Margaret Lake Enters into Non-Binding Letter of Intent to Acquire Emerging Goldfields Resources Ltd.
Margaret Lake Enters into Non-Binding Letter of Intent to Acquire
Emerging Goldfields Resources Ltd.
Vancouver, British Columbia - July 12th, 2023) - Margaret Lake Diamonds Inc. (TSXV: DIA) (OTC:
DDIAF) (FSE: M85A) ("DIA" or the "Company") is pleased to announce that it has signed a non-
binding letter of intent dated June 26 th, 2023 (the " LOI") with Emerging Goldfields Resources Ltd.
("Emerging"), an arm’s length private company incorporated under the Business Corporations
Act (Alberta) (the " ABCA"), which sets forth the general terms and conditions of a proposed reverse
takeover transaction (the " Proposed Transaction "). In addition, and in connection with the Proposed
Transaction, the parties have agreed to use their "commercially reasonable efforts" to cause Emerging to
complete a private placement of units of Emerging ("Units") (the "Proposed Private Placement").
The Proposed Transaction will, pursuant to the policies of the Exchange, constitute a 'reverse takeover' of
the Company. The corporation resulting from the Proposed Transaction (the "Resulting Issuer") will carry
on the business of Emerging as currently constituted and be listed for trading on the Exchange as a Tier 2
mining issuer and the Frankfurt Stock Exchange under the name "Emerging Goldfields Resources Ltd.", or
such other name as the parties may agree.
Pursuant to the terms of the LOI, it is intended that DIA and Emerging will enter into a business combination
by way of a share exchange, merger, amalgamation, arrangement, or other similar form of transaction. The
final structure of the business combination is subject to receipt by the parties of tax, corporate, and securities
law advice and will be agreed to and superseded by a definitive agreement (the " Definitive Agreement")
between DIA and Emerging with such agreement to include representations, warranties, conditions and
covenants typical for a transaction of this nature.
Overview of Emerging
Emerging is a private corporation incorporated under the ABCA carrying on business as a mineral
exploration company focused on the acquisition, exploration, and development of mineral properties in
Armenia. Emerging, through its UK wholly owned subsidiary, Goldfield Holdings Ltd., holds a 80%
working interest in Armenian companies Vayk Gold LLC, Geghi Gold LLC and Copper Plus LLC.
Emerging has an 80% interest in a portfolio of gold-silver deposits having a combined 43-101-compliant
M&I attributable Au resources of 2.37 M ounces of Au and 15.82 million ounces Ag consisting of three
polymetallic gold-silver deposits in Armenia, all with significant resource growth potential.
* See Endnote on resource estimate and reference to technical reports
Cut-Off Tonnage
(Au, g/t) (t) Au
(g/t)
Ag
(g/t)
Sb
(%)
Pb
(%)
Zn
(%)
Cu
(%)
Azatek(1) Measured 80% 1.00 5,902,491 2.09 12.88 0.07 0.16 0.12 0.16
Indicated 80% 1.00 13,516,178 1.72 12.45 0.08 0.17 0.21 0.18
Voskedzor(2) Indicated 80% 1.00 28,810,000 1.52 10.22 n.a 0.04 0.08 0.07
Archut(3) Indicated 80% 0.80 4,190,000 1.11 5.24 n.a n.a n.a 0.08
Total Attributable
Azatek(1) Inferred 80% 1.00 5,264,822 1.77 16.75 0.07 0.13 0.19 0.22
Total Attributable Inferred
Measured & Indicated
Grade
OwnershipCategoryDeposit
Capitalization of DIA
Each issued and outstanding common share the capital of DIA (the " Margaret Common Shares") at the
time of closing, will be exchanged into one common share of the resulting issuer (each a "Newco Common
Share") on a 1:1 basis, such that all of the issued and outstanding Margaret Common Shares will be
exchanged for 4,741,230 Newco Common Shares and the outstanding warrants to purchase Margaret
Common Shares (the " Margaret Warrants ") shall each be exchanged for one replacement warrant
("Newco Warrant"), exercisable on a 1:1 basis so that all of the issued and outstanding Margaret Shares
will be exchanged for 4,741,230 Newco Common Shares, the outstanding Margaret Warrants will be
exchanged for 4,157,313 Newco Warrants.
