Everton Resources Inc.
TSX VENTURE : EVR
FRANKFURT : ERV

Everton Resources Inc.

July 09, 2009 08:30 ET

Everton to Acquire Hays Lake Gold Inc. and its Interests in the Shoal Lake West and Shoal Lake East Gold Projects Near Kenora, Ontario

OTTAWA, ONTARIO--(Marketwire - July 9, 2009) - Everton Resources Inc. (TSX VENTURE:EVR)(FRANKFURT:ERV) ("Everton" or the "Company") is pleased to report that it has signed a Letter of Intent (the "LOI") with Hays Lake Gold Inc. ("HLG") whereby the Company is proposing to acquire all of the issued and outstanding shares of HLG, subject to the terms and conditions outlined in the LOI. To date, the LOI has been accepted by shareholders holding more than 90% of the issued and outstanding common shares of HLG.

HLG has various options to acquire a consolidated land package located in the Shoal Lake region of north-western Ontario, in the prolific Archean Greenstone Belt. The land package is comprised of two adjacent properties, Shoal Lake West ("SLW") and Shoal Lake East ("SLE") covering 38 km2 and located approximately 45 km southwest of Kenora, Ontario. Two significant high grade gold deposits with an in-situ NI 43-101 compliant indicated resource of 416,000 oz of gold and an inferred resource of 282,000 oz of gold have been identified on this land package (see details below); including the Cedar Island gold deposit located on the mainland (SLE) and the nearby Duport gold deposit located on Stevens Island (SLW).

Andre Audet, Chairman & CEO of Everton Resources said: "The proposed transaction with HLG provides a compelling opportunity for Everton to participate in the development of advanced gold projects in the prospective Archean Greenstone Belt of north-western Ontario. What makes this deal interesting is that HLG has, for the first time, assembled this large land package to make the overall project viable through the use of a common road network, power grid and milling complex. The Shoal Lake gold project holds two significant high grade gold deposits with in-situ NI 43-101 compliant indicated and inferred resources and 5 former gold producing mines. Everton is of the opinion that the Shoal Lake package of properties hosts a significant gold target with excellent potential to increase the gold resource and warrants additional exploration. Everton intends to fast track the development of the Shoal Lake gold project by teaming up with HLG's first-class development team."

Terms of the LOI

The terms of the LOI between Everton and HLG can be summarized as follows:

(i) Everton is proposing to acquire all of the 32,432,400 HLG shares (the "HLG Shares") in exchange for a maximum of 12,000,000 common shares of Everton (the "Everton Shares"), based on an exchange ratio of 0.37 of an Everton Share for 1 HLG Share (the "Exchange Ratio").

(ii The 3,916,725 share purchase warrants of HLG presently outstanding (the "HLG Warrants") would be exchanged for share purchase warrants of Everton (the "Everton Warrants") in accordance with the Exchange Ratio and the exercise price of such warrants shall be adjusted accordingly, the whole in compliance with the policies of the TSX Venture Exchange (the "Exchange").

(iii) Within a period of three (3) years following the closing of the transaction, should Everton announce the completion of a NI 43-101 compliant report for the combined Shoal Lake properties (property that falls within 100 km of Shoal Lake) that includes 2,000,000 oz Au having a grade of no less than 6.0 g/t Au, of which at least 1,000,000 oz Au shall be in the indicated mineral resource estimate category or better, Everton will issue to the shareholders of HLG on a pro rata basis, within a period of five (5) business days following the announcement, additional Everton Shares having a total value of $1.5 million at a price per share equal to the closing price of the Everton's shares on the Exchange on the day prior to the date of such announcement, subject to a maximum of 7,000,000 Everton Shares.

