PureGold Closes First Tranche of Previously Announced Announcement
NOT FOR DISTRIBUTION TO UNITED STATES NEWS WIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES
VANCOUVER, British Columbia, May 25, 2022 (GLOBE NEWSWIRE) — Pure Gold Mining Inc. (TSX-V:PGM, LSE:PUR) (“PureGold” or the “Company”) is pleased to announce that it has closed a first tranche (“First Tranche”) of its non-brokered private placement announced on May 6, 2022 (the “Offer”). The second of two tranches (“Second Tranche”) is expected to close on or about May 27, 2022. Between the first tranche and the second tranche, the Company expects to close with aggregate gross proceeds of approximately $31 million Canadians.
Pursuant to the closing of the first tranche, the Company issued an aggregate of 185,072,960 units of the Company (the “Units”), at a price of C$0.15 per Unit, for aggregate gross proceeds of 27,760,944 $CAD. Each Unit consists of one common share and one common share purchase warrant (a “Warrant”). Each warrant will be transferable and entitle the holder to purchase one common share of PureGold for six months from the closing date of the offering at a price of C$0.18.
In connection with the First Tranche Closing, Tamesis Partners LLP, REDPLUG Inc., Canaccord Genuity Corp., Sprott Capital Partners, PI Financial Corp., Haywood Securities Inc., BMO Nesbitt Burns Inc., Stephen Avenue Securities Inc., Pollitt & Co Inc., Research Capital Corp. and Leede Jones Gable Inc. (collectively, the “Finders”), received an underwriting fee equal to 6.0% (the “Underwriting Fee”) of the gross proceeds raised under the First Tranche by each Finder for an aggregate total of $512,592 in subscription fees paid by the Company.
Certain directors and officers of the Company, in particular Mark O’Dea, Chris Haubrich, Lenard Boggio, Graeme Currie, Bryan Wilson, Maryse Belanger, Troy Fierro, Robert Pease and Phil Smerchanski (collectively, “Interested Persons”) have purchased or acquired management and control of a total of 13,933,332 Units pursuant to the Offering. Interested Persons are each considered a “related party” of PureGold and the sale of Common Shares under the Offering to Interested Persons constitutes a “related party transaction” within the meaning of NI 61-101. The relevant persons collectively owned and controlled approximately 2.23% of the issued and outstanding common shares of the Company, on a non-diluted basis, prior to the closing of the transactions. Following the completion of the Offering, interested persons hold 29,571,856 common shares, collectively representing approximately 3.65% of the issued and outstanding common shares of the Company. The “related party” portion of the Offer was exempt from the minority approval requirement of Section 5.6 and the formal valuation requirement of Section 5.4 of NI 61-101 since neither the fair value market value of the “related party” part of the Offer, nor the fair market value of the consideration of the “related party” part of the Offer exceeded 25% of the market capitalization of PureGold. A material change report in connection with the Transactions will be filed less than 21 days prior to the closing of the Transactions. This shorter delay was reasonable and necessary in the circumstances since the Company wished to complete the Transactions in a timely manner.
Proceeds from the offering will be used to meet the company’s near-term goals of growing the PureGold mine to 800 tpd by Q3 2022, reducing operating and sustaining capital costs in Q2 2022 by at least 30% compared to the first quarter of 2022, to achieve sustainable positive cash flow results at the site level by the third quarter of 2022, by completing critical trade-off studies in support of the plan Mineral Resources, Mineral Reserves and Life of Mine Update which is expected to be released by the fourth quarter of 2022, and for general corporate purposes.
The securities offered have not been and will not be registered under the United States Securities Act of 1933, as amended (the “United States Securities Act”) or any securities laws of United States, and may not be offered or sold in the United States. or to, or on behalf of or for the benefit of U.S. persons absent registration or any applicable exemption from the registration requirements of U.S. securities law and applicable U.S. securities laws . This press release does not constitute an offer to sell or the solicitation of an offer to buy any securities in the United States, and there will be no sale of such securities in any jurisdiction in which such offer, solicitation or sale would be illegal.
About Pure Gold Mining Inc.
PureGold is a Canadian gold mining company, located in the heart of Red Lake, Ontario, Canada. The Company owns and operates the PureGold Mine, which entered commercial production in 2021 following the successful construction of an 800 tpd underground mine and processing facilities. Gold reserves and resources are concentrated on a forty-seven square kilometer property with significant discovery potential. PureGold’s strategy is to pursue operational excellence today while investing in systematic exploration and incremental expansions to fuel discovery and growth for the future.1
- For more information, see the technical report entitled “Madsen Gold Project Technical Report Feasibility Study for the Madsen Deposit, Red Lake, Ontario, Canada” with an effective date of February 5, 2019 and dated July 5, 2019 ( the “Feasibility Study”), for more information, please see puregoldmining.ca or under the Company’s Sedar profile at www.sedar.com
ON BEHALF OF COUNCIL
Mark O’Dea, President and CEO
Adrian O’Brien, Director, IR and Communications
Neither the 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.
All statements contained in this press release, other than statements of historical facts, are “forward-looking information” regarding PureGold within the meaning of applicable securities laws, including, but not limited to, statements regarding the realization of debt securities. transaction, the use of the proceeds of the Offering and certain other matters relating to the Offering and its timing, including the closing of the Second Tranche, expectations regarding new mining areas and grade and global tons available; and expectations and timing for reduction in operations, sustaining capital costs at the PureGold mine, achievement of sustainable positive cash flow at the site level, completion of critical trade-off studies in support of updated mineral resource, mineral reserve and life of mine plans. Forward-looking information is often, but not always, identified by the use of words such as “seek”, “anticipate”, “plan”, “continue”, “planned”, “expect”, “project”, “predict”, “potential”, “targeting”, “intend”, “believe”, “potential” and other similar expressions, or describe an “objective”, or a variation of these words and expressions or state that certain actions, events or results “may”, “should”, “could”, “would”, “could” or “will” be taken, occur or be realized. Forward-looking information is not a guarantee of future performance and is based on a number of management’s estimates and assumptions as of the date the statements are made, including, among other things, assumptions about future gold and other metal prices, foreign exchange and interest rates, favorable operating conditions, political stability, obtaining government approvals resources and funding on time, obtaining renewals of existing licenses and permits and obtaining required licenses and permits, stability of the workforce, stability of market conditions, availability of equipment, accuracy of all mineral resources , successful resolution of disputes and anticipated costs and expenses. Many assumptions are based on factors and events beyond PureGold’s control and there is no assurance that they will prove to be correct.
This forward-looking information involves known and unknown risks, which may cause actual results to differ materially from future results expressed or implied by such forward-looking information, including risks relating to the interpretation of results at Pure Gold Red Lake Mine Complex; changes in project parameters as plans continue to be refined; current economic conditions; future commodity prices; possible variations in grade or recovery rates; the costs and timing of developing new deposits; failure of equipment or processes to perform as intended; non-performance by contracting parties; the timing and success of exploration and development activities generally; delays in obtaining permits; possible claims against the Company; the timing of future economic studies; labor disputes and other hazards of the mining industry; delays in obtaining governmental approvals, financing or in completing exploration as well as the factors discussed in the Company’s Annual Information Form dated March 30, 2022 in the section entitled “Risk Factors”, under the SEDAR profile of PureGold at www.sedar.com.
Although PureGold has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in the forward-looking information, there may be other factors that cause actual actions, events or results are not those anticipated, estimated or intended. . There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. PureGold disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by law.