Goldcliff Resource Corporation (GCN) Earnings Call Transcript & Summary

Joining the meeting.

This is Graham Scott.

Good morning Graham Scott or good evening, wherever you are. This is George Sanders.

Hello, George, how are you?

Well, thank you.

Yes. Paul Saxton here. Yes.

Hi, Paul.

Edwin Rockel here as well.

Good morning, Paul. Hi, Ed.

Good morning.

May I ask, do we have any shareholders on the line other than directors? May be a quick call, Graham.

It could be. Is Gary on the line and Sam?

Yes, here I'm here. It' Gary.

I'm here.

Okay. Both here. And Francesca are you there?

Yes, I'm here as well.

Hi, Francesca.

Hello. How are you.

Well, thank you. Thank you for your help the other day. Graham, I apologize for not calling you straight back. I was in Mexico for 3.5 weeks. Though I did get your message that you left on my office voice mail, and I didn't get the other message because I had changed SIM cards on my phone. So I got it on Tuesday, and I figured I'd be talking to you on Thursday, so I didn't bother.

But what the heck announcement, if I had to guess, I had talked to you at your cabin on Tuesday [at Upper Lake ], but obviously, I was...

Actually Arrow Lake, and we're actually headed there after this call.

So George [ talk any silver ] project down in Mexico going.

Actually, they just put out a really comprehensive news release this morning, updating their construction progress and budget where they are on budget. So basically, they are on time and on budget. They're already extracting in stockpiling ore. And I believe the mill is like 90% complete and so their scheduling tune up, I think, I don't want to put like -- I don't have it in front of me, but early second quarter. So it's going okay, but I don't have any involvement there any longer other than I'm still a shareholder. So, hoping it works well for them. Graham, if we don't have any other -- are you able to tell as the host if there are other folks on the line because following the business of the AGM I would appreciate if you stayed on the line for just a few minutes, and I'll give you an update. Most of the Board is fairly up to date, but I will include them, but I'd like to update you on what we're doing at Kettle Valley because it's getting kind of exciting. So...

Yes, George. I look forward to that. And no, I've got no means of coming on the present call who's there. I think it can be done, but I haven't got the clip of a video. I'm sitting in my office in Europe, in England with a laptop. So let's assume that the people on the call are the only ones who are the ones who have identified themselves are the only ones unless there's any shareholder who joined us very late. Are there any more shareholders? Okay. In that case, I'll call the meeting to order. This is the company's 2022 Annual General Meeting. With your consent, I'll act as Chairman of the meeting, and I appoint George Sanders, the president and CEO as the Recording Secretary. The matters to be considered today are to receive and consider the company's financial statement for the fiscal year ended October 31, 2021, and the report of auditor. Secondly, to elect directors for the ensuing year. Thirdly, to appoint Davidson & Company, Chartered Professional Accountants as the auditor of the company for the ensuing year. Fourthly, to confirm the company's stock option plan as required by the TSX Federal Exchange. And lastly, any other business that may properly call before the meeting. With your consent, I'll appoint Francesca Power of Computershare Investor Services as the company's registrar and transfer agent, to act as scrutineer of the meeting. Notice of the meeting has been given to all of the shareholders as required by the BC Business Corporations Act and related policies of the BC Securities Commission. And I present to the meeting the affidavit of Brendan Black of DataCore Mail Management confirming that all the required materials were mailed on April 1, 2022, unless somebody requires the notice to be read, I would accept the motion -- I will accept the motion of the meeting notice that you read. The motion please.

So moved.

So moved.

Seconded. On favor say, aye? [Voting]

And you guys. Motion carried. Thank you all. The quorum for shareholder meeting is at least 2 persons who represent in proxy or in person.

Joining the meeting.

Sam.

The issued -- of the issues shares entitled to be voted at the meeting. Hello, Sam, sorry, I didn't know that you weren't on. But we just got going.

Sorry, I'm late.

No problem at all. We just got to the quorum and I'd ask Francesca to give her oral interim report and attendance. Francesca could you let us know how many shareholders are here and how many -- what percentage of the issued shares those shares represent?

Sure. So we have 1 shareholder in person representing 20,420 shares, 32 shareholders by proxy representing 17,596,429 shares for a total of 33 shareholders holding 17,616,849 shares, which is 29.93% of the issue outstanding as of the record date.

