Acme Resources Corp.
TSX VENTURE : ACY.P

December 15, 2011 08:00 ET

Acme Resources Corp. Agrees to Acquire Copper and Gold Assets With Acquisition of First Minerals Exploration Limited

TORONTO, ONTARIO--(Marketwire - Dec. 15, 2011) - Acme Resources Corp. (TSX VENTURE:ACY.P) ("Acme")

NOT FOR DISTRIBUTION TO UNITED STATES WIRE SERVICES OR DISSEMINATION IN THE UNITED STATES.

This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States or to or for the account or benefit of U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.

Acme Resources Corp. is pleased to announce that it has entered into a letter agreement with First Minerals Exploration Limited ("First Minerals") effective December 14, 2011, relating to a qualifying transaction (the "First Minerals Transaction"), pursuant to which Acme proposes to acquire all of the issued and outstanding common shares of First Minerals in exchange for the issuance of common shares in the capital of Acme (the "Acme Shares") by way of a three-cornered amalgamation.

Trading in the shares of Acme has been halted in accordance with the policies of the TSX Venture Exchange (the "TSXV") and will remain halted until such time as all required documentation has been filed with and accepted by the TSXV and permission to resume trading has been obtained from the TSXV.

Transaction Summary

The First Minerals Transaction is expected to be effected by way of a three-cornered amalgamation, pursuant to which a wholly-owned Ontario subsidiary of Acme will amalgamate with First Minerals, with the amalgamated company being a wholly-owned subsidiary of Acme. Acme will change its name to First Minerals Exploration Ltd. (the "Resulting Issuer"). Under the terms of the First Minerals Transaction, each First Minerals shareholder will receive one common share in the Resulting Issuer having a deemed price of $0.05 for every common share of First Minerals (the "First Minerals Shares") held. Upon completion of the First Minerals Transaction, the Resulting Issuer will carry on the business of mineral exploration. The actual number of Acme Shares to be issued pursuant to the First Minerals Transaction will depend in part on the size and pricing of the First Minerals Private Placements (described below), but will not be less than 9,698,900 Acme Shares. As a result, after giving effect to the First Minerals Transaction, but before giving effect to the First Minerals Private Placements (as defined below), the shareholders of First Minerals will hold 77.28% of the Resulting Issuer common shares and the Acme shareholders will hold 22.72% of the Resulting Issuer common shares, in each case on a non-diluted basis.

The First Minerals Transaction is a related party transaction, as two directors of Acme, David Constable and Kees Van Winters, hold securities in First Minerals (David Constable holds 144,000 common shares (1.49%) of First Minerals and Kees Van Winters holds 365,000 common shares (3.77%) and 50,000 common share purchase warrants of First Minerals). Mr. Constable also holds 200,000 (7.02%) Acme Shares and options to purchase 6,879 Common Shares. Messrs. Constable and Van Winters having declared their interest in the First Minerals Transaction, the letter agreement was approved by the disinterested directors of Acme. The First Minerals Transaction is not a "Non-Arm's Length Qualifying Transaction" for purposes of the TSXV Policies, and is not subject to the requirements to obtain minority shareholder approval pursuant to Multilateral Instrument 61-101 and Policy 5.9 of the TSXV and will not otherwise be subject to Acme shareholder approval.

Integral Wealth Securities Limited will be paid a finder's fee for its role in identifying First Minerals for Acme by the issuance of 350,000 Acme Shares.

Private Placement

Prior to the closing of the First Minerals Transaction, First Minerals intends to complete two non-brokered private placements of First Minerals Shares (together, the "First Minerals Private Placements"). The first of these private placements will be to raise gross proceeds of up to $100,000 and will entail the issuance of First Minerals shares at a price of $0.15. A subsequent private placement is anticipated to close in mid to late January, 2012 raising at least the minimum amount of funds specified by the TSXV as a condition of listing and a maximum of $500,000 will be made at a price to be determined.

Conditions Precedent to Completing the First Minerals Transaction

The parties' obligations to complete the First Minerals Transaction are subject to the satisfaction of a number of conditions, including but not limited to, completion of the First Minerals Private Placement, TSX Venture Exchange approval, First Minerals shareholder approval and other conditions customary for a transaction of this type.

