Schooner Announces Qualifying Transaction for Ponderosa Gold Property in Spences Bridge Gold Belt and Name Change to Aureus Gold Corp.
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Schooner Capital Corp.
NR1-2020
Schooner Announces Qualifying Transaction for Ponderosa Gold Property
in Spences Bridge Gold Belt and Name Change to Aureus Gold Corp.
Toronto, Ontario – September 1 , 2020 – Schooner Capital Corp . (TSXV:SCH.P) (“ Schooner” or the
“Company”) is pleased to announce that it has entered into a binding letter of intent, dated August 14,
2020 (the " LOI"), with 1201361 B.C. Ltd. ("Target"), which sets out the principal terms upon which
Schooner will acquire all of the issued and outstanding securities of Target (the " Transaction") which
controls the prospective Ponderosa Gold Property in the Spences Bridge Gold Belt of British Columbia ,
Canada. The Transaction will constitute an Arm’s Length Transaction, as such term is defined in the
policies of the TSX Venture Exchange (the “TSXV”). Schooner, after giving effect to the completion of the
Transaction, is referred to in this press release as the " Resulting Issuer”. On closing of the Transaction,
Resulting Issuer will change its name to "Aureus Gold Corp." trading under the symbol “AUGC”.
Highlights
• Transaction creates a new TSXV listed gold exploration company, Aureus Gold Corp.
• Experienced management team and board of directors
• Flagship asset, Ponderosa Gold Property, in Spences Bridge Gold Belt, British Columbia
• Schooner anticipates raising up to $2 million in concurrent financing
• Near surface drill-ready gold targets to advance with financing
• Transaction expected to close in mid-Q4
Transaction Summary
Schooner is a "capital pool company" that completed its initial public offering in June 2018. The common
shares of Schooner (the “Shares” or " Schooner Shares") are listed for trading on the TSX Venture
Exchange (the " TSXV" or the " Exchange") under the stock symbol "SCH.P". It is intended that the
Transaction, when completed, will constitute the Qualifying Transaction (as such term is defined in the
policies of the TSXV) of Schooner for the purposes of Policy 2.4 – Capital Pool Companies of the TSXV.
Schooner currently has 4,750,000 Shares issued and outstanding and will acquire Target for 7,147,40 8
Shares. In connection with the Transaction, Schooner proposes to raise up to $2 million through a
Concurrent Financing (as defined herein) of Units (as defined herein) and FT Shares (as defined herein).
Upon completion of the Transaction and the closing of the Concurrent Financing, the Resulting Issuer
will have approximately 31,897,408 Shares issued and outstanding. See further details below under
“Concurrent Financing”.
The management team of the Resulting Issuer will be led by Mr. Marc G. Blythe, MBA, P. Eng as
President and CEO, Ms. Winnie Wong, CPA, CA as the CFO and Corporate Sec retary, and Mr. William A.
Wengzynowski, P. Eng . as Exploration Manager . The current directors of Schooner will resign upon
completion of the Transaction. The current directors of Schooner are graciously thanked for founding
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Schooner and carrying the Company to its present position. It is anticipated that t he directors of the
Resulting Issuer will be Mr. Marc G. Blythe, Mr. Garrett Ainsworth, Mr. Mark T. Brown, Mr. Neil Burns,
and Mr. Scott Trebilcock. See further details below under “Resulting Issuer”.
From and upon completion of the Transaction, the Resulting Issuer will carry on the mineral exploratio n
business conducted by Target, with a focus on the Ponderosa Gold Property (the “Ponderosa Gold
Property” or the “ Property"). Schooner and Target antic ipate that, on closing of the Transaction, the
Resulting Issuer will meet the TSXV's initial listing requirements for a Tier 2 mining issuer. Exploration
plans for the Ponderosa Gold Property will be updated on completion of the Qualifying Transaction,
which will include a minimum exploration budget of $1 million and an initial drill program. See “ The
Ponderosa Gold Property” below for more details on the Property, including significant geological
features of the project.
On closing of the Transaction, Schooner will change its name to " Aureus Gold Corp ." and Target will
change its name to “ Ponderosa Exploration Ltd.” or such other similar names as parties may direct and
which is acceptable to the Exchange and other applicable regulatory authorities. It is anticipated that the
common shares of the Resulting Issuer will be listed under the trading symbol “AUGC”.
