchase common shares in the
capital of TerraX; and (c) an option to acquire a 60% interest in a
mineral property from TerraX. TerraX is a mineral exploration
Company listed on the TSXV. These investments have a value of
approximately $1,000,000 as of February 28, 2014. Further
information regarding these investments is set out in the Company's
news release of March 3, 2014 and will also be contained in the
Circular (as defined below).
The Company proposes to invest a further $1,000,000 in
accordance with its Investment Policy subsequent to receipt of
conditional TSXV approval and prior to final TSXV approval of the
Proposed COB. The Company will issue a news release with
comprehensive disclosure of each proposed investment. Each proposed
investment shall be subject to TSXV approval.
Future Investments
Subject to certain conditions, the Company has received from the
TSXV a waiver from the initial listing requirement for a tier 2
investment issuer that at least 50% of available funds be allocated
to at least two investments at the time of completion of the
Proposed COB. Pursuant to the waiver, the Company is required to
have at least $2,000,000 allocated to at least two investments at
the time of completion of the Proposed COB. The Company will
undertake to the TSXV to invest such further amounts as are
necessary to ensure that at least 50% of available funds
(currently, an estimated $3,000,000) are invested within 12 months
of completion of the Proposed COB.
Shareholder Approval
The Proposed COB requires the approval of the shareholders of
the Company. The Company has scheduled a meeting of its
shareholders on June 24, 2014 (the "Meeting") to obtain this
approval. A majority of shareholders present at the Meeting must
approve the Proposed COB for it to proceed. Further information
regarding the Meeting and the Proposed COB will be contained in the
management information circular (the "Circular") to be prepared and
mailed to the Company's shareholders in respect of the Meeting. A
copy of the Circular will also be available on the Company's
profile at www.sedar.com.
Sponsorship
The Company has received from the TSXV a waiver from the
requirement to engage a sponsor in connection with the Proposed
COB.
Name Change
In connection with the Proposed COB, the Company anticipates
changing its name to Trafalgar Capital Corp. Approval of any change
of name of the Company is subject to approval of the Company's
shareholders at the Meeting.
Other Information
Completion of the Proposed COB is subject to a number of
conditions, including TSXV acceptance and shareholder approval. The
transaction cannot close until the required shareholder approval is
obtained. There can be no assurance that the Proposed COB will be
completed as proposed or at all.
Investors are cautioned that, except as disclosed in the
Circular to be prepared in connection with the Proposed COB any
information released or received with respect to the Proposed COB
may not be accurate or complete and should not be relied upon.
Trading in the securities of the Company should be considered
highly speculative.
The TSX Venture Exchange Inc. has in no way passed upon the
merits of the Proposed COB and has neither approved nor disapproved
the contents of this press release.
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as the term is defined in the Policies of the TSX Venture
Exchange) accepts responsibility for the adequacy or accuracy of
this release.
Caution Regarding
Forward-Looking Statements - This news release
contains certain forward-looking statements, including statements
regarding the Proposed COB. These statements are subject to a
number of risks and uncertainties. Actual results may differ
materially from results contemplated by the forward-looking
statements. When relying on forward-looking statements to make
decisions, investors and others should carefully consider the
foregoing factors and other uncertainties and should not place
undue reliance on such forward-looking statements. The Company does
not undertake to update any forward looking statements, oral or
written, made by itself or on its behalf, except as required by
applicable law.
Alberta Star Development Corp.Stuart RogersPresident & Chief
Executive Officer(604) 689-1749
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