Proposed Directors of the Resulting Issuer

The board of directors of Acme is currently comprised of six directors. Acme will procure duly executed resignations and releases in favour of Acme, effective at the closing of the First Minerals Transaction, from each director and officer of Acme who will no longer be serving in such capacities and the nominees of First Minerals will comprise the board of directors of the Resulting Issuer. It is expected that the board of directors of the Resulting Issuer will be comprised of five persons, who shall include Michael Newbury, Harry Burgess, Brian Cloney and two directors still to be determined.

Michael Newbury. Mr. Newbury holds a B.Sc. M.SC. and P.Eng., and has been a banker, engineer and project finance specialist. He is the President, Chief Executive Officer and a director of Strike Minerals Inc. and Greenrock Resources, and a director of Roscan Minerals and Ring of Fire Resources.

Harry Burgess. Mr. Burgess is currently a director of Acme. He received a B.Sc. in Mechanical Engineering and a B.Sc in Mining Engineering in 1966 and 1968, respectively, both from the London University, England, and an M.Sc. in Engineering from the University of Witwatersrand, South Africa, in 1980. Mr. Burgess is Vice-President of Micon International Limited, a minerals industry consulting firm. In the past 5 years Mr. Burgess has been the Director of Vena Resources Inc., Absolut Resources Corp., and Amerix Precious Metals Corp.

Brian Cloney. Mr. Cloney is currently a director and the Chief Financial Officer of Acme. He has a Bachelor of Arts from University of Waterloo, Ontario, Canada and has been a chartered accountant since 1976. Mr. Cloney is the principal of BMC Institutional Supplies & Services Inc., a private Ontario corporation providing management, compliance and financial consulting services, a position he has held since January 2007. Mr. Cloney was, until January 2007, a Chartered Accountant at Brian Cloney CA & Associates, an accounting firm, a position he held since 1985. He is currently the CEO of NWT Copper Mines Ltd. and the CEO of Carscallen Gold (a private company). Up until 2007, he was also the CFO of SilkRoad Resources. He is the former CFO of Cenit Corp. and HMZ Metals Inc. Mr. Cloney is currently a director and the chairman of the audit committee and the former acting CFO of Cuervo Resources Inc.

About First Minerals

First Minerals was incorporated on October 6, 2009 and is a private Ontario corporation focused on the acquisition and exploration of mineral properties. First Minerals' head office is located at 67 Third Avenue, Timmins, Ontario. Since its incorporation, First Minerals has acquired various interests in mineral properties as well as minority shareholdings in Strike Minerals Inc. and Cenit Corporation.

Currently, there are 9,698,900 First Minerals Shares issued and outstanding. Other than warrants to purchase an aggregate of 176,000 First Minerals Shares at a price of $0.25 per common share for a period of one year from listing on a stock exchange, no stock options, warrants or other securities entitling holders to acquire First Minerals Shares are outstanding. First Minerals is not a reporting issuer and its securities are not listed or posted for trading on any stock exchange. The controlling shareholder of First Minerals is Robert Young, a resident of Ontario.

Selected Financial Information of First Minerals

The following unaudited financial information for the period ended September 30, 2011 has been provided by First Minerals. Such information is subject to all other information contained in the relevant financial statements disclosed in the filing statement to be prepared in connection with the First Minerals Transaction.

During the period from incorporation through September 30, 2011, First Minerals raised cash net proceeds of approximately $250,000 from the issuance of First Minerals securities and used $200,000 of these funds principally for payments toward the acquisitions of mineral properties, as described above. As at September 30, 2011, First Minerals had cash and cash equivalents amounting to $120,000.

First Minerals Properties

As at the date hereof, First Minerals has acquired interests in three mineral projects in Ontario, the Nicholson Prospect being the project that will be the property relied on for listing the Resulting Issuer.

The exploration results disclosed by this press release have been reviewed, verified (including sampling, analytical and test data) and compiled by Bruce Edgar. Mr. Bruce Edgar, HBSc, P. Geo, is independent of First Minerals and is responsible for the technical information in this news release.

Nicholson Prospect

First Minerals has retained Mr. Edgar to prepare an NI 43-101 compliant technical report in respect of the Nicholson Prospect.