The LOI was negotiated at arm's length and the terms and conditions outlined in the LOI are binding on
the parties, and the LOI is expected to be superseded by a definitive agreement (the " Definitive
Agreement") to be negotiated between Schooner and Target and entered into on or before November
14, 2020.
About Target
Target was incorporated on March 15, 2019 under the Business Corporations Act (British Columbia) and
has a head office located in North Vancouver , British Columbia . Target's controlling shareholders are
Marc G. Blythe and Malaspina Mining Solutions Ltd. Target’s principal business focus is the exploration
and development of gold and mineral prospects in Canada. Target's business activity since incorporation
has been the acquisition and exploration of mineral properties.
Target's principal property is the Ponderosa Gold Property, located in the Nicola Mining Division of
British Columbia. Target has two separate option agreements covering the Ponderosa Gold Property.
Target holds a 60% option on the central claim which is held, pursuant to an option agreement dated
September 6 , 2019 with Almadex Minerals Ltd. (TSXV: DEX) and a 100% option on three surrounding
claims held jointly by Mr. Edward Balon and Mr. Wojtek Jakubowski, pursuant to an option agreement
dated April 5, 2019.
The Ponderosa Gold Property, Spences Bridge Gold Belt
The Ponderosa Gold Property is located 16 km southwest of Merritt, BC, less than three hours drive
from Vancouver, Canada. The Property is accessible by road via the sealed Coldwater Road from either
Merritt or the Coquihalla Highway Exit 256 and then 9 km by way of gravel road from the
Coldwater/Patchett Road junction. The Ponderosa Gold Property is located within the unceded
traditional territory of the Nlaka’pamux People.
The Ponderosa Gold Property consists of four contiguous mineral claims covering an area of 1.8 km by
2.3 km (420 hectares). The Property lies within the Spences Bridge Gold Belt which forms a northwest
trending belt roughly 180 km long and up to 24 km wide. Rocks of immediate interest in the belt and
underlying much of the Property comprise successions of Cretaceous subaerial and pyroclastic volcanic
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flows which host significant gold mineralization at Westhaven Gold Corp.’s Shovelnose pro ject
approximately 20 km southeast of the Ponderosa Gold Property.
Much of the Ponderosa Gold Property is moderately to sparsely tree covered with elevations ranging
from 1,270 to 980 m above sea level. Outcrop exposures are documented across the project area
confined mostly to ridges and knolls while overburden and relatively thin accumulations of glacial till
prevail elsewhere. Geology across the Ponderosa Gold Property claim group is broadly divided into two
Cretaceous age volcanic sequences comprising subaerial and pyroclastic volcanic flows of the Pimainus
and Spius Formations.
Historical exploration at Ponderosa began with broadly spaced soil geochemistry and prospecting which
led to the identification of a number of showings across the P roperty. Prior operators focused almost
exclusively on an in-sit u occurrence referred to as “ Axel Ridge”, which is characterized by outcropping
cryptocrystalline/saccharoidal to crustiform and colloform banded epithermal quartz. A series of
trenches were excavated across these outcropping exposures with highlights including 2.22 g/t gold over
11.7 m, 1.92 g/t gold over 14.0 m (with 3.03 g/t gold over 8.0 m) and 3.6 g/t gold over 7 m. Follow -up
diamond drilling of seven holes at Axel Ridge was unsuccessful in intersecting the surface mineralization
at depth. A localized ground magnetic geophysical survey was also carried out by prior operators.
Work conducted on the Property by Target in 2019 and 2020 significantly upgraded three historic
showings and iden tified an entirely new showing. These showings in order of Target’ s priority are
referred to as the Tomahawk, Flat Iron, T-Bone and Rib Eye zones.
