Giyani Gold Corp., C Level III Inc. and two Manitoba companies enter into a conditional agreement

        






Giyani Gold Corp., C Level III Inc. and two Manitoba companies enter into a conditional agreement

TORONTO, Feb. 4, 2013 /CNW/ - Giyani Gold Corp. (TSXV: WDG) ("Giyani Gold"), C Level III Inc. (TSXV: CLV.P) ("C Level"), a capital pool company under the policies of the TSX Venture Exchange Inc. (the "TSXV"), 6413251 Manitoba Ltd. ("ManitobaCo") and Canada Bay Resources Ltd. ("Canada Bay") are pleased to announce a conditional agreement (the "Agreement") by which Giyani Gold, through its subsidiary 2299895 Ontario Inc. ("OntarioCo"), will transfer their Canadian mining exploration properties for common shares of C Level. As part of the Agreement, C Level will also acquire the shares of Manitoba based ManitobaCo and certain assets of Canada Bay in exchange for common shares of C Level. Greater details relating to the Agreement are outlined in the Transaction below.

As a result of the proposed transactions, Giyani Gold will become the majority shareholder of C Level.  C Level will continue to operate and expand the Canadian mining exploration activities independent of Giyani Gold. Giyani Gold will thereafter be purely focused on corporate activities relating to the Giyani Gold Project in South Africa. The proposed acquisition of Giyani Gold's Canadian properties by C Level will constitute the qualifying transaction of C Level in accordance with the policies of the TSXV. The Agreement was negotiated at arm's length and is effective as of the date hereof.

Duane Parnham, Executive Chairman of Giyani Gold, stated that: "This is a very exciting strategic transaction that unlocks considerable shareholder value and strengthens the Giyani Gold balance sheet while positioning us to participate and fully benefit in any future discoveries made on these Canadian properties".  Mr. Parnham added: "Although our management team will assist in the new company's growth profile, the Transaction allows Giyani Gold to focus all its efforts into building a premier gold development company through methodical corporate development and the exploration of our excellent land package assembled in South Africa."

It is expected that the Board of directors of the Resulting Issuer will be comprised of Duane Parnham, Scott Kelly, Ed Guimares, Donald Gibb, and Jean-François Pelland and that the management of the Resulting Issuer will initially be comprised of certain current senior officers of Giyani Gold, including R. Charles (Chuck) Allen as President.

A proposed technical team with expertise and experience in gold exploration will be comprised of Doug Fogwill and Susan Butorac with Robert S. Middleton, Dr. Roy Shegelski and Dr. Howard Poulsen acting as technical advisors.

The Transaction
Under the Agreement, C Level is to acquire all of the issued and outstanding common shares of OntarioCo in exchange for approximately 24,605,265 common shares of C Level, issued at a price of $0.20 per common share. OntarioCo owns the Canadian portfolio of mining properties held by Giyani Gold.  The Abbie Lake-Keating Gold Project is the most significant of the mining properties held by OntarioCo along with the Skead gold property and the Baska-Eldorado rare earth elements property. C Level will acquire the shares of ManitobaCo as well as certain assets of Canada Bay in exchange for approximately 8,000,000 common shares of C Level, also issued at a price of $0.20 per common share. ManitobaCo and Canada Bay are the owners of gold exploration properties in the Rice Lake Gold Belt of Manitoba and the Silverleaf rare earth elements property located in southern Manitoba. All parties to this Agreement are arm's length parties. In addition, the shareholders of OntarioCo, ManitobaCo and Canada Bay are arm's length parties to C Level. C Level currently has 5,004,343 outstanding shares.

A concurrent $2-4 million financing ("the Offering") is proposed in order for the Resulting Issuer to meet the TSXV listing requirements, and to generate the general operating funds necessary to immediately commence with exploration programs including drilling at the Abbie Lake-Keating Gold Project. Insiders of Giyani Gold will be participating in the Offering, and due to the participation of certain insiders, the Offering may qualify as a "related party transaction" pursuant to the rules of Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61-101"). C Level is relying on exemptions from both the formal valuation and minority approval requirements of MI 61-101 based on the exemption for the fair market value of the Offering being not more than 25% of the market capitalization of the Resulting Issuer.

