TSX Venture Exchange Symbol: HCL.P
VANCOUVER, Aug. 3 /CNW/ - Holcot Capital Corp. ("Holcot" or the "Corporation") is pleased to announce the signing of a binding letter of intent dated July 30, 2007 with Goldmember Ventures Corp. ("GVC" or "Goldmember") pursuant to which the Corporation will, subject to a number of conditions, acquire all of the issued and outstanding securities of GVC, an arms length company incorporated under the laws of British Columbia. The transaction will constitute the Corporation's qualifying transaction (the "Qualifying Transaction") under the policies of the TSX Venture Exchange (the "Exchange") as well as a reverse take-over under Exchange policies. Upon completion of the Qualifying Transaction, it is expected that the Corporation will be a Tier 2 Mining Issuer.
Holcot has agreed to issue an aggregate of approximately 15,800,000 common shares in consideration for all of the issued and outstanding shares of GVC. Holcot has also agreed to issue share purchase warrants which will entitle the holders to purchase 2,000,000 common shares of Holcot at a price of $0.50 per share for a period of two years following closing of the Qualifying Transaction and to assume GVC's obligation to issue a further 2,000,000 common shares under certain circumstances. A finder's fee of 200,000 common shares of Holcot will also be paid. The final structure of the business combination is subject to receipt of tax, corporate and securities law advice for both Holcot and GVC.
Upon completion of the Qualifying Transaction, Holcot will be engaged in the business of exploring for, with the ultimate goal of developing and producing, precious and base metals.
Goldmember Ventures Corp.
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Goldmember has substantial mining exploration holdings in central British Columbia, west of Vanderhoof, B.C. and is also engaged in the identification and acquisition of precious metals properties in North America that have the potential for substantial ore deposition.
The claims currently held by Goldmember were acquired from United Exploration Management Inc., ("UEMI") a private British Columbia company specializing in project generative work. In 2005, UEMI was researching the entire Nechako Plateau region of B.C., an area known for epithermal gold-silver mineralization and where Goldmember has its claims. In the 1980's following substantial government initiatives and encouragement, much of the region was claimed by major and junior mining companies alike. Substantial funds were expended over the next decade exploring for epithermal gold-silver deposits. However, technology at the time was limited in its interpretive scope and success was mixed.
The process UEMI employed consisted of acquiring all geochemical data and digitizing this, completing a fault interpretive map including basin and range, caldera, and host and grade structures. SJ Geophysics of Delta, B.C., was then contracted to process and refilter in digital format a 3-dimensional magnetic and density study of the region. Following this, all information was merged and interpreted. Several priority one targets were generated with coincident multi-element geochemical anomalies (Au, Ag, As, Hg, Sb, Mo) in the 90-98 percentile in rocks, soils, silts, and lake sediment samples; geophysical features, structured intersections and favorable geology. Two prime areas, one being the Nechako property with 72,7753.74 hectares was optioned to Goldmember, while the Langer Alexis property some 40 km southeast was optioned to Mt. Dent Resources.
Each company undertook grid establishment contracted to Nicholson & Associates of Vancouver, BC with 3-dimentional induced polarization geophysics (3-D I.P.) following up on the grids completed by SJ Geophysics. 3-D I.P. is a recent practice developed jointly with research by SJ Geophysics and the Mineral Depot Research Unit at the University of British Columbia. It is a marked improvement over previous systems in that it allows for precise determination of resistivity and conductivity of mineralized horizons up to depths exceeding 700 meters. Goldmember completed 3 grids totaling 143,775 kilometers while Mt. Dent completed 103 line kilometers on one grid. Each company established multiple drill targets with anomalies remaining open. Each company had several targets remaining untested. Reconnaissance geological mapping was completed on both properties confirming previous work by both government and industry sources and attesting to the prospectivity of the region. Goldmember also completed on one grid detailed sampling for Mobil Metal Ion. (MMI) analysis. This method was devised for tropical and glaciated regions where conventional soil sampling may be inconsistent. The results confirmed multi-element anomalies within the target areas and confirmed multiple 3-D I.P targets.
The results of both companies confirmed the presence of epithermal gold-silver style mineralization and advance the projects to drilling status subject to infill 3-D I.P. lines. With the close proximity of properties, nearly identical targets and results; a common vendor; related shareholders and one director; the companies entered into negotiations in December of 2006 to merge the 2 entities providing common synergies and efficiency of costs. In January of 2007 the negotiations were concluded with the boards and shareholders of both companies agreeing to merge into one company named Goldmember Venture Corp.