The main showing of the Nicholson Property has been intermittently worked since the early 1930's. High grade assays for gold have been returned during every historical exploration program or investigation of the showing in the past. The geological mapping and channel sampling program by Strike Minerals Inc. (November 2008), the diamond drill program (completed on May 26, 2009) and the trenching, mapping and sampling program completed from July through October, 2009, represent the most comprehensive work programs performed on the property.

The zone features pinch and swell quartz veining to 40 centimetres in width, located within a tension shear/fracture trending from 130º to 150º in Lapilli/Crystal Tuffs, and often accompanied by a narrow felsic intrusive dike.

A surface stripping and channel sampling program completed in October, 2009, indicated that the Main Showing Zone can be continuously traced over the length of the entire exposure for 294 meters (with the exception of a 15 meter section of Diabase dike which has cut through the zone along a pre-existing NW trending fault). The zone remains open along strike and at depth.

The main showing zone is a highly significant gold occurrence within the eastern portion of the Wawa Greenstone belt.

The zone exhibits excellent continuity of structure over the tested strike length, both on surface and at vertical depths to 55 metres (180 feet), as indicated by geological mapping and diamond drilling.

A grab sample taken by River Gold Mines in the late 1990's returned a grade of 658.48 gpt Au.

Channel sampling by Strike Minerals Inc. (Nov. 2008) of the south-east section of the Main Showing Zone returned a grade of 14.77 gpt Au over 1.52 meters for 57.3 meters while sampling of the north-west portion of the Zone returned a grade of 8.95 gpt Au over 1.52 meters for 16.3 meters.

Assays as high as 298.4 gpt over 0.46 metres (8.705 opt over 1.5 feet) were returned during the diamond drill program (N-26-09).

However, the gold within the quartz veining is randomly distributed, and check samples indicate that the gold tends to exhibit the nugget effect.

Historically, and during the recent work programs, high grade values for gold are separated by numerous lower to trace values.

The West Dog River showing is located approximately 500 meters west of the main showing zone and features similar pinch and swell quartz veining. Sampling of the cliff face showing returned a grade of 9.76 gpt Au over 2.44 meters. Historical showings within pits west of the cliff face returned grades as high as 2.37 gpt Au over 0.6 meters.

Batchewana Prospect

First Minerals intends to retain MPH Consulting Limited to prepare an NI 43-101 compliant technical report in respect of the Batchewana Prospect.

The Batchewana Prospect is located approximately 85 kilometers west and north of Sault Ste. Marie, Ontario. The Trans-Canada Highway (Highway 17) crosses the westernmost part of the property. A portion of the property is subject to a 1.5% net smelter return royalty of which one half (0.75%) may be purchased at any time for $750,000.

A mining operation and several subsequent exploration programs have been conducted on the property between 1948 and 2006. Regional geological mapping was done in 1973. There have been various phases of prior surface and underground exploration conducted on a portion of the property including pitting, trenching, drilling and underground development although the bulk of this work was done in close proximity to the mine workings.

Post mining exploration work has included airborne and ground geophysical surveys, and site specific geological mapping and geochemical sampling and a two-phase diamond drilling program testing the southern extension of the historical Coppercorp Mine trend as well as various geophysical anomalies.

First Minerals entered into an arm's length option and joint venture agreement with Cenit dated September 1, 2010 pursuant to which Cenit may acquire an undivided 50% right title and interest in 44 unpatented mineral claims covering approximately 250 square kilometers that includes the previously mined Coppercorp Property, now known as the Batchawana Bay Copper Property.

Cenit has paid First Minerals a cash payment of $50,000 and has issued to First Minerals 1,000,000 shares of Cenit;

In order to maintain this option to acquire a fifty percent (50%) interest in the Claims, Cenit shall:

(a) expend work costs of $250,000 on the claims on or before the eighteen month anniversary of this Agreement;
(b) issue to First Minerals common shares of the capital stock of Cenit with no resale restrictions except those imposed by the TSXV as follows:
(i) the number of Cenit shares which is equal to $75,000 divided by the twenty day weighted average market price as at the first twelve month anniversary of the date of execution of the agreement and delivered to the Optionor within five (5) days of receipt of TSXV approval; and
(ii) the number of Cenit shares which is equal to $100,000 divided by the twenty day weighted average market price as at the first twenty-four month anniversary of the date of execution of the agreement and delivered to the Optionor within five (5) days of receipt of the TSXV approval.