The Agreement is to be superseded by a definitive merger, amalgamation, and/or share exchange agreement (the "Definitive Agreement") and remains subject to TSXV approval and certain closing conditions, including approval by the directors of each of the Parties, necessary shareholder approvals, and the obligation of OntarioCo to fund certain costs and expenses of ManitobaCo and Canada Bay. The legal structure for the Transaction will be confirmed after the parties have considered all applicable tax, securities law and accounting efficiencies.

About Giyani Gold and OntarioCo
Giyani Gold is an Africa focused exploration company with gold assets in the Limpopo province of South Africa. As it relates to this Transaction, Giyani Gold's Canadian properties held through its subsidiary OntarioCo being the Abbie Lake-Keating and Skead gold properties and the Baska Eldorado rare earth elements property will be exchanged for common shares in the Resulting Issuer. The flagship asset of OntarioCo is the Abbie Lake-Keating gold property located on similar geology and in close proximity to producing gold mines near White River, Ontario. A potential gold bearing structure called the Iron Lake Deformation Zone ("ILDZ") spans 27km through the Abbie Lake-Keating property. An exploration program comprised of geophysics and drilling focused on the ILDZ was conducted on the property in 2012 and new drilling targets on the eastern extension of the ILDZ have been identified for the upcoming 2013 drill program.

About ManitobaCo and Canada Bay
ManitobaCo and Canada Bay are private Canadian companies focused primarily on gold exploration in the Rice Lake Gold Belt of Manitoba in close proximity to San Gold's newly constructed mine. They will contribute to the Transaction their flagship gold exploration properties located in the Rice Lake Gold Belt, as well as the Silverleaf rare earth elements property in Southern Manitoba. The Rice Lake Gold Belt has over 1.7 million oz of historically reported gold production and the properties being transferred by Canada Bay and ManitobaCo for the Transaction are strategically located in underexplored and former producing areas of this belt.

About C Level
C Level is a capital pool company with its registered and head office in Toronto, Ontario and intends for this Transaction to constitute its "Qualifying Transaction" as such term is defined in the policies of the TSXV. As of the date hereof, C Level has 5,004,343 common shares. The trading on the common shares of C Level has been halted in consideration of the issuance of this press release and it is anticipated that trading will not resume until the closing of the Qualifying Transaction or the termination of the Agreement.

Sponsorship
Sponsorship of a qualifying transaction of a capital pool company is required by the TSXV unless exempt in accordance with TSXV policies. C Level is currently reviewing the requirements for sponsorship and may apply for an exemption from the sponsorship requirements pursuant to the policies of the TSXV, however, there is no assurance that C Level will ultimately obtain this exemption. C Level intends to include any additional information regarding sponsorship in a subsequent press release.

Completion of the transaction is subject to a number of conditions, including but not limited to, TSXV acceptance and, if applicable, pursuant to the requirements of the TSXV, majority of the minority shareholder approval. Where applicable, the transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the transaction will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the management information circular or filing statement to be prepared in connection with the transaction, any information released or received with respect to the transaction may not be accurate or complete and should not be relied upon. Trading in the securities of a capital pool company should be considered highly speculative.

The TSX Venture Exchange Inc. has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved the contents of this press release.

NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION: This news release includes certain "forward-looking statements" under applicable Canadian securities legislation. Forward-looking statements include, but are not limited to, statements with respect to: the terms and conditions of the proposed Transaction; the terms and conditions of the proposed Offering; future exploration and testing; use of funds; and the business and operations of the Resulting Issuer after the proposed transaction. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking statements. Such factors include, but are not limited to: general business, economic, competitive, political and social uncertainties; delay or failure to receive board, shareholder or regulatory approvals; and the results of current exploration and testing. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. The Parties disclaim any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

SOURCE Giyani Gold Corp.

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