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TORONTO, May 13, 2020 /CNW/ - Arizona Metals Corp. (TSXV: AMC) (the "Company" or "Arizona Metals") is pleased to announce that in connection with the previously announced bought deal private placement, the Company, Stifel GMP and Canaccord Genuity Corp. (collectively, the "Underwriters") have agreed to upsize the Underwriters' Option to up to 4,650,000 Units.

The Underwriters have agreed to purchase on their own behalf, 4,650,000 units of the Company (the "Units") at a price of $0.65 per Unit (the "Offering Price") for gross proceeds to the Company of $3,022,500 (the "Offering"). Each Unit shall consist of one (1) common share ("Common Share") and one-half (0.5) of a common share purchase warrant (each whole common share purchase warrant, a "Warrant"). Each Warrant will entitle the holder thereof to purchase one common share of the Company at an exercise price of $0.85 for a period of 18 months following the Closing Date (as defined below). Additionally, the Company will grant the Underwriters an option (the "Underwriters' Option") to purchase up to an additional 4,650,000 Units at the Offering Price exercisable, in whole or in part, at any time and from time to time on or prior to the date that is 5 days prior to the Closing Date. In the event that the Underwriters' Option is exercised in full, the gross proceeds from the Offering will be $6,045,000.

The completion of the Offering shall be subject to, among other things, the receipt of all necessary regulatory and stock exchange approvals relating to the Offering as are appropriate in the circumstances, including the approval of the TSX Venture Exchange (the "TSXV") prior to the Closing Date. The Underwriters shall have the right and will endeavor to arrange for substituted purchasers of the Units.

The Company shall pay the Underwriters a cash fee equal to 5.0% of the gross proceeds (the "Commission") from the sale of Units. As additional consideration for their services, the Underwriters shall also receive compensation warrants (the "Compensation Warrants") equal to 5.0% of the number of Units sold pursuant to the Offering payable on the Closing Date. Each Compensation Warrant will entitle the holder thereof to subscribe for one Common Share of the Company at a price of $0.65 for a period of 18 months following the Closing Date.

Proceeds from the Offering will be used primarily to fund general working capital purposes and exploration at the Company's Kay Mine Project. The Offering is expected to close on or around May 29, 2020 (the "Closing Date").

The Offering is subject to TSX Venture Exchange approval. All Common Shares and Warrants issued pursuant to the Private Placement and any Common Shares issuable on exercise of Warrants will be subject to a four month and a day hold period from the Closing Date.

It is anticipated that certain directors, officers and other insiders of the Company may acquire up to $1 million worth of Units in the Offering. Such participation will be considered to be "related party transactions" within the meaning of TSX Venture Exchange Policy 5.9 and Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61-101") adopted in the Policy.

The Company intends to rely on the exemptions from the formal valuation and minority shareholder approval requirements of MI 61-101 contained in sections 5.5(a) and 5.7(1)(a) of MI 61-101 in respect of related party participation in the Private Placement as neither the fair market value (as determined under MI 61-101) of the subject matter of, nor the fair market value of the consideration for, the transaction, insofar as it involves the related parties, is expected to exceed 25% of the Company's market capitalization (as determined under MI 61-101).

This press release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States. The securities 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 state securities laws and may not be offered or sold within the United States or to or for the account or benefit of a U.S. person (as defined in Regulation S under the U.S. Securities Act) unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.

About Arizona Metals Corp.

Arizona Metals Corp. owns 100% of the Kay Mine Property in Yavapai County, which is located on a combination of patented and BLM claims totaling 1,300 acres that are not subject to any royalties. An historic estimate by Exxon Minerals in 1982 reported a "proven and probable reserve of 6.4 million short tons at a grade of 2.2% copper, 2.8g/t gold, 3.03% zinc, and 55g/t silver". The historic estimate at the Kay Mine was reported by Exxon Minerals in 1982. The historic estimate has not been verified as a current mineral resource. None of the key assumptions, parameters, and methods used to prepare the historic estimate were reported, and no resource categories were used. Significant data compilation, re-drilling and data verification may be required by a Qualified Person before the historic estimate can be verified and upgraded to be compliant with current NI 43-101 standards. A Qualified Person has not done sufficient work to classify it as a current mineral resource, and AMC is not treating the historic estimate as a current mineral resource. The Kay Mine is a steeply dipping VMS deposit that has been defined from a depth of 150m to at least 900m. It is open for expansion on strike and at depth. The Company also owns 100% of the Sugarloaf Peak Property, in La Paz County, which is located on 4,400 acres of BLM claims. Sugarloaf is a heap-leach, open-pit target and has a historic estimate of "100 million tons containing 1.5 million ounces gold" at a grade of 0.5g/t (Dausinger, 1983, Westworld Resources). The historic estimate at the Sugarloaf Peak Property was reported by Westworld Resources in 1983. The historic estimate has not been verified as a current mineral resource. None of the key assumptions, parameters, and methods used to prepare the historic estimate were reported, and no resource categories were used. Significant data compilation, re-drilling and data verification may be required by a Qualified Person before the historic estimate can be verified and upgraded to be compliant with current NI 43-101 standards. A Qualified Person has not done sufficient work to classify it as a current mineral resource, and AMC is not treating the historic estimate as a current mineral resource

Disclaimer

This press release contains statements that constitute "forward-looking information" (collectively, "forward-looking statements") within the meaning of the applicable Canadian securities legislation, All statements, other than statements of historical fact, are forward-looking statements and are based on expectations, estimates and projections as at the date of this news release. Any statement that discusses predictions, expectations, beliefs, plans, projections, objectives, assumptions, future events or performance (often but not always using phrases such as "expects", or "does not expect", "is expected", "anticipates" or "does not anticipate", "plans", "budget", "scheduled", "forecasts", "estimates", "believes" or "intends" or variations of such words and phrases or stating that certain actions, events or results "may" or "could", "would", "might" or "will" be taken to occur or be achieved) are not statements of historical fact and may be forward-looking statements. Forward-looking statements contained in this press release include, without limitation, the successful completion of the Offering and the use of proceeds of the Offering. In making the forward- looking statements contained in this press release, the Company has made certain assumptions, including that: all applicable regulatory approvals for the Offering will be received. Although the Company believes that the expectations reflected in forward-looking statements are reasonable, it can give no assurance that the expectations of any forward-looking statements will prove to be correct. Known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking statements. Such factors include, but are not limited to general business, economic, competitive, political and social uncertainties. Accordingly, readers should not place undue reliance on the forward-looking statements and information contained in this press release. Except as required by law, the Company disclaims any intention and assumes no obligation to update or revise any forward-looking statements to reflect actual results, whether as a result of new information, future events, changes in assumptions, changes in factors affecting such forward-looking statements or otherwise.

NEITHER THE TSXV NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN POLICIES OF THE TSXV) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.

SOURCE Arizona Metals Corp.

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