West Red Lake Gold Mines Ltd. (“West Red Lake Gold” or
“WRLG” or the “Company”) (TSXV: WRLG) (OTCQB: WRLGF), is
pleased to announce that it has entered into an agreement with
Raymond James Ltd. to act as sole bookrunner and lead agent, on
behalf of a syndicate of agents (together, the
“
Agents”), in connection with a marketed “best
efforts” private placement of units of the Company (each, a
“
Unit”) at a price of US$1,000 per Unit (the
“
Offering Price”) for gross proceeds of
US$20,000,000 (the “
Offering”). The Agents will
have the option to sell up to an additional 15% of the Units
offered, exercisable, in whole or in part, at any time up to 48
hours prior to the Closing Date (as defined below) to cover
over-allotments, if any.
Each Unit will contain gold-linked notes in the
aggregate principal amount of US$1,000 (the
“Notes”) and 710 common share purchase warrants
(the “Warrants”). Each whole Warrant will entitle
the holder to purchase one common share of the Company
(collectively, the “Common Shares”) at an exercise
price of C$0.95 per share for a period of 60 months following the
closing of the Offering.
The Notes will represent senior unsecured
obligations of the Company. The Notes will bear a 12% per annum
coupon, calculated and payable quarterly in arrears, and will
mature on December 31, 2029. Commencing January 1, 2026, the
Company will cause gold to be placed in escrow on a quarterly basis
into a gold trust account. The aggregate principal amount of Notes
outstanding will be reduced by the Company on a quarterly basis,
commencing on March 31, 2026, and with the final payment on
December 31, 2029, in accordance with the payment schedule to be
set forth in the indenture that will govern the Notes. The Notes
will amortize based on a guaranteed floor price of US$1,800 per
ounce of gold (the “Floor Price”). Any excess
proceeds by which the gold price exceeds the Floor Price will be
paid to investors as a premium.
Frank Giustra, who holds 11.07% of the
outstanding Common Shares, has indicated his intent to participate
in the Offering by subscribing for 3,700 Units representing US$3.7
million in gross proceeds.
The net proceeds of the Offering are expected to
be used to continue to advance the development of a restart plan
for the Madsen Gold Mine as well as for working capital and general
corporate purposes.
Shane Williams, CEO of West Red Lake Gold,
commented, “The Offering marks another key step in the financing
process as we focus our efforts on the development of a derisked
and robust restart plan for the Madsen Gold Mine while minimizing
dilution to our shareholders”.
The Units may be offered: (i) in Canada, to
“accredited investors” in each of the provinces and territories of
Canada; (ii) in the United States, to “qualified institutional
buyers” (QIBs) and “accredited investors”, as defined in Rule
144A(a)(1) and Rule 501(a) of Regulation D, respectively, under the
United States Securities Act of 1933, as amended (the “U.S.
Securities Act”). The. The Units may be distributed in
jurisdictions outside of Canada and the United States in such
jurisdictions as the Company and the Agents may agree, where they
may be lawfully sold on a basis exempt from the prospectus,
registration and similar requirements of any such jurisdiction.
All securities issued in connection with the
Offering will be subject to a four-month and one day hold period
from the Closing Date. Subject to meeting minimum listing
requirements, the Company will use commercially reasonable efforts
to list the Notes and Warrants following the statutory hold period.
There can be no assurance that a listing for the Notes or the
Warrants will be obtained.
The Offering is expected to close on or about
March 19, 2024 (the “Closing Date”), subject to
customary closing conditions, including the approval of the TSX
Venture Exchange.
This press release shall not constitute an offer
to sell or the solicitation of an offer to buy nor shall there be
any sale of the securities in the United States or in any other
jurisdiction in which such offer, solicitation or sale would be
unlawful. The securities have not been registered under the U.S.
Securities Act and may not be offered or sold in the United States
absent registration or an applicable exemption from the
registration requirements thereunder.
ABOUT WEST RED LAKE GOLD MINES
LTD.
West Red Lake Gold Mines Ltd. is a mineral
exploration company that is publicly traded and focused on
advancing and developing its flagship Madsen Gold Mine and the
associated 47 km2 highly prospective land package in the Red Lake
district of Ontario. The highly productive Red Lake Gold District
of Northwest Ontario, Canada has yielded over 30 million ounces of
gold from high-grade zones and hosts some of the world’s richest
gold deposits. WRLG also holds the wholly owned Rowan Property in
Red Lake, with an expansive property position covering 31 km2
including three past producing gold mines – Rowan, Mount Jamie, and
Red Summit.
ON BEHALF OF WEST RED LAKE GOLD MINES
LTD.
“Shane Williams”
Shane Williams
President & Chief Executive
Officer
FOR FURTHER INFORMATION, PLEASE
CONTACT:
Freddie LeighTel: (604) 609-6132Email:
investors@westredlakegold.com
or visit the Company’s website at
https://www.westredlakegold.com
Neither the TSX Venture Exchange nor its
Regulation Services Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this release. The TSX Venture Exchange
has neither approved nor disapproved the contents of this news
release.
Certain information included in this press
release constitutes forward-looking information under applicable
securities legislation including statements relating to the Closing
Date, the Company's ability to enter into a definitive agreement
with the Agent, the future price of gold, Mr. Giustra participating
in the Offering, the Company making a Change of Control offer for
the Notes, and the intended use of proceeds and the expected
closing date. Forward-looking information typically contains
statements with words such as “anticipate”, “believe”, “expect”,
“plan”, “intend”, “estimate”, “propose”, “project”, “scheduled”,
“will” or similar words suggesting future outcomes or statements
regarding an outlook. The forward-looking statements contained in
this press release are based on certain key expectations and
assumptions made by the Company including, the Company and the
Agent being able to agree to the terms of a definitive agreement,
various factors that could affect the price of gold, Mr. Giustra’ s
ability or desire to purchase Units in the Offering, the Company
having the cash required to make a Change of Control offer, the
Company satisfying various closing conditions on or before the
proposed closing date and various market conditions that could
alter the proposed use of proceeds. Although the Company believes
that the expectations and assumptions on which the forward-looking
statements are based are reasonable, undue reliance should not be
placed on the forward-looking statements because the Company can
give no assurance that they will prove to be correct. Since
forward-looking statements address future events and conditions, by
their very nature they involve inherent risks and uncertainties.
Actual results could differ materially from those currently
anticipated due to a number of factors and risks.
For more information on the Company, investors
should review the Company’s continuous disclosure filings that are
available at www.sedarplus.ca.
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