Argo Prospect and Gilbert Occurrence

First Minerals also has an interest in a property known as the Argo Prospect, consisting of 5 contiguous claim blocks, 4218144, 4218163, 4218164, 4218165 and 4218166, (comprised of 67 units), which are in good standing until April 23, 2012.

The property is easily accessible as the Missanabie highway passes through it from north to south. The showing area is accessed via an old, overgrown bush road.

Apparently the showing was originally worked in the 1950's with hand trenching and in the 1980's with mechanical trenching and sampling, however, no data has been found in the assessment files on the MNDM website.

First Minerals has also recently staked the historical "Gilbert Occurrence" (historical "Sylvanite Gold Mines Property") in Copenace Township. Two claim blocks, 4218174 and 4218175, composed of 16 units each are contiguous to, and located south-east of, the Argo Prospect claim blocks.

The First Minerals property in Copenace township is comprised of 7 contiguous claim groups (99 claim units).

Completion of the First Minerals Transaction is subject to a number of conditions, including but not limited to, Exchange acceptance, the closing of the First Minerals Private Placements and First Minerals shareholder approval. The First Minerals 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 filing statement to be prepared in connection with the First Minerals Transaction, any information released or received with respect to the First Minerals Transaction may not be accurate or complete and should not be relied upon. Trading in securities of Acme should be considered highly speculative.

Forward-Looking Information

This news release contains "forward-looking information", which may include, but is not limited to, statements with respect to the future financial or operating performance of Acme, First Minerals and its projects. Often, but not always, forward-looking statements can be identified by the use of words such as "plans", "expects", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates", or believes" or variations (including negative variations) of such words and phrases, or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Acme and First Minerals to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Forward-looking statements contained herein are made as of the date of this press release and Acme and First Minerals disclaim, other than as required by law, any obligation to update any forward-looking statements whether as a result of new information, results, future events, circumstances, or if management's estimates or opinions should change, or otherwise. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, the reader is cautioned not to place undue reliance on forward-looking statements.

Cautionary Note Concerning Resource and Reserve Estimates

The mineral resource and mineral reserve figures referred to in this press release are estimates and no assurances can be given that the indicated levels of minerals will be produced. Such estimates are expressions of judgment based on knowledge, mining experience, analysis of drilling results and industry practices. Valid estimates made at a given time may significantly change when new information becomes available. By their nature resource and reserve estimates are imprecise and depend, to a certain extent, upon statistical inferences which may ultimately prove unreliable. If such estimates are inaccurate or are reduced in the future, this could have a material adverse impact on the Resulting Issuer.

Mineral resources are not mineral reserves and do not have demonstrated economic viability. There is no certainty that mineral resources can be upgraded to mineral reserves through continued exploration.

Estimates of mineral resources and reserves may be materially affected by environmental permitting, legal and other relevant issues.

Due to the uncertainty that may be attached to inferred mineral resources, it cannot be assumed that all or any part of an inferred mineral resource will be upgraded to an indicated or measured mineral resource as a result of continued exploration. Confidence in the estimate is insufficient to allow meaningful application of the technical and economic parameters to enable an evaluation of economic viability worthy of public disclosure (except in certain limited circumstances). Inferred mineral resources are excluded from estimates forming the basis of a feasibility study.

The TSXV has in no way passed upon the merits of the proposed transaction described herein and has neither approved nor disapproved the contents of this news release.

All information contained in this news release with respect to First Minerals was supplied by First Minerals for inclusion herein.

Neither the securities of Acme nor the securities of First Minerals have been, nor will be, registered under the U.S. Securities Act or any state securities laws and such securities may not be offered or sold within the United States or to, or for the account or benefit of, U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an applicable exemption from such registration requirements is available. This news release does not constitute an offer or sale of securities in the United States.

Neither TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this news release.

Contact Information

  • Acme Resources Corp.
    Paul Ankcorn
    Chief Executive Officer
    (416) 866-2200