Discovery Metals Closes First Tranche of C$25 Million Private Placement
June 01 2020 - 08:15AM
Discovery Metals Corp. (TSXV: DSV; OTCQX: DSVMF)
is pleased to announce that it has closed the first tranche of the
non-brokered private placement (the “Private Placement”) as
previously announced on May 18, 2020. The first tranche consists of
31,090,945 units (“Units”) at a price of C$0.55 per Unit for
aggregate proceeds of C$17,100,020. Each Unit is comprised of one
common share of Discovery (“Common Share”) and one half of one
Common Share purchase warrant, with each full warrant (a “Warrant”)
exercisable at C$0.77 for a period of two years after the date of
issuance. Discovery intends to close a further C$7,899,980 in
subscriptions in a second tranche of the Private Placement, for an
aggregate total of C$25,000,000.
Mr. Eric Sprott, through 2176423 Ontario Ltd. (a
corporation which is beneficially owned by him), acquired
18,181,800 Units (composed of 18,181,800 Common Shares and
9,090,909 Warrants) in the Private Placement, for a total
investment of C$10,000,000. Prior to the closing of the Private
Placement, Mr. Sprott owned 44,610,111 Common shares of Discovery
representing 21.1% of the interest of Discovery on a non-diluted
basis. Through the purchase of Common Shares and Warrants in the
Private Placement, as of the closing of the first tranche and until
the closing of the second tranche of the Private Placement, Mr.
Sprott will own approximately 25.9% interest in Discovery on a
non-diluted basis and approximately 28.6% on a partially diluted
basis assuming the exercise of the Warrants owned by Mr. Sprott. A
copy of 2176423 Ontario Ltd.’s early warning report will appear on
Discovery’s profile on SEDAR and may also be obtained by calling
(416) 362-7172 (200 Bay Street, Suite 2600, Royal Bank Plaza, South
Tower, Toronto, Ontario, M5J 2J1).
Discovery has paid finders’ and advisory fees of
C$711,003 in cash and issued 373,636 finder warrants with an
exercise price of $0.55 and a two year expiry to certain arms’
length parties who introduced Discovery to investors in the first
tranche, in accordance with the policies of the TSX Venture
Exchange. The securities issued on closing of the Private Placement
are subject to a statutory hold period expiring four months and one
day after their date of issuance.
The proceeds of the Private Placement will be
used primarily to fund Discovery’s continuing exploration program
at its Cordero project and its Coahuila projects. A portion of the
proceeds will be used for general working capital purposes.
On Behalf of the Board of Directors,
Taj Singh, M.Eng,, P.Eng,, CPAPresident, Chief
Executive Officer, and Director
About DiscoveryDiscovery Metals
Corp. (TSX-V: DSV, OTCQX: DSVMF) is a Canadian exploration and
development company headquartered in Toronto, Canada, and focused
on historic mining districts in Mexico. Discovery’s flagship is its
100%-owned Cordero silver project in Chihuahua State, Mexico. The
35,000-hectare property covers a large district that hosts the
announced resource as well as numerous exploration targets for bulk
tonnage diatreme-hosted, porphyry-style, and carbonate replacement
deposits.
For further information contact:
Forbes Gemmell, CFA VP
Corporate Development & Investor Relations
forbes.gemmell@dsvmetals.com
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.
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 securities in any jurisdiction in which such
offer, solicitation or sale would be unlawful, including 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, 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.
Cautionary Note Regarding Forward-Looking
Statements
This news release may include forward-looking
statements that are subject to inherent risks and uncertainties.
All statements within this news release, other than statements of
historical fact, are to be considered forward looking. Although
Discovery believes the expectations expressed in such
forward-looking statements are based on reasonable assumptions,
such statements are not guarantees of future performance and actual
results or developments may differ materially from those described
in forward-looking statements. Factors that could cause actual
results to differ materially from those described in
forward-looking statements include fluctuations in market prices,
including metal prices, continued availability of capital and
financing, and general economic, market or business conditions.
There can be no assurances that such statements will prove accurate
and, therefore, readers are advised to rely on their own evaluation
of such uncertainties. There can be no assurance that the Private
Placement will close on the announced terms. Discovery does not
assume any obligation to update any forward-looking statements
except as required under applicable laws.
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