/NOT FOR DISTRIBUTION TO UNITED
STATES NEWSWIRE SERVICES OR DISSEMINATION IN THE UNITED STATES/
VANCOUVER, BC, Dec. 30, 2020 /CNW/ - District Metals
Corp. (TSX-V: DMX) (FRA: DFPP); ("District" or the
"Company") is pleased to announce that it has closed its
previously announced brokered private placement financing pursuant
to an agency agreement with Haywood Securities Inc. (the
"Agent"), raising aggregate gross proceeds of $4,750,000 (the "Offering"). Under the
terms of the Offering, the Company issued a total of 15,833,333
units (the "Units") at a price of $0.30 per Unit (the "Issue Price"),
including the exercise by the Agent of an option granted by the
Company to sell up to an addition $250,000 worth of Units.
Garrett Ainsworth, President
& CEO of District, commented: "District Metals is now fully
funded for the upcoming 5,000 m drill
program at our high grade polymetallic Tomtebo Property located in
the Bergslagen Mining District of south-central Sweden. Our financing was heavily
oversubscribed, exemplifying the enthusiasm towards the discovery
potential at our high priority Tomtebo targets. I would like to
thank our existing shareholders who participated, as well as
welcome many new shareholders, including several institutional
investors."
Each Unit consists of one common share in the capital of the
Company (a "Unit Share") and one-half of one common share
purchase warrant (each whole such purchase warrant, a
"Warrant"). Each Warrant will entitle the holder thereof to
acquire one common share in the capital of the Company (a
"Warrant Share") at $0.42 per
Warrant Share for a period of 24 months from the Closing Date (as
hereinafter defined), provided that if, at any time prior to the
expiry date of the Warrants, the volume weighted average trading
price of the common shares in the capital of the Company on the TSX
Venture Exchange is equal to or greater than $0.70 for 10 consecutive trading days, the
Company may, within 15 days of the occurrence of such event,
deliver a notice to the holders of Warrants accelerating the expiry
date of the Warrants to the date that is 30 days following the date
of such notice (the "Accelerated Exercise Period"). Any
unexercised Warrants shall automatically expire at the end of the
Accelerated Exercise Period.
The net proceeds from the Offering will be used for exploration
at the Company's Tomtebo project in Sweden, and for working capital and general
corporate purposes.
In consideration for its services, the Agent received a cash
commission of $255,000 and was issued
850,000 compensation options, with each such compensation option
entitling the holder to purchase one Unit of the Company at a price
of $0.30 per Unit for a period of 24
months from the date of issuance.
All securities issued and issuable pursuant to the Offering are
subject to a statutory hold period and may not be traded until
May 1, 2021 except as permitted by
applicable securities legislation and the rules and policies of the
TSX Venture Exchange.
Certain related parties of the Company participated in the
Offering. The issuance of Units to related parties is considered to
be a related party transaction within the meaning of TSX Venture
Exchange Policy 5.9 and Multilateral Instrument 61-101 ("MI
61-101"). The Company has relied on the exemptions from the
valuation and minority shareholder approval requirements of
MI 61–101 (and Policy 5.9) as the fair market value of the
Units issued to such persons does not exceed 25% of the Company's
market capitalization.
The securities issued pursuant to the Offering 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
applicable U.S. state securities laws, and may not be offered or
sold in the United States absent
registration or any applicable exemption from the registration
requirements of the U.S. Securities Act and applicable U.S. state
securities laws. This news release shall not constitute an offer to
sell or the solicitation of an offer to buy securities in
the United States, nor shall there
be any sale of these securities in any jurisdiction in which such
offer, solicitation or sale would be unlawful.
Further to a shareholder rights agreement entered into between
the Company and EMX Royalty Corp. ("EMX") in connection with
the acquisition of the Tomtebo and Trollberget properties in
June 2020, EMX has been issued
219,756 common shares in the capital of the Company, which
completes EMX's top-up right to maintain its proportionate
shareholding in the Company for no additional
consideration.
