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Ottawa, ON, Canada: Cornerstone Capital Resources Inc. ("Cornerstone" or the "Company") (TSXV:CGP) (Frankfurt:GWN) (Berlin:GWN) (OTC:CTNXF) announces that it plans to spin off all of its assets except for its interests in the Cascabel concession in Ecuador and shares of SolGold plc into a new, well funded exploration company called Cornerstone Exploration Inc. ("Spinco"). Spinco will own the drill ready Caña Brava, Bella Maria, Vetas Grandes and Bramaderos properties in Ecuador, the pending applications for new properties in Ecuador made by Cornerstone subsidiary La Plata Minerales S.A., and the Miocene property in Chile, in addition to Cornerstone's generative exploration databases for Ecuador and Chile. The Board of Directors of Cornerstone is also evaluating the transfer to Spinco of Cornerstone's interest in the generative exploration joint venture with Ecuadorian state mining company ENAMI EP, a joint venture which is currently exploring nine highly prospective concessions to the east, south, and south-west of the Cascabel concession.Cornerstone shareholders will receive shares of Spinco on a pro rata basis, and Cornerstone will be changing its name to Cascabel Gold & Copper Inc. Details of the proposed spin-off will be contained in an information circular to be mailed to Cornerstone shareholders and filed on SEDAR. Cornerstone intends to apply to list the shares of Spinco on the TSX Venture Exchange. The spin off will be subject to TSX Venture Exchange and Cornerstone shareholder approvals, with completion expected to be in the third or fourth quarter of this year.Commenting on the proposed transaction, Brooke Macdonald, President & CEO of Cornerstone, said: "When we acquired the Cascabel concession in 2011 and then, subsequently, created a joint venture in 2012 to explore the Cascabel concession together with SolGold plc, we had as our objective to advance the property to a stage where it could attract the interest of major mining companies to acquire the Cascabel concession and/or Cornerstone as it is our commitment to maximize shareholder value. That remains our objective for our Cascabel project as well as for all the highly prospective properties in our portfolio. By spinning off the other highly prospective properties we intend to unlock additional shareholder value and repeat our success at Cascabel. The same team of dedicated and experienced Cornerstone explorationists who found Cascabel and the same management team that formed the joint venture with ENAMI will be focused on developing Cornerstone Exploration."Additionally, the Company is announcing that Mr. Greg Chamandy will serve as the Chairman of Cascabel Gold & Copper Inc. Mr. Chamandy was the co-founder of Gildan Activewear and its former Chairman and CEO, the former Chairman and co-owner of Europe's Best frozen foods, the former Executive Chairman of Richmont Mines Inc., and serves on the Advisory Committee for Monarques Gold. Mr. Macdonald commented further, "We are very pleased to have such an experienced entrepreneur and gold industry investor such as Greg to work with, and look forward to the Company and its shareholders benefitting from his commitment to, and involvement in, the Company. Our current Chairman, Colin McKenzie, will remain a director of the Company and become Chairman of Cornerstone Exploration, and the remaining directors of the Company have agreed to also become directors of Cornerstone Exploration."The Board of Directors of the Company has approved the granting of 7.5 million stock options to directors, officers, consultants and employees of the Company under the Company's Stock Option Plan. These options have been priced at the greater of (a) $0.475 (being the closing price of the Company's common shares on the TSX Venture Exchange on July 12, 2017 and (b) the closing price of the Company's common shares on the TSX Venture Exchange on July 13, 2017, less the maximum discount permitted by the policies of the TSX Venture Exchange, have an expiry date of July 11, 2022 and vest in three equal tranches over an 18-month period from the date of issue. Following this grant, the Company has a total of 28,422,000 stock options outstanding, which represents approximately 5% of the Company's outstanding common shares (pro forma the previously announced share exchange transactions).About Cascabel:Exploraciones Novomining S.A. ("ENSA"), an Ecuadorean company owned by SolGold plc and Cornerstone, holds 100% of the Cascabel concession. Subject to the satisfaction of certain conditions, including SolGold plc fully funding the project through to feasibility, SolGold plc will own 85% of the equity of ENSA and Cornerstone will own the remaining 15% of ENSA. SolGold plc is funding 100% of the exploration at Cascabel and is the operator of the project.Cascabel is in northwestern Ecuador in an under-explored northern section of the Andean Copper Belt, 60 km northeast of the undeveloped inferred resource of 982 million tons at 0.89% Cu Llurimaga (formerly Junin) copper project (0.4% Cu cut-off grade; Micon International Co. Ltd. Technical Report for Ascendant Exploration SA, August 20, 2004, pages 28 & 29). Mineralization identified at the Llurimaga copper project is not necessarily indicative of the mineralization on the Cascabel Property. |
