NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES

VANCOUVER, British Columbia, Jan. 27, 2022 (GLOBE NEWSWIRE) -- Pure Gold Mining Inc. (TSX-V:PGM, LSE:PUR) (“PureGold” or the “Company”), is pleased to announce that it has entered into an agreement with National Bank Financial Inc., as lead underwriter, on behalf of a syndicate of underwriters including Clarus Securities Inc. (collectively, the “Underwriters”) and with Tamesis Partners LLP acting as special selling agent in the UK and Europe, under which the Underwriters have agreed to purchase, on a bought deal private placement basis, 16,989,000 common shares of the Company at a price of C$0.53 (“Offering Price”) per share for gross proceeds of C$9,004,170 (“Brokered Offering”). The Company has also granted the Underwriters an option to purchase up to an additional 9,434,000 common shares pursuant to the Brokered Offering for additional gross proceeds to the Company of up to C$5,000,020 (“Underwriters Option”).

The Company is also pleased to announce it has agreed to a concurrent private placement of 30,181,572 common shares at the Offering Price with the Company’s largest shareholder, AngloGold Ashanti Limited (“AngloGold Ashanti”) by way of non-brokered private placement for additional gross proceeds of C$15,996,233 (the “AngloGold Subscription” and together with the “Brokered Offering”, the “Transactions”). Closing of the AngloGold Subscription and the Brokered Offering are cross conditional upon one another.

Troy Fierro, President & CEO of PureGold, stated, “We are delighted to announce this financing with the support of our largest shareholder, AngloGold Ashanti. We value the global operational expertise AngloGold Ashanti brings and look forward to working collaboratively with their technical team to continue to unlock the full potential of the PureGold Mine.”

After giving effect to the Transactions, AngloGold Ashanti will own 19.9% of the outstanding common shares of PureGold on a partially diluted basis. Should the Underwriters Option be exercised, AngloGold Ashanti shall have the option to purchase such additional shares under the AngloGold Subscription as to allow AngloGold Ashanti to maintain approximate 19.9% ownership of PureGold following the exercise of the Underwriters Option. AngloGold Ashanti currently holds 65,653,870 common shares in PureGold which represents a 14.9% interest in the outstanding common shares of PureGold on a non-diluted basis. In addition, AngloGold Ashanti owns 1,653,809 PureGold warrants which if exercised in full would increase AngloGold Ashanti’s interest in PureGold to 15.2% on a partially diluted basis. Following the implementation of the Transactions, AngloGold Ashanti will hold 95,835,442 common shares in PureGold and 1,653,809 warrants which will represent an interest in PureGold of 19.6% on a non-diluted basis and 19.9% on a partially diluted basis, respectively. AngloGold Ashanti’s current interest in PureGold as well as the interest to be acquired pursuant to the AngloGold Subscription is for investment purposes and its interest may increase or decrease depending on market and other circumstances.

The Company intends to use the net proceeds raised from the Transactions to complete the ramp up of operations to design capacity at its 100%-owned PureGold Mine located in Red Lake, Ontario and for general corporate purposes.

In connection with the AngloGold Subscription, PureGold and AngloGold Ashanti will enter into a shareholder rights agreement providing AngloGold Ashanti with certain rights, standard anti-dilution and equity participation rights as well as certain rights to PureGold’s technical and scientific data.

The Transactions are expected to close on February 15, 2022 and are subject to certain conditions including receipt of all applicable regulatory approvals, the approval of the TSX Venture Exchange and, for the AngloGold Subscription, the approval of the South African Reserve Bank. Closing of the AngloGold Subscription is subject to execution of definitive documentation. The securities to be issued under the Transactions will be issued on a private placement basis and will have a hold period of four months and one day from the applicable closing date in accordance with applicable securities laws.

