TORONTO, ONTARIO -- (Marketwire) -- 11/03/10 -- Auriga Gold Corp. (TSX VENTURE: AIA) ("Auriga Gold" or the "Company") is pleased to announce that the Company's common shares ("Common Shares") will commence trading on the TSX Venture Exchange ("TSXV") as a Tier 2 mining issuer under the trading symbol "AIA" on November 4, 2010.
Puffy Lake and Nokomis Properties
The Company completed the acquisition of the Puffy Lake and Nokomis properties on October 8, 2010 by payment of $2.5 million and the issuance of 4.0 million common shares to Pioneer Metals ULC, a wholly owned subsidiary of Barrick Gold Corporation. For more information on the Puffy Lake and Nokomis properties, please refer to the technical report entitled "Technical Report on Puffy Lake Mine" ("Puffy Lake Technical Report") dated July 23, 2010 and prepared by Karel R. Pieterse, P. Eng., as the qualified person, in accordance with the Canadian Securities Administrator's National Instrument 43-101. The Puffy Lake Technical Report can be viewed on the SEDAR website at www.sedar.com.
Fox River Properties
The Company completed the acquisition of the Fox River Properties on October 20, 2010 by the issuance of 1,262,500 common shares to Xstrata Canada Corporation. The Fox River Properties are located in The Pas Mining District which is situated about 300 kms east of Thompson and approximately 80 kilometres southeast of Gillam in northeastern Manitoba. For more information on the Fox River Properties, please refer to the technical report entitled "Technical Report, Prepared in accordance with NI 43-101 guidelines describing the geology, exploration history and mineral potential on the Fox River Property and Surroundings in the Fox River Belt, Circum-Superior Boundary Zone", ("Fox River Technical Report") dated June 25, 2010 and prepared by Robert A. Brozdowski, Ph.D., P. Geo., Scott Franko, BSc., P.Geo. and Harold Joseph Tracanelli, GETN, P.Geo., as the qualified persons, in accordance with the Canadian Securities Administrator's National Instrument 43- 101. The Fox River Technical Report can be viewed on the SEDAR website at www.sedar.com.
In connection with the Company's listing, the Company completed a non-brokered private placement in various tranches ending on October 26, 2010 of $5,350,762 through the issuance of (i) 2,542,393 flow-through subscription receipts ("FT Sub Receipts") at a price of $0.35 per FT Sub Receipt; and (ii) 14,869,747 subscription receipts ("Unit Sub Receipts") at a price of $0.30 per Unit Sub Receipt. Each FT Sub Receipt entitles the holder thereof to receive, without payment of additional consideration, one unit (an "FT Unit"). Subject to adjustment as set out below, each FT Unit entitles the holder thereof to receive, without payment of additional consideration, one Common Share (an "FT Share") issued on a "flow-through" basis pursuant to the Income Tax Act (Canada) and one half of one common share purchase warrant (an "FT Warrant"). Each Unit Sub Receipt entitles the holder thereof to receive, without payment of additional consideration, one Unit. Subject to adjustment as set out below, each Unit will be comprised of one Common Share (a "Unit Share") and one common share purchase warrant (a "Warrant"). Each whole FT Warrant will entitle the holder thereof to purchase one Common Share for a period of twenty-four months from date of issuance of the Warrants at a price of $0.45 per Common Share. Each Warrant will entitle the holder thereof to purchase one Common Share for a period of twenty-four months from the date of issuance of the warrants at a price of $0.40 per Common Share.
If the Company does not qualify the distribution of the FT Units and Units in Canada by a short form prospectus on or before the date that is 30 days following the closing date with respect to a FT Sub Receipt or a Unit Sub Receipt, as the case may be, (i) the FT Unit underlying any such Flow-through Subscription Receipt will thereafter entitle the holder to receive upon conversion, without payment of additional consideration, 1.10 FT Shares and one half of one FT Warrant (in lieu of one FT Share and one half of one FT Warrant); and (ii) the Unit underlying any such Unit Subscription Receipt will thereafter entitle the holder to receive upon conversion, without payment of additional consideration, 1.10 Unit Shares and one Warrant (in lieu of one Unit Share and one Warrant).
