GFG Resources Inc. (TSX-V: GFG) (OTCQB: GFGSF)  announces that it has closed the oversubscribed, private placement financing (see news release dated November 9, 2021) for gross proceeds of C$3,114,653.

Pursuant to the Offering, the Company issued (i) 6,501,514 units of the Company  at a price of C$0.145 per Unit for gross proceeds of C$942,719 ; (ii) 6,261,676 common shares of the Company that will qualify as “flow-through shares” for the purposes of the Income Tax Act (Canada) at a price of C$0.17 per FT Share for gross proceeds of C$1,064,484 ; and (iii) 5,350,000 premium units of the Company at a price of C$0.207 per Premium Unit for gross proceeds of C$1,107,450 .

Each Unit consists of one common share of the Company and one-half of one share purchase warrant, with each whole share purchase warrant entitling the holder thereof to acquire one additional common share of the Company at an exercise price of C$0.22 for a period of 24 months from the date of issuance. Each Premium Unit consists of one FT Share and one-half of one Warrant.

“The Company is pleased to close the oversubscribed financing and grateful for the continued support from our existing and new owners,” stated Brian Skanderbeg, President and CEO of GFG. “With the financing complete, we are well positioned to continue our aggressive exploration approach to advance both our Ontario and Wyoming gold projects. In 2021, we have made several strategic moves that have significantly reduced our exploration risk and I am confident that we will be able to provide on-going catalysts that have the potential to create significant shareholder value.”

The gross proceeds raised from the sale of the FT Shares and Premium Units will be used for exploration activities in Ontario that will qualify as “Canadian Exploration Expenses” (within the meaning of the Income Tax Act (Canada)). The net proceeds raised from the sale of the Units and will be used for exploration activities on the Company’s projects in Ontario as well as for general working capital purposes.

If during the exercise period of the Warrants, but after the resale restrictions on the common shares have expired, the closing price of the common shares is at a price equal to or greater than C$0.36 for a period of 10 consecutive trading days, GFG will have the right to accelerate the expiry date of the Warrants by giving notice, via a new release, to the holders of the Warrants that the Warrants will expire on the date that is 30 days after the issuance of said news release.

The shares issued in the Offering are subject to a hold period and may not be traded until March 31, 2022 except as permitted by applicable securities legislation and the rules and policies of the TSX Venture Exchange.

Related Party Transaction

In connection with the Offering, Messrs. Brian Skanderbeg the CEO and a director of the Company, Richard Johnson, the CFO of the Company, Patrick Downey, Chair of the Company, Brian Booth, a director of the Company, and Arnold Klassen a director of the Company have purchased a total of 941,448 Units and 553,294 FT Shares. Insiders’ participation in the Offering constitutes a “related party transaction” pursuant to Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101”). The Company is relying on an exemption from the formal valuation requirements of MI 61-101 available on the basis of the Company not being listed on specified stock exchanges, including the Toronto Stock Exchange, the New York Stock Exchange, the American Stock Exchange, the NASDAQ and certain overseas exchanges. The Company is also relying on the exemption from minority shareholder approval requirements under MI 61-101, as the fair market value of the insiders’ participation in the Offering does not exceed 25% of the market capitalization of the Company, as determined in accordance with MI 61-101.

In connection with the Offering, the Company paid cash finder’s fees on portions of the Offering totaling C$7,833.

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.

About GFG Resources Inc.

GFG is a North American precious metals exploration company focused on district scale gold projects in tier one mining jurisdictions, Ontario and Wyoming. In Ontario, the Company operates the Montclerg, Pen and Dore gold projects, each large and highly prospective gold properties within the prolific gold district of Timmins, Ontario, Canada. The projects have similar geological settings that host most of the gold deposits found in the Timmins Gold Camp which have produced over 70 million ounces of gold. The Company also owns 100% of the Rattlesnake Hills Gold Project, a district scale gold exploration project located approximately 100 kilometres southwest of Casper, Wyoming, U.S. In Wyoming, the Company has partnered with Group 11 through an option and earn-in agreement to advance the Company’s Rattlesnake Hills Gold Project with a technology that could revolutionize the gold mining industry. The geologic setting, alteration and mineralization seen in the Rattlesnake Hills are similar to other gold deposits of the Rocky Mountain alkaline province which, collectively, have produced over 50 million ounces of gold.