First Legacy options Wicheeda from Spectrum
2018-11-26 19:54 ET - News Release
Mr. Todd Hanas reports
FIRST LEGACY MINING CORP. ENTERS INTO OPTION AGREEMENT WITH SPECTRUM MINING CORPORATION TO ACQUIRE RARE EARTH ELEMENT PROJECT
First Legacy Mining Corp. has entered into an arm's-length option agreement with Spectrum Mining Corp. dated Nov. 22, 2018, pursuant to which First Legacy has the option to acquire all of the issued and outstanding shares of Spectrum, a private B.C. incorporated company, that is the legal, beneficial and registered holder of a 100-per-cent interest in and to six mining claims located in the Cariboo mining division, British Columbia, known as the Wicheeda rare earth element project.
First Legacy also announces that it intends to complete a non-brokered private placement (the "Private Placement") of up to 1,200,000 flow-through common shares ("Flow-Through Shares") of the Company at a price of $0.25 per Flow-Through Share to raise gross proceeds of up to $300,000. The Private Placement is subject to TSX Venture Exchange ("TSXV") approval.
Highlights of the Proposed Acquisition
Pursuant to the Agreement, in order to exercise the Option and to maintain the Option in good standing, First Legacy must:
- incur expenditures in respect of the Property totaling $1,930,000 as follows:
- $680,000 within 12 months of the date of TSXV approval (the "Effective Date");
- an additional $625,000 within 24 months of the Effective Date;
- an additional $625,000 within 36 months of the Effective Date;
- pay to Spectrum an aggregate of $370,000 as follows:
- $25,000 in cash (paid);
- $95,000 in cash within five (5) business days of the Effective Date;
- $50,000 in cash on or before the first anniversary of the Effective Date;
- $100,000 in cash on or before the second anniversary of the Effective Date;
- $100,000 in cash on or before the third anniversary of the Effective Date;
- issue to Spectrum:
- 200,000 common shares of the Company on the Effective Date;
- $50,000 in common shares of the Company on or before the first anniversary of the Effective Date;
all of which such foregoing obligations of the Option above may be accelerated at the Company's sole discretion.
Once First Legacy has fulfilled the foregoing obligations, the Company will have the right for a period of 90 days thereafter, to exercise the Option (the "Exercise Period") by written notice to Spectrum within the Exercise Period (the "Exercise Notice"). If the Company fulfills the foregoing obligations, and delivers to Spectrum the Exercise Notice within the Exercise Period, the Company shall forthwith: (a) issue to the shareholders of Spectrum (the "Vendors") on a pro rata basis, such number of common shares of the Company equal to 49% of the aggregate of the following: (i) the issued and outstanding common shares of the Company at such time; plus (ii) the common shares of the Company to be issued to the Vendors; and (b) pay to the Vendors on a pro rata basis, a cash payment in the aggregate of $100,000.
In addition, pursuant to the Agreement, Spectrum will have the right to appoint a director to the board of directors of the Company, immediately following the next annual general meeting of First Legacy shareholders scheduled for December 14, 2018.
The Acquisition is subject to approval of the Vendors and the TSXV. The Agreement and the Private Placement are subject to the prior acceptance of the TSXV, as the Acquisition, if completed, will constitute a "Fundamental Acquisition" for the Company pursuant to TSXV Policy 5.3 - Acquisitions and Dispositions of Non-Cash Assets. The acceptance of the TSXV will require, among other things, the completion and filing of a National Instrument 43-101 technical report on the Wicheeda Property. First Legacy has engaged the services of Moose Mountain Technical Services of Cranbrook, B.C. to prepare the NI 43-101 technical report. Trading in the common shares of the Company has been halted in accordance with the policies of the TSXV and will remain halted until such time as all required documentation has been filed with and accepted by the TSXV and permission to resume trading has been obtained from the TSXV.
In connection with the Agreement, First Legacy has entered into a finder's fee agreement (the "Finder's Agreement") with Mulgravian Ventures Corporation ("MVC") in consideration for services in introducing the Company to Spectrum, pursuant to which MVC shall receive consideration of 400,000 common shares (the "Finder's Shares") of the Company if the Agreement is approved by the TSXV and such number of common shares that is equal to 1.5% of the common shares of the Company that are issued to the Vendors if the Acquisition closes. The Finder's Shares are subject to TSXV approval and will be subject to a four month hold period.
The Wicheeda Property
The Wicheeda Property located approximately 80 km northwest of the city of Prince George, British Columbia, is readily accessible by all-weather gravel roads and is close to major infrastructure including power transmission lines, railway and major highways. Geologically, the Wicheeda Property is situated in the Foreland Belt and within the Rocky Mountain Trench, a major continental geologic feature. The Foreland belt contains part of a large alkaline igneous province stretching from the Canadian Cordillera to the southwestern United States and hosts several carbonatite and alkaline complexes among which the Aley (niobium), Rock Canyon (REE), and Wicheeda (REE) alkaline complexes contain the highest concentrations of Rare Earth Elements minerals.
The Wicheeda Property is underlain by Kechika Group metasedimentary rocks that are intruded by a southeast-trending carbonatite. The Wicheeda carbonatite is a deformed plug or sill approximately 250 metres in diameter that hosts potentially economic REE mineralization. The intrusion comprises a ferroan dolomite carbonatite core, which passes gradationally outward into calcite carbonatite. The potentially economic REE mineralization is hosted by the dolomite carbonatite.
Further information about the Wicheeda Property and its proposed exploration and development will be disclosed in a National Instrument 43-101 - Standards of Disclosure for Mineral Projects technical report.
Name Change
In connection with the approval by the TSXV of the Agreement, the Company intends to change its name to "Defense Metal Corp.". In conjunction with the proposed name change, the Company's share capital would be issued under new CUSIP/ISIN numbers and the trading symbol is expected to change to "DEFN". The proposed name change and symbol change are subject to the acceptance of the TSXV.
Senior Technical Advisor
First Legacy is pleased to announce that it will retain Chris Graf as a senior technical advisor after the Agreement is approved by the TSXV. Mr. Graf is currently a director of Spectrum. Mr. Graf was born in Cranbrook, B.C. and graduated with a B.Ap.Sc. degree in geological engineering from the University of British Columbia in 1974. He has been registered as a Professional Engineer with the Association of Professional Engineers of British Columbia since 1980.
Mr. Graf has successfully applied his profession for the past 40 years, conceiving and conducting mineral exploration programs in British Columbia, Alberta, Yukon and northern Mexico. His forte has been mineral property evaluation, field exploration and diamond drilling. Mr. Graf was a director of the BC and Yukon Chamber of Mines during the 1990's when the provincial NDP were in power. During his tenure he was very involved in the Chamber's Aboriginal Affairs and Environmental/Park committees trying to mitigate the NDP's overly ambitious land use policies that were largely negative for mineral exploration in BC. In 2011, Mr. Graf was the recipient of the Chamber's Frank Woodside Past Presidents Award for distinguished service to the Minerals Industry.
The scientific and technical information contained in this news release has been reviewed and approved by Kristopher J. Raffle, P.Geo. (BC) Principal and Consultant of APEX Geoscience Ltd. of Edmonton, AB, a "Qualified Person" as defined in National Instrument 43-101 - Standards of Disclosure for Mineral Projects.
About First Legacy Mining Corp.
First Legacy Mining Corp. is a mineral exploration company focused on the acquisition, exploration and development of mineral resource properties.
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