ELMGF - Element79 Gold Announces Convertible Note Financing Provides Financial Update
(TheNewswire)
Vancouver, B.C. - TheNewswire - May 5, 2023 – Element79 Gold Corp(CSE:ELEM) (OTC:ELMGF) (FSE:7YS) ("Element79 Gold", the"Company") announces a non-brokeredprivate placement of unsecured convertible note units (the“Unit") in the aggregate principal amount of up to CA$500,000Each Unit shall consist of a $1,000 unsecured convertible note (each,a “Convertible Note”) and 10,000 non-transferrable full-commonshare purchase warrants (each, a “Warrant”). Each Convertible Note will be convertible into common shares(each, a "Share") of the Company at a price of $0.10 perShare and any accrued but unpaid interest thereon will be convertibleinto Shares at the price of $0.10 per Share.
Each Warrant will be exercisable into one common shareof the Company (a “Warrant Share”) at an exercise price of $0.20for two (2) years from issuance (the “Warrant Expiry Date”) andare subject to an acceleration clause noting that in the event thatthe volume weighted average price (VWAP) of the Shares equals orexceeds $0.30 per share on the Canadian Securities Exchange for tenconsecutive trading days after the date that is four months and oneday from the Closing Date.
The Principal Amount of the Convertible Note will bearinterest at 15% per annum, payable every six months from the ClosingDate, in shares or cash, at the Company’s election with 60 days’notice. Any accrued but unpaid interest, will mature on the datethat is two (2) years following the Closing Date (the "MaturityDate"). The Company may elect to extend theConvertible Notes for an additional one (1) year at the same terms asthe initial term, with written notice to Note Holders 6 months priorto the Maturity Date.
Note Holders will be entitled, at their option, toconvert (the “Conversion Right”), at any time on or prior to theMaturity Date, the full outstanding Principal and accrued Interestinto common shares of the Company (“Shares”) at a price per shareequal to $0.10 (the “Conversion Price”).
The Company may elect to prepay all of the outstandingPrincipal Amount at any time and from time to time at a premium of 10%of the face value of the note, plus all accrued and unpaid Interest onthe Principal Amount.
The securities issued will be subject to a 4-month oneday hold period from the date of issue of the Convertible Notes, orthe Shares. The completion of the private placement and payment of anycommission and fees remains subject to the receipt of all necessaryapprovals, including the approval of the Exchange.
The Company will distribute all forms of capitalizationin 2023 approximately 85-90% towards its projects and 10-15% foroperations and reducing accounts payable.
Certain members of the Company’s Management and Boardof Directors are leading the funding of this Convertible Note with$100,000 of total investment. In connection with the privateplacement, the Company may, subject to regulatory acceptance, pay afinder's fee to certain arm's-length parties on the proceedsraised.
Debt Settlement
The Company further announces that it has agreed tosettle an aggregate of $555,793 of indebtedness of the Company withvarious arm’s length creditors through the issuance of an aggregateof 7,352,068 common shares ("Debt Shares"). The Debt Sharesare being issued at a price equal to the closing market price of thecommon shares of the Company as listed on the Canadian SecuritiesExchange ("CSE") on April 28, 2023, being CA$0.075, inaccordance with the policies of the CSE.
The Debt Shares issued pursuant to the debt conversionare subjected to a four (4) month hold period.
Crescita Draw
To advance its flagship projects at Maverick Springs inElko and White Pine counties in Nevada, and Lucero in Arequipa, Peru,the Company has drawn an additional $399,000 from Crescita, exchanging7,000,000 shares.
Element79 CEOJames Tworek comments: “There are three mainefforts underway at Element79 Gold: cleaning up the balance sheet;restarting and expanding work programs to uncover value throughresource development and create a clear path to near term cashflowgeneration; and ensuring we have the funds on hand to continue furtherexploration, drilling and project development. These recent effortsat our world-class projects have brought new energy to our story andas a team we are pulling together to bring further proof of the valuewe are confident is there for our shareholders today and in thefuture.“
About Element79 Gold
Element79 Gold is a mining company focused on gold,silver and associated metals. Element79 Gold’s main focus is on twocore properties: developing its previously-producing, high-grade goldand silver mine, the Lucero project located in Arequipa, Peru, withthe intent to bring it back into production in the near term; and itsflagship Maverick Springs Project located in the famous gold miningdistrict of northeastern Nevada, USA, between the Elko and White PineCounties. Maverick Springs hosts a 43-101-compliant, pit-constrainedmineral resource estimate reflecting an inferred resource of 3.71million ounces of gold equivalent “AuEq” at a grade of 0.92 g/tAuEq (0.34 g/t Au and 43.4 g/t Ag) with an effective date of Oct. 19,2022 (see news release October 20, 2022, available on SEDAR). Theacquisition of the Maverick Springs Project also included a portfolioof 15 properties along the Battle Mountain trend in Nevada, which arenon-core to its primary business focus. In British Columbia, Element79Gold has executed a Letter of Intent and funded a drilling programpursuant to acquire a private company which holds the option to 100%interest of the Snowbird High-Grade Gold Project, which consists of 10mineral claims located in Central British Columbia, approximately 20kmwest of Fort St. James. The Company also has an option to acquire 100%interest in the Dale Property, 90 unpatented mining claims locatedapproximately 100 km southwest of Timmins, Ontario, Canada in theTimmins Mining Division, Dale Township. The Company is analyzing thenon-core Nevada projects, The Dale Property and Snowbird Property forfurther merit of exploration, sale or spin-out. For more informationabout the Company, please visit www.element79.gold
For corporate matters, pleasecontact:
James C. Tworek, Chief Executive Officer
Email: jt@element79gold.com
For investor relations inquiries,please contact:
Investor Relations Department
Phone: +1 (604) 200-3608
Email: investors@element79gold.com
NEITHER THE CANADIANSECURITIES EXCHANGE NOR ITS REGULATIONS SERVICES PROVIDER HAVEREVIEWED OR ACCEPT RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THISRELEASE.
Copyright (c) 2023 TheNewswire - All rights reserved.