TORONTO, June 26, 2020 (GLOBE NEWSWIRE) -- Labrador Gold Corp. (TSX-V: LAB) (“LabGold” or the “Company”) is pleased to announce that it has closed the previously announced (see news release dated June 23, 2020) non-brokered private placement of 24,571,429 units (“Units”) at a price of $0.175 per Unit (the “ Unit Offering”) for gross proceeds to LabGold of $4,300,000. 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 until June 25, 2022.
“This new capital gives us the ability to launch an aggressive exploration campaign on our recently acquired Kingsway Project. Kingsway shows excellent potential for gold mineralization, with significant anomalies found in all media sampled along the northwards extension of the Appleton Fault Zone that appears to be a major control of gold in the district,” said Roger Moss, President and CEO of LabGold. “We are currently working to get field crews in place around mid-July and anticipate an exciting summer field season in the Gander area.”
The Company paid an aggregate of $211,475.35 in cash compensation to PI financial (as to $139,807.50), Haywood Securities (as to $7,574.99), Hampton Securities (as to $3,150), Mackie Research (as to $525) and Generic Capital Corporation (as to $60,417.86) . As additional compensation, the Company issued 1,179,043 broker warrants (“Broker Warrants”) to PI Financial (as to 798,900), Haywood Securities (as to 43,286), Hampton Securities (as to 18,000), Mackie Research (as to 3,000) and Generic Capital Corporation (as to 315,857). Each Broker Warrant is exercisable at $0.175 until June 25, 2022 to acquire one Common Share.
Insiders of the Company subscribed for 2,106,858 Units 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 issued to the insiders will not exceed 25% of its market capitalization.
The Common Shares and Unit Warrants comprising the Units and the Broker Warrants have a hold period expiring on October 26, 2020.
The proceeds of the Private Placement will be used to fund LabGold’s exploration program at its Kingsway project and for working capital purposes.
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.
Following completion of this private placement, the Company has 85,610,451 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.