Pure Gold Mining Inc. said it has agreed to issue 3,307,619 units of the company at a price of C$1.05 per unit for gross proceeds of approximately C$3,473,000 on a non-brokered basis to Anglogold Ashanti Limited.
Each unit is comprised of one common share and one-half common share purchase warrant. Each full warrant will entitle the holder to purchase one Pure Gold Mining common share at a price of C$1.36 for 18 months from the closing of the transaction.
The company said it intends to use the net proceeds raised from the transaction to fund the continued ramp-up of operations at its 100%-owned PureGold Mine Project located in Red Lake, Ontario, underground drilling and development of the high-grade 8 zone, and for general corporate purposes.
READ: Stifel GMP upgrades Pure Gold Mining rating to ‘Buy’
It is expected that the closing of the transaction will occur on or about October 15, 2021, and is subject to the satisfaction of certain conditions, such as receipt of all applicable regulatory approvals including the approval of the TSX Venture Exchange and SARB approval.
The securities to be issued under the transaction will have a hold period of four months and one day from the applicable closing date in accordance with applicable securities laws.
Anglogold is considered a 'related party' as it currently owns approximately 14.3% of the issued and outstanding common shares of Pure Gold on a non-diluted basis. The transaction is exempt from the minority approval requirement as neither the fair market value of the transaction, nor the fair market value of the consideration exceeds 25% of Pure Gold’s market capitalization.
The securities offered have not been, and will not be, registered under the United States Securities Act of 1933, as amended or any US 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 US Securities Act and applicable US state securities laws.
Pure Gold Mining is a growth company, located in the very heart of Red Lake, Canada. Its objective is to develop a highly profitable long-life gold mining company, and become Canada’s next iconic gold producer.
Contact the author at jon.hopkins@proactiveinvestors.com