Accend Capital Announces Acquisition of Seven Exploration Licenses Comprising 1,564 km2 of Highly Prospective Cobalt Acreage in Uganda, East Africa
Vancouver, British Columbia (Newsfile Corp. - November 7, 2017) - Accend Capital Corporation (TSXV: ADP.V) (the 'Company') is pleased to announce that it has entered into a binding letter of intent ('LOI') to acquire seven exploration licenses in the Republic of Uganda spanning approximately 1,564 square kilometers ('km2') of land highly prospective for cobalt, as well as copper and nickel (the 'Transaction').
The Company intends to launch an extensive exploration program with the goal of discovering cobalt mineral deposits in Uganda. The exploration licenses are underlain by Proterozoic rocks which exhibit important similarities to the major producing cobalt mines in the Democratic Republic of Congo ('DRC') (Geological Mapping, Geochemical Surveys and Mineral Resources Assessment in Selected Areas of Uganda, GTK, 2011). Uganda hosts the past producing Kilembe copper-cobalt mine, previously operated by Falconbridge Ltd., which produced over 16 million tons of ore grading 1.98% copper and 0.17% cobalt between 1956 and 1977. Following interpretation of airborne geophysical surveys and geochemical sampling programs conducted by the Finnish Geological Survey Consortium (or 'GTK'), the areas surrounding Kilembe, and another area in west-central Uganda (which the Company refers to as 'Bujagali'), were ranked by GTK among the country's highest exploration priorities for cobalt. These areas are included in the asset package the Company is acquiring, and are generally regarded as main opportunities for the discovery of a significant copper-cobalt deposit.
More specifically, two of the seven target licenses (together 193 km2) are located immediately north and south of the Kilembe mine, near to the border with the DRC, and are underlain by similar stratigraphy to the Kilembe mine itself. The five Bujagali licenses (together 1,371 km2)are adjacent to two artisanal gold mining operations, where more than 20,000 artisanal miners were mining until recently. Reconnaissance rock grab samples from within the Bujagali licenses taken by the Vendors contain 0.31% Co; 3.49 grams per tonne gold; and 0.17% Cu. The grab samples are selective rock samples and are not necessarily representative of the mineralization hosted on the licenses. Eight rock grab samples contain greater than 0.12% Co from multiple locales, with the highest cobalt concentrations in sulphide-bearing Proterozoic metasedimentary rocks with similarities to those in the Katanga district copper-cobalt mines in the DRC. That is, age equivalent Proterozoic rock units underlie both the licenses in Uganda and the Katanga copper-cobalt deposits in the DRC (Kamoto Copper Company Technical Report, 2016).
As required by the TSX Venture Exchange, the Company is in the process of finalizing a National Instrument 43-101 technical report on the assets covered by the seven exploration licenses as well as a full legal title opinion on the licenses. Further details will be provided upon completion.
Simon Clarke, Chief Executive Officer of the Company, commented: 'we are delighted to enter into this transaction to position the Company as a significant player in cobalt exploration globally. Not only is this acquisition of a large package of licenses highly prospective for cobalt, it is also situated near the key producing cobalt areas of the DRC, which is estimated to produce over 50% of global cobalt production making it the world's leading producer of cobalt (Kamoto Copper Company Technical Report, 2016).
We believe that this major land package in Uganda, which for historical reasons remains largely under-explored despite sharing many geologic features with the biggest cobalt producing areas globally, provides significant potential for the discovery of large scale cobalt deposits. At the same time, Uganda has had stable government for a number of years and has built a mining infrastructure which focuses on encouraging and attracting investment into the country. Furthermore, Uganda does not have the child labour, conflict mining or ethical production issues associated with the DRC.'
An LOI was entered into with 1126302 B.C. Ltd., 0972697 B.C. Ltd., and Manuforty Holding Company Limited (collectively, the 'Vendors'), each arms length parties to the Company and which collectively hold the rights to the licenses through their respective subsidiaries. In consideration for the acquisition of the licenses, the Company will issue 19,700,000 common shares (the 'Consideration Shares') and will complete a series of cash payments totaling $1,100,000. Upon issuance, the Consideration Shares will be subject to a pooling arrangement from which they will be released in tranches every six months over a thirty-six month period. In connection with completion of the Transaction, the Company intends to immediately change its name to 'M2 Cobalt Corp.' and its trading symbol to 'MC'.
Completion of the Transaction is subject to a number of conditions, including negotiation and finalization of definitive documentation, the availability of financing, and the approval of the TSX Venture Exchange (the 'Exchange'). The Transaction cannot be completed until these conditions are satisfied, and there can be no assurance that the Transaction will be completed in a timely fashion, or at all. As part of its due diligence process, and as required by the Exchange, the Company has commissioned a geological report on the seven licenses to be acquired. Once completed, a copy of the geological report will be available for review under the Company's profile on SEDAR (www.sedar.com).
Pending completion of filings with the Exchange in connection with the Transaction, trading in the Company's common shares has been halted at the request of the Company. It is anticipated that trading will remain halted until the Transaction has been completed.
In connection with completion of the Transaction, Thomas Lamb will join the Board of Directors of the Company and will serve as its 'Vice President of Operations'. Mr. Lamb has significant experience in structuring mining related transactions and has worked on numerous projects in Uganda over the past five years. Prior to becoming a corporate executive, Mr. Lamb practised as a securities lawyer.
