Golden Arrow Resources Completes Initial Closing of Mogote Project Option and Private Placement

Golden Arrow Resources: Mogote Project Update

Golden Arrow Resources Corporation, listed on the TSX Venture Exchange (TSXV: GRG), recently announced a significant milestone concerning the Mogote Copper-Gold Project, located in San Juan Province, Argentina. In a strategic move, the company has finalized the initial closing of an option agreement with Mogotes Metals Inc. This option allows Mogotes Metals to obtain a 100% interest in the Mogote project.

Details of the Initial Closing

As part of the agreement, Mogotes Metals made a cash payment of $550,000 to Golden Arrow. Additionally, they acquired 9,000,000 units of Golden Arrow through a private placement, priced at $0.05 per unit, totaling gross proceeds of $450,000. Each unit comprises one common share and one warrant, where each warrant can be exercised to purchase an additional share at a price of $0.08 for three years from the issuance date.

Moreover, Mogotes Metals has issued 10,714,285 common shares of their own stock to Golden Arrow. The funds raised from this private placement will be utilized for general working capital, reinforcing the financial stability of Golden Arrow as it continues its operations and project developments.

Future Commitments by Mogotes Metals

To finalize the option and secure full ownership of the project, Mogotes Metals is set to issue additional shares valued at $1,500,000 on or before the first anniversary of the initial closing. The exact share count will depend on the volume-weighted average trading price (VWAP) on the TSX Venture Exchange over the 15 trading days leading up to the final closing date. Importantly, should the VWAP fall below the minimum price of $0.1125 per share, Mogotes Metals has the provision to pay the difference in cash or, pending TSX approval, issue extra shares.

In addition to this share issuance, on the final closing date, Mogotes Metals will confer a 1.5% net smelter returns royalty to Golden Arrow on the project. They also hold the right to purchase 0.5% of this royalty for $2,000,000, effectively reducing the royalty to 1% of net smelter returns.

Compliance and Reporting

Mogotes Metals filed an early warning report per National Instrument 62-103, indicating that post-private placement, they now own 9,000,000 shares, representing approximately 5.31% and 10.09% on a diluted basis of Golden Arrow's total outstanding shares.

They have emphasized that their acquisition of these units stems from investment motivations, and they may adjust their stake in Golden Arrow depending on market conditions over time.

Golden Arrow's Exploration Efforts

Golden Arrow Resources is recognized for its successful exploration efforts, particularly at its flagship property, the San Pietro project in Chile, along with an expansive portfolio comprising nearly 125,000 hectares of mineral properties in Argentina. The company is a prominent member of the Grosso Group, a resource management firm with a well-established reputation in Argentine mineral exploration.

As Golden Arrow continues to enhance its project portfolio and strengthen partnerships such as the one with Mogotes Metals, its prospects within the mining sector appear increasingly promising. The successful initial closing unveils a new chapter for Golden Arrow, paving the way for future developments and advancements in the Mogote Copper-Gold Project.