Jazz Resources closes $1.3M 1st tranche of financing

May 22, 2021

2021-05-21 16:43 ET – News Release

Mr. Robert Klenk reports

JAZZ ANNOUNCES CLOSING OF FIRST TRANCHE OF CONVERTIBLE DEBENTURE OFFERING AND ACQUISITION OF GRAVIMETRIC PLANT FOR THE VILA NOVA GOLD PROJECT

Jazz Resources Inc. has closed a first tranche of its previously announced non-brokered private placement offering of unsecured convertible debentures. The principal sum of Debentures issued in the first tranche totals $1,300,000.

The Debentures will mature on the date that is two (2) years from the date of issuance and shall bear interest at a rate of 8% per annum, payable and compounded annually. The principal sum of the Debentures, or any portion thereof, may be converted into units (the ” Units “) of the Company at a conversion price of $0.30 per Unit, commencing on the date that is six (6) months from the date that the Debentures are issued (the ” Conversion Commencement Date “). Each Unit shall be comprised of one common share (a ” Conversion Share “) and one share purchase warrant (a ” Warrant “). Each Warrant shall entitle the holder to acquire one additional common share (a ” Warrant Share “) in the capital of the Company at a price of $0.30 per share for a period of eighteen (18) months from the date that the Warrants are issued. In the event the volume weighted average trading price of the Company’s common shares trading on the TSX Venture Exchange (the ” Exchange “), or any other stock exchange on which the Company’s common shares are then listed, is equal to or greater than $0.90 for a period of 30 consecutive trading days, the Debentures shall automatically convert into Units of the Company at a rate of one Unit for each $0.30 of outstanding principal sum. If the Debentures are automatically converted, any accrued but unpaid interest shall be paid in cash. The Company shall have the right, at its discretion and on the date that is the day before the Conversion Commencement Date, to redeem up to one-half (50%) of the outstanding principal sum of any Debenture (the ” Redemption Amount “) upon paying to the holder the Redemption Amount, in cash, and any accrued but unpaid interest thereon up to the date of redemption.

In connection with the closing of the first tranche of the Offering, the Company paid fees to two (2) arm’s length third parties (the ” Finders “) comprised of cash fees totaling $10,800 and issued 6,000 non-transferable finder’s warrants, with each finder’s warrant entitling the holder to purchase one (1) common share in the capital of the Company at a price of $0.30 for a period of eighteen (18) months. The Company may pay finder’s fees to certain registered brokerage firms in connection with the balance of the Offering, as permitted by the policies of the Exchange and in accordance with applicable securities laws. All securities issued pursuant to the Offering, including any securities issued to the Finders, will be subject to a hold period of four months and one day from the date of issuance thereof. The Company will use the proceeds of the Offering to advance the development and exploration of the Vila Nova gold project located in the state of Amapa, Brazil. The Offering will be subject to customary closing conditions, including the approval of the Exchange.

The Company is also pleased to announce that its joint venture partner in the Vila Nova gold project, Eco Mining Oil & Gaz Drilling and Exploration EIRELI (” Eco “), has entered into an agreement with Brastorno Tecnologia em Equipamentos para Mineracao (” Brastorno “), a prominent Brazilian manufacturer of high performance equipment for mineral resource projects, to acquire, install and operate on the Vila Nova gold project a gravimetric plant (the ” Mill “) capable of processing up to 800 tonnes of ore per day. The plant components will be delivered, assembled, and operated by a team from Brastorno. The Company advanced to Eco a certain portion of the required funds for the acquisition of the Mill, with a purchase price of US$800,000 to be paid in multiple instalments.

We seek Safe Harbor.

https://www.jazzresources.ca/