Additionally, pursuant to the previously announced services
agreement between the Company, Vector Geological Solutions Inc.
(the "Consultant"), and Daniel
MacNeil, as principal of the Consultant, in connection with
the acquisition of the Tomtebo and Trollberget properties in
June 2020, the Company has issued
33,610 common shares in the capital of the Company to the
Consultant. The Consultant is at arm's length to the Company.
The Company has also granted a total of 1,400,000 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 $0.46
per common share (being the closing price of the Company's common
shares on December 29, 2020, the
grant date). All stock options have a term of five years and vest
on the grant date.
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 advanced exploration stage Tomtebo Property, located in the
Bergslagen Mining District of south-central Sweden, is the Company's main focus. The
Tomtebo Property comprises 5,144 ha, and is situated between the
historic Falun Mine and Boliden's Garpenberg Mine located 25 km to
the northwest and southeast, respectively. Two historic
polymetallic mines and numerous polymetallic showings are located
on the Tomtebo Property along an approximate 17 km trend that
exhibits similar geology, structure, alteration and VMS/SedEx style
mineralization as other significant mines within the district.
Mineralization that is open at depth and along strike at the
historic mines on the Tomtebo Property has not been followed-up and
modern systematic exploration has never been conducted on the
Property.
On Behalf of the Board of Directors
"Garrett Ainsworth"
President and Chief Executive Officer
(604) 288-4430
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.
This news release contains certain statements and information
that may be considered "forward-looking statements" and "forward
looking information" within the meaning of applicable securities
laws. In some cases, but not necessarily in all cases,
forward-looking statements and forward-looking information can be
identified by the use of forward-looking terminology such as
"plans", "targets", "expects" or "does not expect", "is expected",
"an opportunity exists", "is positioned", "estimates", "intends",
"assumes", "anticipates" or "does not anticipate" or "believes", or
variations of such words and phrases or statements that certain
actions, events or results "may", "could", "would", "might", "will"
or "will be taken", "occur" or "be achieved" and other similar
expressions. In addition, statements in this news release that are
not historical facts are forward looking statements, including
statements or information concerning the use of proceeds of
the Offering.
These statements and other forward-looking information are
based on assumptions and estimates that the Company believes are
appropriate and reasonable in the circumstances, including, without
limitation, assumptions about the future prices of
precious metals; the price of other commodities such as coal, fuel
and electricity; currency exchange rates and interest rates;
favourable operating conditions; political stability; timely
receipt of governmental approvals, licences and permits (and
renewals thereof); access to necessary financing; stability of
labour markets and market conditions in general; availability of
equipment; the accuracy of mineral resource estimates and
preliminary economic assessments; estimates of costs and
expenditures to complete the Company's programs and goals; and
there being no significant disruptions affecting the development
and operation of the project, including due to the COVID-19
pandemic.
There can be no assurance that such statements will prove to
be accurate, and actual results and future events could differ
materially from those anticipated in such statements. Important
factors that could cause actual results to differ materially from
the Company's expectations include risks associated with the
business of the Company; business and economic conditions in the
mining industry generally; the supply and demand for labour and
other project inputs; changes in commodity prices; changes in
interest and currency exchange rates; risks relating to inaccurate
geological and engineering assumptions; risks relating to
unanticipated operational difficulties; failure of equipment or
processes to operate in accordance with specifications or
expectations; cost escalations; unavailability of materials and
equipment; government action or delays in the receipt of government
approvals; industrial disturbances or other job action;
unanticipated events related to health, safety and environmental
matters; risks relating to adverse weather conditions; political
risk and social unrest; changes in general economic conditions or
conditions in the financial markets; and other risk factors as
detailed from time to time in the Company's continuous disclosure
documents filed with Canadian securities regulators. The Company
does not undertake to update any forward-looking information,
except in accordance with applicable securities laws.
SOURCE District Metals Corp.