MegumaGold Corp. (OTCPK:NSAUF) (CSE:NSAU)

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MEGUMAGOLD and OSPREY GOLD Sign Definitive Agreement for Plan of Arrangement to Create a Leading PRECIOUS METALS EXPLORATION COMPANY in nova scotia

Vancouver, BC – Halifax, Nova Scotia – June 10, 2020 –  MegumaGold Corp. (CSE: NSAU) (OTCPK: NSAUF) (FWB: 2CM2) (“MegumaGold”) and Osprey Gold Development Ltd. (TSXV: OS, OTCQB: OSSPF) (“Osprey”) are pleased to announce that, further to their joint press release on March 30, 2020, the companies have entered into a definitive agreement (the “Arrangement Agreement”) to merge their respective businesses pursuant to a plan of arrangement (the “Transaction”) to create a leading Nova Scotia precious metals exploration company focused within highly prospective and reactivated historic mining camps of Nova Scotia, Canada.

 

Theo Van der Linde, President of MegumaGold stated, “We’re incredibly pleased to have executed the definitive agreement to combine with Osprey Gold.  This consolidation forms the foundation of a company positioned to capitalize on the emerging Meguma gold camp in Nova Scotia amidst a rapidly developing gold market. MegumaGold continues to be strongly focused on acquiring high-quality targets with known gold potential within stable underexplored jurisdictions. The combination of MegumaGold’s commanding land position in Nova Scotia and Osprey’s existing gold deposits creates a unique synergy designed to increase shareholder value through the use of modern exploration techniques in the Meguma Gold District, adjacent to Atlantic Gold’s mining operations acquired by St Barbara Ltd. for $802 million cash consideration in July 2019.”

 

Osprey Gold President, Cooper Quinn commented, “The combined entity of MegumaGold and Osprey will have a leading group of assets in the region and a stronger market presence than either company could achieve alone. We look forward to leveraging the collective strengths of the new team to explore the combined portfolio of assets ranging from early stage exploration through resource expansion and development. We are very pleased with the deal we have structured and believe it offers significant benefits to Osprey shareholders.”

 

Key benefits of this transaction for MegumaGold and Osprey shareholders:

 

MegumaGold’s untested target anomalies on Moose River Anticlinal Structure 4km south west of St Barbara’s Touquoy Milling facility, combined with Osprey’s current mineral resources completed in accordance with NI 43-101 that are open for expansion; and

 

  • Consolidated district scale land package in Nova Scotia’s most prospective gold mining regions;
  • Strengthened balance sheet and greater ongoing access to capital;
  • Capacity to create operational synergies to increase exploration efforts while streamlining programs and budgets;
  • Significantly strengthened management and leadership team with balanced and complimentary skillsets; and
  • Broader in-house technical expertise

 

Nova Scotia

 

Nova Scotia is currently experiencing a resurgence in gold exploration, predominantly as a result of the St Barbara Ltd. acquisition of Atlantic Gold and its Moose River Consolidated Project in July 2019 for C$802 million cash consideration. The Moose River Consolidated Project is currently producing gold from the Touquoy open-pit mine located approximately 10 km south of Osprey’s Caribou Project and 4 km east of MegumaGold’s Touquoy West Project.

 

Details of the Transaction

 

Pursuant to the terms of the Arrangement Agreement, MegumaGold will acquire all of the issued and outstanding shares of Osprey. Each shareholder of Osprey will receive such number of common shares of MegumaGold (the “Meguma Shares”) as is equal to the product of the number of Osprey Shares held by such shareholder at an exchange ratio which equals one (1) Meguma Share per two (2) Osprey Shares outstanding at the closing of the Transaction.

 

The definitive agreement provides that unexercised Osprey options and share purchase warrants will be assumed by MegumaGold and will: (i) remain outstanding for their full term, and (ii) following the closing date of the Transaction, entitle the holder thereof to acquire MegumaGold Shares in lieu of Osprey Shares, in such number and at such exercise price as shall be adjusted based on the exchange ratio inherent in the Transaction, and otherwise on the same terms and conditions as existed prior to the Transaction.

 

Osprey will have the right to appoint 2 members to the board of directors of the resulting issuer, with the total number of members of such board of directors to be initially set at 5. Osprey shall also contribute management personnel to the resulting issuer.

 

MegumaGold currently has 102,780,640 outstanding shares and 31,364,506 shares reserved for issuance under incentive stock options and warrants.  As of today’s date, without inclusion of including any of MegumaGold’s current shareholdings in Osprey, it is anticipated an aggregate of 36,671,166 common shares of MegumaGold are anticipated to be issued to Osprey shareholders, along with incentive stock options and warrants entitling Osprey shareholders to acquire a further 16,303,567 common shares of MegumaGold.