Very good. Thanks, Francesca, I'll accept your report, and I declare the meeting regularly called for the transaction of business. Obviously, we're not having a meeting in person, so we can do voting by a show of hand. So we'll have voting according to an oral vote, aye for positive, and nay for negative. I now move to the consideration of the financial statements and the report of the auditor. The statements of the company for the year ended October 31, 2021, are present at the meeting and are available for review on the company's profile on the SEDAR website. It's not necessary to vote on the financial statement but it's typical to accept the receipt of the financial statements. So I could please have a motion receiving the financial statements for the year ended October 31, and the report of the auditor on those statements. A motion please.

Moved.

There is numerous motions made.

I think it was the whole audit committee.

All in favor, aye, say aye. [Voting]

Any against? [Voting]

Motion carried. Thank you very much. The next matter of business is the election of Directors. The Business Corporations Act requires any individual nominated as the Director [ must not be ] present at the meeting or not review the nomination or if not present, the individual must have provided the company with the written consent to act as the Director before being elected. Management nominees are George Sanders, Edwin Rockel, Paul Saxton, Gary Moore and Sam Zastavnikovich, I almost got it. But sorry, Sam, I apologize every year, I know. The company has an advanced notice division in this article, which doesn't require, which means that nominees for directors must be made to the company within a certain time period prior to the shareholder meeting. No nominations were received during the time allowed by the advanced notice division and therefore, I declare the nomination is closed. Is the motion then that the company declare all management nominees as directors for these siting here. I motion, please.

So moved.

All in favor, say, aye. [Voting]

Any against ? Motion carried. Thank you. The next matter is the appointment of the auditor, the company's current auditor is Davidson & Company LLP chartered professional accountants. I'd like to motion that the company appoint Davidson & Company as the company's auditor to hold office until the close of the next annual meeting and also ask the directors of the company to fix their remuneration. Motion, please.

So moved.

All in favor say, aye? [Voting]

Any against? Motion carried. And the last matter, as you know, we have to approve the company's stock option plan every year. That's one of the policies of the TSX Venture Exchange. It's in the motion that the shareholders will pass or not by all their resolution confirming and approving the company's stock option plan. A motion, please.

Moved.

Thank you George. All in favor say , aye? [Voting]

Any against. Very good. Motion carried. Is there any other business?

Mr. Chairman, I have no other business to bring before the meeting.

Very good. Any other shareholders who would like to raise any matter before the meeting -- if not, I declare the meeting to have ended. Thank you all for coming. George, we could now have the directors meeting which follows the annual meeting or would you rather have a general discussion that the company per se ?

I think I'd like to have a quick discussion, Graham, and I think I have in front of me for circulation, the consent resolution to appoint the officers. Maybe we can just do that normal officer appointment by consent resolution.

Sure. We'll do that.

Okay. And I guess, Francesca, we can let you get back to your other duties today and appreciate your input on the meeting and all the work that you've done for us.

Yes, no problem at all. Yes. I will head off now. Thanks, guys.

Thank you.

Thank you.

