ECU Silver Mining Inc. (“ECU”), a Québec company, and Golden Minerals Company (“Golden”), a Delaware company, completed a plan of arrangement under Québec's new Business Corporations Act, a first since the adoption of such legislation. The arrangement, which was valued at approximately $600 million at the time of announcement, represented a “merger of equals” between ECU, a mineral exploration company listed on the Toronto Stock Exchange (“TSX”), and Golden Minerals Company (“Golden”), a mineral exploration company listed on the NYSE Amex and the TSX, with a view to creating a new leading junior silver mining company with a diversified portfolio of assets in Mexico and South America.
Under the plan of arrangement agreed upon by the two corporations pursuant to an arrangement agreement entered into on June 24, 2011, holders of common shares, options and warrants of ECU exchanged their respective ECU securities for similar securities of Golden, with holders of common shares also receiving $0.000394 in cash for each ECU share. Upon completion of the arrangement, former holders of ECU securities held, on a fully diluted basis, approximately 55 per cent of the outstanding Golden stock, assuming that all outstanding options and warrants of ECU would have been exercised prior to the closing of the arrangement, and ECU became a wholly owned subsidiary of Golden. Concurrently with the execution of the arrangement agreement, Golden signed a subscription agreement for the private placement of $15 million principal amount, 0 per cent senior unsecured convertible notes at par of ECU. Under the plan of arrangement, Golden received non-convertible replacement notes issued by ECU.
ECU was represented by Blake, Cassels & Graydon LLP, with a team that included Howard Levine, Michael Bantey, Alfred Buggé, Patrick Menda, Eric Poole and Paul Martel (corporate and securities); John Leopardi and Emmanuel Sala (tax) and Sébastien Guy, Marc-André Landry and Adam Tobias Spiro (litigation); and by Skadden, Arps, Slate, Meagher & Flom LLP in the US, with a team that included, in New York, Richard Grossman and Russ Denton (M&A); in Toronto, Riccardo Leofanti, David Beeston and Dan Micak (corporate); in Washington, D.C., Eric Sensenbrenner and Brian Jenn (tax) and Andrew Lawrence (SEC compliance and enforcement) and in Boston, Moshe Spinowitz (tax).
Golden was represented by Davis Graham & Stubbs LLP with a team that included Deborah Friedman, Brian Boonstra, Ryan McGee, Elisabeth Oertle and Todd Criger (corporate and securities) and Laurence Nemirow (tax); and by Fasken Martineau DuMoulin LLP with a team that included John Sabetti, Daniel Batista, Krisztián Tóth, Catherine Isabelle, Daniel Fuke and Andrew Teehan (corporate and securities); Mitchell Thaw (tax) and Stéphanie Lapierre (litigation).