Discovery Metals Announces $17 Million Private Placement Including $5 Million Investment from Eric Sprott
NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES
OR FOR DISSEMINATION IN THE UNITED STATES
October 10, 2019
DISCOVERY METALS ANNOUNCES $17 MILLION PRIVATE
PLACEMENT INCLUDING $5 MILLION INVESTMENT FROM ERIC
SPROTT
Toronto, Ontario – Discovery Metals Corp. (“ Discovery”) (TSXV: DSV) is pleased to
announce that it intends to complete a non-brokered private placement (the “Private Placement”)
to raise up to $17 million through the issuance of common shares (“ Common Shares ”) and
subscription receipts (“Subscription Receipts”) at a price of $0.45 per security.
Arlington Group Asset Mangement Limited has been engaged to provide advice on the Private
Placement with select European institutions and Sprott Capital Partners LP is acting as an advisor
to Discovery and finder for North American investors.
Mr. Eric Sprott has agreed to invest $5 million in the Private Placement. Mr. Sprott will purchase
that number of Common Shares which will maintain his 19.9% interest in Discovery following the
issuance of the Common Shares. The balance of Mr. Sprott’s investment w ill be completed with
the purchase of Subscription Receipts, which if converted, will increase his interest in the
Company to approximately 22%, assuming the Private Placement is fully subscribed.
Proceeds from the Subscription Receipts will be placed in escrow on the closing of the Private
Placement, to be released to Discovery on the receipt of all necessary shareholder and regulatory
approvals (“Approvals”) to the creation of a new “Control Person” (as defined in the policies of the
TSX Venture Exchange). On conversion, each Subscription Receipt will automatically convert into
one Common Share, for no additional consideration. In the event that the Approvals are not
obtained by December 31, 2019, each Subscription Receipt will be cancelled, and the
subscription funds will be returned to the subscriber.
Taj Singh, President and CEO of Discovery commented, “ We are excited to have substantially
expanded our European investor base as we transition into our next phase of growth. We are also
very appreciative of the continued support of Mr. Sprott and are pleased that he has significantly
increased his ownership in Discovery . These investments ensure we are well funded to pu rsue
exploration plans for our Cordero silver project, and also for our Coahuila silver-zinc-lead projects.
For Discovery shareholders, this private placement is a strong endorsement of our future business
plans.”
In connection with the Private Placement, Discovery may pay a finder’s fee to one or more arms’
length parties who introduce Discovery to investors, in accordance with the policies of the TSX
Venture Exchange (the “Exchange”). The securities issued will be subject to a four -month-and-
one-day statutory hold period from the date of issuance. Closing of the Private Placement remains
subject to Exchange approval.
The proceeds of the Private Placement will be used primarily to fund Discovery’s continuing
exploration program at its exploration properties. A portion of the proceeds will be used for general
working capital purposes.
About Discovery Metals Corp.
Discovery Metals Corp. (TSX -V: DSV) is a Canadian exploration and development company
headquartered in Toronto, Canada, and focused on historic precious metal districts in Mexico.
Discovery’s flagship is its 100% -owned Cordero silver project in Chihuahua State, Mexico. The
37,000-hectare property covers an entire porphyry district that hosts the announced resource and
numerous exploration targets for bulk tonnage diatreme -hosted, porphyry-style, and carbonate
replacement deposits. In addition, Discovery is focused on discovering and advancing multiple
high-grade carbonate replacement -style silver -zinc-lead projects in a land package of
approximately 150,000 hectares in Coahuila State, Mexico. The land holdings contain numerous
historical direct-ship ore workings and significant underground development, but no drill -testing
has ever been carried out on them.
For Further Information:
Discovery Metals Corp.
(416) 613-9410
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the
Exchange) accepts responsibility for the adequacy or accuracy of this release.
This news release does not constitute an offer to sell or a solicitation of an offer to buy nor shall there be any sale of
any of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful, including any of the
securities in the U nited States of America. The securities have not been and will not be registered under the United
States Securities Act of 1933, as amended (the “1933 Act”) or any state securities laws and may not be offered or sold
within the United States or to, or for account or benefit of, U.S. Persons (as defined in Regulation S under the 1933
Act) unless registered under the 1933 Act and applicable state securities laws, or an exemption from such registration
requirements is available.
This news release may include forward -looking statements that are subject to inherent risks and uncertainties. All
statements within this news release, other than statements of historical fact, are to be considered forward looking.
Although Discovery believes the expectations expressed in such forward-looking statements are based on reasonable
assumptions, such statements are not guarantees of future performance and actual results or developments may differ
materially from those described in forward-looking statements. Factors that could cause actual results to differ materially
from those described in forward -looking statements include fluctuations in market prices, including metal prices,
continued availability of capital and financing, and general economi c, market or business conditions. There can be no
assurances that such statements will prove accurate and, therefore, readers are advised to rely on their own evaluation
of such uncertainties. There can be no assurance tha t the Private Placement will close on the announced terms.
Discovery does not assume any obligation to update any forward -looking statements except as required under
applicable laws.