Discovery Metals Corp. (TSX-V: DSV) is pleased to announce that it has closed its non-brokered private placement of 38,911,108 common shares at a price of $0.45 per Common Share and 3,311,111 subscription receipts at a price of $0.45 per Subscription Receipt, for aggregate proceeds of $19,000,000. Announced on October 10, 2019, the Private Placement was oversubscribed due to investor demand.

Proceeds from the Subscription Receipts will be placed in escrow on the closing of the Private Placement, to be released to Discovery on the receipt of all necessary shareholder and regulatory approvals to the creation of a new “Control Person” (as defined in the policies of the TSX Venture Exchange). On conversion, each Subscription Receipt will automatically convert into one Common Share, for no additional consideration. In the event that the Approvals are not obtained by December 31, 2019, each Subscription Receipt will be cancelled, and the subscription funds will be returned to the subscriber.

Mr. Eric Sprott, through 2176423 Ontario Ltd. (a corporation which is beneficially owned by him), acquired 7,800,000 Common Shares and 3,311,111 Subscription Receipts in the Private Placement, for a total investment of $5,000,000. Prior to the closing of the Private Placement, Mr. Sprott owned 33,499,000 Common shares of Discovery representing 19.9% of the interest of Discovery on a non-diluted basis. Through the purchase of Common Shares in the Private Placement, Mr. Sprott maintains approximately 19.9% interest in Discovery. The Subscription Receipts, if converted and subject to the Approvals, will result in Mr. Sprott becoming a “Control Person” and will bring the balance of his interest in the Company to approximately 21%.

In connection with the Private Placement, Discovery will hold a special meeting of its shareholders on December 11, 2019, to approve Mr. Sprott becoming a “Control Person” and to address any further business that may properly come before the meeting. Details of the meeting, including its record date, location, and time, can be found in the Notice of Meeting published on Discovery’s SEDAR profile at www.sedar.com.

Taj Singh, President and CEO of Discovery commented, “We are excited to have closed this second financing of 2019 and we welcome Mr. Sprott’s continued support as our largest shareholder as well as the support from our new expanded European investor base. The increased demand for the offering demonstrates improved market sentiment and also investor confidence in our future business plans. Discovery is now solidly financed and is well-positioned to aggressively explore and develop its district-scale silver-rich projects in a rallying precious metals price environment.”

Discovery has paid finders’ and advisory fees of $972,450 in cash and issued 1,063,833 broker warrants with an exercise price of $0.50 and a 24-month expiry to certain arms’ length parties who introduced Discovery to investors, in accordance with the policies of the TSX Venture Exchange. The securities issued on closing of the Private Placement are subject to a statutory hold period expiring four months and one day after their date of issuance.

The Common Shares and Subscription Receipts were acquired by Mr. Sprott through 2176423 Ontario Ltd. for investment purposes. Mr. Sprott has a long-term view of the investment and may acquire additional securities of the Company including on the open market or through private acquisitions or sell securities of the Company including on the open market or through private dispositions in the future depending on market conditions, reformulation of plans and/or other relevant factors. A copy of 2176423 Ontario Ltd.’s early warning report will appear on Discovery’s profile on SEDAR and may also be obtained by calling (416) 362-7172 (200 Bay Street, Suite 2600, Royal Bank Plaza, South Tower, Toronto, Ontario, M5J 2J1).

The proceeds of the Private Placement will be used primarily to fund Discovery’s continuing exploration program at its exploration properties. A portion of the proceeds will be used for general working capital purposes.

About Discovery

Discovery Metals Corp. is a Canadian exploration and development company headquartered in Toronto, Canada, and focused on historic precious metal districts in Mexico. Discovery’s flagship is its 100%-owned Cordero silver project in Chihuahua State, Mexico. The 37,000-hectare property covers an entire porphyry district that hosts the announced resource and numerous exploration targets for bulk tonnage diatreme-hosted, porphyry-style, and carbonate replacement deposits. In addition, Discovery is focused on discovering and advancing multiple high-grade carbonate replacement-style silver-zinc-lead projects in a land package of approximately 150,000 hectares in Coahuila State, Mexico. The land holdings contain numerous historical direct-ship ore workings and significant underground development, but no drill-testing has ever been carried out on them.