(iv) The transaction is expected to close by no later than July 31st, 2009, or any other date agreed to in writing by the parties, and is subject to various conditions customary to this type of transaction, among which:

(a) Shareholders holding at least 90% of HLG Shares shall have consented to the transaction;

(b) Execution of a formal share purchase agreement between Everton, HLG and its shareholders;

(c) Completion by Everton of a legal, technical and environmental due diligence investigation on HLG and its business with the results of such investigation being acceptable to Everton in its sole and absolute discretion;

(d) Successful financing totalling $1.9 million which includes $900,000 with two investment funds and a hard cash financing for gross proceeds of $1,000,0000;

(e) All persons having a right to receive or to be issued HLG Shares shall have consented to receive Everton Shares in replacement of such HLG Shares in accordance with the Exchange Ratio;

(f) Approval of the transaction by the Exchange and Everton's Board of Directors.

(v) Everton has agreed to pay HLG a non-refundable cash advance of $25,000 in order to allow HLG to proceed with certain property payments to certain property and lien holders and obtain a thirty (30) day extension to complete the transaction.

(vi) HLG has granted Everton an exclusivity period to complete a transaction until September 30, 2009. In exchange for such exclusivity period, Everton will pay HLG a non-refundable cash amount of $30,000.

(vii) HLG shall have representation on Everton's Board of Directors through one (1) Board seat.

Everton shall have a right to terminate the agreement should any of the conditions outlined above not be completed. The agreement can also be terminated by mutual agreement of the parties or by any of the parties should the formal agreement not have been executed on or before July 31, 2009.

Shoal Lake Regional Geology and Historical Prospects

Rocks of the Shoal Lake are underlain by granite-greenstone terrain within the western portion of the Wabigoon Subprovince, a major sub-division of Precambrian rocks of the Canadian Shield. Volcanic rocks have been folded about the northeast trending Gull Bay-Bag Bay Anticline, the axial trace which is located over 2.2 km southeast of the Duport deposit and extends just to the east of the Cedar deposit. Later penetrative shear zones cut the earlier folds but appear to be controlled by felsic intrusives. Within the project, the main structural features are the silicified shear zones. The Cedar deposit Mainland Zone strikes southeast.

The Duport gold deposit on SLW is hosted by strongly deformed and altered basic rocks within the major northeast-trending, steeply west dipping Duport Deformation Zone. Gold mineralization is present over a strike length of approximately 1.2 km. Grades of possible economic interest have been intersected to a depth of approximately 600 m. In 2006, Roscoe Postle Associates Inc. ("RPA") estimated Mineral Resources, compliant with NI 43-101, using the contour method. Indicated Mineral Resources were estimated at 424,000 tonnes grading 13.40 g/t Au for 182,000 contained ounces of gold. In addition, Inferred Mineral Resources were estimated at 387,000 tonnes grading 10.69 g/t Au for 131,000 contained ounces of gold. To date, most of the work on SLW has been concentrated in the area of the known zones at the Duport gold deposit. A combined airborne magnetic and electromagnetic survey flown in 2005 identified several anomalies within prospective lithologies which have yet to be drill tested. The potential exists to increase the resource base through the discovery of additional zones along strike and at depth.

The mineralization at the Cedar gold deposit is categorized as an Archean lode gold deposit-type related to solution remobilization. The host rocks to the veins include lithologies related to volcanic arcs including the ultramafic to felsic lavas, chemical sediments, younger intrusive diabases, and quartz and feldspar porphyritic rocks. The veins appear as well-defined continuous quartz veins that locally pinch and swell or branch. The Vancouver-based engineering firm Giroux Consultants Ltd. completed a mineral resource estimate on the Cedar deposit in 2003. The mineral resource estimate section of the report was completed in accordance with NI 43-101 guidelines, resulting in an indicated mineral resource estimate of 1,096,000 tonnes grading 6.63 g/t Au for 234,000 contained ounces of gold and an inferred mineral resource estimate of 832,000 tonnes grading 5.63 g/t Au for 151,000 contained ounces of gold. This mineral resource estimate did not include an additional 35 deep drill holes for 10,011 m completed in 2004 by another exploration company on the Cedar deposit mineralized structures known as the 9 East Target. The additional 35 holes were completed in compliance with NI 43-101 standards, which will allow for an updated NI 43-101 compliant mineral resource estimate to be prepared during 2009. Significant drill results were generated during this final program, ranging up to 22 g/t Au over 9.2 m. All veins are open at depth and along strike west of the of the Cedar deposit.

