TIDMPUR
RNS Number : 8805Z
Pure Gold Mining Inc.
27 January 2022
NEWS RELEASE 22-04 January 27 , 2022
NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR
DISSEMINATION IN THE UNITED STATES
PureGold Announces Equity Financings for Total Proceeds of C$25
Million; AngloGold Ashanti Proposes to Increase Ownership to
19.9%
VANCOUVER, B.C. - Pure Gold Mining Inc. (TSX-V:PGM, LSE:PUR)
("PureGold" or the "Company"), is pleased to announce that it has
entered into an agreement with National Bank Financial Inc., as
lead underwriter, on behalf of a syndicate of underwriters
including Clarus Securities Inc. (collectively, the "Underwriters")
and with Tamesis Partners LLP acting as special selling agent in
the UK and Europe, under which the Underwriters have agreed to
purchase, on a bought deal private placement basis, 16,989,000
common shares of the Company at a price of C$0.53 ("Offering
Price") per share for gross proceeds of C$9,004,170 ("Brokered
Offering"). The Company has also granted the Underwriters an option
to purchase up to an additional 9,434,000 common shares pursuant to
the Brokered Offering for additional gross proceeds to the Company
of up to C$5,000,020 ("Underwriters Option").
The Company is also pleased to announce it has agreed to a
concurrent private placement of 30,181,572 common shares at the
Offering Price with the Company's largest shareholder, AngloGold
Ashanti Limited ("AngloGold Ashanti") by way of non-brokered
private placement for additional gross proceeds of C$15,996,233
(the "AngloGold Subscription" and together with the "Brokered
Offering", the "Transactions"). Closing of the AngloGold
Subscription and the Brokered Offering are cross conditional upon
one another.
Troy Fierro, President & CEO of PureGold, stated, "We are
delighted to announce this financing with the support of our
largest shareholder, AngloGold Ashanti. We value the global
operational expertise AngloGold Ashanti brings and look forward to
working collaboratively with their technical team to continue to
unlock the full potential of the PureGold Mine."
After giving effect to the Transactions, AngloGold Ashanti will
own 19.9% of the outstanding common shares of PureGold on a
partially diluted basis. Should the Underwriters Option be
exercised, AngloGold Ashanti shall have the option to purchase such
additional shares under the AngloGold Subscription as to allow
AngloGold Ashanti to maintain approximate 19.9% ownership of
PureGold following the exercise of the Underwriters Option.
AngloGold Ashanti currently holds 65,653,870 common shares in
PureGold which represents a 14.9% interest in the outstanding
common shares of PureGold on a non-diluted basis. In addition,
AngloGold Ashanti owns 1,653,809 PureGold warrants which if
exercised in full would increase AngloGold Ashanti's interest in
PureGold to 15.2% on a partially diluted basis. Following the
implementation of the Transactions, AngloGold Ashanti will hold
95,835,442 common shares in PureGold and 1,653,809 warrants which
will represent an interest in PureGold of 19.6% on a non-diluted
basis and 19.9% on a partially diluted basis, respectively.
AngloGold Ashanti's current interest in PureGold as well as the
interest to be acquired pursuant to the AngloGold Subscription is
for investment purposes and its interest may increase or decrease
depending on market and other circumstances.
The Company intends to use the net proceeds raised from the
Transactions to complete the ramp up of operations to design
capacity at its 100%-owned PureGold Mine located in Red Lake,
Ontario and for general corporate purposes.
In connection with the AngloGold Subscription, PureGold and
AngloGold Ashanti will enter into a shareholder rights agreement
providing AngloGold Ashanti with certain rights, standard
anti-dilution and equity participation rights as well as certain
rights to PureGold's technical and scientific data.
The Transactions are expected to close on February 15, 2022 and
are subject to certain conditions including receipt of all
applicable regulatory approvals, the approval of the TSX Venture
Exchange and, for the AngloGold Subscription, the approval of the
South African Reserve Bank. Closing of the AngloGold Subscription
is subject to execution of definitive documentation. The securities
to be issued under the Transactions will be issued on a private
placement basis and will have a hold period of four months and one
day from the applicable closing date in accordance with applicable
securities laws.