Private Placement
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In conjunction with, or prior to the closing of the Qualifying Transaction, GVC will complete a brokered private placement (the "Private Placement") of units ("Units") at a price of $0.50 per Unit through Toronto based Becher McMahon Capital Markets (the "Agent") for gross proceeds of a minimum of $2,000,000 and a maximum of $3,000,000. Each Unit will consist of one common share and one-half of one common share purchase warrant with each whole warrant entitling the holder to purchase one common share at a price of $0.60 per share for a period of twenty-four (24) months following the date of closing of the Private Placement. The Agent will be paid a cash commission of 8% of the gross proceeds of the offering and will also be issued a compensation option entitling it to purchase that number of Units of GVC as is equal to 10% of the number of Units sold pursuant to the Private Placement, exercisable for a period of two years at a price of $0.60 per Unit. On closing of the Qualifying Transaction, Holcot will assume GVC's obligation to issue Units on exercise of the Compensation Option.
As of June 30, 2007 Holcot had a working capital position of approximately $498,000 and GVC had a working capital position of approximately $230,000.
Proposed Work Program
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An independent, NI 43-101 compliant geological report has been received. The report was authored by Laurence Stephenson, P.Eng. A $1,345,000 Phase I program of diamond drilling and continued ground geophysical and geochemical surveying is recommended to advance the properties with a success contingent Phase II program, budgeted at $4,000,000. To date, $657,000 has been spent on the Nechako Property and $487,000 on the Alexis Property.
Board of Directors
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On closing of the Qualifying Transaction, Michael Kennedy and John Boddie will resign as directors of Holcot. Bipinchandra Ghelani and Gier Liland will remain as directors and will be joined on the Board by Alistair MacLennan, Ian Klassen and David McMillan.
Upon completion of the Qualifying Transaction, it is also intended that Mr. Ghelani will resign as a senior officer of Holcot and that Alistair Maclennan will be appointed President and Chief Executive Officer.
Mr. MacLennan has been working in the junior resources sector (oil/gas/minerals), in various capacities, for over thirty years. He has gained industry knowledge through founding, investment in and serving on the Boards of a number of public and private exploration companies. Mr. MacLennan is also the Chairman and director of Helijet International Inc., a helicopter airline operating a fleet of Sikorsky S76 helicopters throughout the Pacific Northwest since 1986. Mr. MacLennan is actively involved in a number of private companies which are involved in leasing, manufacturing and natural gas production.
Mr. Klassen has nearly twenty years experience in business management, public relations, government affairs and entrepreneurialism. He has extensive experience in government policy, media relationship strategies, business/government project management and legislative decision-making. Mr. Klassen currently serves as President of Grande Portage Resources Ltd. (tsx.v: "GPG"), a Canadian junior resource exploration Company focused on massive sulphide exploration on Vancouver Island, BC. In addition, he is a founding Director of Goldmember Ventures Corp. a privately held company exploring for gold in central British Columbia. Mr. Klassen is an (Honours) B.A. graduate from the University of Western Ontario.
Mr. McMillan was an investment advisor for Yorkton Securities Inc. from 1983-2000. From 1995-2000 he held the position of Senior Vice-President and Director of Yorkton. He has acted as a consultant and advisor to venture companies since 2000, and is President and CEO of Wyn Developments Inc. (tsx-v: "WL", Frankfurt: YXE, OTCBB WYDPF), and a Director of TTM Resources Inc. (tsx.v: "TTQ", Frankfurt: T2U), Pacific Cascade Minerals Inc. (tsx.v: "PCV"), and Goldmember Ventures Corp.
Sponsorship of Qualifying Transaction
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Sponsorship of a qualifying transaction of a capital pool company is required by the Exchange unless exempt in accordance with Exchange policies. Holcot will apply to the Exchange for an exemption from sponsorship requirements on the basis that the Qualifying Transaction is a Canadian based resource venture, however there is no assurance that an exemption will be granted.
Share Structure
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Assuming the maximum of 6,000,000 Units are sold pursuant to the Private Placement, Holcot will have approximately 26,000,000 common shares issued and outstanding on completion of the Qualifying Transaction. To the knowledge of Holcot, on closing of the Qualifying Transaction, no person will beneficially own, directly or indirectly, or exercise control or direction over, more than 10% of the issued and outstanding common shares of Holcot.
The closing of the Qualifying Transaction is subject to a number of conditions including, but not limited to, the closing of the minimum $2,000,000 Private Placement, approval of the shareholders of Holcot and GVC and Exchange acceptance.
Completion of the transaction is subject to a number of conditions, including but not limited to, Exchange acceptance. Where applicable, the transaction cannot close until the required shareholder approval is obtained. 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 or filing 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 a capital pool company should be considered highly speculative.
The TSX Venture Exchange Inc. has in no way passed upon the merits of the
proposed transaction and has neither approved nor disapproved the
contents of this press release.
ON BEHALF OF THE BOARD OF DIRECTORS
"Bipinchandra A. Ghelani"
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Bipinchandra A. Ghelani, President
THE TSX VENTURE EXCHANGE HAS NOT REVIEWED AND DOES NOT ACCEPT
RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THE CONTENT OF THIS
NEWS RELEASE