 

Based on the foregoing and assuming no outstanding common shares or warrants of Osprey are exercised prior to closing and before giving effect to any concurrent financing, the resulting issuer from the Transaction will have 139,451,806 shares issued and outstanding, of which former shareholders of Osprey will hold approximately 26.3% of the issued and outstanding common shares of the resulting issuer (27.4% of the common shares of the resulting issuer on a fully diluted basis).

 

The Transaction was negotiated at arm’s length, will be implemented by way of a statutory plan of arrangement pursuant to the British Columbia Business Corporations Act. The Transaction is subject to the approval of two thirds of the votes cast by the holders of Osprey’s common shares present in person or represented by all at a special meeting of the Osprey shareholders. The Transaction is expected to close shortly thereafter following receipt of all shareholder, court, certain third-party and stock exchange approvals. Further details as to the proposed record date and meeting date for Osprey’s special meeting of shareholders will be disclosed in due course.  It is not anticipated that MegumaGold shareholders will be required to approve the Transaction.

 

Other Matters

 

The Transaction is subject to customary closing conditions, including approval by the shareholders of Osprey, obtaining all governmental, regulatory, TSX Venture Exchange (“TSXV”), Canadian Securities Exchange (the “CSE”), and other third-party approvals which are necessary in order to allow the parties to complete the Transaction including court approval of the plan of arrangement. The Transaction cannot close until all of these conditions are met. There can be no assurance that the Transaction will be completed as proposed or at all.

 

Upon closing of the Transaction, the resulting issuer is expected to be listed for trading on the CSE.

 

MegumaGold files NI 43-101 Technical Report

 

MegumaGold is also pleased to announce that it has filed a National Instrument 43-101 (“NI 43-101”) technical report (the “Technical Report”) on its Meguma gold properties in Nova Scotia. The Technical Report was prepared by Mercator Geological Services Ltd. and is titled “NI 43-101 Technical Report on the Meguma Gold Properties, Nova Scotia, Canada” with an effective date of April 30, 2020. The Technical Report can be found under the Company’s SEDAR profile at www.sedar.com.

 

Qualified Person Statement

 

This press release has been reviewed and approved by Regan Isenor, Chief Executive Officer of MegumaGold Corp.  Paul Ténière, M.Sc., P.Geo. of Mercator Geological Services Ltd. and Perry MacKinnon, P.Geo., Vice President of Exploration of Osprey, both “Qualified Persons” as defined under NI 43-101, have prepared and approved the scientific and technical information disclosed in this press release.

 

About MegumaGold Corp.

 

MegumaGold Corp. (CSE: NSAU, OTC: NSAUF, FWB: 2CM2) is a Canadian junior gold exploration company engaged in the business of acquiring, exploring and developing natural resource properties. MegumaGold has centered its exploration focus on the developing Meguma Formation of Nova Scotia. As a result, MegumaGold has assembled a strategically positioned, district-scale tenure position of 107,114 hectares within the Meguma Gold District. For additional information, please visit MegumaGold’s website: http://www.MegumaGold.com.

 

About Osprey Gold

 

Osprey (TSXV: OS, OTCQB: OSSPF) is focused on exploring five historically producing gold properties in Nova Scotia, Canada. Osprey has the option to earn 100% (subject to certain royalties) in all five properties. For additional information, please visit Osprey’s website: www.ospreygold.com.

 

Mr. Regan Isenor, Chief Executive Officer, MegumaGold Corp.

902-233-4381

info@megumagold.com

www.megumagold.com

 

For more information, please contact:

Cooper Quinn, President and Director, Osprey Gold Development Ltd.

(778) 986-8192

cooper@ospreygold.com

www.ospreygold.com

 

Forward-Looking Statements and Cautionary Language

All statements in this presentation, other than statements of historical fact, are “forward-looking information” with respect to MegumaGold and Osprey within the meaning of applicable securities laws including, without limitation economic estimates and any statements related to the proposed transaction, proposed board and management changes and shareholder and exchange approvals. MegumaGold and Osprey provide forward-looking statements for the purpose of conveying information about current expectations and plans relating to the future and readers are cautioned that such statements may not be appropriate for other purposes. By its nature, this information is subject to inherent risks and uncertainties that may be general or specific and which give rise to the possibility that expectations, forecasts, predictions, projections or conclusions will not prove to be accurate, that assumptions may not be correct and that objectives, strategic goals and priorities will not be achieved. These risks and uncertainties include but are not limited to exploration findings, results and recommendations, results of due diligence investigations, ability to raise adequate financing, shareholder and exchange approvals in respect of the transaction and unprecedented market and economic risks associated with current unprecedented market and economic circumstances due to the COVID-19 pandemic, as well as those risks and uncertainties identified and reported in MegumaGold’s and Osprey’s  public filings under its respective  SEDAR profile at www.sedar.com. Although MegumaGold and Osprey have attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking information, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate as actual results and future events could differ materially from those anticipated in such statements. MegumaGold and Osprey disclaim any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise unless required by law.

