Arctic Hunter Signs Definitive Agreement to Acquire up to a 50% Interest in Real de Rebeico Gold S.A. de C.V. (Operator of San Javier Flotation Mill) to Obtain Future Production Revenues on Copper, Gold and Silver Production, Closes First Tranche of Private Placement for
ARCTIC HUNTER ENERGY INC.
Suite 1610 - 675 West Hastings Street · Vancouver · British Columbia · V6B 1N2 Telephone: (604) 681-3131
NEWS RELEASE
April 28, 2017 TSX-V Trading Symbol: AHU
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ARCTIC HUNTER SIGNS DEFINITIVE AGREEMENT TO ACQUIRE UP TO A 50% INTEREST IN REAL DE REBEICO GOLD S.A. de C.V. (OPERATOR OF SAN JAVIER FLOTATION MILL) TO OBTAIN FUTURE PRODUCTION REVENUES ON COPPER, GOLD AND SILVER PRODUCTION, CLOSES FIRST TRANCHE OF PRIVATE PLACEMENT FOR GROSS PROCEEDS OF $500,500
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VANCOUVER, B.C. - Arctic Hunter Energy Inc. (TSX-V: AHU) (“Arctic Hunter” or the “Company”) is pleased to announce that it has signed a definitive agreement to acquire up to a 50% interest in Real de Rebeico Gold S.A. de C.V. (“Rebeico Gold”), the operator of a State owned 100 ton per day flotation mill situated near the city of Hermosillo in Sonora State, Mexico. The formal option agreement with Rebeico Gold of Sonora, Mexico allows Arctic Hunter to earn up to a 50% equity interest in Rebeico Gold for USD$500,000. Rebeico Gold holds the right to operate the San Javier Mill and to receive the proceeds derived therefrom pursuant to an assignment agreement between Rebeico and Exlporacion y Desarollo del Desierto, S.A de C.V. (“EDDSA”) dated April 24, 2017. EDDSA holds the right to operate and receive all proceeds from the San Javier Mill and to conduct ancillary activities on the project site pursuant to a 10 year lease agreement between EDDSA and the state of Sonora, Mexico dated February 24, 2015. The San Javier Mill Project site is located within the heart of the prolific Sierra Madre Gold belt of northern Mexico and is easily accessed by paved highway from the City of Hermosillo, Mexico. The San Javier Mill is a former working and operational State owned flotation mill that has serviced the many working gold, copper and silver mines located in this mining region in the past. The final option agreement is subject to TSX Venture Exchange approval.
Arctic Hunter may acquire up to a 50% equity interest in Rebeico Gold by paying the aggregate sum of USD$500,000 in cash as follows:
a) paying the sum of USD$250,000 in cash to acquire an initial 30% equity interest in Rebeico Gold within 30 days of final TSX Exchange Venture acceptance of the transaction; and
b) paying, within two years (24 Months) of the date on which the payment above is made, the additional sum of USD$250,000 in cash to acquire an additional 20% interest in Rebeico Gold, giving Arctic Hunter a 50% equity interest in Rebeico Gold and production revenues derived therefrom.
ARCTIC HUNTER TO CLOSE FIRST TRANCHE OF $1.0 CDN MILLION DOLLAR NON- BROKERED PRIVATE PLACEMENT
The Company has previously announced (Dec 8, 2016) a non-brokered private placement financing of units (the “Units”) at a price of CDN $0.10 per Unit to raise gross proceeds of up to CDN $1,000,000 (the “Offering”). Each Unit will consist of one (1) common share and one (1) common share purchase warrant, each warrant exercisable at a price of $0.15 per share for a period of two (2) years from the date of issuance. The private placement is subject to approval from the TSX Venture Exchange and all of the securities issued pursuant to the private placement will be subject to a four month hold period from the date of issue in accordance with applicable securities laws. The Company may increase the size of the offering by up to 25% prior to closing, in which case the Offering will be for up to a maximum of 12,500,000 Units and gross proceeds of $1,250,000.
The Company intends to complete a first tranche closing of the Offering for aggregate gross proceeds of CDN$500,500 (5,005,000 Units). The proceeds will be used as follows: (i) first cash payment on San Javier Mill (CDN$345,000); (ii) fund completion of a National Instrument 43-101 compliant technical report on the Rebeico Gold-Copper property currently under option (as disclosed in news releases dated December 8, 2016, February 8, 2017 and March 20, 2017) (CDN$27,000); and (iii) transaction costs including professional fees and finder’s fees in connection with the Offering, and general working capital ($128,500).
The Company has agreed to pay a finders’ fee to arm’s length parties for services rendered in respect of the Offering. The finder’s fee will consist of a cash fee equal to 8% of the gross proceeds of the Offering and finder’s warrants equal in number to 8% of the units sold under the Offering. Each finder’s warrant will entitle the holder to acquire one common share of the Company at a price of $0.15 per share for a period of two (2) years from the date of issuance.
In addition to other prospectus exemptions commonly relied on in private placements, the Offering will be available to existing shareholders of the Company who, as of the close of business on February 3, 2017, held common shares of the Company (and who continue to hold such common shares as of the closing date), pursuant to the prospectus exemption set out in BC Instrument 45-534 - Exemption from prospectus requirement for certain trades to existing security holders and in similar instruments in other jurisdictions in Canada (the “Existing Shareholder Exemption”). The Existing Shareholder Exemption limits a shareholder to a maximum investment of CAD$15,000 in a 12-month period unless the shareholder has obtained advice regarding the suitability of the investment and, if the shareholder is resident in a jurisdiction of Canada, that advice has been obtained from a person that is registered as an investment dealer in the jurisdiction. If the Company receives subscriptions from investors relying on the Existing Shareholder Exemption exceeding the maximum Offering, the Company may adjust the subscriptions received on a pro-rata basis.
The Company will also make the Offering available to certain subscribers pursuant to BC Instrument 45-536 - Exemption from prospectus requirement for certain distributions through an investment dealer (the “Investment Dealer Exemption”). In accordance with the requirements of the Investment Dealer Exemption, the Company confirms that there is no material fact or material change about the Company that has not been generally disclosed.
ABOUT ARCTIC HUNTER ENERGY
The Company is a Canadian Oil & Gas exploration and Mining resource development Company that identifies, acquires and finances the acquisition, exploration and development of mining and oil and gas assets primarily situated in Western Canada and North America. The Company is currently a junior heavy oil producer in the greater Lloydminster area of Alberta & Saskatchewan. The Company is continually reviewing future production and exploration opportunities, through selective property acquisitions and identifying low risk exploration drilling activities situated in Canada, the United States, Mexico and abroad.
FOR FURTHER INFORMATION, PLEASE CONTACT:
Tim Coupland, President and CEO Arctic Hunter Energy Inc.
Tel: (604) 681-3131 [email protected]
or
Ted Burylo, Director Arctic Hunter Energy Inc.
Tel: (604) 764-9178
Neither the TSX Venture Exchange nor its Regulation Services Provider, (as the term is defined in the Policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.