TORONTO, May 28, 2020 (GLOBE NEWSWIRE) -- Labrador Gold Corp. (TSX-V: LAB) (“LabGold” or the “Company”) is pleased to announce that it intends to complete a non-brokered private placement to raise up to C$2,500,000 through the issuance of up to 14,285,714 units (“Units”) at a price of C$0.175 per Unit (the “Unit Offering”). Each Unit is comprised of one common share of LabGold (“Common Share”) and one Common Share purchase warrant (a ”Unit warrant”), with each Unit warrant exercisable to acquire a Common Share at C$0.30 for a period of two years after the date of issuance.
The Company further announces that it intends to complete a non-brokered private placement of up to 4,000,000 flow through units (the “FT units”) at a price of C$0.25 per FT Unit (the “Flow Through Offering” and collectively with the Unit Offering, the “Private Placement”) for gross proceeds to LabGold of C$1,000,000. Each FT Unit is comprised of one flow through share and one non-flow through share purchase warrant, with each warrant exercisable to acquire a Common Share at C$0.30 for a period of two years after the date of issuance
LabGold may pay a finder’s fee to one or more arms’ length parties who introduce LabGold to investors, in accordance with the policies of the TSX Venture Exchange. The securities issued will be subject to a four-month-and-one-day statutory hold period from the date of issuance. Closing of the Private Placement remains subject to TSX Venture Exchange approval.
The proceeds of the Private Placement will be used primarily to fund LabGold’s exploration program at its Kingsway project and its Hopedale Project. A portion of the proceeds will be used for general working capital purposes.
The Company also announces the appointments of Mr. Bill Johnstone as Corporate Secretary and Mr. Eric Myung as Chief Financial Officer. Both positions were previously held by Ms. Aurora Davidson who has resigned to focus on a new opportunity. The Board thanks Ms. Davidson for her service to the Company over the many years she was part of the management team and wish her well in her new endeavour.
Insiders of the Company may subscribe for a portion of the Private Placement. The insider private placements are exempt from the valuation and minority shareholder approval requirements of Multilateral Instrument 61-101 (“MI 61-101”) by virtue of the exemptions contain in section 5.5(a) and 5.7(1) (a) of MI 61-101 in that the fair market value of the consideration for the securities of the Company to be issue to the insiders will not exceed 25% of its market capitalization.
About Labrador Gold:
Labrador Gold is a Canadian based mineral exploration company focused on the acquisition and exploration of prospective gold projects in the Americas.
In early March 2020, Labrador Gold acquired the option to earn a 100% interest in the Kingsway project in the Gander area of Newfoundland. The property is along strike to the northeast of New Found Gold’s discovery of 92.86 g/t Au over 19.0 metres on their Queensway property. (Note that mineralization hosted on adjacent or nearby properties is not necessarily indicative of mineralization hosted on the Company’s property). The two licenses comprising the Kingsway project cover approximately 16km of the Appleton fault zone which is associated with gold occurrences in the region, including the New Found Gold discovery. Historical work over the area covered by the Kingsway licenses shows evidence of gold in till, vegetation, soil, stream sediments, lake sediments and float. Infrastructure in the area is excellent located just 18km from the town of Gander with road access to the project, nearby electricity and abundant local water.
The Hopedale property covers much of the Florence Lake greenstone belt that stretches over 60 km. The belt is typical of greenstone belts around the world but has been underexplored by comparison. Initial work by Labrador Gold during 2017 show gold anomalies in soils and lake sediments over a 3 kilometre section of the northern portion of the Florence Lake greenstone belt in the vicinity of the known Thurber Dog gold showing where grab samples assayed up to 7.8g/t gold. In addition, anomalous gold in soil and lake sediment samples occur over approximately 40 kilometres along the southern section of the greenstone belt (see news release dated January 25th, 2018 for more details).
The Ashuanipi gold project is located just 35 km from the historical iron ore mining community of Schefferville, which is linked by rail to the port of Sept Iles, Quebec in the south. The claim blocks cover large lake sediment gold anomalies that, with the exception of local prospecting, have not seen a systematic modern day exploration program. Results of the 2017 reconnaissance exploration program following up the lake sediment anomalies show gold anomalies in soils and lake sediments over a 15 kilometre long by 2 to 6 kilometre wide north-south trend and over a 14 kilometre long by 2 to 4 kilometre wide east-west trend. The anomalies appear to be broadly associated with magnetic highs and do not show any correlation with specific rock types on a regional scale (see news release dated January 18th, 2018). This suggests a possible structural control on the localization of the gold anomalies. Historical work 30 km north on the Quebec side led to gold intersections of up to 2.23 grams per tonne (g/t) Au over 19.55 metres (not true width) (Source: IOS Services Geoscientifiques, 2012, Exploration and geological reconnaissance work in the Goodwood River Area, Sheffor Project, Summer Field Season 2011). Gold in both areas appears to be associated with similar rock types.
The Company has 57,039,022 common shares issued and outstanding and trades on the TSX Venture Exchange under the symbol LAB.
The technical content of this news release was approved by Roger Moss Ph.D., P.Geo, President and CEO of the Company and a qualified person as defined by National Instrument 43-101.
For more information please contact:
Roger Moss, President and CEO Tel: 416-704-8291
Or visit our website at: www.labradorgold.com
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.
Forward-Looking Statements: This news release contains forward-looking statements that involve risks and uncertainties, which may cause actual results to differ materially from the statements made. When used in this document, the words “may”, “would”, “could”, “will”, “intend”, “plan”, “anticipate”, “believe”, “estimate”, “expect” and similar expressions are intended to identify forward-looking statements. Such statements reflect our current views with respect to future events and are subject to risks and uncertainties. Many factors could cause our actual results to differ materially from the statements made, including those factors discussed in filings made by us with the Canadian securities regulatory authorities. Should one or more of these risks and uncertainties, such as actual results of current exploration programs, the general risks associated with the mining industry, the price of gold and other metals, currency and interest rate fluctuations, increased competition and general economic and market factors, occur or should assumptions underlying the forward looking statements prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, or expected. We do not intend and do not assume any obligation to update these forward-looking statements, except as required by law. Shareholders are cautioned not to put undue reliance on such forward-looking statements.