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Golden Spike Announces Closing of Private Placement Offerings Raising $2.39 Million, with Participation by Mr. Eric Sprott

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Golden Spike Announces Closing of Private Placement Offerings Raising $2.39 Million, with Participation by Mr. Eric Sprott

 

 

 

 

 

Golden Spike Resources Corp. (CSE: GLDS) (OTCQB: GSPRF) (FSE: L5Y) is pleased to announce that it has closed its previously announced brokered private placement offering for aggregate gross proceeds of $1.84 million and the first tranche of its previously announced non-brokered private placement offering for aggregate gross proceeds of $557,500. The Brokered Offering was led by Kernaghan & Partners Ltd., as the lead agent and sole bookrunner.

 

In connection with the Brokered Offering, the Company issued 8,000,000 flow-through units of the Company at a price of $0.23 per FT Unit. Each FT Unit consists of one common share of the Company and one-half of one Common Share purchase warrant. Each Common Share and each FT Warrant will qualify as a “flow-through share” within the meaning of subsection 66(15) of the Income Tax Act (Canada). Each FT Warrant is exercisable into one Common Share at an exercise price of $0.33 per Common Share for a period of 24 months from closing.

 

In connection with the Non-Brokered Offering, the Company issued 2,787,500 non-flow-through units of the Company at a price of $0.20 per NFT Unit. Each NFT Unit consists of one Common Share and one-half of one Comon Share purchase warrant. Each NFT Warrant is exercisable into one Common Share at an exercise price of $0.30 per Common Share for a period of 24 months from closing.

 

Eric Sprott, subscribed for $300,000 of the FT Units in the Brokered Offering and through 2176423 Ontario Ltd, a corporation beneficially owned by him $100,000 of the NFT Units in the Non-Brokered Offering. Mr. Sprott is an insider of the Company, and as such, his participation in the private placement is a related-party transaction under Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions. The Company is relying on exemptions from the minority shareholder approval and formal valuation requirements applicable to related-party transactions under sections 5.5(a) and 5.7(1)(a), respectively, of MI 61-101, as neither the fair market value of the shares to be purchased on behalf of Mr. Sprott nor the consideration to be paid by him exceeds 25% of the Company’s market capitalization.

 

The entire gross proceeds from the issue and sale of the FT Units will be used for Canadian exploration and development of the Company’s project in Newfoundland and the proceeds from the issue and sale of NFT Units will be used for general working capital purposes.

 

In connection with the Brokered Offering, the Agent received a cash fee of $106,020. In addition, the Company granted the Agent 460,957 non-transferable compensation warrants. Each Compensation Warrant will entitle the holder thereof to purchase one Common Share at an exercise price of $0.23 per Common Share for a period of 36 months following the closing of the Brokered Offering. In connection with the Non-Brokered Offering the Company issued 81,000 finder’s warrants and paid a cash commission of $16,200 to certain finders, including Leede Financial Inc. and Canaccord Genuity Corp. Each Finder’s Warrant entitles the holder thereof to purchase one Common Share at a price of $0.30 per Common Share for a period of 24 months from issuance.

 

The Company intends to close a second and final tranche of the Non-Brokered Offering in the coming weeks.

 

The securities issued under the Brokered Offering and Non-Brokered Offering will have a hold period of four months and one day from the date of closing. The securities described herein 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 accordingly may not be offered or sold within the United States except in compliance with the registration requirements of the U.S. Securities Act and applicable state securities requirements or pursuant to exemptions therefrom. This press release does not constitute an offer to sell or a solicitation to buy any securities in any jurisdiction.

 

About Golden Spike

 

Golden Spike Resources Corp. is a Canadian mineral exploration company focused on identifying, acquiring and unlocking value in mineral opportunities in Canada and other low-risk jurisdictions. The Company currently holds 100% interest in the 5,050-hectare Gregory River Property in Newfoundland, strategically centered over an approximate 11-kilometer-long stretch of the Gregory River VMS-belt, a north-northeast trending corridor of very prospective ground with potential to host Cyprus-type polymetallic VMS deposits. In addition, the Property hosts a cluster of historically explored, high-grade, copper ±gold vein structures.

 

Posted October 9, 2024

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