NEW CAROLIN AMENDS AGREEMENT TO ACQUIRE 100% OF LADNER GOLD PROJECT
The receiver of the assets of Century Mining Corp. has agreed, subject to the authorization of the Superior Court of Quebec, to amend the acquisition agreement announced by New Carolin Gold Corp. (LAD,V) on Aug. 27, 2014, whereby the company can purchase the remaining ownership interests of CMC in the Ladner gold project in southwestern British Columbia. To date the Company has acquired 40% of the Project with an undivided 60% interest remaining with CMC.
The Receiver has now agreed that the amount of the financing to be completed by the Company as a condition precedent to the transaction will be reduced to $1,500,000, with $600,000 required to be spent on the exploration and development of the Project. Of this reduced requirement, the Company has raised $980,000 to date, leaving a balance of $520,000 to meet this condition.
With respect to the funding requirement and to secure additional exploration and working capital, the Company announces a proposed offering of up to 23,000,000 units in its capital stock for gross proceeds of up to $1,150,000 (the “Offering”) in a combination of flow-through units (“FT Unit”) and non-flow-through units (“NFT Unit”). Both FT and NFT Units are priced at $0.05, and will consist of one common share and one common share purchase warrant (“Warrant”). Each Warrant will have a two year term with an exercise price in year one of $0.07 per share and year two of $0.08 per share. Common shares delivered as part of the FT Unit will be designated as flow-through shares (“FT Share”) pursuant to the Income Tax Act (Canada). The proceeds from the sale of FT Units will be used to fund qualified CEE work on the Company’s exploration program at the Project. Warrants issued, whether with FT or NFT Units, will not have flow-through attributes nor be exercisable for common shares with flow-through attributes. Proceeds from the sale of NFT Units will be used for general working capital. Finder’s fees may be paid in connection with the Offering. All securities issued in connection with the Offering will be subject to a four-month plus one day hold period from the closing of the Offering.
The original terms of the Agreement provided that the shares issuable to the Receiver, as consideration for the property interest being acquired, be limited to up to 20,000,000 shares. As consideration for the Receiver’s agreement to amend the terms of the Agreement and accelerate closing, the Company has agreed that the shares issuable to the Receiver will be, immediately after issue of same (including the common shares issued under the Financing or in connection with any other conditions to the transaction outlined in the Agreement), together with all other shares of the Company then held by the Receiver, equal to 19.9% of the common shares of the Company then issued and outstanding.
The Receiver has further agreed to reduce to $400,000 the Company’s accounts payable and accrued liabilities which it is required to settle as a condition precedent to the closing of the transaction. In this regard, the Company has recently settled over $400,000 in debt.
In addition, the Company has also agreed with the Receiver, as a condition of closing, to obtain an agreement from one of the Company’s creditors to amend the terms of a recent secured loan for $200,000, so that such loan shall not come due and payable until December 31, 2016. The Company has secured this agreement.
Other closing conditions include receiving TSX Venture Exchange approval, in addition to obtaining an order from the Superior Court of Quebec authorizing such amendments.
The Company has spent the past 3½ years working to complete this acquisition and looks to re-energize its activities after having overcome many hurdles and poor market conditions. Upon acquiring the remaining interests of the Project, the Company believes the investment community following it will finally be able to measure and attribute value in keeping with the Company’s assets. The Company looks forward to concluding the acquisition process and executing its plans at the Ladner Gold Project.
We seek Safe Harbor.