/NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES
OR FOR DISSEMINATION IN THE UNITED
STATES/
TSX-V: CXO
VANCOUVER, March 31, 2020 /CNW/ - COLORADO RESOURCES LTD. (TSX-V: CXO)
("Colorado" or the
"Company") is pleased to announce that, further to its news
releases of February 28, 2020 and
March 18, 2020, the Company has
closed the non- brokered private placements (the
"Placements") of 6,929,667 units (the "Units") at an
issue price of $0.06 per Unit and
15,793,000 charity flow-through common shares (the "FT
Shares") at an issue price of $0.075 per FT Share for aggregate gross proceeds
of $1,600,255.
Each Unit consisted of one common share in the capital of the
Company (each a "Colorado Share") and one-half of one common
share purchase warrant. Each whole warrant (a "Colorado
Warrant") entitles the holder to acquire an additional Colorado
Share at an exercise price of $0.09
for three years from the date of issuance.
No finder's fee or commission was paid in connection with the
placement. The net proceeds from the Placements will be used to
fund planned exploration activities as per Colorado's press release dated February 19, 2020, as well as for working capital
purposes. All securities issued in connection with the private
placement are subject to a four month hold period.
Certain Directors of the Company subscribed directly or
indirectly for 1,000,001 Units in the financing. The
transaction is exempt from the formal valuation and minority
shareholder approval requirements of Multilateral Instrument 61-101
("MI 61-101") in reliance on the exemptions set forth in
sections 5.5(a) and 5.7(1)(a) of MI 61-101, as neither the fair
market value of the securities to be distributed in the Placements
nor the consideration to be received for those securities, in so
far as the Placements involves the insiders, exceeds 25% of the
market capitalization. The Board of Directors approved the
Placements by resolutions on which the Directors did not vote with
respect to their participation in the Placements.
The Company did not file a material change report more than 21
days before the expected closing of the Placements as the details
of the Placements and the participation therein by related parties
of the Company were not settled until shortly prior to closing and
the Company wished to close on an expedited basis for sound
business reasons.
Early Warning Disclosure
Newmont Corporation
("Newmont"), indirectly through Peartree Securities Inc.,
acquired 15,793,000 Colorado Shares pursuant to the
Placements. Immediately prior to completion of the Placements,
Newmont directly or indirectly held 23,796,717 Colorado
Shares, representing approximately 12.6% of the issued and
outstanding Colorado Shares and 3,168,358 Colorado Warrants,
representing approximately 12.9% of the issued and outstanding
Colorado Warrants.
Newmont has advised the Company that following the Placements,
it now owns, directly or indirectly, 39,589,717 Colorado
Shares, representing approximately 18.7% of the issued and
outstanding Colorado Shares and 3,168,358 Colorado Warrants,
representing approximately 11.3% of the issued and outstanding
Colorado Warrants. Should Newmont exercise all of the Colorado
Warrants, Newmont would hold, directly or indirectly, 42,758,075
Colorado Shares, representing approximately 19.9% of the
issued and outstanding Colorado Shares (on a partially diluted
basis). Newmont's purchase price of the Colorado Shares was
$740,691.70.
The Colorado Shares were acquired by Newmont for investment
purposes. Newmont will evaluate its investment in the Company from
time to time and may, based on such evaluation, market conditions
and other circumstances, increase or decrease shareholdings as
circumstances require through market transactions, private
agreements or otherwise. A copy of the early warning report filed
by Newmont in connection with the transaction will be available on
the Company's SEDAR profile. Newmont's head office is located at
6363 South Fiddler's Green Circle, Suite 800, Greenwood Village, Colorado, 80111.
About Colorado
Colorado Resources Ltd. is
exploring for high-grade gold and copper in the Golden Triangle and
the Toodoggone area of British
Columbia. The portfolio includes the flagship Castle
property, a porphyry copper-gold project located in the Red Chris
mining district of the Golden Triangle neighbouring GT Gold's
Tatogga property. Other properties include the KSP, North ROK,
Kingpin, Heart Peaks and Sofia
properties in British Columbia.
These assets are being advanced by a newly assembled technical and
management team with experience in exploration, permitting and
discovery.
ON BEHALF OF THE BOARD OF DIRECTORS OF COLORADO RESOURCES LTD.
"Joseph
Mullin"
Joseph Mullin
Chief Executive Officer and Director
This news release does not constitute an offer to sell or
a solicitation of an offer to buy any of the securities in
the United States of America. The
securities have not been and will not be registered under the
United States Securities Act of 1933 (the "1933 Act") or any state
securities laws and may not be offered or sold within the United States or to U.S. Persons (as
defined in the 1933 Act) unless registered under the 1933 Act and
applicable state securities laws, or an exemption from such
registration is available.
Cautionary Note Regarding Forward-Looking
Statements
All statements, trend analysis and other information
contained in this press release about anticipated future events or
results constitute forward-looking statements. Forward-looking
statements are often, but not always, identified by the use of
words such as "seek", "anticipate", "believe", "plan", "estimate",
"expect" and "intend" and statements that an event or result "may",
"will", "should", "could" or "might" occur or be achieved and other
similar expressions. All statements, other than statements of
historical fact, included herein, including, statements regarding
the use of proceeds of the Placements are forward-looking
statements. Although the Company believe that the expectations
reflected in such forward-looking statements and/or information are
reasonable, undue reliance should not be placed on forward-looking
statements since the Company can give no assurance that such
expectations will prove to be correct. These statements involve
known and unknown risks, uncertainties and other factors that may
cause actual results or events to differ materially from those
anticipated in such forward-looking statements, including the
risks, uncertainties and other factors identified in the Companies'
periodic filings with Canadian securities regulators as well as the
risk that the ongoing COVID-19 pandemic may have on the Company's
business. Important factors that could cause actual results to
differ materially from Colorado
expectations include the risk that management of the Company
determines to use the proceeds of the Placements in a way that is
not currently contemplated. Forward-looking statements are
based on estimates and opinions of management at the date the
statements are made. Colorado does
not undertake any obligation to update forward-looking statements
except as required by applicable securities laws. Investors should
not place undue reliance on forward-looking statements.
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
SOURCE Colorado Resources Ltd.
