TORONTO, Oct. 29, 2018 /CNW/ - Enforcer Gold Corp
("Enforcer" or the "Company") (TSX-V: VEIN; FSE: N071) announces
that it plans to complete a non-brokered private placement of up to
$1,500,000 (the "Private Placement")
in conjunction with a property acquisition in the Red Lake area of northwestern Ontario (the "Acquisition") and a share
consolidation (the "Consolidation") on the basis of three (3)
existing common shares (the "Shares") for one (1)
post-Consolidation Share. Completion of the Private Placement,
Acquisition and Consolidation will be conditional upon the
successful completion of each other and subject to TSX Venture
Exchange approval.
Proposed Acquisition
Enforcer is pleased to announce that it has signed a Letter of
Intent (the "LOI") with 1082545 B.C.
Ltd. (the vendor) to acquire a 100% interest in the McKenzie Gold
property (the "Property") located just northwest of the historic
mining community of Red Lake,
Ontario. Pursuant to the LOI, the terms of the acquisition
call for the payment of $150,000 to
the vendor and the issuance of 2,000,000 post-Consolidation Shares
of the Company to 1082545 BC. Ltd and 2,000,000 post-Consolidation
Shares of the Company to 1156009 B.C.
Ltd. The acquisition constitutes an arm's-length transaction
between Enforcer and the other parties. No finder's fees are being
paid in connection with the acquisition.
The Property comprises 15 contiguous claims covering 1,348.5
hectares (3,332 acres) within the western portion of the prolific
Red Lake gold camp. Gold
production in the Red Lake area
exceeds 29 million oz, making Red
Lake the third largest gold camp in Canada. The high-grade Campbell and
Red Lake (formerly Dickenson)
mines account for over 80 percent of the production at average
recovered grades ranging from 0.56 to 0.68
oz/ton.
The Property is underlain by felsic intrusive rocks of the
regionally significant Dome Stock and by sheared greenstone rocks
locally intruded by gabbroic sills and dikes. Drilling in 2005 by
Cypress Development Corp. ("Cypress") in the southern portion of
the project area outlined a strongly silicified and sericite
altered east-west trending zone within the Dome Stock that is
600 m long and open on strike and to
depth. Quartz veining accompanied by sphalerite, arsenopyrite,
chalcopyrite and free gold returned gold values up to 24.0 g/t
including 2.2 g/t Au over 6.0 m. This
zone lies ~3.4 km west of the Premier Gold Mines' Central Zone
(Hasaga Project) with reported indicated and inferred
pit-constrained resources of 804,000 oz (0.79 g/t) and 583,000 oz
(0.76 g/t), respectively (note: mineralization hosted on adjacent
properties are not necessarily reflective of mineralization hosted
on the McKenzie Gold property).
Drilling by Cypress in the northern property area intersected
anomalous to low-grade gold mineralization within an east-west
trending shear zone near the northern margin of the Dome Stock.
Most recently, a prospecting program carried out in 2017 discovered
2 new areas of gold mineralization within quartz veins on
McKenzie Island. Results of grab
samples taken from a flat lying quartz vein in the Dome Stock near
the southern edge of the island ranged 9.37 to 331.14 g/t gold
(note: grab samples are selective by nature and are unlikely to be
representative of average grades). No follow-up has been conducted
on the recent discoveries. Of note, flat-lying quartz veins within
the nearby McKenzie Stock produced
significant gold from underground workings in the McKenzie Red Lake
and the Gold Eagle mines.
All technical information for the McKenzie Gold property was
sourced from a report titled "NI 43-101 Updated Technical Report on
a Group of Crown Mineral Claims Located on McKenzie Island and in the Area of
Saint Paul's Bay, Red Lake, Ontario" prepared for 1082545 B.C. Ltd. by Robert D. Marvin, PGeo, and dated May 15, 2018.
Enforcer's management believes that the McKenzie Gold property
acquisition provides the Company with a high-quality, early-stage
exploration project in an established gold camp. The Company's
primary focus will continue to be on the Roger gold-copper project
located in Chibougamau,
Quebec.
