PureGold Closes $15 Million Non-Brokered Flow Through Financing
VANCOUVER, B.C. – June 17, 2020 – Pure Gold Mining Inc. (TSXV:PGM, LSE:PUR) (“PureGold” or the “Company”) is pleased to announce that it has closed the non-brokered private placement of 9,868,421 common shares of the Company that qualified as “flow-through shares” for the purposes of the Income Tax Act (Canada) (the “FT Shares”) at a price of $1.52 per FT Share (the “Financing”), for gross proceeds to PureGold of $15,000,000. Subsequent to the private placement, Mr. Eric Sprott was the back-end buyer of all of the FT Shares.
“This new capital gives us the financial flexibility to launch an aggressive exploration drilling campaign designed to accelerate our goal of resource growth and expansion. While we remain completely focused on our fully-funded mine construction and ramp-up, we strongly believe our mine plan is both scalable, and has the potential to expand. This investment allows us to begin building out our future growth today, concurrent with mine construction activities which remain on-track for first gold production in Q4 2020,” said Darin Labrenz, President & CEO. “We would like to thank Eric Sprott for his continued support of the Company and of our vision of becoming a high-margin, long-life producer in the Red Lake mining district”.
The gross proceeds from the issuance of the FT Shares will be used for “Canadian exploration expenses” and will qualify as “flow-through mining expenditures” (the “Qualifying Expenditures”), as those terms are defined in the Income Tax Act (Canada), which will be renounced to the initial purchasers of the FT Shares with an effective date no later than December 31, 2020 in an aggregate amount not less than the gross proceeds raised from the issue of the FT Shares, and, if the Qualifying Expenditures are reduced by the Canada Revenue Agency, the Company will indemnify each initial purchaser of FT Shares for any additional taxes payable by such subscriber as a result of the Company’s failure to renounce the Qualifying Expenditures as agreed.
In consideration for their services, a finders’ fee equal to 6.0% of the gross proceeds of the Financing was paid to a group of financial advisors led by Clarus Securities Inc.
The FT Shares have a hold period of four months and one day from closing, expiring on October 18, 2020.
This news release does not constitute an offer to sell or a solicitation of an offer to buy nor shall there be any sale of any of the FT Shares in any jurisdiction in which such offer, solicitation or sale would be unlawful, including any of the FT Shares in the United States of America. The FT Shares have not been and will not be registered under the United States Securities Act of 1933, as amended (the “1933 Act”) or any state securities laws and may not be offered or sold within the United States or to, or for account or benefit of, U.S. Persons (as defined in Regulation S under the 1933 Act) unless registered under the 1933 Act and applicable state securities laws, or an exemption from such registration requirements is available.
About Pure Gold Mining Inc.
The PureGold Red Lake Mine is Canada’s next gold mine. Fully funded, the project is on track to deliver near term gold production into a rising Canadian gold price environment, with first production scheduled for late 2020. The orebody is situated within a seven-kilometre-long gold system that is wide open for expansion at depth and along strike, and multiple discoveries by the Company suggest potential opportunities for near-term growth.
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
Darin Labrenz, President & CEO
Adam Buchanan, Manager, Investor Relations