GOLD STRIKE ANNOUNCES $15 MILLION BOUGHT-DEAL FINANCING AND ENTERS INTO STRATEGIC QUARTZ CLAIM PURCHASE AGREEMENT TO CREATE ONE OF THE LARGEST CONSOLIDATED LAND POSITIONS IN THE TOMBSTONE GOLD BELT, YUKON
Executive Summary
- Gold Strike Resources Corp. announced a $15 M bought‑deal private placement and a related‑party acquisition of three contiguous projects in the Tombstone Gold Belt for an aggregate consideration of ~C$34 M.
- The transaction adds the Florin, FLR and RJ gold projects (≈320 km²) to GSR’s land package, including a defined 2.507 Moz inferred resource at the Florid deposit.
- Proceeds from the offering will fund the cash portion of the purchase price, transaction expenses, further exploration/development of the acquired assets, and general corporate purposes.
Key Details
- Financing – Bought‑Deal Private Placement
- Underwriters: ATB Capital Markets Corp. & Canaccord Genuity Corp.
- Subscription Receipts: 27,273,000 at C$0.55 each (gross proceeds C$15,000,150).
- Over‑allotment option for an additional 9,091,000 receipts (up to C$5,000,050).
- Each receipt converts into one Unit (1 common share + 1 warrant).
- Warrants exercisable at C$0.75 per share for 36 months after escrow release.
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Underwriters receive a 7% cash commission (50% payable on closing, remainder escrowed) and compensation options equal to 7% of receipts issued; reduced to 3% for “president’s list” sales.
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Asset Purchase – Related‑Party Transaction
- Purchaser: Gold Strike Resources Corp. (GSR).
- Sellers: LIRECA Resources Inc. and affiliate Florin Resources Inc. (“LIRECA Group”).
- Assets acquired: Florin Gold Project (~89 km²), FLR Gold Project (~165 km²), RJ Gold Project (~66 km²) – total ≈320 km² contiguous land in the Tombstone Gold Belt, Yukon.
- Total consideration: ~C$34 M comprising:
- Shares: 43,636,363 common shares at a deemed price of C$0.55 per share (issued on closing).
- Cash: C$10 M payable C$5 M at closing, C$2.5 M one year later, and C$2.5 M two years later; accelerated if the company completes financing ≥C$30 M.
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Net Smelter Return (NSR) royalties granted on each project (3% on unencumbered claims, 1% on encumbered claims for Florin; 3% flat for FLR and RJ), with optional buy‑downs payable in gold or cash prior to production.
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Resource Highlights – Florid Deposit
- Inferred resource: 2.507 Moz Au (162.8 Mt @ 0.48 g/t Au, 0.30 g/t cut‑off).
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Historic drilling: 147 holes, >31,000 m total; notable intercepts include 4.72 m @ 0.72 g/t Au and 14.5 m @ 4.23 g/t Au.
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Use of Proceeds (net of commissions & expenses)
- Pay the cash component of the acquisition consideration.
- Cover transaction costs related to the purchase agreement and private placement.
- Advance exploration and development of the newly acquired projects.
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Working capital and general corporate purposes.
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Closing Timeline & Conditions
- Transaction closing expected in Q2 2026, subject to shareholder approval (minority), TSX‑V acceptance, completion of the offering, and customary conditions.
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Trading halt may be imposed pending regulatory review.
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Security & Restrictions
- First‑ranking security interest granted over GSR’s assets to secure deferred cash payments.
- Prohibition on sale/transfer of the acquired projects for five years without LIRECA consent.
Notable Quotes
- Peter Miles, CEO: “This transformational transaction moves GSR from a pure exploration company to one with a meaningful resource base…with ~80 % of the prospective geological trend still untested, we look forward to extensive drilling and unlocking the full potential of this exceptional land package.”
- John Fiorino, LIRECA Group Principal: “By accepting the majority of consideration in escrowed equity, the LIRECA Group demonstrates confidence in the projects and alignment with long‑term shareholders.”
Materiality Assessment
Material – Positive – The combined financing and acquisition significantly expands GSR’s land position, adds a multi‑Moz inferred resource, and provides substantial capital for future exploration, representing a material positive development for shareholders.