Proposed Private Placement
Enforcer plans to raise up to $1,500,000 through the Private Placement,
consisting of up to 16,666,666 units at a post Consolidation price
of $0.09 per Unit (the "Units"). Each
Unit will consist of one post-Consolidation Share of the Company
and one Share purchase warrant (a "Warrant"). Each Warrant will
entitle the holder to purchase one additional post-Consolidation
Share of the Company at a price of $0.13 for three (3) years. Finder's fees may be
paid in connection with the Private Placement subject to and in
accordance with the policies of the TSX Venture Exchange. All
securities will be subject to a four month hold period from the
date of closing.
The Private Placement is subject to TSX Venture Exchange
approval and completion of the Consolidation.
The Company proposes to use the proceeds of the financing for
exploration and development of the Company's projects, in
particular its flagship Roger gold-copper project, as well as
potential acquisitions of new mineral properties and for general
corporate purposes.
Proposed Consolidation
The Company currently has 64,388,734 Shares issued and
outstanding and after completion of the Consolidation will have
approximately 21,462,911 common shares issued and outstanding, not
including any shares that may be issued pursuant to the Private
Placement.
The exercise price and the number of Shares issuable under the
Company's outstanding warrants and stock options will be
proportionately adjusted to reflect the Consolidation in accordance
with the respective terms thereof. Fractional common shares will
not be issued, and no cash will be paid in lieu of fractional post-
consolidation common shares. The number of post-consolidation
common shares to be received by a shareholder will be rounded down
to the nearest whole common share.
Enforcer's management and board of directors believe that a
consolidation of its share capital will better position the Company
to raise the funds it requires to finance its ongoing business
activities including the acquisition of mineral projects and
exploration and development of its projects, and as such, is in the
best interest of the Company. The proposed Consolidation has been
approved and authorized by Enforcer's board of directors.
The Issuer's articles of incorporation authorize the board of
directors to approve certain changes to the Issuer's capital
structure, including the consolidation. As such, shareholder
approval is not required. The consolidation is subject to approval
by the TSX Venture Exchange. The Issuer does not intend to change
its name or its current trading symbol in connection with the
proposed share consolidation.
About Enforcer Gold Corp
Enforcer Gold Corp is a Canadian-based mineral exploration
company and is earning a 50% interest in the royalty-free Roger
project from SOQUEM. Roger hosts the Mop-II gold-copper deposit
located 5 km from the historic mining center of Chibougamau, Quebec. Enforcer also holds a
100% interest in the Waswanipi
gold project located 125 km west of Chibougamau. Both projects are situated within
the prolific Abitibi greenstone belt, which has produced over
180 M oz. of gold and over
450 M tonnes of copper-zinc ore since
the early 1900s.
Enforcer's President & CEO, Steve
Roebuck, PGeo, is a qualified person as defined by National
Instrument 43-101 and has reviewed and approved the content of this
news 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 news release.
This news release contains "forward-looking statements" that are
based on expectations, estimates, projections and interpretations
as at the date of this news release. Forward-looking statements are
frequently characterized by words such as "plan", "expect",
"project", "intend", "believe", "anticipate", "estimate",
"suggest", "indicate" and other similar words or statements that
certain events or conditions "may" or "will" occur, and include,
without limitation, statements regarding the Company's plans with
respect to completion of a share consolidation, the ability to
raise the funds to finance its ongoing business activities
including the acquisition of mineral projects and the exploration
and development of its projects. Such forward-looking statements
involve known and unknown risks, uncertainties and other factors
which may cause the actual results, performance or achievements of
the Company to be materially different from any future results,
performance or achievements expressed or implied by such
forward-looking statements. Such risks and other factors may
include, but are not limited to, the results of exploration
activities; the ability of the Company to complete further
exploration activities; the ability of the Company to complete
transactions on terms announced; timing and availability of
external financing on acceptable terms and those risk factors
outlined in the Company's Management Discussion and Analysis as
filed on SEDAR. Enforcer Gold does not undertake to update any
forward-looking information except in accordance with applicable
securities laws.
SOURCE Enforcer Gold