The Concerned Shareholder of MGold Resources Inc.

June 14, 2012 18:20 ET

The Concerned Shareholder of MGold Resources Inc. Files Letter and Dissident Proxy Circular

Shareholders are asked to Vote FOR Change by Voting Your GREEN Proxy

CALGARY, ALBERTA--(Marketwire - June 14, 2012) - Martin Ellis, a Concerned Shareholder of MGold Resources Inc. ("MGold"), announced today that he has filed a letter to shareholders, dissident circular and form of proxy on SEDAR at for the replacement of the existing directors of MGold.

The Concerned Shareholder is asking for shareholders of MGold to vote for a new board of directors at the upcoming annual general and special meeting of shareholders to be held on June 29, 2012, in Montreal, Quebec. Please review the letter and biographies of the highly qualified and experienced proposed nominees contained in the dissident proxy circular filed at:

The time has come to provide MGold with the direction and leadership it requires through a new shareholder-focused board of directors. In early 2011, the current management of MGold decided to seek additional projects for the company. In June, 2011, MGold entered into a letter of intent with Silver Reserve Corp. ("SRC") of Reno, Nevada to acquire, through a subsequent option and joint venture agreement to be entered in by MGold and SRC, a 50% working interest in the Silver Queen and Klondyke Properties located in Nevada. In September 2011, MGold completed a brokered private placement for total proceeds of $2,030,000 and entered into a definitive option agreement with SRC, pursuant to which the Corporation had the option to acquire a 50% undivided interest in each of the Silver Queen property and the Klondyke property. The proceeds from the private placement were intended to be used primarily to incur exploration expenditures as consideration for the acquisition of the Silver Queen and Klondyke Properties and for working capital and general corporate purposes. Notwithstanding the fact that the option was cancelled by MGold on March 23, 2012, and thus the proposed business plan contemplated by the private placement financing was not executed, the Corporation paid excessive fees to its Chief Executive Officer as described below.

In 2011, the Corporation paid a company controlled by Mr. Joel Scodnick, the Chief Executive Officer of MGold, management and consulting fees in the amount of $192,104. The financial statements for the year ended December 31, 2011, show general and administrative expenses in the amount of $546,949. In addition, the interim financial statements for the period ended March 31, 2012, show further general and administrative expenses of $244,592, with the Corporation paying a company controlled by Mr. Joel Scodnick $60,672 for geological consulting and management services, being fees in the amount of over $20,000 per month. In the view of the Concerned Shareholder, these expenses are not justified in the context of the Corporation's activity level and demonstrate the incompetence of the current management and Board. In addition, in the view of the Concerned Shareholder, the general and administrative expenses in the total amount of $791,541 for the period from January 1, 2011 to March 31, 2012, are not justified.

Having regard to the current lack of viable mineral exploration projects that are being executed upon by current management and the experience and expertise of the Concerned Shareholder's Nominees, it is expected that under the direction of the new directors that efforts will be made to preserve what is left of the Corporation's cash resources, identify and evaluate potential domestic and international oil and gas exploration opportunities and raise the requisite financing to complete and exploit such opportunities.

The new board nominees of the Concerned Shareholder are:

Hugh Loney. Mr. Loney has a B.Sc. Geology (University of Calgary) 1999. He is a member of the Association of Professional Engineers and Geoscientists of Alberta and a member of the Canadian Society of Petroleum Engineers. Mr. Loney has also served as a guest lecturer at the University of Calgary Geology Department. Mr. Loney is currently an independent geologist and in that capacity, analyzes and interprets geological, geophysical and engineering data to determine project viability for investors.

Patrick A. Acham. Mr. Acham has a B.A. Geology (University of Saskatchewan) 1961, and an M.Sc. Geology (University of Alberta) 1971. He is a member of the Association of Professional Engineers, Geologists and Geophysicists of Alberta. Mr. Acham is currently a principal of Peak Petroleum Trinidad Limited, a company that provides geological consulting, executive management, advisory and related services including technical evaluations to companies. Mr. Acham is a highly experienced senior oil and gas executive and consultant with more than forty- nine (49) years of diverse petroleum industry experience with a successful record working initially as a development geologist, explorationist, geological consultant and in senior executive management and technical positions with small, medium and large private and public oil and gas companies in Trinidad and Tobago, Canada and the USA.

Edward C. Kozowy. Mr. Kozowy is a Registered Engineering Technologist (Professionally Licensed with the Alberta Society of Engineering Technologists) with a specialization in petroleum reservoir economic evaluations and A&D evaluations. His work experience spans 34 years including Senior Management and Board of Director positions with several privately controlled E&P companies and Energy Industry consultancies. Upon graduating from Kelsey Institute of Applied Arts and Sciences (Saskatoon, Saskatchewan) in 1977, Mr. Kozowy began his career as a research Technologist with the Alberta Research Council and AGAT Laboratories until 1979, and as and exploitation and operations Technologist with Dome Petroleum from 1980 to 1984.

John E. Squarek. Mr. Squarek has a B. Sc. in Petroleum Engineering (University of Oklahoma), 1966, and a Masters Degree in Business Administration (Adelaide University, Adelaide, South Australia), 1996. Mr. Squarek is a Registered Professional Engineer (Alberta) and a Member of the Society of Petroleum Engineers. His professional experience also includes serving as Chairman of the Small Explorers and Producers Association of Canada and Chairman of the Environment Committee. Mr. Squarek is currently the President and Chief Executive Officer of Oasis Energy Inc., a private company providing management and energy consulting services. Mr. Squarek is a seasoned energy industry executive with a wealth of technical, managerial and business experience. Mr. Squarek has a track record of proven accomplishments in operations management, including environment, health and safety, strategic and business planning and the management of staff in a variety of disciplines. He also has significant international experience and a record for spotting viable business opportunities. Mr. Squarek has directed turn-around and start-up operations.

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