AngloGold Ashanti is considered a “related party” of PureGold as it currently owns approximately 14.9% of the issued and outstanding common shares of PureGold on a non-diluted basis and, accordingly, the AngloGold Subscription constitutes a “related party transaction” within the meaning of Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101”). The AngloGold Subscription is exempt from the minority approval requirement of Section 5.6 and the formal valuation requirement of Section 5.4 of MI 61-101 as neither the fair market value of the AngloGold Subscription, nor the fair market value of the consideration for the AngloGold Subscription, exceeds 25% of PureGold’s market capitalization. A material change report in connection with the AngloGold Subscription will be filed less than 21 days before the closing of the AngloGold Subscription. This shorter period is reasonable and necessary in the circumstances as the Company wishes to complete the AngloGold Subscription in a timely manner.

The securities offered 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 U.S. state securities laws, and may not be offered or sold in the United States or to, or for the account or benefit of, United States persons absent registration or any applicable exemption from the registration requirements of the U.S. Securities Act and applicable U.S. state securities laws. This press release shall not constitute an offer to sell or the solicitation of an offer to buy securities in the United States, nor will there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.

About Pure Gold Mining Inc.

PureGold is a Canadian gold mining company, located in the very heart of Red Lake, Ontario, Canada. Our vision is pure and simple. To build a highly profitable, multi-generational growth company in the world-class gold mining district of Red Lake. With our 100%-owned, fully constructed operating PureGold Mine, a multi-million-ounce gold endowment, and significant exploration upside, our value-maximizing strategy is to pursue operational excellence today, while investing in systematic exploration and phased expansions to fuel discovery and growth for the future.

Additional information about the Company and its activities may be found on the Company’s website at www.puregoldmining.ca and under the Company’s profile at www.sedar.com

ON BEHALF OF THE BOARD
"Troy Fierro"                        
Troy Fierro, President & CEO

Investor inquiries:
Adrian O’Brien, Director, Marketing and Communications
Tel: 604-809-6890
aobrien@puregoldmining.ca

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.

All statements in this press release, other than statements of historical fact, are "forward-looking information" with respect to PureGold within the meaning of applicable securities laws, including, but not limited to statements with respect to the timing and completion of the Transactions, the receipt of the necessary approvals for the Transactions, the use of the proceeds for the transactions and certain other matters relating to the proposed Transactions, PureGold entering into an investor rights agreement with AngloGold Ashanti in connection with the AngloGold Subscription and the anticipated terms contained therein, the receipt of applicable TSX Venture Exchange approval for the Transactions and the receipt of South African Reserve Bank approval for the AngloGold Subscription. Forward-looking information is often, but not always, identified by the use of words such as "seek", "anticipate", "plan", "continue", "planned", "expect", "project", "predict", "potential", "targeting", "intends", "believe", "potential", and similar expressions, or describes a "goal", or variation of such words and phrases or state that certain actions, events or results "may", "should", "could", "would", "might" or "will" be taken, occur or be achieved. Forward-looking information is not a guarantee of future performance and is based upon a number of estimates and assumptions of management at the date the statements are made including, among others, assumptions about future prices of gold and other metal prices, currency exchange rates and interest rates, favourable operating conditions, political stability, obtaining governmental approvals and financing on time, obtaining renewals for existing licences and permits and obtaining required licences and permits, labour stability, stability in market conditions, availability of equipment, accuracy of any mineral resources, successful resolution of disputes and anticipated costs and expenditures. Many assumptions are based on factors and events that are not within the control of PureGold and there is no assurance they will prove to be correct.

Such forward-looking information, involves known and unknown risks, which may cause the actual results to be materially different from any future results expressed or implied by such forward-looking information, including, risks related to the interpretation of results at the Pure Gold Red Lake Mine complex; changes in project parameters as plans continue to be refined; current economic conditions; future prices of commodities; possible variations in grade or recovery rates; the costs and timing of the development of new deposits; failure of equipment or processes to operate as anticipated; the failure of contracted parties to perform; the timing and success of exploration and development activities generally; delays in permitting; possible claims against the Company; the timing of future economic studies; labour disputes and other risks of the mining industry; delays in obtaining governmental approvals, financing or in the completion of exploration as well as those factors discussed in the Annual Information Form of the Company dated March 31, 2021 in the section entitled "Risk Factors", under PureGold’s SEDAR profile at www.sedar.com.

Although PureGold has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking information, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate as actual results and future events could differ materially from those anticipated in such statements. PureGold disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise unless required by law. 


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