In addition, it is anticipated that Dr. Jennifer Hinton will join the Company as 'Director of East Africa Operations'. Dr. Hinton, based in Entebbe, Uganda, is a geological engineer and has been an integral part of the Uganda mining community for over twelve years. Dr. Hinton was initially posted in Uganda by the World Bank to help re-energize the mining sector. Dr. Hinton has access to a local team of geologists, mining engineers, and key in-country personnel, and has strong relationships with the Directorate of Geologic Survey and Mines ('DGSM') and the Government of Uganda.
Simon Clarke commented: 'we are delighted that we will have Dr Jennifer Hinton and her local team working in country to enable us to progress the development of our assets. This is a major benefit for us as we pursue our vision of discovering major global cobalt deposits which can help address the growing shortfall in global supply resulting from the rapid adoption of electric battery technologies.'
Thomas Lamb, Chief Executive Officer of the Vendors, commented: 'We are pleased to be joining Accend to create an important leader in cobalt exploration. This is an enormous land package which comprises the best cobalt targets in mining-friendly Uganda. We intend to make Africa's next major discoveries here. We look forward to making important contributions to Uganda's economy and society.'
In connection with the Transaction, the Company intends to conduct a non-brokered private placement (the 'Financing') of a minimum of 8,000,000 subscription receipts (each, a 'Receipt') at a price of $0.50 per Receipt. The proceeds of the Financing will be held in escrow pending the Company completing the Transaction. Upon completion of the Transaction, each Receipt will automatically convert into one unit (each, a 'Unit') of the Company. Each Unit will consist of one common share of the Company and one-half-of-one common share purchase warrant. Each whole warrant will entitle the holder to acquire a further common share at a price of $0.80 per share for period of twenty-four months, subject to accelerated expiry in the event the common shares of the Company trade on the Exchange at a price of $1.40 or higher for ten consecutive trading days. All securities to be issued by the Company pursuant to the Financing will be subject to a four-month statutory hold period. The Company anticipates paying finders' fees to certain eligible parties who introduce subscribers to the Financing.
The proceeds of the Financing are intended to be used to advance exploration efforts Uganda, and to satisfy working capital requirements of the Transaction.
About the Republic of Uganda
For historic reasons, Uganda's mineral potential is yet to be fully realized. The country shares multiple geologic features conducive to mineralization with its neighbors, the mineral-rich DRC, Tanzania, Rwanda and South Sudan. In addition, growth in the minerals sector is a key pillar of the Government of Uganda's national development strategy. Strong government commitment is exemplified by its well-developed and continued commitment to foreign investment in the resource sector.
Community relations are of utmost importance to the Company. The Company intends to support sustainable development of the communities within and surrounding the properties. The goal is to create long-term value through the ethical and responsible extraction of mineral resources and production of metals by working in cooperation with all stakeholders with transparency and accountability in all activities.
Cobalt has many commercial, industrial and military applications. The leading use of cobalt is for rechargeable battery electrodes. The temperature stability and heat- and corrosion-resistance of cobalt-based super-alloys makes them suitable for use in turbine blades for jet turbines and gas turbine engines. Other uses of cobalt include: vehicle airbags; catalysts for the petroleum and chemical industries; cemented carbides and diamond cutting and abrasion tools; drying agents for paints; varnishes and inks; dyes and pigments; ground coats for porcelain enamels; high-speed steels; magnetic recording media; magnets; and steel-belted radial tires. More than half of the global refined production of cobalt comes from the DRC.
The technical content of this news release has been reviewed and approved by Dean Besserer, P.Geol., the Technical Advisor of the Company and a Qualified Person as defined by National Instrument 43-101.
For further information, contact Simon Clarke at 604.551.9665 or firstname.lastname@example.org.
On behalf of the Board,
Accend Capital Corporation
Simon Clarke, Chief Executive Officer
Completion of the Transaction is subject to a number of conditions, including Exchange acceptance. The Transaction cannot close until the required approvals are obtained, and the outstanding conditions are satisfied. There can be no assurance that the Transaction will be completed as proposed or at all.
Investors are cautioned that 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.
The TSX Venture Exchange has in no way passed upon the merits of the proposed Transaction and has neither approved nor disapproved the contents of this press release. 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.
This news release may contain certain 'Forward-Looking Statements' within the meaning of the United States Private Securities Litigation Reform Act of 1995 and applicable Canadian securities laws. When used in this news release, the words 'anticipate', 'believe', 'estimate', 'expect', 'target, 'plan', 'forecast', 'may', 'schedule' and other similar words or expressions identify forward-looking statements or information. These forward-looking statements or information may relate to future prices of commodities, accuracy of mineral or resource exploration activity, reserves or resources, regulatory or government requirements or approvals, the reliability of third party information, continued access to mineral properties or infrastructure, fluctuations in the market for cobalt and certain precious metals, changes in exploration costs and government regulation in Canada and the Province of Ontario, and other factors or information. Such statements represent the Company's current views with respect to future events and are necessarily based upon a number of assumptions and estimates that, while considered reasonable by the Company, are inherently subject to significant business, economic, competitive, political and social risks, contingencies and uncertainties. Many factors, both known and unknown, could cause results, performance or achievements to be materially different from the results, performance or achievements that are or may be expressed or implied by such forward-looking statements. The Company does not intend, and does not assume any obligation, to update these forward-looking statements or information to reflect changes in assumptions or changes in circumstances or any other events affections such statements and information other than as required by applicable laws, rules and regulations.
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07.11.2017 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG.The issuer is solely responsible for the content of this announcement.The DGAP Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Archive at www.dgap.deLanguage: English Company: Accend Capital Corporation
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