Xali closes $1.5-million first tranche of financing

Executive Summary

• Xali Gold Corp. closed the first tranche of a non-brokered private placement for gross proceeds of $1.5 million, with a second tranche of up to $500,000 planned for early January 2026.
• The net proceeds are primarily designated to fund the $500,000 (U.S.) payment required to close the acquisition of the Pico Machay gold property from Pan American Silver Corp. and Aquiline Resources Inc.
• The transaction involves the issuance of 15 million units at 10 cents per unit, including warrants, and facilitates the immediate closing of the Pico Machay acquisition, subject to final TSX-V approval.

Key Details

• Financing Structure:
  • Gross proceeds from first tranche: $1.5 million.
  • Planned second tranche: Up to $500,000, expected to close in early January 2026.
  • Units issued: 15 million units.
  • Price per unit: 10 cents.
  • Unit composition: One common share and one-half of one common share purchase warrant.
• Warrant Terms:
  • Exercise price: 20 cents per warrant share.
  • Expiry: 18 months from closing.
  • Accelerated Expiry: If the common shares close at or above 30 cents on the TSX Venture Exchange for 10 consecutive trading days after April 24, 2026, the company may accelerate warrant expiry to 40 days from notice.
  • Hold Period: Mandatory four-month-and-one-day hold period for shares and warrant shares upon exercise.
• Use of Proceeds:
  • $500,000 (U.S.) payment to Pan American Silver Corp. for the closing of the Pico Machay acquisition.
  • Exploration of Pico Machay.
  • Working capital and general corporate purposes.
• M&A Update (Pico Machay):
  • Target: Minera Calipuy SAC, which wholly owns the Pico Machay gold property.
  • Sellers: Pan American Silver Corp. and its subsidiary, Aquiline Resources Inc.
  • Status: Expected to close later on the date of the release (Dec 23, 2025), subject to final TSX-V approval.
  • Project Description: Advanced-exploration-stage gold project in Peru with a near-term production goal.
• Finder’s Fees:
  • Cash fee: 6% on a portion of the placement; total cash paid was $30,300 ($9,900 to Canadian-registered dealer firms, $20,400 to BLB Advisory).
  • Warrant fee: 6% in non-transferrable finder warrants; 99,000 warrants issued to Canadian-registered firms.
  • Finder warrant terms: Exercisable into common shares for 18 months at 20 cents, subject to the same accelerated expiry provisions as investor warrants.
• Related Party Transactions:
  • Two directors participated in the private placement.
  • Exemptions: The issuance is exempt from valuation requirements (Section 5.4) and minority shareholder approval requirements (Section 5.6) under Multilateral Instrument 61-101.

Notable Quotes

• "The successful progress of this private placement allows us to move ahead with the Pico Machay acquisition and execute on the next phase of our growth strategy," said Joanne Freeze, president and chief executive officer of Xali Gold. "We are excited about the opportunities this transaction presents for the company."