CANADA ZINC METALS CORP.
FOR IMMEDIATE RELEASE
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Tongling Nonferrous Metals Group Holdings Co.
Ltd. Subscribes to
�$18 Million Private Placement
Vancouver,
British Columbia, Canada � Monday, July 26, 2010 � Canada Zinc Metals Corp.
(TSX Venture Exchange: CZX) is pleased to announce that it has
entered into a financing arrangement with Tongling
Nonferrous Metals Group Holdings Co. Ltd. (�Tongling�) pursuant to which Tongling has subscribed, by way of a
non-brokered private placement, to 31,386,224 units of Canada Zinc Metals at a
price of $0.5735 per unit for gross proceeds of $18,000,000.�� Each unit consists of one common share and
one half of a common share purchase warrant.�
Each whole warrant shall entitle the purchaser to purchase, at any time
within 24 months from closing, one additional common share of the Company at a
price of $0.675 during the first year and at a price of $0.775 during the
second year.�
�We are
extremely pleased to see this level of investment by Tongling,� stated Mr.
Peeyush Varshney, CEO of Canada Zinc Metals.�
�Earlier this year, Tongling retained a leading international mining
consulting firm to complete an independent due diligence review of the work we
have done on the Akie property to date and, clearly, a very positive report was
produced.�
The proceeds
of the private placement will be used to fund further exploration and
advancement of the Company�s Akie zinc-lead property and for working capital
and corporate purposes.
��We are pleased
to be further increasing our stake in Canada Zinc Metals,� said Mr. Li
Dongqing, Vice-President and Chief Engineer of Tongling.� �We look forward to continuing to build our
relationship with the Company.�
Tongling
Nonferrous Metals Group Holdings Co. Ltd., based in Tongling,
Anhui, is a state-owned holding company, and one of China's
largest copper smelting companies.�
Tongling�s principal activities are exploration, mining, ore processing, smelting & refining and products
processing of copper, lead, zinc, gold, silver and other non-ferrous and rare
metals.�
Upon
completion of the private placement, Tongling will own approximately a 36%
equity position in Canada Zinc Metals.
The
financing is subject to receiving the necessary approvals of the Tongling board
of directors, the relevant Chinese regulatory departments, the TSX Venture
Exchange and the shareholders of the Company.
The
financing is also subject to terms and conditions that generally accompany
significant strategic investments of this nature and size.
About the Akie Property
The Akie
zinc-lead property is situated within the southern-most part (Kechika Trough)
of the regionally extensive Paleozoic Selwyn Basin, one of the most prolific
sedimentary basins in the world for the occurrence of SEDEX zinc-lead-silver
and stratiform barite deposits.
Drilling on the Akie property by Inmet Mining
Corporation during the period 1994 to 1996 and by Canada Zinc Metals since 2005
has identified a significant body of baritic-zinc-lead SEDEX mineralization
(Cardiac Creek deposit).� The deposit is
hosted by variably siliceous, fine grained clastic rocks of the Middle to Late
Devonian �Gunsteel� formation.� The
Company has outlined a NI 43-101 compliant inferred resource of 23.6 million
tonnes grading 7.6% zinc, 1.5% lead and 13.0 g/t silver (at a 5% zinc cut off
grade).�
Two similar deposits, Cirque and Cirque South Cirque,
located some 20 km northwest of Akie and owned under a joint venture by Teck
Resources and Korea Zinc, are also hosted by Gunsteel rocks and have a combined
geologic inventory in excess of 50 million tonnes (not 43-101 compliant)
grading� approximately 10% combined zinc
+ lead.
In addition to the Akie property, Canada Zinc Metals
Corp. controls a large contiguous group of claims which comprise the Kechika Regional project. These claims
are underlain by geology identical to that on the Akie property (Cardiac Creek
deposit) and Cirque. This project includes the�
100% owned Mt. Alcock property, which has yielded a historic drill
intercept of 8.8 metres grading 9.3% zinc+lead, numerous zinc-lead-barite
occurrences,� and several regional base
metal anomalies.
The
TSX Venture Exchange has neither approved nor disapproved the contents of this
press release.
ON BEHALF OF THE BOARD OF DIRECTORS
CANADA ZINC METALS CORP.
�PEEYUSH VARSHNEY�
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pEEYUSH vARSHNEY, LL.B
CEO & CHAIRMAN