Gold X Mining Corp. (TSX-V: GLDX, OTCQX: SSPXD)
(“
Gold X” or the
“
Company”) announces a
non-brokered private placement offering (the
“
Offering”) of up to
US$20,000,000 principal amount, 10% secured convertible debentures
due thirty-six months from the closing date of the Offering (the
“
Debentures”).
“This is a monumental moment for Gold X Mining.
After advancing this world class gold deposit Toroparu for 20
years, I’m delighted to see the purchase option finally be
exercised,” Rich Munson, CEO. “I want to personally thank Mr.
Alphonso, the country of Guyana, as well as our supportive partners
including Wheaton Precious Metals International Ltd.
(“Wheaton”), Gran Colombia and
Fiore Group for stepping up and providing this capital. It’s been a
pleasure to be working with Bassam Moubarak and the Strategic
Advisory Board to help make this happen.”
“The exercise of this option to purchase 100% of
one of the larger gold deposits in South America provides ownership
certainty, outright control of Toroparu by the Company and, checks
off a significant milestone on the path to value creation for all
stakeholders,” Paul Matysek, head of the Strategic Advisory Board.
“2020 is shaping up to be a significant year for Gold X.”
The outstanding amount of each Debenture will be
convertible, in whole or in part, at the option of holder into that
number of Gold X common shares (the “Common
Shares”) equal to the quotient of such amount
converted to Canadian dollars using the daily representative rate
of exchange as published by the Bank of Canada on the business day
prior to conversion divided by CAD$3.20 (the
“Conversion Price”). This
represents a 51% premium to the market close on December 2, 2019.
The Conversion Price is subject to customary adjustments.
The interest on the Debentures will be
compounded semi-annually and payable annually. Interest is payable
in shares at the option of the holder. If the holder does not elect
to receive interest in shares then the Company has the right to
settle the interest payment in cash or defer payment, with interest
to maturity.
The proceeds of the Offering will be used by the
Company solely for exercising the purchase option, through the
Company’s wholly owned subsidiary, ETK, Inc.
(“ETK”), to acquire 100% of the
interest in and to the Company’s Toroparu Project in Guyana, South
America held by Mr. Alfro Alphonso pursuant to a joint venture
agreement between Mr. Alphonso and ETK.
Closing of the Offering is expected to occur
during the first two weeks of December, 2019 and remains subject to
approval by the TSX Venture Exchange.
The Company’s 100% owned and permitted Toroparu
Gold Project containing 7.353 million ounces Measured + Indicated
and 3.150 Million oz Inferred Gold Resource. Final design of a
conventional open-pit mine and gold leaching circuit producing an
average of 152,000 ozs Gold per year over a 24-year mine life is
ongoing. Preliminary economic estimates for the project include
US$1.25 billion of after-tax free cash flow from a project with a
$378 million pre-production capital cost estimate, a 2.92 year
payback of pre-production capital & a 20.25% internal rate of
return at US$1,300/oz base case gold price (24.2% IRR at $1,400/oz
Au price) with the participation by Wheaton Precious Metals1 (See
Sandspring Resources June 4 2019 Press Release).2
Having completed both the environmental
authorization to proceed and a mineral development agreement with
the Guyana government, transfer of the title to the mining permits
is the last step required for the issuance of the Mining License to
Operate the Toroparu Gold Project.
Under the terms of the Debenture, Wheaton will
have the right, but not the obligation, to acquire approximately
4,155,625 Common Shares in connection with the exercise of the
above-described Debenture conversion right. Assuming the conversion
of the entire initial principal amount, based upon a $1.3298
Exchange rate, of the Wheaton Debenture to Common Shares, Wheaton
would hold, in aggregate,10.6% of Gold X’s Common Shares currently
issued and outstanding on a partially diluted basis. Prior to the
transactions contemplated hereby, Wheaton did not hold any
securities of Gold X. The Debenture issued to Wheaton is presently
being held only for investment purposes. Wheaton may from time to
time in the future increase or decrease its ownership, control or
direction over securities of the Company, through market
transactions, private agreements or otherwise. Wheaton intends to
file an early warning report (the “Early Warning
Report”) pursuant to applicable securities laws
in connection with the transactions contemplated hereby. A copy of
the Early Warning Report to which this press release relates can be
obtained from Wheaton, at 1-844-288-9878 or info@wheatonpm.com or
on the SEDAR profile of the Company at www.sedar.com.
The securities offered have not been, and will
not be, registered under the U.S. Securities Act or any U.S. state
securities laws, and may not be offered or sold in the United
States or to, or for the account or benefit of, United States
persons absent registration or any applicable exemption from the
registration requirements of the U.S. Securities Act and applicable
U.S. state securities laws. This press release does not constitute
an offer to sell or the solicitation of an offer to buy securities
in the United States, nor in any other jurisdiction.
On behalf of the Board of
Directors of Gold X Mining Corp.
“Richard A. Munson” Director and Chief
Executive Officer
About Gold X Mining
Corp.
Gold X Mining Corp., formerly known as
Sandspring Resources Ltd., is a Canadian junior mining company
currently moving toward a feasibility study for the Toroparu
Project in Guyana, South America with 7.4 million ounces of gold in
the Measured and Indicated categories. A Preliminary Economic
Assessment study (Preliminary Economic Assessment Report, Toroparu
Gold Project, Upper Puruni River Area, Guyana, dated July 18, 2019
completed by SRK Consulting (U.S.), Inc.,) (the “PEA”) available on
SEDAR (www.sedar.com) and on the Company’s website
(www.goldxmining.com). Gold X also holds a 100% interest in the
Chicharrón Project located in the Segovia-Remedios mining district,
Antioquia, Colombia. Additional information is available at
www.goldxmining.com or by email at info@goldxmining.com.
Visit Gold X’s website at
www.goldxmining.com.
Contact Gold X Mining
Corp.
Richard A. Munson Chief Executive Officer Tel:
+1 (303) 991-5683 or via email at info@goldxmining.com
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.
Forward-looking Statements
Information in this news release that is not
current or historical factual information may constitute
forward-looking information within the meaning of securities laws.
Implicit in this information, particularly in respect of the
potential closing of the Offering and the amount to be raised, are
assumptions regarding the general market conditions and the ability
of the Company to satisfy certain closing conditions. These
assumptions, although considered reasonable by the Company at the
time of preparation, may prove to be incorrect. Readers are
cautioned that the closing of the Offering is subject to a number
of risks and uncertainties, including relating to general market
conditions, the ability of the Company to satisfy certain closing
conditions with respect to the Offering and approval of the
Offering by the TSX Venture Exchange, and accordingly the Offering
may not be able to be completed on the terms as currently expected
as set out above, or at all. Other than as required under
securities laws, we do not undertake to update this information at
any particular time. Forward-looking information contained in this
news release is based on our current estimates, expectations and
projections, which we believe are reasonable as of the current
date. The reader should not place undue importance on
forward-looking information and should not rely upon this
information as of any other date. All forward-looking
information contained in this news release is expressly qualified
in its entirety by this cautionary statement.
1
The Company and Wheaton
Precious Metals International Ltd. (“Wheaton”)
entered into an Agreement (“Wheaton PMPA”)
in 2013 which was amended in 2015. The Wheaton PMPA is available on
http://www.sedar.com and www.goldxmining.com.
2 A PEA is preliminary in nature,
it includes inferred mineral resources that are considered too
speculative geologically to have the economic considerations
applied to them that would enable them to be categorized as mineral
reserves, and there is no certainty that the preliminary economic
assessment will be realized.
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