The Tomahawk Zone is the most advanced and highest priority showing on the Property. The area was
identified through historical prospecting as a quartz rubble pile roughly 3 m in diameter. Six surface
samples collected by a prior operator from the quartz rubble area returned grades from below detection
to 0.54 g/t gold but the lack of soil geochemical response over this target and apparent lack of strike
extent of the surface exposure discouraged any follow -up exploration. Target investigated the site in
2019 and located additional mineralization 50 m to the southwest believed to be associat ed with the
initial discovery. Six samples of weakly crustiform to cryptocrystalline/ saccharoidal quartz returned
values ranging from below detection limits to 2.96 g/t gold. Five hand trenches were located at varying
intervals across the two exposures to identify the nature, width and orientations of the respective vein
zones. All trenches reached bedrock, encountering significant widths of silicification, brecciation and
clay altered volcanic clasts, quartz flood zones resembling sheeted veinlets and veins, and massive
quartz vein material. The interpretation of the mineralization encou ntered in all trenches is that of one
continuous vein zone exposed along strike for roughly 55 m across a width of up to 25 m. Structural
measurements indicate moderate to steep northwesterly dips ranging from 45 to 70 degrees. The
hanging wall contact of the vein zone has not yet been delineated; leaving the zone open for expansion
and its strike length is not yet fully exposed.
The textural nature of the alteration and mineralization is suggestive of high-level emplacement within
an epithermal system, therefore the tenor of gold mineralization is expected to be somewhat subdued.
While these trenches require additional extension and detail sampling, Target believes diamond drilling
is justified on the Tomahawk Zone.
The Flat Iron Zone is situated approximately 100 m south of the Tomahawk Zone and is interpreted as a
sinistral structural offset of the Tomahawk Zone by an easterly trending property -scale structure. The
Flat Iron Zone is defined by two historical trenches comprising roughly 85 m of mechanized trenching
which identified a number of significant quartz zones, zones of brecciation, silicification and pyritization.
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Individual samples from the longer of the two trenches (~65 m) reportedly assayed up to 7.54 g/t gold
while a weighted average across 25 m yielded 0.80 g/t gold. The main zone of quartz veining observed is
described as white to grey, opaque, cryptocrystalline material with <1mm black bands. This zone was
mapped as being bound to the east by a steeply dipping verti cal fault zone containing abundant quartz
fragments within pervasively argillic and chlorite altered fault gouge with oxidized and weathered pyrite.
The other trench encountered a quartz vein zone described as massive silica across 3 m exhibiting
multiple flooding events and narrow brecciated zones within the main vein in addition to diffuse
andesite clasts, minor banding and trace amounts of fine-grained disseminated pyrite. Assays reported
from this trench returned an overall weighted average of 1.24 g/t gold across 4 m with individual
samples returning up to 2.12 g/t gold. One drill hole was completed by a prior operator to test the Flat
Iron Zone vein exposures but did not encounter any material resembling the mineralization exposed
near surface. The ho le was drilled due west to test mineralized zones interpreted to have steep
southeast and northeast dips. However, Target believes the Flat Iron mineralization likely dips
northwest based on exposures at the nearby Tomahawk Zone which would explain why th e historic drill
hole did not intersect the mineralized zones in the trenches but rather drilled beneath them. Additional
mechanized trenching is required to further understand and delineate this target prior to drilling.
The T-Bone Zone is situated approximately 200 m northeast of the Tomahawk Zone and represents the
strongest coincident gold -arsenic soil geochemistry on the Property aside from Axel Ridge. Preliminary
interpretation by Target suggests the target area hosts multiple vein zones with similar orientations to
the Tomahawk and Flat Iron zones dip ping moderately to steeply west -northwest. Mechanized
trenching is proposed to delineate the mineralization at T-Bone.
The Rib Eye Zone was encountered during the 2019 soil sampling program carried out by Target , which
identified a narrow excavation that exposed a zone of extremely hydrothermally altered volcanic strata
completely converted to orange, white and tan clay with intermittent clear and white silica veinlets. The
excavation is parallel to the alteration zone therefore only a narrow section of the silicified footwall
volcanic is exposed and the clay alteration is also only partially exposed across a width of 3.70 m.