 

UNITED STATES ADVISORY

The securities referred to herein have not been and will not be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”), have been offered and sold outside the United States to eligible investors pursuant to Regulation S promulgated under the U.S. Securities Act, and may not be offered, sold, or resold in the United States or to, or for the account of or benefit of, a U.S. Person (as such term is defined in Regulation S under the United States Securities Act) unless the securities are registered under the U.S. Securities Act, or an exemption from the registration requirements of the U.S. Securities Act is available. Hedging transactions involving the securities must not be conducted unless in accordance with the U.S. Securities Act. This press release shall not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in the state in the United States in which such offer, solicitation or sale would be unlawful.

 

Neither the CSE nor TSXV has approved or disapproved the contents of this news release or passed upon the merits of any of the transactions described herein, including the Transaction.

 

Neither the CSE, TSXV nor their Regulation Services Providers (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this release.

 

Source:  –  MegumaGold Corp.

MegumaGold Provides Update on Osprey Acquisition and Its Projects

Halifax, NS – April 14, 2020 – MegumaGold Corp. (CSE: NSAU) (OTC: NSAUF) (FWB: 2CM2) (“MegumaGold” or the “Company”) is pleased to provide the following updates on its on-going corporate and exploration activities.

Osprey Gold Acquisition Update

The Company continues its discussions with Osprey Gold Development Ltd. (“Osprey Gold”) regarding the proposed business combination transaction whereby the Company will acquire 100% of the issued and outstanding shares of Osprey Gold (the “Proposed Transaction”). Details of the Proposed Transaction are described in a Company press release dated March 23, 2020. Each of the Company and Osprey Gold remain committed to consummating the Proposed Transaction and the parties are currently in the process of finalizing the terms of a definitive agreement.

Touquoy West

The Company continues to advance targeting and permitting work in preparation for core drilling activities on its Touquoy West Property. Extensive ground geophysics and soil survey programs completed in 2019 and combined with the recent IP survey were successful in defining three large anomalies on the western extension of the Moose River anticlinal structure, which hosts St Barbara’s operating Touquoy mine (see Company press release dated March 2, 2020). None of these well-defined exploration targets have been drilled in the past. Drill collar locations are currently being defined on these new targets with permitting work to follow. A core drilling program will commence at Touquoy West once permits are received and the COVID-19 situation improves.

Killag

Results of a reverse circulation (“RC”) drilling program (2,247 metres) completed in early 2019 on the Killag Property appear to indicate that highly anomalous gold values over significant widths are occurring in bedrock sequences of quartz-veined greywacke and argillite present on the property. These anomalous gold values are focused along the hinge zone of the historically mapped Killag-Goldenville anticline and occur within a broad geochemical alteration halo that also marks an important anticlinal hinge zone. Previously disclosed 2019 RC program results define a corridor of gold anomalism that is coincident with the hinge zone and measures at least 1 km in length (see Company press release dated May 7, 2019). This anomalous trend is open to both the east and west beyond the limits of the 2019 RC program, and results from historical mining and core drilling in close proximity appear to support the potential for further gold mineralization on the property. The Company has recently completed detailed geological modeling and a bedrock gold distribution study for the Killag Property, and drill program planning and permitting activities are currently underway to ensure field work can commence promptly once working conditions are stabilized.

Optioned Genius Licences

The Company is currently designing and preparing a detailed ground survey program on exploration licences optioned from Genius Metals Inc. (“Genius”) that sit contiguous to the western extension of the Company’s Touquoy West Property. The program being prepared for the Genius licences will incorporate previous exploration targeting techniques used on the Touquoy West Property, which successfully defined several anomalies on the Touquoy West Property, and include geological mapping, soil sampling, combined ground magnetometer and VLF surveys, and an IP survey. The Company anticipates field work on the Genius licences will commence once the COVID-19 situation improves allowing for a safe working environment for field staff.

Expanding Nova Scotia Footprint

In addition, the Company has further expanded its mineral claims footprint in Nova Scotia through the acquisition of 21 exploration licences comprised of 477 mineral claims (7,727 hectares) that are contiguous with several exploration licences already held by the Company in the Meguma Terrane. These additional mineral claims were acquired from an arm’s-length vendor at a cost approximately equal to mineral licence fees paid to the Government of Nova Scotia. A 2% gross royalty was granted on the claims in connection with the purchase.

Qualified Person Statement

This press release has been reviewed and approved by Regan Isenor, Chief Executive Officer of MegumaGold Corp.; and Paul Ténière, M.Sc., P.Geo. of Mercator Geological Services Ltd., a “Qualified Person” as defined under National Instrument 43-101 – Standards of Disclosure for Mineral Projects, has prepared and approved the scientific and technical information disclosed in this press release.

