Collingwood Resources Corp. — M&A Activity 2020

Aug 18, 2020

Collingwood Resources Corp. Announces Proposed Qualifying Transaction with Forte Copper Corp.

NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR RELEASE PUBLICATION, DISTRIBUTION OR DISSEMINATION DIRECTLY, OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES.

Vancouver, British Columbia – August 18, 2020 / Collingwood Resources Corp. (TSXV: COLL.P) ("Collingwood ") is pleased to announce that it has entered into a binding letter of intent (the "LOI") dated August 13, 2020, with Forte Copper Corp. ("Forte"), which outlines the terms and conditions pursuant to which Collingwood and Forte have agreed to complete a transaction that will result in a reverse take-over of Collingwood by the shareholders of Forte (the "Transaction"). The Transaction, if completed, will constitute Collingwood's "Qualifying Transaction" as such term is defined in Policy 2.4 (the "CPC Policy") of the TSX Venture Exchange (the "Exchange"). It is anticipated that the resulting issuer of Collingwood after completion of the Qualifying Transaction (the "Resulting Issuer") will continue the business of Forte and be listed as a Tier 2 mining issuer on the Exchange. Collingwood and Forte do not have a common control person and therefore the Transaction is not a Non-Arm's Length qualifying transaction under CPC Policy. Additionally, the Transaction is not anticipated to be a 'related party transaction' or 'business combination' as such term is defined in Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions. It is anticipated that Collingwood will not be required to obtain shareholder approval of the Transaction

About Forte

Forte is a private company incorporated in March 2011 under the laws of the Province of British Columbia. Through its wholly owned Peruvian subsidiaries, Forte Cobre SAC and Cordillera Resources SAC, Forte either owns, controls or has an option to control three prospective gold and copper exploration projects in Peru. Forte's principal business is to advance its existing copper and gold projects to develop economic resources and identify and evaluate exploration opportunities for staking and acquisition with an emphasis on gold epithermal high sulfidation, polymetallic VMS and porphyry copper systems. Forte is currently completing a NI 43-101 compliant report on the Pucarini Gold Epithermal High Sulphidation Project in the Department of Puno, Peru ("Pucarini").

Forte's principal assets include cash and its interests in three exploration projects, including Pucarini, comprising 6900 hectares. Forte's other exploration projects include a 60% interest in the Don Gregorio project, optioned from Candente Copper Corp. (TSX:DNT) in June 2017 and a 100% interest in the Esperanza project acquired from Globetrotters Resources Group Inc. ("GlobeTrotters").

The following table sets out selected financial information from Forte's unaudited financial statements as of March 31, 2020. The information provided herein should be read in conjunction with such financial statements, which will be included in the filing statement being prepared in connection with the Transaction and will be filed on www.sedar.com in due course.

	Three Months Ended
	March 31, 2020
Total Assets	$376,655
Total Liabilities	$65,236
Deficit	($1,932,341)
Revenues	Nil
Expenses	$39,653
Net Earnings (Loss)	($37,866)

Subsequent to the period ended March 31, 2020, Forte completed a private placement generating aggregate gross proceeds of approximately $1.47M and acquired the Pucarini and Esperanza projects indirectly through the acquisition of Peruvian subsidiaries from GlobeTrotters.

GlobeTrotters, which is a private British Columbia company involved in copper and gold exploration in Peru is Forte's principal shareholder, holding approximately 18.4% of Forte's outstanding share capital. There are no other holders of Forte Shares (as defined below) holding in excess of 10% of Forte's issued and outstanding shares.

About Pucarini

Pucarini is a high sulfidation epithermal gold system with a staked land area of 1000 Hectares. The prospect is located in a region of significant historical gold production. Globetrotters staked the prospect in 2017 and preliminary mapping and sampling has outlined multiple gold-bearing advanced argillic alteration zones within a 3.6 x 1.8 km argillic alteration footprint. Alteration and mineralization patterns suggest an erosion level near the upper edge of the mineral system. The targets are untested by drilling. The communities in the area are amenable to project advancement and the project is accessible by road. Induced potential and magnetic geophysical surveys were planned to begin in early April before Peru shut down transportation networks in response to COVID-19.

Summary of the Transaction

Pursuant to the LOI, Collingwood and Forte intend to effect the Transaction by way of an arrangement, amalgamation, share exchange or similar transaction whereby the holders of common shares of Forte ("Forte Shares") will exchange their respective shares in consideration for common shares of Collingwood ("Common Shares") on the basis of one Forte Share for every one Common Share.

