Evolving Gold Corp. (the “
Company”) (CSE: EVG) is
pleased to announce that it has entered into a letter of intent
(the “
Letter”), dated effective October 26, 2021,
pursuant to which it proposes to acquire (the
“
Transaction”) all of the outstanding share
capital of Elephant Capital Corp. (“
Elephant
Capital”).
Elephant Capital is an arms’-length resource
exploration company, established under the laws of the Province of
British Columbia. Elephant Capital holds the rights to
acquire all of the outstanding share capital of Cibola Resources
LLC., which itself controls the rights to a lease of a mineral
property comprising approximately 6,700 acres of mineral rights and
5,700 acres of surface rights located in west-central New Mexico
and commonly referred to as the “Cebolleta Uranium Project” (the
“Project” or “Cebolleta”).
Cebolleta is an advanced exploration uranium project located within
the Grants Mineral Belt of New Mexico; an area that is host to one
of the largest concentrations of sandstone-hosted uranium in the
world. Cebolleta has an historical in-situ Inferred Mineral
Resource of ~ 19,000,000 lbs U3O8.1
The Cebolleta mineral resource estimate
presented herein use the appropriate mineral resource categories
and modern statistical techniques as per CIM Definition Standards
on Mineral Resources & Reserves (2014), however, a Qualified
Person (QP) does not have enough information to verify the resource
estimate as a current mineral resource, as per the CIM Estimation
of Mineral Resources & Mineral Reserves Best Practices
Guidelines (2019), therefore the estimate is considered historical
in nature. The historical resource estimation discussed is relevant
in that it was prepared and calculated by reputable companies that
were intimately familiar with, and knowledgeable about, the
property and the geology and resource potential of the Property.
The historical resource does provide an indication of the extent of
mineralization identified by previous operators at the project. A
QP has not done sufficient work to classify the historical estimate
as a current mineral resource, therefore, the historical estimate
is not being treated as a current resource.
In accordance with the terms of the Transaction,
all existing common shares of Elephant Capital will be exchanged
for an equivalent number of common shares of the
Company. Elephant currently has 43,733,000 common
shares outstanding. Prior to completion of the
Transaction, Elephant Capital is required to issue a further
11,308,250 common shares to enCore Energy Corp. (TSXV: EU) to
complete the acquisition of the Project and a further 1,500,000
common shares to certain arms-length finders in consideration for
introducing the Project to Elephant Capital. No cash consideration
is payable by the Company to Elephant Capital in connection with
completion of the Transaction.
In connection with completion of the
Transaction, the Company intends to undertake a non-brokered
private placement (the “Concurrent Financing”) of
no less than 6,000,000 subscription receipts (each, a
“Receipt”) at a price of $0.50 per Receipt to
raise no less than $3,000,000. All proceeds from the Concurrent
Financing will be held in escrow pending completion of the
Transaction and will be returned to subscribers in the event the
Transaction is not completed. Upon completion of the Transaction,
each subscription receipt will automatically convert into one
common share of the Company. All securities issued in connection
with the Concurrent Financing, will be subject to a
four-month-and-one-day statutory hold period.
No finders’ fees or commissions are payable in
connection with the Transaction, although finders’ fees may be paid
in connection with the Concurrent Financing. On closing of the
Transaction, it is anticipated that the Company will change its
name to “Future Fuel Corporation” and will reconstitute its board
and management to consist of nominees of Elephant Capital. Further
information regarding the board and management of the Company
following completion of the Transaction will be provided as soon as
available.
Completion of the Transaction remains subject to
a number of conditions, including the completion of satisfactory
due diligence, the negotiation and finalization of definitive
documentation, completion of the Concurrent Financing, receipt of
any required regulatory and third-party consents, approval of the
Canadian Securities Exchange, and the satisfaction of other
customary closing conditions.
The Transaction cannot close until the required
approvals are obtained. There can be no assurance that the
Transaction will be completed as proposed or at all. Trading in the
Company’s common shares is currently halted, and it is anticipated
that trading will remain halted until completion of the
Transaction.
Further information regarding the Transaction,
including financial information of Elephant Capital, and details
regarding the proposed board and management of the Company
following completion of the Transaction, will be made available in
due course. Elephant Capital has commissioned a geological report
on the Project, in accordance with National Instrument 43-101 –
Standards of Disclosure for Minerals Projects. Readers are
encouraged to review the listing statement which will be prepared
by the Company in connection with the Transaction along with a copy
of the geological report on the Project, both of which will be made
available under the Company’s profile on SEDAR (www.sedar.com).
DISCLOSURE OF HISTORICAL TECHNICAL
DATA
Data disclosed in this release relating to
in-situ Inferred Mineral Resource at Cebolleta is historical in
nature. Neither the Company nor a qualified person has yet verified
this data and therefore investors should not place undue reliance
on such data. Should the transaction be completed the Company’s
future exploration work would need to include verification of the
data.
QUALIFIED PERSON UNDER
NI-43-101The technical information disclosed in this
release has been reviewed by Michael Dufresne, M.Sc, P.Geol, P.Geo,
a qualified person as defined by National Instrument 43-101. Mr.
Dufresne has not yet verified the historical data disclosed for the
Cebolleta property, including sampling, analytical, test data and
resource estimates underlying the information or opinions contained
in the release.
For further information, contact
info@evolvinggold.com.
On behalf of the Board of Directors,
EVOLVING GOLD CORP.
Charles JenkinsActing Chief Executive Officer
The Canadian Securities Exchange has in any way
passed upon the merits of the proposed Transaction and has neither
approved nor disapproved the contents of this press release.
Completion of the Transaction is subject to a
number of conditions, including but not limited to, the acceptance
of the Canadian Securities Exchange. There can be no assurance that
the Transaction will be completed as proposed or at all.
Investors are cautioned that, except as
disclosed in the listing statement to be prepared in connection
with the Transaction, any information released or received with
respect to the Transaction may not be accurate or complete and
should not be relied upon. Trading in the securities of the Company
should be considered highly speculative.
This news release includes certain
“forward-looking statements” under applicable Canadian securities
legislation. Forward-looking statements include, but are not
limited to, statements with respect to the terms and conditions of
the proposed Transaction. Forward-looking statements are
necessarily based upon a number of estimates and assumptions that,
while considered reasonable, are subject to known and unknown
risks, uncertainties, and other factors which may cause the actual
results and future events to differ materially from those expressed
or implied by such forward-looking statements. Such factors
include, but are not limited to: general business, economic,
competitive, political and social uncertainties, uncertain capital
markets; and delay or failure to receive board or regulatory
approvals. There can be no assurance that the Transaction will
proceed on the terms contemplated above or at all and that such
statements will prove to be accurate, as actual results and future
events could differ materially from those anticipated in such
statements. Accordingly, readers should not place undue reliance on
forward-looking statements. The Company disclaims any intention or
obligation to update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise,
except as required by law.
______________________________________
1 “NI 43-101 Technical Report on Resources Cebolleta Uranium
Project, Cibola County, New Mexico, USA” – effective Date: March
24, 2014
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