VANCOUVER, May 20, 2020 /CNW/ - District Metals Corp.
(TSX-V: DMX; "District" or the "Company") is pleased
to announce a non-brokered private placement offering of up to
15,000,000 common shares of the Company (the "Shares")
at a price of CDN$0.12 per share to
raise gross proceeds of up to CDN$1,800,000 (the "Private
Placement").
Closing of the Private Placement is subject to all necessary
regulatory approvals including acceptance from the TSX Venture (the
"TSXV") Exchange. All securities issued in connection with
the Private Placement will be subject to a four-month hold period
from the closing date under applicable Canadian securities laws, in
addition to such other restrictions as may apply under applicable
securities laws of jurisdictions outside Canada. Certain insiders of the Company may
acquire shares under the Private Placement.
As described in the Company's news releases dated February 28, 2020 and May
8, 2020, the Company has entered into a definitive agreement
to acquire a 100% interest in the Tomtebo property, subject to
final approval of the TSXV Exchange and satisfaction of other
closing conditions. The Company intends to use the proceeds from
the Private Placement to finance its initial exploration program at
the Tomtebo property and for general working capital purposes. In
the event the Company does not complete the acquisition of the
Tomtebo property, the proceeds of the Private Placement will be
used for the identification, assessment and acquisition of other
prospective mineral properties, and for general corporate
purposes.
To demonstrate continued support of the Company's growth plans,
insiders of the Company, including certain directors and officers,
are expected to participate in the Private Placement. Such
participation is considered a related party transaction within the
meaning of Multilateral Instrument 61-101 – Protection of
Minority Security Holders in Special Transactions ("MI
61-101"). The related party transaction will be exempt from
minority approval, information circular and formal valuation
requirements pursuant to the exemptions contained in Sections
5.5(a) and 5.7(1)(a) of MI 61-101, as neither the fair market value
of the gross securities to be issued under the Private Placement
nor the consideration to be paid by the insiders will exceed 25% of
the Company's market capitalization.
In connection with the Private Placement, the Company intends to
pay cash finders' fees to eligible finders with a value equivalent
to 6% of the aggregate gross proceeds raised from the sale of the
shares subscribed for by subscribers introduced to the Company by
the finders.
The Private Placement is subject to an over-allotment option
exercisable in the sole discretion of the Company any time prior to
closing to issue up to an additional 5,000,000 Shares for up to an
additional $600,000 of gross
proceeds. (all references to "Private Placement" include references
to any Shares issued pursuant to the over-allotment option).
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. 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, U.S. Persons unless
registered under the U.S. Securities Act and applicable state
securities laws, unless an exemption from such registration is
available.
About District Metals Corp.
District Metals Corp. is led by industry professionals with a
track record of success in the mining industry. The Company's
mandate is to seek out, explore, and develop prospective mineral
properties through a disciplined science-based approach to create
shareholder value and benefit other stakeholders. The Company has
entered into a definitive agreement to acquire a 100% interest the
Tomtebo and Trollberget properties in the prolific Bergslagen
District of Sweden. Upon
completion of the proposed transaction, the Company's primary focus
will be on the advanced exploration stage Tomtebo
property.
On behalf of District Metals Corp.
Garrett Ainsworth, President and
CEO
District Metals Corp.
604-628-2669
Neither TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in policies of the TSX Venture
Exchange) accepts responsibility for the adequacy or accuracy of
this release.
Cautionary Statement Regarding "Forward-Looking"
Information.
All statements, trend analysis and other information
contained in this news release relative to markets 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, without limitation, statements relating to the size of
the Private Placement, the closing of the Private Placement and the
anticipated use of proceeds of the Private Placement and the
completion of the acquisition of the Tomtebo property are
forward-looking statements. Forward-looking information is subject
to business and economic risks and uncertainties and other factors
that could cause actual results of operations to differ materially
from those contained in the forward-looking information. Important
factors that could cause actual results to differ materially from
District's expectations include failure to complete the acquisition
of the Tomtebo property, fluctuations in commodity prices and
currency exchange rates; uncertainties surrounding the results of
planned exploration activities, uncertainties relating to
interpretation of drill results and the geology, continuity and
grade of mineral deposits; the need for cooperation of government
agencies and native groups in the exploration and development of
properties and the issuance of required permits; the need to obtain
additional financing to meet the minimum expenditure requirements
to maintain an interest in the Tomtebo property, uncertainty as to
the availability and terms of future financing and the
possibility of delay in exploration or development programs;.
Forward-looking statements are based on estimates and opinions of
management at the date the statements are made. District 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.
SOURCE District Metals Corp.