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Vangold Mining Corp (2)
Symbol VGLD
Shares Issued 111,037,351
Close 2020-12-17 C$ 0.275
Recent Sedar Documents

Vangold increases private placement to $12.6-million

2021-01-19 13:31 ET - News Release

Mr. James Anderson reports

VANGOLD INCREASES PLACEMENT TO $12,600,000

Due to increased demand and to allow for participation from existing security holders who may not otherwise qualify as accredited investors, Vangold Mining Corp. has expanded the size of its non-brokered private placement financing announced Dec. 23, 2020. The private placement will now consist of a total of 42 million units at a price of 30 cents per unit for gross proceeds of $12.6-million. Each unit will consist of one common share of the company and one-half of a common share purchase warrant, with each warrant entitling the holder to purchase an additional common share of the company at a price of 45 cents within three years of closing, subject to acceleration in certain events. All other terms of the private placement as announced on Dec. 23, 2020, remain the same.

The private placement remains subject to acceptance of the TSX Venture Exchange and is expected to close immediately prior to or concurrent with the company's acquisition of the El Cubo mine and mill complex. The company may pay finder's fees in cash, shares and/or warrants to certain finders in connection with the sale of units in accordance with the policies of the TSX-V and all securities issued pursuant to the private placement will be subject to a four-month hold period from the date of closing.

Reinstatement of trading

The company has submitted documentation pertaining to its acquisition of El Cubo, as well as the company's budget and financing plans in relation to the acquisition, to the TSX-V for review. Upon completion of that review process, the company expects its shares to be reinstated for trading on the TSX-V.

El Cubo mine and mill

On Dec. 18, 2020, the company announced it had signed a binding letter of intent with Endeavour Silver Corp. to acquire El Cubo. The El Cubo plant and tailings facilities are currently on short-term care and maintenance and Vangold intends to restart the mill at approximately 750 tonnes per day using mineralized material from its existing surface and underground stockpiles at El Pinguico as a significant portion of its estimated throughput for the first 36 months of operation.

As reported by Endeavour on Jan. 29, 2020, as at Dec. 31, 2019, El Cubo contained the silver-gold resources outlined in the attached table.

Vangold is not treating these estimates as current mineral resources as a qualified person on behalf of Vangold has not done sufficient work to classify these estimates as current resources. However, as such resources were derived from 19 different veins on the property, the company believes El Cubo hosts excellent exploration possibilities for the future.

Under the Endeavour agreement, Vangold will acquire the El Cubo mine, the El Cubo mill (known also as the El Tajo mill) and approximately 7,000 hectares of prospective mining concessions located adjacent to the El Cubo mill and within the greater Guanajuato mine region. The acquisition remains subject to acceptance of the TSX-V.

Vangold's El Pinguico project

El Pinguico is a high-grade gold and silver deposit that was mined from the early 1890s until 1913. Toward the end of that period, it was mined exclusively by The Pinguico Mines Company of New York, whose shares traded on the Boston and New York stock exchanges. The mining was done principally from the El Pinguico and El Carmen veins, which are thought to be splays off the Mother vein, or Veta Madre.

The Veta Madre is associated with a mega fault that outcrops for 25 kilometres and is the most important source of precious metal mineralization in the region. Current geologic interpretation, based on regional mapping and projections from the Veta Madre developed at adjacent historic mine operations, suggests that the Veta Madre vein system may cross Vangold's property at depth, underneath the high-grade El Pinguico and El Carmen veins. Very limited drilling has been done on the property and no drilling has yet attempted to encounter the Veta Madre at depth. The intersections of these major vein structures are excellent exploration targets and may result in zones of significant size and grades.

Hernan Dorado Smith, a director of Vangold and a qualified person as defined by National Instrument 43-101, Standards of Disclosure for Mineral Projects, has approved the scientific and technical information contained in this news release.

Existing securityholder exemption within the private placement

The private placement is being made pursuant to certain exemptions from the prospectus requirements in Canada to accredited investors, family members, close friends, and business associates of directors and executive officers of the company, and now to existing shareholders of the company under the existing securityholder exemption. The company has allocated up to a maximum of 1.5 million units for gross proceeds of up to $450,000 for sale to existing shareholders under the existing securityholder exemption on a first-come first-serve.

For existing shareholders, the private placement is available to all shareholders of the company as at Jan. 15, 2021, who satisfy the criteria for participating in the private placement under the existing securityholder exemption, including that the shareholder: (a) was a shareholder of the company on the record date (and is still a shareholder), (b) is purchasing the units as a principal (i.e. for their own account and not for any other party), (c) may not purchase more than $15,000 of securities from the company in any 12-month period unless the shareholder has obtained advice regarding suitability of the investment from a registered investment dealer; and (d) must execute and deliver a subscription agreement in the required form which includes the requirements of the existing securityholder exemption. Any persons who become shareholders of the company after the record date are not permitted to participate in the private placement using the existing securityholder exemption, but other exemptions may still be available to them. Shareholders interested in participating in the private placement under the existing securityholder exemption should consult with their investor adviser or contact the company as soon as possible, as this portion of the private placement will be allocated on a first-come first-serve basis such that a subscription received from an existing shareholder may not be accepted by the company if the allocation under the existing securityholder exemption is oversubscribed.

The company plans to allocate the gross proceeds raised under the existing shareholder exemption in the amount of $450,000 (assuming the existing shareholder exemption is fully subscribed for) toward the refurbishment of the El Cubo mill for operation ($300,000) and the delineation and development of the historic resources identified by Endeavour Silver ($150,000).

About Vangold Mining Corp.

Vangold Mining is an exploration and development company engaged in reactivating high-grade past-producing silver and gold mines near the city of Guanajuato, Mexico. The company's El Pinguico project is a significant past producer of both silver and gold located just seven kilometres south of the city. The company remains focused on the near-term potential for development and monetization of its surface and underground stockpiles of mineralized material at El Pinguico, and in delineating silver and gold resources through underground and surface drilling on projects located in this historic mining camp.

We seek Safe Harbor.

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