Samples of the clay material collected from the trench were analyzed and identified as low temperature
smectite group clays comprising montmorillonite and laumontite. The orientation of the Rib Eye
alteration trends southwest toward the strongest gold -in-soil value ( 110 ppb) in the area and dips are
steep northwest. Also of note in this area is the highest gold value obtained from prospecting samples
on the P roperty, reported to have returned 46.9 g/t gold and 110 g/t silver. Although sampling across
the trench expos ure returned low values for gold, the Rib Eye Zone is deemed significant as it is may
represent a high level telescoping portion of a fertile hydrothermal system at depth. Mechanized
trenching and geophysics are proposed to better understand this target area.
A technical report in respect of the Ponderosa Gold Property will be filed in connection with the
Transaction, which will include a summary of work completed to date on the Ponderosa Gold Property,
both by Target and prior operators. The report will provide recommendations for further work which
the Resulting Issuer intends to commence post financing. The Company anticipates that the Ponderosa
Gold Property will meet the TSXV’s requirements for a Qualifying Transaction, as Target has incurred
property expenditures in excess of $100,000 within the last three years and anticipates a recommended
work program exceeding $200,000 on the Property.
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Financial Information about Target
The following table sets out selected financial information with respect to Target. Target's financial
statements are prepared in accordance with International Financial Reporting Standards, issued by the
International Accounting Standards Board, and are denominated in Canadian dollars.
Balance Sheet Data As at March 31, 2020 CAD$ (unaudited)
Total Cash on Hand $30,178
Total Exploration Assets $188,724
Share Capital $89,079
Accounts Payable $105,202
Shareholder’s Loan $39,625
Administrative Expenses $22,572
There have been no material changes to the amounts shown above to date. Administrative expenses
cover the period from incorporation on March 15, 2019 to March 31, 2020. Target also has a GST
receivable amount of $4,932 and the total comprehensive loss for that period was $10,072.
Transaction Details
Schooner and Target currently intend to effect the Transaction pursuant to a share exchange
agreement, whereby Schooner will acquire all of the issued and outstanding securities of Target and in
consideration, will issue to the former shareholders of Target an aggregate of 7,147,40 8 Schooner
Shares. Pursuant to the Transaction, Target will become a wholly -owned subsidiary of Schooner .
Schooner and Target have agreed to cooperate with each other in structuring the Transaction in an
efficient manner and the final Transaction structure may differ from that presented above following
receipt of final tax, securities, corporate law and other advice.
Completion of the Transaction is subject to a number of conditions including, but not limited to: (i)
completion of mutually satisfactory due diligence reviews; (ii) execution of the Definitive Agreement and
related transaction documents; (iii) receipt of requisite shareholder approvals; (iv) receipt of all requisite
regulatory approvals relating to the Transaction, including, without limitation, the TSXV; (v) completion
of the Concurrent Financing (as such term is defined below); (vi) no material adverse changes with
respect to either Schooner or Target; (vii) receipt of all required third party consents and approvals ; and
(viii) the transfer of all of the Schooner Shares held in escrow by the existing Principals (as such term is
defined in the policies of the TSXV ) of Schooner to the incoming directors and of ficers of th e Resulting
Issuer.
Concurrent Financing
In connection with the Transaction, Schooner proposes to complete a "best efforts" non -brokered
private placement of units of the Company (the “ Units”) for gross proceeds of up to $ 1 million at a price
of $0.10 per Unit (the “ Unit Financing ”). The Units will be comprised of one common share (each, a
“Share”) and one -half of one common share purchase warrant (each full warrant , a “ Warrant”). Each
Unit will be sold at $0.10 per Unit and each Warrant is exercisable for a Share at a price of $0. 15 per
Share for a period of two years from the date of issuance.
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Schooner will also complete a non-brokered private placement of flow -through common shares of the
Company (the “ FT Shares”) for gross proceeds of $ 1 million at a pr ice of $0.10 per FT Share (together
with the Unit Financing, the “Concurrent Financing”).
Schooner and Target expect that the net proceeds of the Concurrent Financing will be used by the
Resulting Issuer for continued mineral exploration activities across its mineral properties, including
exploration and drilling, and general operating expenses on the Ponderosa Gold Property. Schooner
intends to use the gross proceeds from the sale of the FT Shares to incur eligible "Canadian exploration
expenses" that qualify as "flow -through mining expenditures" as both terms are defined in the Income
Tax Act (Canada).
The Resulting Issuer
The Resulting Issuer will continue conducting the business of Target, with a focus on mineral exploration
activities on the Ponderosa Gold Property.
