MONARCH MINING CORPORATION (TSX: GBAR) (OTCQB: GBARF) announces the closing of the first tranche of a non-brokered private placement for total gross proceeds of $4,074,432 effective January 19, 2023. The first tranche of the Offering consisted of the issuance of 62,683,576 common shares of the Corporation at a price of $0.065 per Share.
The net proceeds of the Offering are expected to be used by the Corporation for debt settlements with its creditors, disbursements for care and maintenance and working capital.
Alamos Gold Inc. has agreed to participate in the Offering with a subscription for 7,692,308 Shares, for aggregate consideration of $500,000.02. Prior to the closing of the Offering, Alamos held 10,460,307 Shares and 1,666,667 share purchase warrants of the Corporation. Since Alamos’ last Early Warning Report, Monarch completed a share for debt settlement with a number of its creditors, dropping Alamos’ security holding percentage to below 10%. Immediately prior to the Offering, Alamos’s security holding was 7.67%, on a partially diluted basis, an overall decrease of 3.30% in its security holdings as a result of Monarch issuer events. Following the closing of the Offering, Alamos holds 18,152,615 Shares and 1,666,667 Warrants, for a security holding percentage of 8.62% on a partially diluted basis. Alamos acquired the Shares for investment purposes, which will be evaluated and may be increased or decreased from time to time at Alamos’ discretion. A copy of Alamos’ early warning report is available on the SEDAR website at www.sedar.com or can be requested by contacting Scott K. Parsons, Senior Vice President, Investor Relations, at SParsons@alamosgold.com, 416-368-9932 (ext. 5439) or by mail at Brookfield Place, 181 Bay Street, Suite 3910, Toronto, Ontario M5J 2T3.
Insiders of the Corporation, which are executive officers and directors of the Corporation, have subscribed in the Offering for a total of 3,757,692 Shares representing gross proceeds of $244,249.98, which constitutes a “related party transaction” within the meaning of Regulation 61-101 respecting Protection of Minority Security Holders in Special Transactions. However, the directors of the Corporation who voted in favour of the Offering have determined that the exemptions from formal valuation and minority approval requirements provided for respectively under subsections 5.5(a) and 5.7(1)(a) of Regulation 61-101 can be relied on as neither the fair market value of the Shares issued to insiders nor the fair market value of the consideration paid exceed 25% of the Corporation’s market capitalization. None of the Corporation’s directors have expressed any contrary views or disagreements with respect to the foregoing. A material change report in respect of this related party transaction will be filed by the Corporation but could not be filed earlier than 21 days prior to the closing of the Offering due to the fact that the terms of the participation of each of the non-related parties and the related parties in the Offering were not confirmed.
As consideration for the services provided by finders in connection with the Offering, the Corporation paid a cash finder’s fee totalling $6,748.95.
As part of the Offering, the Corporation reached agreements with two creditors for an aggregate amount of $675,122.25. In consideration, the Corporation will issue a total of 9,001,630 Shares at a price of $0.075 per Share.
All securities issued pursuant to the first tranche of this Offering and the Debt Settlements are subject to a restricted period of four months and a day, ending on May 20, 2023, under applicable Canadian securities legislation. The Offering and the Debt Settlements remain subject to the final approval of the Toronto Stock Exchange.
This press release shall not constitute an offer to sell or a solicitation of an offer to buy nor shall there be any sale of the securities in any state in which such offer, solicitation or sale would be unlawful. The securities being offered have not been, nor will they be, registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”) and may not be offered or sold to, or for the account or benefit of, persons in the United States or U.S. persons absent registration or an applicable exemption from the registration requirements of the U.S. Securities Act and applicable state securities laws. “United States” and “U.S. person” are as defined in Regulation S under the U.S. Securities Act.
Monarch Mining Corporation is a gold mining company that owns four projects, including the Beaufor Mine, which is currently on care and maintenance and has produced more than 1 million ounces of gold over the last 30 years. Other assets include the Croinor Gold, McKenzie Break and Swanson properties, all located near Monarch’s wholly owned Beacon Mill with a design capacity of 750 tpd. Monarch owns 29,504 hectares (295 km2) of mining assets in the prolific Abitibi mining camp that host a combined measured and indicated gold resource of 666,882 ounces and a combined inferred resource of 423,193 ounces.
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