So Graham, I'll give you the quick version first in part because of your geologic training, but also just as a heads-up, and we don't know yet. But we think we might have a possibility of a serious new discovery at Kettle Valley. And to give you the very quick background, 2000 -- whatever, 2016, 2017, Trygve Höy does a Republic Rock Creek, Graben Geoscience BC paper, which is actually read by Wayne Martin. And Wayne is the -- one of the things he did in that area was -- he was the last mine manager at the Highland Bell Mine at Beaverdell. And he was the guy charged with shutting down the mine, so prior to that exercise, there was a lot of exploration in the district to see if they could keep the thing open. So he spot something in Tryg Höy's report that caused him to go and investigate. And some anomalous numbers showed up in rocks that he didn't think should host anomalous numbers. So he gets into the field and discovers between the time of Höy's mapping and his visit that an area has been extensively logged and in the clear cut, there's all these quartz carbonate boulders lying around. So he stakes the ground and then he is not sure what he's going to do with it and he talks to it and by and by he talked to the folks about it. And by and by, I'm one of the people that he spoke to and because of my regard for him and having worked with him in the past, I took it very seriously because it was close to Kelowna, it was easy to take a drive out there and look at it. And so that's why we optioned the ground and you prepared that agreement, and so you know all about that. So then we did our regular routine, some more prospecting extensive soil and rock geochemistry was done. LiDAR survey was done. We -- this time last year, we did a trenching program and after we got on the east side in this clear cut after we got the trenches excavated. There was some pretty interesting look in rocks in those trenches, but nothing that really kicked particularly and not the same rocks as were found in the boulder field. But just above the trenches and up slope is a substantial cliff. It may be, I don't know, Ed, Sam, what do you say, 20, 30 meters high and it's several hundred meters along of north-south direction, so we started prospecting that and saw the same kind of rocks and started to get some interesting values, nothing particularly exciting, but certainly enough values above 0.5 gram that we were pretty encouraged with subsequent rounds got us to additional rock sampling, lots of classic epithermal kind of samples, many of which were in the sort of 50 to 100 ppb range, so not greatly exciting, but nevertheless, really, really sexy looking. We did subsequently get some surface samples that carried some grade and pretty decent grade. So we drilled. And instead of on the east side of this ridge where we trenched, it was pretty clear that if there was anything to be found, it was on the other side of it. So we got on the back side, and we put 5 drill holes in, we've tested the zone or structures, which straight North-South, along a strike length of 550 meters. We hit roughly like on surface we've hit in every single hole. We've also seen across all lithologies, including basement granite. We've seen extensive fracturing quartz, hairline courts spinning multicenter quartz veins, a little bit bigger quartz veins and pyrite mineralization. We saw very little sulfides on surface. So we just had last weekend because of what we've seen in the core, we had Trygve Höy come back and look at it. I'll send you later, Graham, his just quick one pager, but he did tell the guys, he didn't put this in writing in so many words, but he did tell the guys before he left that this was the best early-stage project he has ever been on in Southern BC or the U.S. though, coming from an esteemed geologic guy like him, that's really high praise. So we don't have any numbers I'm being very careful with what I say because obviously, people have invested to give us the money to do the drilling, and they're interested. They know the program has been completed. I'm getting questions, right? That just always happens from investors. And I'm giving a fairly low key response. I am telling them that we're happy with what we see. But gold being what it is, you never know until that fire actually comes back. So we are also not circulating any pictures of core. And I can tell you -- I can tell all of you, if we were circulating that, we could certainly create a buzz or a following about this. I don't see the point of doing that. We're all still under black goat. We don't have any assays. There's no reason to hype this thing and get egg on our face because we have very low grade numbers that come back or alternatively, you can stand yourself in a position where you maybe shouldn't have been saying certain things and you got a regulatory issue. So we're not -- we're behaving responsibly. We're going to get our assays soon enough. Not all the core has even been logged yet, but I can tell you from my visit on Monday, and the Board has heard this from me that I really had to do an emotional struggle not to be enthusiastic or should I say over-enthusiastic because the stuff really, really -- it really looks like -- some of it looks ore basically and it really looks good. And the major difference between the rocks that we've seen since we got on the property and the rocks we see in the drill core is quite a bit more sulfides, and mostly pyrite, but not just pyrite and other things showing up some of the guys aren't even sure exactly -- exactly what they're looking at, but possibly silver, sulfur salts, possibly argentite, possibly fine-grain galena, all of which is positive. But again, until we get numbers, we can't say. And Graham, the reason I wanted to brief you -- and it may in a couple of months' time, look pretty foolish. But I wanted you to have the sort of heads up on the setting and what we're looking at. If we do get some joy because out of that is going to come financing pressures, just managing disclosure kind of guidance will require. And we do have some -- we do have a couple of Majors that have contacted me that are following this. We don't have CAs with either of them. They haven't seen any pictures. They haven't had core described to them. They -- all they've seen is news releases. But we are on their radar screen. And so we would need guidance and CAs and stuff if , if, if. So I just wanted to -- I just wanted to mostly repeat, some of which I said to the directors to you. So that if numbers do come back, you've got a context for it. And also I don't know if you will have completed your move by the time we get numbers back, but we may need your guidance in a less than casual way because we're going to get real busy is the bottom line.

Well, I look forward to that. And I'm not sure if the other directors now, but at the end of May, the leading Bennett Jones to join Lawson Lundell, who have, in my view, one of the best mining groups in North America. And so it will be ideally situated to help the company. I've got a couple of questions. I assume that the drilling program has now ended. Is that correct?

Correct. And we've disclosed that.

Okay. And how does this mineralization compare to that at Beaverdell, is it meant to be kind of a or is it...

Totally different.

Totally different. That's what I thought.

These are -- you've seen. So they are very young, so they're very young volcanic and intrusives.

Okay. Are there any signs of Jasper and material like that?