Everton will file in the next few weeks updated technical reports on the both the Shoal Lake West and Shoal Lake East properties.

Other properties

The HLG portfolio also includes two highly prospective projects: one located 70 km west of the Hemlo Camp where high-grade gold-bearing veins were identified and the other within the Timmins Mining Camp located adjacent to past producing mines along the Porcupine-Destor Fault.

Information on HLG

HLG was granted its most significant option by Halo Resources Ltd. ("Halo") in October 2008, pursuant to which HLG was granted by Halo the right to earn a 51% undivided interest in the SLW property by incurring exploration expenditures of $1,500,000 by May 1st, 2010. The agreement is also subject to HLG making quarterly property payments totalling $290,000 by no later than October 31, 2012, of which $24,500 has been paid to date by HLG. HLG has also the right to earn an additional 24% undivided interest in the SLW property by incurring additional exploration expenditures of $3,500,000 by October 31, 2012, and by making a final payment to Halo of $6,000,000 before such date.

HLG was incorporated pursuant to articles of incorporation dated January 23, 2008 under the laws of the Province of Ontario. Its head office is located at 3422 Mulcaster Road, Mississauga, Ontario. HLG is a private issuer within the meaning of applicable securities legislation. As at the closing of the transaction, HLG will have 32,432,400 common shares issued and outstanding.

To the knowledge of Everton, the only persons who currently beneficially own, directly or indirectly, or exercise control or direction over more than 10% of the HLG shares are set forth below:



----------------------------------------------------------------------
NAME JURISDICTION OF NUMBER OF HLG PERCENTAGE
RESIDENCE SHARES
----------------------------------------------------------------------
Chris North Ontario 5,000,000 15.41%
----------------------------------------------------------------------
Moray Resources Inc.(1) Ontario 5,000,000 15.41%
----------------------------------------------------------------------
(1) Company over which Mr. Alexander Stewart, CEO of HLG, exercises
control.


The remaining 69.18% of outstanding HLG shares are currently held by 44 shareholders.

This news release was prepared under the supervision of Marc L'Heureux, P. Geo. and VP Exploration of Everton, who acts as Everton's Qualified Person as defined by NI 43-101.

Everton is well funded and actively exploring in the Dominican Republic adjacent to the US$2.7 billion Pueblo Viejo project, currently being developed by the world's largest gold mining company, Barrick Gold Corporation (60%) (NYSE/TSX: ABX) in partnership with Goldcorp (40%) ("Goldcorp") (NYSE: GG, TSX: G). Pueblo Viejo is estimated to contain 22.4 million ounces of gold, 455 million pounds of copper and 131.3 million ounces of silver. Everton is also exploring in the Opinaca region of James Bay, Quebec where the Company has amassed one of the largest land claims adjacent to Goldcorp Inc.'s Eleonore gold deposit, which currently hosts an estimated mineral resource of 5.3 million ounces of gold.

This news release contains certain forward-looking statements that involve risks and uncertainties, such as statements of Everton's plans, objectives, strategies, expectations and intentions. The words "may", "would", "could", "will", "intend", "plan", "anticipate", "believe", "estimate", "expect" and similar expressions, as they relate to Everton, or its management, are intended to identify such forward-looking statements. Many factors could cause Everton's actual results, performance or achievements to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements. The forward-looking statements included in this press release represent Everton's views as of the date of the release. While Everton anticipates that subsequent events and developments may cause its views to change, it specifically disclaims any obligation to update these forward-looking statements. All subsequent written and oral forward-looking statements attributable to Everton or persons acting on its behalf are expressly qualified in their entirety by this notice.

Neither 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 release.

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