TORONTO, ONTARIO -- (Marketwired) -- 05/23/13 -- Sage Gold Inc. (TSX VENTURE: SGX) (the "Company") announces the closing of the first tranche of a previously announced Cdn $700,000 non-brokered private placement for gross proceeds of $499,270 through the sale of 3,620,396 flow-through units (the "FT Units") at $0.05 per FT Unit and 10,608,334 common shares (the "Common Shares") at $0.03 per common share. The Company has received conditional approval from the TSX Venture Exchange for this issuance and all securities are subject to a four (4) month hold period which expires on September 22, 2013.
Each FT Unit consisted of one (1) flow through common share of the Company and one half (1/2) of one common share purchase warrant (each whole warrant, a "Warrant"). Each Warrant entitles its holder to purchase one common share at a price of $0.05 for a period of 12 months following the closing date of the private placement. In connection with the private placement, the Company will pay finder's fees of approximately $2,000 and issue 56,000 compensation options.
Seven insiders participated in the private placement, thereby making the private placement a "related party transaction" as defined under Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61-101"). Mr. Patrick Mars, Chairman and a director of the Company, Mr. Nigel Lees, President and Chief Executive Officer and a director of the Company, Mr. Sandy Chim, a director of the Company, Mr. Peter Bojtos, a director of the Company, Mr. Gary Robertson, a director of the Company, Mr. William Love, VP - Business Development of the Company and Waterton Global Value, L.P., a greater than 10% holder of voting securities of the Company, purchased, in the aggregate, 400,000 FT Units and 5,941,667 common shares pursuant to the private placement.
Mr. Mars purchased 200,000 FT Units and 700,000 common shares and owns or controls 2,639,500 common shares or approximately 2.3% of the total common shares issued and outstanding after the completion of the private placement. Mr. Lees purchased 100,000 FT Units and 200,000 common shares and owns or controls 4,241,726 common shares or approximately 3.7% of the total common shares issued and outstanding after the completion of the private placement. Mr. Chim purchased 500,000 common shares and owns or controls 1,970,541 common shares or approximately 1.7% of the total common shares issued and outstanding after the completion of the private placement. Mr. Bojtos purchased 200,000 common shares and owns or controls 349,001 common shares or approximately 0.3% of the Company. Mr. Robertson purchased 175,000 common shares and owns or controls 1,177,036 common shares or approximately 1.0% of the Company. Mr. Love purchased 100,000 FT and owns or controls 584,160 common shares or approximately 0.5% of the total common shares issued and outstanding after the completion of the private placement. Waterton Global Value, L.P purchased 4,166,667 common shares and owns or controls 18,500,000 common shares or approximately 16.2% of the total common shares issued and outstanding after the completion of the private placement. The private placement was unanimously approved by the directors of the Corporation, with Messrs. Mars, Lees, Robertson, Bojtos and Chim disclosing their interests and abstaining from voting with respect thereto. The private placement was exempt from the formal valuation and minority shareholder approval requirements of MI 61-101 as neither the fair market value of any common shares issued to or the consideration paid by Messrs. Mars, Lees, Chim, Robertson, Bojtos, Love and Waterton Global Value, L.P. exceeded 25% of the Company's market capitalization.
This private placement is necessary to support existing operations, activities and assets, and none of the proceeds from the Common Share portion of the private placement will be used to fund the purchase or pursuit of new businesses, operations or activities, or to compensate, settle indebtedness with, or otherwise satisfy obligations to, any person who is a Related Party (as such term is defined in the TSX Venture Exchange ("TSXV") Corporate Finance Manual). Specifically, the use of the proceeds from the Common Share portion of the private placement will be used to preserve the Clavos gold property in Timmins, Ontario, satisfy option payments and interest payments on secured debt, to pay down accounts payable and for working capital purposes. The proceeds of the flow-through portion of the private placement will be used to fund the Company's share of the exploration and development of the Clavos gold property.
Completion of the offering is subject to the TSXV final approval. The Common Share portion of the private placement is being completed pursuant to the TSXV's Notice to Issuers dated August 12, 2013, regarding Temporary Relief from Certain Pricing Requirements. The second tranche of the private placement is expected to close in mid-June, 2013.
Sage has a NI 43-101 resource for Clavos which includes indicated mineral resources of 1,258,400 tonnes at 4.81 g/t Au totaling 194,600 ounces of gold and Inferred mineral resources of 796,000 tonnes at 4.7 g/t Au representing 120,000 ounces. These resources are reported at a base case cut-off grade of 2.75 g/t Au and individual assays have been capped at 60 g/t.
Sage is a mineral exploration and development company which has primary interests in near-term production and exploration properties in Ontario. Its main properties are the Clavos Gold deposit in Timmins and the Lynx deposit and other exploration properties in the Beardmore-Geraldton Gold Camp. Technical reports and information relating to the properties can be obtained from the System for Electronic Document Analysis and Retrieval (SEDAR) website at www.sedar.com and www.sagegoldinc.com.
This release was prepared by management of the Company who takes full responsibility for its contents.
Cautionary Statement on Forward-Looking Information:
Except for statements of historical facts, all statements in this news release regarding, without limitation, the private placement, including the use of proceeds from the private placement, future plans and objectives are forward-looking statements which involve risks and uncertainties. There can be no assurance that such statements will prove to be accurate. Although the Company believes the expectations expressed in such forward-looking statements are based on reasonable assumptions actual results and future events could differ materially from those anticipated in such statements. Factors that may cause the actual results to differ materially from those in forward-looking statements include, but are not limited to, precious metal prices, results of exploration and development activities, regulatory changes, availability of materials and equipment, timeliness of government approvals, continued availability of capital and financing and general economic, market or business conditions. The Company cautions the foregoing list of important factors is not exhaustive. Investors and others who base themselves on the Company's forward-looking statements should carefully consider the above factors as well as the uncertainties they represent and the risk they entail. For more information, please see the public filings of the Company at www.sedar.com.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Sage Gold Inc.
President and C.E.O.
Sage Gold Inc.
Communications Manager/Investor Relations
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