Immediately prior to the closing of the Transaction, Collingwood intends to complete certain pre-closing transactions pursuant to which Collingwood will (a) consolidate the issued and outstanding Common Shares and convertible securities of Collingwood on the basis of one (1) post-consolidation Common Share for every three (3) pre-consolidation Common Shares (the "Consolidation"), and (b) change its name to a new name suitable to its business (the "Name Change").

It is contemplated that 27,128,587 common shares of the Resulting Issuer ("Resulting Issuer Shares") will be issued to the shareholders of Forte and up to 6,138,593 warrants to purchase Resulting Issuer Shares will be issued in exchange for outstanding Forte warrants (the "Replacement Warrants"). The Replacement Warrants will be exercisable into Resulting Issuer Shares at an exercise price of $0.20 per share. Additionally, 3,150,000 options to purchase Resulting Issuer Shares will be issued in exchange for Forte stock options (the "Replacement Stock Options"). The Replacement Stock Options will be exercisable into Resulting Issuer Shares at an exercise price of $0.12 per share.

On closing of the Transaction but prior to the completion of any concurrent financing, the Resulting Issuer is expected to have 31,607,587 Resulting Issuer Shares issued and outstanding on an undiluted basis and 41,096,513 on a fully diluted basis.

Certain of the Resulting Issuer Shares issued to the principals of Forte, who will become the management of the Resulting Issuer, will be subject to escrow in accordance with TSXV policies.

Conditions of Closing

Completion of the Transaction will be subject to certain customary transaction conditions, including but not limited to: (a) receipt of all necessary approvals of the boards of directors and shareholders of Collingwood and Forte; (b) receipt of all necessary third party consents; (c) approval of the Transaction by the Exchange as Collingwood 's Qualifying Transaction; (d) completion by Forte of a work program on Pucarini of not less than $100,000 in qualifying expenditures (e) Collingwood satisfying the Initial Listing Requirements set by the Exchange for a Tier 2 Mining Issuer; (f) the parties' entry into definitive transaction documentation in furtherance to the LOI; and (g) completion of the Financing.

Advances and Loans

In connection with signing the LOI, Collingwood has advanced $25,000 to Forte, as a non-refundable deposit, upon signing the LOI. The loan is expected to be utilized by Forte as partial of funding initial costs of the Transaction.

Management and Board of Directors

Upon completion of the Qualifying Transaction, it is intended that all current members of the Collingwood board will resign and the board of directors of the Resulting Issuer will be reconstituted to include Doug Turnbull, Richard Osmond and Patrick Elliott, and Stephanie Ashton.

Doug Turnbull, Director

Mr. Turnbull received a B.Sc. (Honours) in Geology from Lakehead University in 1988, and is a Qualified Professional Geoscientist recognized by the Association of Professional Engineers and Geoscientists of British Columbia. He is a consulting geologist with over 20 years experience in diamond, precious metal and base metal exploration. Mr. Turnbull has worked for companies such as Monopros Ltd., Goldfields Mining Corporation, Prime Exploration Ltd., Adrian Resources Ltd., and Madison Enterprises Corp., and currently sits on the Board of Directors of Astur Gold Corp, Oromin Exploration Ltd. and Grizzly Diamonds Ltd. Mr. Turnbull was part of teams responsible for the exploration and development of the Eskay Creek Gold Deposit in British Columbia, Canada, the Petaquilla Cu-Au Porphyry Deposit in Panama and the Mt. Kare Gold Deposit in Papua New Guinea.

Patrick Elliott, President CEO & Director

Mr. Elliott is an accomplished economic geologist with a BSc. in Geology from the University of Western Ontario, a MSc. in Mineral Economics and an MBA in Mining Finance from Curtin University of Technology in Australia. He is currently the President & CEO of Lexore Capital Corp., a resource investment and consulting company, VP Strategy of Globetrotters Resource Group, and Director for Element 29 Resources. Mr. Elliott has over 10 years of professional experience in mineral exploration working extensively throughout North and South America as well as the FSU. He spent several years as a project geologist for AQM Copper on the Zafranal Porphyry Copper project in Peru and for Midas Gold on the world class Golden Meadows Project in Idaho. Mr. Elliott specialises in economic resource project evaluation, financial modelling, CAPEX estimation, and mining finance. Combined with his technical knowledge, Mr. Elliott has a wealth of contacts in the financial sector including contacts in retail, institutional, corporate finance, research and venture capital.

Richard Osmond, Executive Director

Mr. Osmond has over 20 years of experience in the mining sector including experience with INCO (VBNC), Falconbridge and Anglo American. He was involved in exploration discoveries at Vale's Voisey's Bay deposit and Xstrata's Raglan mine. He was later hired as a senior technical leader with Anglo American responsible for North America and Europe focused on Ni exploration in northern Canada, Alaska and Scandinavia as well as IOCG and porphyry Cu-Mo exploration in Mexico and Alaska. Since 2007, he has also worked on management teams for several junior mining companies focused on porphyry Cu-Mo (Au) and epithermal Au systems in Latin America. Since 2009, Mr. Osmond continues as the President & CEO of Globetrotters Resource Group who have been successful as a project generator in Peru & Mexico.

