UC Resources Announces Red Lake LOIs and Record Date for Share
Consolidation
VANCOUVER, BRITISH COLUMBIA--(Marketwired - Jun 2, 2014) - UC
Resources Ltd. (the "Company") (TSX-VENTURE:UC) announces that it
proposes to consolidate its common share capital on the basis of
ten pre-consolidation common shares held for one new
post-consolidation common share (10:1) (the "Proposed
Consolidation"). The board of directors of the Company approved the
Proposed Consolidation on April 11, 2014 and, in accordance with
TSX-V policies and s. 9.1 of the Company's articles, shareholder
approval will not be required.
Management believes the Proposed Consolidation will provide the
Company with greater flexibility in its ability to finance the
Company and advance its projects. The Company currently has an
aggregate of 192,497,175 common shares issued and outstanding. It
is anticipated that upon completion of the Proposed Consolidation,
there will be approximately 19,249,718 common shares issued and
outstanding.
The Company currently has 14,550,000 outstanding stock options
which will be cancelled post consolidation.
The Company has no outstanding warrants.
The Proposed Consolidation is subject to TSX Venture Exchange
approval. The effective date of the Proposed Consolidation will be
disclosed in a subsequent news release.
In conjunction with the Proposed Consolidation, the Company has
entered into a Letter of Intent to acquire Crown Gold Corporation's
("Crown") 100% interest in the mining claims that comprise the Red
Lake Project ("Red Lake"). The Company has also entered into a
letter of intent to acquire Frontline Gold's 100% undivided working
interest in the Red Lake gold claims. The Company is currently
negotiating on two additional properties of interest and expects
further announcements shortly.
Proposed Terms of the Transaction - Crown - McKenzie Island Red
Lake Property
To acquire Crowns undivided 100% working interest in the
McKenzie Island Red Lake Property the Company proposes as
follows:
(a) |
Upon
execution of a Definitive Agreement and on the approval of the
Toronto Stock Exchange (the "TSX-V"), UC shall issue to Crown
2,000,000 consolidated shares of UC and CDN$25,000.00 cash;
and |
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(b) |
UC
shall pay to Crown on the anniversary date of the signing of the
definitive agreement Year #1 - $25,000.00 Year #2 - $75,000.00 Year
#3 - $80,000.00, Year #4 - $90,000.00, Year #5 - $100,000.00. Upon
completion of these commitments Crown will assign the ownership of
the property to UC Resources. |
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|
(c) |
UC
Resources will be responsible for property taxes as of the
definitive signing. |
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(d) |
UC
Resources will have a 90 day period to conduct due diligence on the
property prior to signing the definitive agreement. |
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|
(e) |
UC
Resources recognizes a 3% NSR royalty to Timore Resources with a
buyback option of 1.5% for $1 million. |
Proposed Terms of the Transaction - McKenzie Island Red Lake
Property
UC has the exclusive right to negotiate to acquire Frontline's
100% undivided working interest in the Red Lake gold claims (the
"Properties").
a) |
Upon
execution of the LOI, UC shall issue to Frontline 100,000 shares of
UC as a good faith non-refundable deposit and in consideration for
which UC shall have exclusive negotiating rights in respect of the
Properties. UC Resources will have 45 days to perform its due
diligence. Should a definitive agreement be reached with UC the
following principal terms of the LOI will apply: |
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b) |
Upon
execution of definitive agreement and on the approval of the
Toronto Stock Exchange (the "TSX-V"), within 45 days, UC shall
issue to Frontline 600,000 shares of UC and CDN$15,000.00 cash;
and |
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|
(c) |
UC
shall pay to the Frontline a royalty in an amount equal to one
point five percent (1.5%) of the net smelter return ("NSR") derived
from operations on Red Lake. Frontline will grant to UC the
exclusive option (the "Buy-Out") to purchase 1 percent of the NSR
for one million ($1,000,000) dollars. |
The proposed transaction is subject to a number of conditions,
including but not limited to, applicable regulatory approval, and
the execution of a definitive agreement. Frontline's Properties,
located in the Red Lake Gold Camp, consists of 5 properties
consisting of 13 claims totaling approximately 6,000 ha. The
geological environment is comparable to many prolific projects,
such as Goldcorp's Red Lake Mine.
After a decade of history in the Red Lake camp, we are pleased
that UC Resources Director, Mr. John Archibald, P.Geo., has agreed
to be the "Qualified Person" on our exploration programs in the Red
Lake area. Mr. Archibald is a very well known and recognized
Geologist in the Red Lake area. "It is good to be back in the Red
Lake area," commented Archibald. "The area is known for its high
potential in exploration and very high grade area for gold, it's
good to be back in Elephant Country," he stated.
The Town of Red Lake, according to Wikipedia sources,
experienced a sudden surge of economic, industrial, and population
growth with the discovery of gold in 1926. By 1936, Red Lake's
Howey Bay was the busiest airport in the world, with more flights
landing and taking off per hour than any other. Since the mid-1960s
The Red Lake District has yielded over 30-million ounces of gold
worth over USD $20 billion at today's prices and is home to
Goldcorp's Red Lake Mine, one of the richest and lowest cost
producing mines in the world. The Red Lake Mine produces
approximately 600,000 ounces worth USD $405 million annually, with
over 11 million ounces (USD $7 billion) gold to date.
"UC Resources with our consolidation and proposed acquisitions,
moving to definitive agreement and acceptance by the TSX Venture
could result in UC controlling a considerable land package within
one of Canada's most prolific gold areas in the country," stated
Gary Monaghan, CEO of UC Resources. "Our recent efforts in Canada
and our extended effort to move our XORA claims into hard rock
mining at the Mexican LA Yesca facility remain intact," he
continued.
Company Chief Operating Officer Jim Voisin commented, "The La
Yesca mill remains on care and maintenance as we tighten up the
hard rock parameters to ensure the resulting hard rock effort will
be profitable. We are also working closely with our friends at
FIFOMI in requesting their financial support once again to bring
both our mill profitability as well as the support of our Mexican
Community to fruition. The possibility of Joint Venture or use of
contract miners to fast pace the hard rock throughput is also being
investigated. I would like to thank FIFOMI, SEMERNAT and SGM for
their assistance in moving this project forward," he stated.
UC Resources Ltd. is a junior resources exploration company with
a focus on silver and gold exploration and production in Canada and
Mexico.
On behalf of the Board of Directors,
Gary Monaghan, Chief Executive Officer
Neither TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in policies of the TSX Venture
Exchange) accepts responsibility for the adequacy or accuracy of
this release.
Investors or interested parties are invited to visit the UC
Resources website at www.ucresources.net - where they can choose to
join the opt-in e-mail list to receive all future press releases
and updates in real time.
Forward-Looking Information:
This press release may include forward-looking information
within the meaning of Canadian securities legislation. The
forward-looking information is based on certain key expectations
and assumptions made by the management of UC Resources Ltd.
Although the Company believes that the expectations and assumptions
on which such forward-looking information is based are reasonable,
undue reliance should not be placed on the forward-looking
information because the Company cannot provide any assurance that
it will prove to be correct. These forward-looking statements are
made as of the date of this press release and the company disclaims
any intent or obligation to update publicly any forward-looking
information, whether as a result of new information, future events
or results or otherwise, other than as required by applicable
securities laws.
UC Resources Ltd.Gary MonaghanChief Executive
Officer778-478-9530monaghan@ucresources.netwww.ucresources.net
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