Directors, Management and Insiders
Upon completion of the Transaction, it is expected that the management of the Resulting Issuer will
consist of Marc G. Blythe as President and CEO, Mr. William A. Wengzy nowski as Exploration Manager ,
and Ms. Winnie Wong as CFO . It is anticipated that the b oard of directors of the Resulting Issuer will
consist of Marc Blythe, Mark T. Brown, Garrett Ainsworth, Neil Burns and Scott Trebilcock. All current
directors and officers of Schooner will resign at the closing of the Transaction.
The following individuals are expected to be directors or senior officers of the Resulting Issuer:
Marc G. Blythe – President, Chief Executive Officer and Director
Mr. Blythe , P.Eng., has a Master of Business Administration from La Trobe University in
Melbourne and a Bachelor of Mining Engineering degree from the Western Australian School of
Mines. Mr. Blythe is an independent mining consultant who provides diligence reviews and
operational advice to mining companies and financiers. His previous roles include Vice
President of Corporate Development at Nevsun Resources Ltd. f rom 2017 until its acquisition by
Zijin Mining Group Ltd. for $1.9 billion in 2018. Mr. Blythe was President & C EO of Tarsis
Resources Ltd. (now Alianza Minerals Ltd.) (TSXV: ANZ) f rom 2007 until 2015 and concurrently
served as Vice President, Mining of Almaden Minerals Ltd. (TSX: AMM, NYSE MKT: AAU ) from
2006 to 2011.
Mr. Blythe previously served as a Corporate Se nior Mining Engineer for Placer Dome Inc. based
in Vancouver from 2004 until 2006, where he completed internal and external mine evaluation,
including advising on potential acquisitions and mining technology implementation. Mr. Blythe
has also managed mines in Australia for Placer Dome Inc. and WMC Ltd. Mr. Blythe has a strong
understanding of mine feasibility and led two feasibility studies which resulted in successful
operating mines , Raleigh Mine and Bullant Mine, both located in Kalgoorlie, Australia. M r.
Blythe is registered professional engineer in British Columbia.
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William A. Wengzynowski – Exploration Manager
Mr. Wengzynowski, P.Eng., is a registered professional engineer i n British Columbia and holds a
Bachelor of Applied Sciences degree in Geological E ngineering from the University of British
Columbia. He spent most of his professional career in Yukon mineral exploration with the
geological consulting firm of Archer, Cathro & Associates (1981) Limited where he started in
1983 and served as President from 2000 to 2011. He was part of the team that led ATAC
Resources Ltd. (TSXV: ATC) to the discovery of the Tiger Gold Deposit and then Carlin -type
mineralization at the Rackla Gold Project. He is a two -time recipient of the Yukon Prospector of
the Year Award, once in 2000 and again in 2011. He was also co -recipient of the H.H. Spud
Huestis Award for excellence in prospecting in exploration in 2013 for the discovery and
development of the Rackla Gold Belt.
Winnie Wong – Chief Financial Officer and Corporate Secretary
Ms. Wong, CPA, CA, is the Vice President of Client Services at Pacific Opportunity Capital Ltd., a
firm th at provides financial management and accounting services. Following her graduation
from Queen’s University, Ms. Wong worked with Deloitte & Touche, where she earned her
Chartered Accountant designation. In the past 21 years, Ms. Wong has acted as CFO and
Corporate Se cretary for various TSX Venture Exchange listed companies, including Strategem
Capital Corporation (TSXV: SGE), Avrupa Minerals Ltd. (TSXV: AVU), Animas Resources Ltd., and
AQM Copper Inc. Ms. Wong has been involved with several publicly traded companies t hat have
become successful for the shareholders through building value or being taken over.
Garrett Ainsworth – Director
Mr. Ainsworth, B.Sc, P.Geo., is the President and Chief Executive Officer of District Metals Corp.