Capitalization of Emerging
Each issued and outstanding common shares in the capital of Emerging (each an "Emerging Share") at the
time of closing will be exchanged into one Newco Common Share on a 1:1 basis and the outstanding
warrants to purchase Emerging Shares (the "Emerging Warrants") shall each be exchanged for one Newco
Warrant, exercisable on a 1:1 basis so that all of the issued and outstanding Emerging Shares will be
exchanged for 59,800,000 Newco Common Shares, each outstanding Emerging Warrant will be exchanged
for 600,000 Newco Warrants.
Additionally, each issued and outstanding common share and warrant issued pursuant to the Proposed
Private Placement shall be exchanged into one Newco Common Share and one Newco Warrant on a 1:1
basis.
Terms of the Proposed Transaction
The LOI serves as an agreement in principle concerning a business combination between DIA and Emerging
that will result in a reverse takeover of DIA. The Proposed Transaction will take the form of a business
combination between DIA and Emerging whereby the DIA Securities and Emerging Securities will be
exchanged on a 1:1 basis for an equivalent security of the Resulting Issuer (other than Emerging Shares or
Margaret Common Shares held by shareholders who exercise their dissent rights, if applicable.
Pursuant to the rules of the TSXV , a halt in trading is expected to continue until the completion of the
Proposed Transaction. Sponsorship pursuant to rules of the TSXV may be required and Margaret may apply
for a waiver. Margaret has not yet engaged a sponsor.
The completion of the Proposed Transaction is also subject to several other conditions set out in the LOI,
including approval by the directors of the Company and Emerging, satisfactory completion of due diligence,
applicable regulatory approvals, and applicable shareholder approvals. A more comprehensive news release
will be issued by DIA disclosing details of the Proposed Transaction, including financial information
respecting Emerging, the names and backgrounds of all persons who will constitute insiders of the Resulting
Issuer, and information respecting sponsorship, once an agreement has been finalized and certain conditions
have been met, including:
i. satisfactory completion of due diligence; and
ii. execution of the Definitive Agreement.
The Exchange may require some or all of the Newco Common Shares issued to the holders of the Emerging
Shares to be held in escrow pursuant to the requirements of the Exchange. The Proposed Transaction is
subject to, satisfactory completion of due diligence, the execution of a Definitive Agreement, among other
details, final approval of the Exchange and standard closing conditions.
Proposed Private Placement
Pursuant to the LOI, the parties have agreed to use their "commercially reasonable efforts" to cause
Emerging to complete the Proposed Private Placement at a price per Unit of $0.30 to raise gross proceeds
of up to CAD $1,500,000 or such other amount as the Parties may agree to. The Parties may engage an
agent or syndicate of agents (the "Agents") for the Proposed Private Placement. A commission may be paid
to the Agents or to individual registrants (including selling group members). The Agents may also be
granted broker warrants of the number of Private Placement Common Shares sold by the Agents (including
selling group members) in the Proposed Private Placement, with each broker warrant entitling the holder
thereof to purchase one common share of the Resulting Issuer at a price equal to the price paid per Private
Placement Common Share. Further particulars of the Proposed Private Placement will be disseminated in
a news release to be issued upon finalization of its terms.