In connection with the private placement, the Company paid the following finder's fees to certain arm's length parties with respect to the FT Sub Receipts and Unit Sub Receipts that were sold to subscribers introduced to the Company by such parties: (i) cash commissions in the aggregate amount of $424,105 (being an amount equal to 8% of the gross proceeds from the sale of such FT Subscription Receipts and Unit Sub Receipts), and (ii) 1,380,678 financing fee warrants ("Financing Fee Warrants") (being 8% of the aggregate number of such FT Sub Receipts and Unit Sub Receipts). Each Financing Fee Warrant entitles the holder thereof to acquire one Common Share at a price of $0.30 per Common Share for a period of twenty-four (24) months from the date of issuance of the Financing Fee Warrants.
The proceeds of the private placement were used to complete the acquisition of the Puffy Lake and Nokomis properties and the Fox River Properties, for exploration and development of the Puffy Lake and Nokomis properties, and for general corporate purposes.
The Company's board of directors consists of Richard H. Sutcliffe (President and CEO), Chris Irwin (Secretary), Brian Robertson, James D. White and George Faught. Victor Hugo is the interim CFO of the Company. In connection with the listing, an aggregate of 2,075,570 Common Shares and 525,000 stock options held by principals will be deposited into escrow in accordance with the policies of the TSXV. In addition, an aggregate of 700,000 common shares held by certain non-principals will be subject to resale restrictions in accordance with the policies of the TSXV. The Company currently has an aggregate of 30,287,241 common shares, 17,521,621 warrants and 725,000 options issued and outstanding.
Investors should refer to the Company's listing application dated October 29, 2010 and filed on SEDAR and other documents filed on SEDAR for additional information.
About Auriga Gold
Auriga Gold Corp. is a Canadian exploration and development company with an experienced technical team focused on expanding gold resources and developing the combined Puffy Lake and Nokomis properties (the "Maverick Gold Project"). The Company plans to upgrade and expand the historic resources at the Maverick Gold Project and evaluate bringing the Puffy Lake Mine back into production. The Puffy Lake Mine includes a 1,000 tpd flotation mill, a developed underground ramp to 130 metres depth, is road accessible and close to existing mining infrastructure. The Maverick Gold Project is located in the Flin Flon Greenstone Belt of Central Manitoba and includes historical resources (pre-NI 43-101) of 540,000 ounces of gold at Puffy Lake and 68,000 ounces of gold at Nokomis. The Flin Flon Greenstone Belt hosts a number of significant base and precious deposits.
Richard H. Sutcliffe, a director and a registered Professional Geologist, is designated as the Qualified Person under National Instrument 43-101 (NI 43-101) and has reviewed and approved the contents of this news release. NI 43-101: A qualified person has not done sufficient work to verify the historical resource estimates at Puffy Lake and Nokomis. These historic estimates predate NI 43-101, are not compliant with current definitions, have not been verified by the company and consequently should not be relied on by investors. The historical estimates are provided as an indication of historically reported estimates.
Certain information regarding the Company including management's assessment of future plans and operations, may constitute forward looking statements under applicable securities laws and necessarily involve risks associated with mining exploration and development, volatility of prices, currency fluctuations, imprecision of resource estimates, environmental and permitting risks, access to labour and services, competition from other companies and ability to access sufficient capital. As a consequence, actual results may differ materially from those anticipated in the forward-looking statements. A feasibility study has not been completed and there is no certainty the disclosed targets will be achieved nor that the proposed operations will be economically viable.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Contacts:
Auriga Gold Corp.
Richard H. Sutcliffe, Ph.D., P.Geo.
President and CEO
416-214-2785
Auriga Gold Corp.
Alison Tullis
Manager, Investor Relations
416-214-2785
info@aurigagold.ca
www.aurigagold.ca