About MegumaGold Corp.

MegumaGold Corp. (CSE: NSAU, OTC: NSAUF, FWB: 2CM2) is a Canadian junior gold exploration company engaged in the business of acquiring, exploring and developing natural resource properties. MegumaGold has centered its exploration focus on the developing Meguma formation of Nova Scotia. As a result, MegumaGold has assembled a strategically positioned, district-scale tenure position of 108,589 hectares within the Meguma Gold District. For additional information, please visit MegumaGold’s website: http://www.MegumaGold.com.

For more information please contact
Mr. Regan Isenor, Chief Executive Officer
902-233-4381
info@megumagold.com
www.megumagold.com

 

Forward-Looking Statements


All statements in this presentation, other than statements of historical fact, are “forward-looking information” with respect to MegumaGold within the meaning of applicable securities laws including, without limitation economic estimates and any statements related to estimated mining costs. MegumaGold provides forward-looking statements for the purpose of conveying information about current expectations and plans relating to the future and readers are cautioned that such statements may not be appropriate for other purposes. By its nature, this information is subject to inherent risks and uncertainties that may be general or specific and which give rise to the possibility that expectations,  forecasts, predictions, projections or conclusions will not prove to be accurate, that assumptions may not be correct and that objectives, strategic goals and priorities will not be achieved. These risks and uncertainties include but are not limited to exploration findings, results and recommendations, as well as those risks and uncertainties identified and reported in MegumaGold’s public filings under its SEDAR  profile at www.sedar.com. Although MegumaGold has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking information, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate as actual results and future events could differ materially from those anticipated in such statements.  MegumaGold disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise unless required by law.

Neither the CSE nor its Regulation Services Provider (as that term is defined in the policies of the CSE) accepts responsibility for the adequacy or accuracy of this release.

About MegumaGold Corp.


107,114 hectares of exploration potential in an emerging gold camp

 

MegumaGold Corp, a Canadian Junior Gold exploration company, is focused on value-oriented exploration within the emerging gold camp of the Meguma formation in Nova Scotia.

 

Nova Scotia has a rich history of gold discovery and production and has been one of Canada’s first gold mining camps with production dating back to 1861. Between 1862 and 1927, 966,241 ounces of gold were mined from 2,184,850 tons of crushed material (G. Malcolm, 1929 memoir). Historical exploration has focused on narrow-vein high-grade gold deposits.  This traditional model is being re-shaped by the discovery of disseminated gold in the slates in the historic Nova Scotia mining district. Meguma Gold’s 100% owned project covers more than 179,280 hectares encompassing extensive gold showings on the major projected structures of recent large and expanding discoveries.

 

On May 18th of 2018 the company entered into and agreement to acquire 100% interest in 3,888 claims, becoming one of the province’s largest single mineral claim holders and a leading gold exploration company in Nova Scotia. These claims were staked along the under-explored trends of known gold producing anticlinal structures.  Through detailed interpretation of a recently commissioned large airborne geophysical program the company increased their land position to current holdings of 6,614 claims covering over 107,114 Ha, at this point the company estimates that it will control approximately 466 kilometers (total strike length) of gold-prospective anticlines.

 

The company is strategically positioned to build value through targeted exploration of high priority zones and capitalize on the regional scale potential of a major gold camp in the making.

 

MegumaGold is a well-financed, lean and efficient exploration team focused solely on creating exceptional value for our shareholders.

 

In recent years, Nova Scotia has experienced a paradigm shift in the understanding of the genesis and economic potential of its gold deposits.

 

Gold in Nova Scotia has been mined intermittently since the 1860’s from over 350 locations, mainly from high-grade, nugget-style quartz veins. Discovery in the late 1980’s of significant, disseminated gold hosted within argillaceous shales at the Touquoy Deposit in Moose River and the recent opening of Canada’s newest mine by Atlantic Gold has renewed interest in Nova Scotia’s historic gold districts.

 

The Company believes this new understanding of the greater deposit model demonstrates how historic vein-focused production extracted but a mere fraction of the total gold potential and that wide zones of non-visible, disseminated gold in Nova Scotia, presents an opportunity to advance Nova Scotia as a world-scale gold mining district.

 

Positioned for Success Through Anticlinal Control

 

In Nova Scotia, significant quantities of gold are hosted in regional-scale anticlinal structures. These structures are critical to the concentration of gold in near surface, low-cost economic quantities.

 

The evolution of the disseminated gold model has also generated new investor and industry awareness of the significant potential of Nova Scotia’s anticlinal structures.

 

Through Meguma’s  6,723 mineral claims covering 108,845 Ha, the company estimates that it now controls approximately 466 km of gold-prospective anticlines.

 

Source:  https://megumagold.com/

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