AngloGold Ashanti is considered a "related party" of PureGold as
it currently owns approximately 14.9% of the issued and outstanding
common shares of PureGold on a non-diluted basis and, accordingly,
the AngloGold Subscription constitutes a "related party
transaction" within the meaning of Multilateral Instrument 61-101 -
Protection of Minority Security Holders in Special Transactions
("MI 61-101"). The AngloGold Subscription is exempt from the
minority approval requirement of Section 5.6 and the formal
valuation requirement of Section 5.4 of MI 61-101 as neither the
fair market value of the AngloGold Subscription, nor the fair
market value of the consideration for the AngloGold Subscription,
exceeds 25% of PureGold's market capitalization. A material change
report in connection with the AngloGold Subscription will be filed
less than 21 days before the closing of the AngloGold Subscription.
This shorter period is reasonable and necessary in the
circumstances as the Company wishes to complete the AngloGold
Subscription in a timely manner.
The securities offered have not been, and will not be,
registered under the United States Securities Act of 1933, as
amended (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 shall not constitute an offer
to sell or the solicitation of an offer to buy securities in the
United States, nor will there be any sale of these securities in
any jurisdiction in which such offer, solicitation or sale would be
unlawful.
About Pure Gold Mining Inc.
PureGold is a Canadian gold mining company, located in the very
heart of Red Lake, Ontario, Canada. Our vision is pure and simple.
To build a highly profitable, multi-generational growth company in
the world-class gold mining district of Red Lake. With our
100%-owned, fully constructed operating PureGold Mine, a
multi-million-ounce gold endowment, and significant exploration
upside, our value-maximizing strategy is to pursue operational
excellence today, while investing in systematic exploration and
phased expansions to fuel discovery and growth for the future.
Additional information about the Company and its activities may
be found on the Company's website at www.puregoldmining.ca and
under the Company's profile at www.sedar.com
ON BEHALF OF THE BOARD
"Troy Fierro"
Troy Fierro, President & CEO
Investor inquiries:
Adrian O'Brien, Director, Marketing and Communications
Tel: 604-809-6890
aobrien@puregoldmining.ca
Neither TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in policies of the TSX Venture
Exchange) accepts responsibility for the adequacy or accuracy of
this release.
All statements in this press release, other than statements of
historical fact, are "forward-looking information" with respect to
PureGold within the meaning of applicable securities laws,
including, but not limited to statements with respect to the timing
and completion of the Transactions, the receipt of the necessary
approvals for the Transactions, the use of the proceeds for the
transactions and certain other matters relating to the proposed
Transactions, PureGold entering into an investor rights agreement
with AngloGold Ashanti in connection with the AngloGold
Subscription and the anticipated terms contained therein, the
receipt of applicable TSX Venture Exchange approval for the
Transactions and the receipt of South African Reserve Bank approval
for the AngloGold Subscription. 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", "intends",
"believe", "potential", and similar expressions, or describes a
"goal", or variation of such words and phrases or state that
certain actions, events or results "may", "should", "could",
"would", "might" or "will" be taken, occur or be achieved.
Forward-looking information is not a guarantee of future
performance and is based upon a number of estimates and assumptions
of management at the date the statements are made including, among
others, assumptions about future prices of gold and other metal
prices, currency exchange rates and interest rates, favourable
operating conditions, political stability, obtaining governmental
approvals and financing on time, obtaining renewals for existing
licences and permits and obtaining required licences and permits,
labour stability, stability in market conditions, availability of
equipment, accuracy of any mineral resources, successful resolution
of disputes and anticipated costs and expenditures. Many
assumptions are based on factors and events that are not within the
control of PureGold and there is no assurance they will prove to be
correct.
Such forward-looking information, involves known and unknown
risks, which may cause the actual results to be materially
different from any future results expressed or implied by such
forward-looking information, including, risks related to the
interpretation of results at the Pure Gold Red Lake Mine complex ;
changes in project parameters as plans continue to be refined;
current economic conditions; future prices of commodities; possible
variations in grade or recovery rates; the costs and timing of the
development of new deposits; failure of equipment or processes to
operate as anticipated; the failure of contracted parties to
perform; the timing and success of exploration and development
activities generally; delays in permitting; possible claims against
the Company; the timing of future economic studies; labour disputes
and other risks of the mining industry; delays in obtaining
governmental approvals, financing or in the completion of
exploration as well as those factors discussed in the Annual
Information Form of the Company dated March 31, 2021 in the section
entitled "Risk Factors", under PureGold's SEDAR profile 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 forward-looking information,
there may be other factors that cause actions, events or results
not to be as 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
unless required by law.
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END
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