VANCOUVER, May 13, 2019 /CNW/ - Contact Gold Corp. (the
"Company" or "Contact Gold") (TSXV: C) is pleased to announce
that further to its news release dated April
10, 2019, it has entered into an underwriting agreement with
Raymond James Ltd. and Cormark Securities Inc., as joint
bookrunners and underwriters, together with their U.S. affiliates
Raymond James (USA) Ltd. and Cormark Securities (USA) Limited (collectively, the
"Underwriters") whereby the Underwriters have agreed to purchase
20,000,000 shares of common stock (the "Offered Shares") at a price
of $0.20 per Offered Share (the
"Offering Price") for gross proceeds of $4,000,000 (the "Offering"). The Company has
granted to the Underwriters an option (the "Over-Allotment
Option"), exercisable in whole or in part, in the sole discretion
of the Underwriters, for a period of 30 days from and including the
closing of the Offering, to purchase up to an additional 3,000,000
Offered Shares at the Offering Price. If the Over-Allotment Option
is exercised in full, the total gross proceeds to the Company will
be $4,600,000.
The Offering is being conducted (A) in Canada pursuant to a prospectus supplement
(the "Prospectus Supplement") to the Company's short form base
shelf prospectus dated October 24,
2018 filed in all of the provinces and territories of
Canada, except for Québec (the
"Canadian Jurisdictions"), and (B) to the public under an offering
statement on Form 1-A, which includes an offering circular (the
"Offering Statement"), pursuant to Regulation A under the U.S.
Securities Act of 1933, as amended (the "1933 Act"), filed with the
United States Securities and Exchange Commission (the "SEC"). The
qualification of the Offering Statement by the SEC is expected to
occur on or about May 15, 2019.
The Company intends to use the net proceeds of the Offering to
undertake further drilling at Contact Gold's flagship Pony Creek
project located in Elko County,
Nevada, for other exploration expenditures on Contact Gold's
other properties and for general working capital purposes as
further detailed in the Prospectus Supplement and Offering
Statement. Closing of the Offering is expected to occur on or about
May 22, 2019 and is subject to the
receipt of all necessary securities regulatory and stock exchange
approvals.
Pursuant to an existing investor rights agreement between the
Company and Waterton Nevada Splitter, LLC ("Waterton"), Waterton
has the right to participate in the Offering in order to maintain
its pro rata ownership interest in the Company.
Waterton has notified the Company that it plans to purchase
8,448,000 Offered Shares pursuant to the Offering. As a
result, Waterton will hold approximately 38% of the issued and
outstanding common stock of the Company after giving effect to the
Offering.
The Prospectus Supplement and the Offering Statement containing
important information relating to the Offering will be filed with
the securities commissions in the Canadian Jurisdictions and in
the United States with the SEC,
respectively. Copies of the Prospectus Supplement and the Offering
Statement will be available at www.sedar.com and www.sec.gov and
may be obtained from Raymond James
at Raymond James Syndication, 416-777-7000, 5400-40 King
St West, Toronto Ontario, M5H 3Y2, or Cormark
Securities at Cormark Securities Inc., 416-943-6405, Royal Bank
Plaza, South Tower, Suite 2800, 200 Bay Street, P.O. Box 63,
Toronto, On M5J 2J2.
This news release shall not constitute an offer to sell or the
solicitation of an offer to buy any securities, nor shall there be
any offer or sale of any securities, in any state or jurisdiction
in which the offer, solicitation, or sale of securities would be
unlawful. The securities being offered have not been approved
or disapproved by the SEC or any Canadian securities commission,
nor has any such regulatory authority passed upon the accuracy or
adequacy of the Prospectus Supplement or the Offering Statement.
The securities being offered have not been and will not be
registered under the 1933 Act.
About Contact Gold Corp.
Contact Gold is an exploration company focused on producing
district scale gold discoveries in Nevada. Contact Gold's
extensive land holdings are on the prolific Carlin, Independence and Northern Nevada Rift
gold trends which host numerous gold deposits and mines. Contact
Gold's land position comprises approximately 200 km2 of
target rich mineral tenure hosting numerous known gold occurrences,
ranging from early- to advanced-exploration and resource definition
stage.
Additional information about the Company is available at
www.contactgold.com.
Neither the TSXV nor its Regulation Services Provider (as
that term is defined in the policies of the TSXV) accepts
responsibility for the adequacy of this release. No stock exchange,
securities commission or other regulatory authority has approved or
disapproved the information contained herein.
Cautionary Note Regarding Forward-Looking
Information
This news release contains "forward-looking information" and
"forward-looking statements" (collectively, "forward-looking
statements") within the meaning of the applicable Canadian and
United States 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 involves discussions with respect to 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. In this news
release, forward-looking statements relate, among other things, to
the qualification of the Offering Statement, the closing of the
Offering, the exercise of the Over-Allotment Option, the intended
use of proceeds therefrom and the receipt of applicable regulatory
and stock exchange approvals.
These forward-looking statements are based on opinions and
estimates of management of the Company at the time such statements
were made and are based on various assumptions, including but not
limited to, favourable and stable general macroeconomic conditions,
securities markets, spot and forward prices of gold, silver, base
metals and certain other commodities and currency markets (such as
the $ to US$ exchange rate); the receipt of requisite regulatory
approvals; no materially adverse changes or economic developments,
that various risks and hazards associated with the business of
mineral exploration, development and mining will not materialize
and the ability to continue raising the necessary capital to
finance operations. Actual future results may differ
materially as forward-looking statements involve known and unknown
risks, uncertainties and other factors which may cause the actual
results, performance or achievements of the Company to materially
differ from any future results, performance or achievements
expressed or implied by such forward-looking statements. Such
risks, uncertainties and other factors that may affect the
forward-looking statements in this news release include but are not
limited to: risks related to the Offering; the use of proceeds; and
the receipt of applicable regulatory and stock exchange
approvals. Readers are cautioned that the foregoing list is
not exhaustive of all factors and assumptions which may have been
used.
Although the forward-looking statements contained in this
news release are based upon what management of the Company
believes, or believed at the time, to be reasonable assumptions,
the Company cannot assure shareholders that actual results will be
consistent with such forward-looking statements, as there may be
other factors that cause results not to be as anticipated,
estimated or intended. Readers should not place undue reliance on
the forward-looking statements and information contained in this
news release. The Company assumes no obligation to update the
forward-looking statements of beliefs, opinions, projections, or
other factors, should they change, except as required by
law.
The Form 1-A has not been qualified by the SEC. For the
purposes of Regulation A of the 1933 Act, (a) no money or other
consideration is being solicited and if sent in response, will not
be accepted; (b) no offer to buy the securities can be accepted and
no part of the purchase price can be received until the Offering
Statement is qualified, and any such offer may be withdrawn or
revoked, without obligation or commitment of any kind, at any time
before notice of its acceptance given after the qualification date;
and (c) any person's indication of interest involves no obligation
or commitment of any kind.
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SOURCE Contact Gold Corp.