Each Unit is expected to have a subscription price of CAD$0.30 per Unit and is expected to be comprised
of one (1) common share in the capital of Emerging (an "Emerging Share"), and one Common Share
purchase warrant of Emerging (a "Emerging Warrant"). Each Emerging Warrant entitles the holder thereof
to purchase one (1) Emerging Share (a "Warrant Share", together with the Emerging Shares, the Emerging
Warrants, and the Bonus Emerging Shares (defined below), the "Securities") at a price of CAD$0.60 per
Emerging Share expiring three (3) years from the completion of a going public transaction. In the event
that Emerging has not completed a going public transaction within four (4) months following the closing
date (the "Bonus Deadline"), the subscriber shall have the right to be issued by Emerging, and Emerging
shall issue to the subscriber, for no additional consideration from the subscriber, such number of additional
Emerging Shares as is equal to 10% of the number of Emerging Shares comprising the Units purchased by
and issued to the subscriber pursuant to the subscribers subscription agreement at the closing time (such
additional Emerging Shares, the "Bonus Shares")
On behalf of the Board
Margaret Lake Diamonds Inc.
"Yari Nieken"
President, Chief Executive Officer, Chairman
Tel: 604.328.0425 | Email: [email protected]
Disclaimer for Forward-Looking Information
Statements in this press release regarding DIA's business which are not historical facts are "forward-
looking statements" that involve risks and uncertainties, such as terms and completion of the proposed
transaction. Since forward-looking statements address future events and conditions, by their very nature,
they involve inherent risks and uncertainties. Actual results in each case could differ materially from those
currently anticipated in such statements.
Completion of the Proposed Transaction is subject to a number of conditions, including but not limited to,
execution of a binding Definitive Agreement relating to the Proposed Transaction, Exchange acceptance
and where applicable, shareholder and regulatory approvals. Where applicable, the Proposed Transaction
cannot close until the required shareholder approval is obtained. There can be no assurance that the
Proposed Transaction will be completed as proposed or at all.
Investors are cautioned that, except as disclosed in the management information circular or filing statement
to be prepared in connection with the Proposed Transaction, any information released or received with
respect to the Proposed Transaction may not be accurate or complete and should not be relied upon.
Trading in the securities of a DIA 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.
Qualified Person Statement
The technical information in this news release related to the Vayk Gold LLC, Geghi Gold LLC and Copper
Plus LLC assets is based on, and fairly represents, information in the 43-101 report. compiled by Mr .
Ricardo A. Valls, M. Sc., P . Geo, an indepdent and qualified person as defined by NI 43-101. Mr . Valls
confirms that he has reviewed this press release and that the scientific and technical information concerning
the deposit is consistent with the 43-101 report.
Trading in the listed securities of DIA will remain halted pursuant to Policy 5.2 Section 2.5 of the Exchange.
Mineral Resource
1. Azatek
Based on technical report titled “NI 43-101 Technical Report, Azatek Deposit, Armenia” with
an effective date of January 15, 2023, Ricardo A. Valls, M. Sc., P.Geo., Valls Geoconsultant,
Toronto, Ontario
2. Voskedzor
Based on technical report titled “Updated Technical Report, Geghi Ore Belt, Kapan,
Armenia” with an effective date of January 15, 2023, Ricardo A. Valls, M. Sc., P.Geo., Valls
Geoconsultant, Toronto, Ontario
3. Archut
Based on technical report titled “Update of the Technical Report of the Lernajur Project and
the Archut Target, Lori, Armenia” with an effective date of January 15, 2023, Ricardo A. Valls,
M. Sc., P.Geo., Valls Geoconsultant, Toronto, Ontario
Mineral resources are not mineral reserves and do not have demonstrated economic viability. There
is no certainty that all or any part of the mineral resources will be converted into mineral reserves.
The estimate of mineral resources may be materially affected by environmental permitting, legal,
title, taxation, sociopolitical, marketing, or other relevant issues.
The above global resource estimate table is provided for informational purposes only and is not
intended to represent the viability of any project on a standalone or global basis. The exploration
and development of each project, project geology and the assumptions and other factors underlying
each estimate, are not uniform and will vary from project to project. Please refer to the technical
report for each respective project, as referenced herein, for detailed information respecting each
individual project.
All quantities are rounded to the appropriate number of significant figures; consequently, sums may
not add up due to rounding.