(TSXV: DMX). Prior to that, Mr. Ainsworth was the Vice President Exploration and Development
for NexGen Energy Ltd. (“NexGen”) (TSX/NYSE:NXE). He led the NexGen technical team from
June 2014 to April 2018 and was co -recipient of the 2018 PDAC Bill Dennis Award fo r the Arrow
Uranium Deposit in the Athabasca Basin, Saskatchewan. Prior to NexGen, Mr. Ainsworth was co -
recipient of the AME BC Colin Spence Award (For Excellence in Global Mineral Exploration) in
2013. This honour was in recognition of his efforts which l ed to the discovery of the high -grade
uranium mineralized system on the Patterson Lake South Project in the Athabasca Basin,
Saskatchewan. Mr. Ainsworth holds a Diploma of Technology in Mining and Bachelor of
Technology in Environmental Engineering with ho nours from BCIT, and a Bachelor of Science in
Geology with first class honours from Birkbeck, University of London. He has also completed the
Institute of Corporate Directors (ICD) Directors Education Program (DEP) which includes board -
level education on financial strategy, risks, and disclosure.
Mark T. Brown – Director
Mr. Brown, CPA, CA, is the President and a director of Pacific Opportunity Capital Ltd. (“Pacific
Opportunity”), a financial consulting and merchant banking firm active in venture capital
markets in North America. Mr. Brown’s role at Pacific Opportunity focuses on providing
constructive financial support to a range of companies that Pacific Opportunity Capital Ltd.
invests in . Mr. Brown’s background includes founding one company which became a $500
million company. Mr. Brown has a Bachelor of Commerce degree from the University of British
Columbia and became a Chartered Accountant with PricewaterhouseCoopers in 1993.
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Neil Burns - Director
Mr. Burns , P.Geo., is a geologist with 25 years of ex tensive international experience in
exploration, mining and resource evaluation. He is currently the Vice President of Technical
Services at Wheaton Precious Metals where he is responsible for the technical review of
potential precious metals stream financ ing opportunities. He has been with the company since
2008 and prior to Wheaton, Neil held numerous positions with mining and consulting firms
including Corporate Resource Geologist and Project Geologist for Lundin Mining Corporation
and Resource Consultant for Snowden Mining Industry Consultants. Neil holds a Masters degree
in Mineral Exploration from Queen’s University and a Bachelor of Science degree from Dalhousie
University and is a registered Professional Geologist with Engineers and Geoscientists Br itish
Columbia.
Scott Trebilcock – Director
Mr. Trebicock, B.Sc., MBA, is the Chief Executive Officer and director of K ORE Mining Ltd. (TSXV:
KORE). Mr. Trebilcock has over 25 years of experience as a process engineer, management
consultant, and mining executive. Prior to joining K ORE Mining, he was Chief Development
Officer of Nevsun Resources Ltd. (“Nevsun”), responsible for strategy, corporate development,
investor relations and exploration. Nevsun was sold to Zijin Mining Group Ltd. for $1.9 billion.
Mr. Trebilcock also drove mergers and acquisitions at Nevsun, including the 2016 acquisition of
Reservoir Minerals Inc. Mr. Trebilcock holds a Bachelor of Science de gree in Chemical
Engineering, a Master of Business Administration degree from Queen’s University and is a
Chartered Director (C.Dir.).
Transaction Negotiated at Arm’s-Length
The Transaction will constitute an Arm’s Length Qualifying Transaction (as such term is defined in the
policies of the TSXV). No person who or which is a Non -Arm's Length Party of the Company has any
direct or indirect beneficial interest in Target or its assets (including the Ponderosa Gold Property) prior
to giving effect to the Transaction and no such persons are also insiders of Target . Similarly, there is no
known relationship between or among any person who or which is a Non -Arm's Length Party of the
Company and any person who or which is a Non-Arm's Length Party to Target.
Sponsorship
Sponsorship of a Qualifying Transaction of a capital pool company is required by the TSXV unless exempt
therefrom in accordance with the TSXV's policies or a waiver is obtained. In the absence of an available
exemption from the sponsorship requirements, the Company intends to make an application to the
TSXV for a waiver from sponsorship requirements. There is no assurance that if applied for, a waiver will
be granted.
Filing Statement
In connection with the Transaction and pursuant to the requirements of the TSXV, Schooner will file a
filing statement on its issuer profile on SEDAR (www.sedar.com), which will contain details regarding the
Transaction, Schooner, Target and the Resulting Issuer.