We have seen some amethyst and so not Jasper, but amethyst and we are thinking -- Warner Gruenwald, who's project manager. He's thinking some of that is maybe purple fluorite and perhaps not amethyst. But we do see that. And again, interestingly, we're seeing different texture and color in the quartz and even in individual samples. So there will be a bluey gray quartz, maybe with some shades of the purple or pinky purple in it, and then there'd be some white quartz. And some of that is kind of coincident with bladed calcite. So it's got -- like it's got all the goodies that it should have, right? And -- and also in multiple, I mean, even a layman like me can look at it and go, well, this has been broken up like at least 2 maybe 4 different times, right? So you've got brecciated breccias if you will. And in the odd, interesting piece, Warner's pointed out, like look at this little fragment here. It's come from some other place and been in place here. It's like some really bizarre stuff, which is always favorable. And some of these zones go on for core boxes, not like 0.5 meter or a meter. They've got some oomph to them. So geologically, it's -- geologically, it's a big success, the drill program, whether there's any numbers to it is -- remains to be [ seen ].

Sure. Have you secured the land position? Is there any open ground in the area?

We -- in that last disclosure last week of -- that we finished the drill program we did acquire what was it, Ed, 17 units?

17 in the West and 2 to fill a gap in the East and Northeast. Yes.

So we think this is -- we think this is on the west -- well, it's on the west side of the Graben and the Graben is running north-south. But on the north, there's northwest, southeast major structure. And then on the south, there's a similar major structure. And we think that those 2 things bound, we're in the middle of it, and we think that those 2 things bound the juicy stuff. And on either side, some of the rocks continue, but they're less prospective. So we're currently pretty happy with the land position.

Excellent. Okay. Well, first of all, congratulations. That sounds really exciting. And it's something totally new, obviously, in that part of the world. And it could create a lot of excitement.

Fingers crossed.

Exactly. I'll be watching closely. Do you have -- do you circulate the news releases sort of obviously discussed disclosure have been traveling obviously a lot, but -- do you have a mail out for people from the website that signed up for...

I'll make sure. I thought you were on that. I didn't see an old e-mail. So I'll make sure I update that.

Very good thank you. Well, again, fantastic news for us. This is very exciting and look forward to being a part as we move forward.

Okay. That's all I have on my agenda for discussion this morning. And as I say to the rest of you guys on the Board, I think you've had most of the pictures and that sort of thing. So I don't have anything new to add and haven't heard anything new in the last day or 2 from either Warner or Wayne to report. So I'm done.

All right. Just wondering, are we sure we've got a reasonably quick assay results coming? Or are they going to be dragged out like everybody else seems to be?

Well, we switched labs for this program as a Gary, you may not that, but the other guy to. And we were getting better turnaround for sure. It's still a long time for labs for guys doing work in BC, we're early in the season. A lot of the stuff up north they're just now getting mobilized. So we've got that going for us. I wanted to include in the news release that 8- to 10-week turnaround, we don't think it's going to be that long at all. But as I said, when I was briefing Graham, Warner still -- he's completed logging of 2 of the 5 holes. So he -- by end of this afternoon, he should have got 3 out of the way and be started on 4. So we haven't even got everything logged yet, and I do believe the first batches samples got shipped the other day.

Okay. Sounds good.

Anything else? Okay. Guys, that's great. That's inside of 30 minutes for the full Board -- the full AGM and my briefing. So good work.

Are we starting to set records every time. It's not the deal now?

Graham. Great talking to you. And thanks for your help. And now are you taking staff with you or some staff or ?

Perhaps in fact, I'll speaking to [ Shana ] because they that they obviously, they want me to stay as long as possible, and they want to bring as many people as possible. They say there's a very shortage of paralegals and obviously, we've been very happy with the work with [ Shana ]. One of the reasons that I'm going is that they haven't given me the associate support that was promised they began to do that and a lot of the associates hopefully not because of me, but they quit and went to smaller firms.

Well, make sure Bennett Jones knows how to bill. I'll tell you that much.

That's one thing that would be interested in when I -- when they'll do it. Went to their interview at Lawson Lundell , they were rather shocked at our hourly rates, and they got a huge overhead than Bennett Jones does.

No, I never brought it up with you because I knew that it had nothing to do with you. You were at MOI, and that was terrific, and it was a bigger deal. So, but holy smokes, we really noticed it. So I'm...

One thing that I don't like is that every January, I am told what my hourly rate will be. Total without any consultation. So that doesn't please me, but I'm almost certain that after the 1st of June, your bills will go down.

Well, that's great. And you know all of the paralegals that you've had on your team that I've worked with over the years have all been excellent, but [ Shana ] is really terrific.

Yes, she is.

Okay. Thank you so much Graham. Look forward to it, and I'll make sure you get copies of this stuff. I'll even send you some neat pictures.

Sounds good and look forward to it. Thanks George. Thanks everybody.

Okay, guys.

Bye now.

Bye-bye.

Host has left the meeting. So at this time, the meeting will come to an end. Thank you, and goodbye.