Stephanie Ashton

Ms. Ashton has over 24 years in the area of natural resources, specifically, exploration and development of mining projects in Latin America, and more recently in Turkey and Utah. She has participated in the start-up of both junior exploration companies and mining services companies, assisting with their corporate development and financing through the companies' growth stages: assisting with IPOs, negotiating Joint Venture or other value accretive transactions, supporting investor relations, and supervising/ overseeing accounting, auditing. She has served on the boards of junior mining companies, and as an officer in the capacity of Chief Financial Officer and Vice President of Corporate Development, including founder, director and CFO of AQM Copper Inc., with projects in Peru and Chile between 2005 and 2012. She has collaborated with an extensive international network of professionals and service providers related to the mineral sector. While based in Santiago Chile, she was a regular contributor to opinion columns in the magazine, "Minería Chilena". Stephanie is a graduate of Cal Poly State University for International business, holds a Master's degree in International Tax and Legal Strategy from Hautes Etudes Commerciales, Paris, France, and a Postgraduate Diploma in Mineral Economics from the Universidad of Chile, Santiago, Chile. She is fluent in Spanish, French and English.

Concurrent Financing

Concurrent with the Transaction, it is intended that Forte or Collingwood will complete of a private placement to raise aggregate proceeds of up to $3,000,000 through the sale of securities on terms to be determined and announced in a subsequent press release (the "Financing"). The Resulting Issuer will use the net proceeds of the Financing to fund the Transaction, to develop its business and for working capital and general corporate purposes.

Sponsorship

The Transaction is subject to the sponsorship requirements of the Exchange unless an exemption from those requirements is granted. Collingwood intends to apply for an exemption from the sponsorship requirements; however, there can be no assurance that an exemption will be obtained. If an exemption from the sponsorship requirements is not obtained, a sponsor will be identified at a later date. An agreement to act as sponsor in respect of the Transaction should not be construed as any assurance with respect to the merits of the Transaction or the likelihood of its completion.

Trading Suspended

Trading in Common Shares was suspended on May 12, 2020, as a result of the failure of the Company to complete a qualifying transaction within 24 months of listing, and will remain halted pending the satisfaction of all applicable requirements pursuant to Policies 2.4 and 2.9 of the Exchange.

ON BEHALF OF THE BOARD

Collingwood Resources Corp.

Scott Gibson Chief Executive Officer and Director 604 697-0028

Neither the TSX-V nor its Regulation Services Provider (as that term is defined in the policies of the TSX-V) accepts responsibility for the adequacy or accuracy of this release.

Completion of the transaction is subject to a number of conditions, including but not limited to, Exchange acceptance and if applicable, 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 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 Collingwood 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 news release.

Forward Looking Statements:

All statements in this press release, other than statements of historical fact, are "forward-looking information" with respect to Collingwood within the meaning of applicable securities laws. Collingwood provides forward-looking statements for the purpose of conveying information about current expectations and plans relating to the future and readers are cautioned that such statements may not be appropriate for other purposes. By its nature, this information is subject to inherent risks and uncertainties that may be general or specific and which give rise to the possibility that expectations, forecasts, predictions, projections or conclusions will not prove to be accurate, that assumptions may not be correct and that objectives, strategic goals and priorities will not be achieved. These risks and uncertainties include but are not limited to exploration findings, results and recommendations, results of due diligence investigations, ability to raise adequate financing, shareholder and exchange approvals in respect of the transaction and unprecedented market and economic risks associated with current unprecedented market and economic circumstances due to the COVID-19 pandemic, as well as those risks and uncertainties identified and reported in Collingwood's public filings under Collingwood's SEDAR profile at www.sedar.com. Although Collingwood has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking information, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate as actual results and future events could differ materially from those anticipated in such statements. Collingwood disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise unless required by law.

UNITED STATES ADVISORY

The securities referred to herein have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act"), have been offered and sold outside the United States to eligible investors pursuant to Regulation S promulgated under the U.S. Securities Act, and may not be offered, sold, or resold in the United States or to, or for the account of or benefit of, a U.S. Person (as such term is defined in Regulation S under the United States Securities Act) unless the securities are registered under the U.S. Securities Act, or an exemption from the registration requirements of the U.S. Securities Act is available. Hedging transactions involving the securities must not be conducted unless in accordance with the U.S. Securities Act. This press release shall not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in the state in the United States in which such offer, solicitation or sale would be unlawful.