Lions Gate Metals Inc. and Copper Fox Metals Inc. announce business combination

    VANCOUVER, Feb. 27 /CNW/ - Lions Gate Metals Inc. ("Lions Gate") (TSX-V:
LGM) and Copper Fox Metals ("Copper Fox") (TSX-V: CUU) are pleased to announce
that they have entered into a binding letter of intent ("LOI") containing the
principal terms by which, subject to satisfaction of certain conditions, Lions
Gate will acquire all of the issued and outstanding common shares of Copper
Fox through a plan of arrangement or other form of business combination (the
"Business Combination").
    The LOI contemplates that each Copper Fox shareholder will receive 0.094
common shares of Lions Gate for every one common share of Copper Fox. For
every one common share issued by Lions Gate to Copper Fox shareholders, they
will also receive 0.5 warrants of Lions Gate. Each full warrant and payment of
$2.00 will entitle the holder to purchase an additional share of Lions Gate
for a period of five years. In addition, all outstanding convertible
securities of Copper Fox will be exchanged for comparable convertible
securities of Lions Gate in an amount and at exercise prices adjusted in
accordance with the same exchange ratio.
    The LOI contemplates that Lions Gate may complete a private placement of
up to 2,500,000 units of Copper Fox at $0.08 per unit for proceeds to Copper
Fox of up to $200,000. Each unit will be comprised of one common share of
Copper Fox and one share purchase warrant, each such warrant entitling Lions
Gate to purchase one additional common share of Copper Fox at $0.08 per share
for a period of two years. The private placement is to be advanced in tranches
of $25,000 at the discretion of Lions Gate. The units will be cancelled on
closing of the Business Combination.
    There are currently 112,501,585 Copper Fox common shares issued and
outstanding, 8,898,000 outstanding options to purchase Copper Fox common
shares and 15,921,404 Copper Fox common shares issuable pursuant to
outstanding share purchase warrants.
    Copper Fox will be seeking agreements supporting the Business Combination
from the directors and officers of Copper Fox to vote their shares in favor of
the Business Combination.
    The Business Combination will require the approval of Copper Fox security
holders and the TSX Venture Exchange, and will be subject to other customary
conditions, including the execution of a definitive agreement and completion
of due diligence. The Business Combination is also subject to the successful
negotiation of debt settlement agreements with Copper Fox's creditors.
    The LOI provides that Copper Fox shall not, directly or indirectly,
solicit, initiate or encourage letter of intent offers from, or negotiations
with, any third party with respect to any other potential merger or
acquisition of all or a material portion of Copper Fox's business, assets or
outstanding securities except where required to satisfy fiduciary obligations
of directors. Both parties have agreed to pay non-completion fees under
certain circumstances. The transaction is expected to close by June 30, 2009.
    Mark E. Hewett, President and Director of Lions Gate, stated, "I am very
pleased that Lions Gate has been able to execute this binding LOI with Copper
Fox. The successful completion of the Business Combination will position the
combined companies with two very strong copper properties within B.C. This
includes a very prospective exploration stage copper property close to Houston
B.C. as well as a significant copper and gold project in northwestern B.C. In
addition, we are excited to include in our new management team some very
strong technical and financial personnel. This Business Combination further
strengthens our exploration and development position in the copper industry,
and allows us to continue to build through further acquisitions while
maintaining an attractive capital structure."
    Guillermo Salazar, President and CEO of Copper Fox, stated, "I am
delighted that Copper Fox has been able to enter into this binding LOI with
Lions Gate. This transaction will allow us to advance and unlock the inherent
value of our core assets including the Schaft Creek deposit, solidify Copper
Fox's financial position, and leverage the combined asset base with a view to
adding to the shareholders' value. The synergies in focus of business and
management are apparent and we believe that they will strengthen the combined
entity's position in the copper sector."
    Information on Lions Gate and Copper Fox may be viewed on the internet at
their respective websites noted below, or at the Canadian securities
regulator's website at For more information please contact
Blair McIntyre of Lions Gate at (604) 683-7588.

    Lions Gate Metals Inc.      Copper Fox Metals Inc.
    Mark Hewett                 Guillermo Salazar
    President & Director        President & CEO
    (604) 683-7588              (403) 264-2820

    On behalf of the Board of Directors

    Guillermo Salazar S, President and CEO

    The TSX Venture Exchange has not reviewed the contents of this news
    release and accepts no responsibility for the adequacy or the accuracy

    Cautionary Note Regarding Forward-Looking Information

    This news release includes "forward-looking information" within the
meaning of the Canadian securities laws. All statements, other than statements
of historical fact, included herein and including, without limitation;
anticipated dates for receipt, commencement or completion of permits,
approvals, construction, production and other milestones; anticipated results
of drilling programs, scoping, prefeasibility and feasibility studies and
other analyses; anticipated availability and terms of future financings;
estimated timing and amounts of future expenditures; Copper Fox's future
production, operating and capital costs; operating or financial performance;
geological interpretations and potential mineral recovery processes, are
forward-looking statements. Information concerning mineral reserve and
resource estimates also may be deemed to be forward-looking information in
that it reflects a prediction of the mineralization that would be encountered
if a mineral deposit were developed and mined. Forward-looking information is
necessarily based upon a number of estimates and assumptions that, while
considered reasonable by management, are inherently subject to significant
business, economic and competitive uncertainties, risks and contingencies. For
any forward looking information given, management has assumed that the
geological, metallurgical, engineering, financial and economic advice it has
received is reliable, and is based upon practices and methodologies which are
consistent with industry standards. There can be no assurance that such
information will prove to be accurate, and actual results and future events
could differ materially from those anticipated in such information. Important
factors that could cause actual results to differ materially from Copper Fox's
expectations include: fluctuations in copper and other commodity prices and
currency exchange rates; uncertainties relating to interpretation of drill
results and the geology, continuity and grade of mineral deposits; uncertainty
of estimates of capital and operating costs, recovery rates, production
estimates and estimated economic return; the need for co-operation of
government agencies and native groups in the exploration and development of
properties and the issuance of required permits; the need to obtain additional
financing to develop properties and uncertainty as to the availability and
terms of future financing; the possibility of delay in exploration or
development programs or in construction projects and uncertainty of meeting
anticipated program milestones; uncertainty as to timely availability of
permits and other governmental approvals; and other risks and uncertainties
disclosed in Copper Fox's continuous disclosure filings with Canadian
securities regulatory authorities at The forward-looking
information in this news release is based on Copper Fox's current expectations
and Copper Fox assumes no obligations to update such information to reflect
later events or developments, except as required by law.

For further information:

For further information: Investor inquiries: Jason Shepherd, Phoenix
Communications Group, Tel: 1-866-913-1910, E-mail:

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