SASKATOON, Saskatchewan, Dec. 21, 2017 (GLOBE NEWSWIRE) -- GFG Resources Inc. (TSX-V:GFG) (OTCQB:GFGSF) (“GFG” or the “Company”) is pleased to announce that further to its press release dated December 11, 2017 it has completed the acquisition of the West Porcupine Property from Probe Metals Inc. (TSX-V:PRB) (“Probe”) (the “West Porcupine Property Acquisition”) and the Swayze Project from Osisko Mining Inc. (TSX:OSK) (“Osisko”) (the “Swayze Property Acquisition”). Immediately prior to closing the acquisitions, the Company also closed the first tranche of its non-brokered private placement (the “Concurrent Financing”) for gross proceeds of C$4,228,305.
West Porcupine Property Acquisition
GFG has acquired Probe’s 100% interest in the West Porcupine property, a land package consisting of 198 claims and covering approximately 245 km2 located 50 kilometres southwest of Timmins, Ontario, in exchange for the issuance of 6,477,883 common shares of GFG, representing an implied purchase price of approximately C$3.5 million based on GFG’s 20-day volume weighted average share price (“VWAP”) ending December 7, 2017.
Swayze Property Acquisition
GFG has acquired Osisko’s 100% interest in the Swayze property, a land package consisting of 56 claims and covering approximately 120 km2 located 40 kilometres from Borden, Ontario, in exchange for the issuance of 1,110,494 common shares of GFG, representing an implied purchase price of approximately C$600,000 based on GFG’s 20-day VWAP ending December 7, 2017.
Concurrent Private Placement
The Company has completed the first tranche of the Concurrent Financing by way of a non-brokered private placement. Due to higher than expected demand, the Company increased its flow-through common shares offering previously announced (See news release dated December 11, 2017) from 3,636,364 to 5,460,555 flow-through common shares at a price of C$0.55 per share for gross proceeds of C$3,003,305 (the “FT Private Placement”). The Company also issued 2,450,000 units at a price of C$0.50 per unit for gross proceeds of C$1,225,000 (the “Non-FT Private Placement”), with each unit consisting of one common share and one-half of a common share purchase warrant. Each whole warrant will entitle the holder to purchase one additional common share at an exercise price of C$0.75 for a period of 24 months following closing. Gross proceeds raised under the FT Private Placement will be used for exploration activities in Ontario that will qualify as “Canadian Exploration Expenses”. Net proceeds raised under the Non-FT Private Placement will be used for exploration activities at the Company’s projects in Wyoming and Ontario as well as for general working capital purposes.
The Company intends to close a final tranche on or about January 11, 2018, for up to the balance of the remaining units of the Concurrent Financing previously disclosed.
The Company paid cash finder's fees to certain arm’s length finders of up to 6% of the gross proceeds of the Concurrent Financing. The Concurrent Financing is subject to final approval by the TSX Venture Exchange. The securities issued pursuant to this tranche of the Concurrent Financing are subject to a four month hold expiring on April 22, 2018.
Qualified Persons
Brian Skanderbeg, P.Geo. and M.Sc., serves as President and CEO of GFG, and is a “qualified person” within the meaning of National Instrument 43-101 – Standards of Disclosure for Mineral Projects. Mr. Skanderbeg has reviewed and approved the information contained in this news release.
This news release does not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities, in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction. 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 unless an exemption from such registration is available.
