VANCOUVER, June 8, 2020 /CNW/ - District Metals
Corp. (TSX-V: DMX; "District" or the "Company") is pleased
to announce that further to its news release of May 20, 2020 and May 22,
2020, it has closed a non-brokered private placement
offering of 20,000,000 common shares of the Company (the
"Shares") at a price of CDN$0.12 per share for aggregate gross proceeds
of CDN$2.4 million (the
"Private Placement").
The Private Placement included an affiliate of the Sprott Group
who subscribed for 6.0 million Shares, representing 11.31% of the
Company's outstanding common shares after completion of the Private
Placement.
Garrett Ainsworth, President
& CEO of District, commented: "I would like to welcome several
new and prominent investors into District Metals Corp. through our
recently completed and oversubscribed financing, and also thank
existing shareholders for their continued support. We are now
well-positioned to execute on our exploration plans to prove up the
prospective Polymetallic Tomtebo Property located in south-central
Sweden."
As previously disclosed, the Company intends to use the net
proceeds from the Private Placement to finance its initial
exploration program at the Tomtebo property and for general working
capital purposes or, in the event the Company does not complete the
acquisition of the Tomtebo property, for the identification,
assessment and acquisition of other prospective mineral properties,
and for general corporate purposes.
Certain insiders of the Company subscribed, directly or
indirectly for an aggregate of 189,000 Shares pursuant to the
Private Placement. Such participation is considered a "related
party transaction" within the meaning of TSX Venture Exchange
Policy 5.9 and 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 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 Shares purchased by
the insiders nor the consideration to be paid by the insiders
exceeds 25% of the Company's market capitalization.
The Company did not file a material change report more than 21
days before the expected closing of the Private Placement as the
details of the Private Placement 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.
All Shares 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.
In connection with the Private Placement, the Company paid a
total of $60,036 in finders fees
(representing 6% of the aggregate gross proceeds from the sale of
Shares subscribed for by persons introduced to the Company by such
finders).
The Company has also granted a total of 1,865,000 stock options
to directors, officers, employees and consultants of the Company,
in accordance with the provisions of its stock option plan. Each
stock option is exercisable at $0.21
per common share (the closing price of the Company's common shares
on June 2, 2020, the grant date). All
stock options have a term of five years and vest on the grant
date.
Further, the Company announces that Emily Davis has resigned as Corporate Secretary
of the Company and Maria Wells has
been appointed to fill that role.
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 in
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
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 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 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.