March 4, 2016
Eureka Announces Debt Settlement
Vancouver, British Columbia – Eureka Resources Inc. (“Eureka” or the “Company”) announces that it has agreed to settle an aggregate of $67,975 in outstanding payables and debt owing to directors and officers of the Company through the issuance of 906,333 common shares at a deemed price of $0.075 per share (the “Debt Settlement”).
Because the shares will be issued to directors and officers of the Company, the Debt Settlement will constitute a “related party transaction” within the meaning of Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions (“MI 61-101”), which is incorporated into Policy 5.9 of the TSX Venture Exchange (“TSXV”) Corporate Finance Manual.
The board of directors of the Company has determined that neither the value of the shares issued to, nor the aggregate debt settled with respect to, any directors or officers of the Company in connection with the Debt Settlement will exceed 25% of the Company’s market capitalization on the date hereof. As a result, the Debt Settlement is exempt from the formal valuation and minority shareholder approval requirements of MI 61-101.
Completion of the Debt Settlement is subject to the approval of the TSXV. Shares issued in connection with the Debt Settlement will be subject to a four-month hold period in accordance with applicable securities laws.
Since its incorporation in 1981, Vancouver-based Eureka has focused on the exploration and development of natural resource properties. Its flagship project, the Frasergold Project, is the subject of a National Instrument 43-101 (“NI 43-101”) compliant technical report entitled “NI 43-101 Technical Report Frasergold Exploration Project”, dated July 20, 2015 and amended July 27, 2015, authored by K. V. Campbell, Ph.D, P.Geo, and G. H. Giroux, MA.Sc, P.Eng., which is available on SEDAR. The Frasergold Project is located 100 kilometres east of Williams Lake, B.C., with good summer/fall access by provincial highways and secondary roads.
Eureka recently entered into a letter agreement with Nevada Sunrise Gold Corporation (“Nevada Sunrise”) (TSXV: NEV), which gives it the right to acquire a 50% participating interest in the Gemini Lithium Project (“Gemini”), located in the western Lida Valley, Nevada. Gemini hosts two sub-basins that have the potential for lithium-bearing brines similar to the proven lithium brine deposits located in the Clayton Valley. Lithium occurs in economic quantities within brines in the Clayton Valley where the only producing lithium mine in North America is located. Gemini is situated in a similar geologic environment and is 40 kilometres southeast of the Clayton Valley.
John R. Kerr, P.Eng., is the Company’s designated Qualified Person for this news release within the meaning of NI 43-101 and has reviewed and approved the technical information in this news release.
Further information on Eureka can be found on the Company’s website at www.eurekaresourcesinc.com and at www.sedar.com, or by contacting Michael Sweatman, President and CEO, or Bob Ferguson by email at email@example.com or by telephone at (604) 449-2273.
Neither the TSX Venture Exchange nor its regulation services provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.
Cautionary Statement Regarding Forward-Looking Information
This news release includes certain “forward-looking statements” under applicable Canadian securities legislation that are not historical facts. Forward-looking statements involve risks, uncertainties, and other factors that could cause actual results, performance, prospects, and opportunities to differ materially from those expressed or implied by such forward-looking statements. Forward-looking statements in this news release include, but are not limited to, statements with respect to the proposed Debt Settlement and the Company’s acquisition of an interest in Gemini. Forward-looking statements are necessarily based on a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties and other factors which may cause actual results and future events to differ materially from those expressed or implied by such forward-looking statements. Such factors include, but are not limited to: failure to receive TSXV approval for the Debt Settlement; failure of the Company and Nevada Sunrise to enter into a definitive agreement with respect to the Company’s acquisition of an interest in Gemini or any other failure by the Company to acquire such interest; general business, economic and social uncertainties; those additional risks set out in the Company’s public documents filed on SEDAR at www.sedar.com; and other matters discussed in this news release. Although the Company believes that the assumptions and factors used in preparing the forward-looking statements are reasonable, undue reliance should not be placed on these statements, which only apply as of the date of this news release, and no assurance can be given that such events will occur in the disclosed time frames or at all. Except where required by law, the Company disclaims any intention or obligation to update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise.
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