Mr. Gerald Panneton reports
GOLD TERRA RESOURCE CORP. ANNOUNCES CLOSING OF C$5.6 MILLION BOUGHT DEAL FINANCING
Gold Terra Resource Corp. has closed its previously announced bought deal financing, including the exercise in full of the underwriters' overallotment option. Pursuant to the offering, (i) 8,912,500 charitable flow-through common shares were issued at a price of 30 cents per charitable FT share, (ii) 8,046,700 traditional flow-through common shares were issued at a price of 24 cents per traditional FT share, and (iii) 4,761,966 common shares were issued at a price of 21 cents per common share, for aggregate gross proceeds of $5.6-million.
The offering was made through a syndicate of underwriters led by Stifel GMP and including BMO Capital Markets and Beacon Securities Ltd. The underwriters received a cash commission equal to 7 per cent of the gross proceeds of the offering.
The gross proceeds from the sale of the charitable FT shares and the traditional FT shares will be used for expenditures which qualify as Canadian exploration expenses (CEE) and flow-through mining expenditures both within the meaning of the Income Tax Act (Canada). The company will renounce such CEE with an effective date of no later than Dec. 31, 2022. The net proceeds from the sale of the common shares will be used for working capital and general corporate purposes.
The offering was completed by way of a short form prospectus filed in each of the provinces of Canada (other than Quebec) and the Northwest Territories and the common shares were sold outside of Canada on a private placement basis.
Directors and officers of Gold Terra participated in the offering and were issued an aggregate of 700,000 common shares and 200,000 traditional FT shares. Such participation in the offering constitutes a related party transaction as defined in Multilateral Instrument 61-101 -- Protection of Minority Security Holders in Special Transactions. The offering is exempt from the formal valuation and minority shareholder approval requirements of 61-101 as neither the fair market value of the securities issued to related parties nor the consideration for such securities exceed 25 per cent of the company's market capitalization. The company did not file a material change report 21 days prior to closing of the offering as the participation of insiders of the company in the offering had not been confirmed at that time.
About Gold Terra's Yellowknife City gold project
The Yellowknife City gold project encompasses 800 square kilometres of contiguous land immediately north, south and east of the city of Yellowknife in the Northwest Territories. Through a series of acquisitions, Gold Terra controls one of the six major high-grade gold camps in Canada. Being within 10 kilometres of the city of Yellowknife, the Yellowknife City gold project is close to vital infrastructure, including all-season roads, air transportation, service providers, hydroelectric power and skilled tradespeople. Gold Terra is currently focusing its drilling on the prolific Campbell shear, where 14 million ounces of gold have been produced, and most recently on the Con mine option claims immediately south of the past-producing Con mine (1938 and 2003).
The Yellowknife City gold project lies on the prolific Yellowknife greenstone belt, covering nearly 70 kilometres of strike length along the main mineralized shear system that host the former-producing high-grade Con and Giant gold mines. The company's exploration programs have successfully identified significant zones of gold mineralization and multiple targets that remain to be tested, reinforcing the company's objective of re-establishing Yellowknife as one of the premier gold mining districts in Canada.
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