Southern Arc Announces Disposition of Japan Gold Shares and Subscription in Private Placement of Japan Gold

June 02, 2020 4:33 PM EDT | Source: Southern Arc Minerals Inc.

Vancouver, British Columbia--(Newsfile Corp. - June 2, 2020) -  Southern Arc Minerals Inc. (TSXV: SA) ("Southern Arc" or the "Company") announces that on May 20, 2020 it sold an aggregate of 3,520,000 Japan Gold Shares (each, a "Japan Gold Share") in the capital of the Japan Gold Inc. ("Japan Gold") through the facilities of the TSX Venture Exchange ("Exchange") at the prices of $0.25, $0.255 and $0.26 per Japan Gold Share for aggregate proceeds of $880,150 to Southern Arc. Southern Arc also announces that on May 29, 2020 it used the proceeds from the sale of the 3,520,000 Japan Gold Shares to subscribe for 3,520,000 units of Japan Gold (each, a "Unit") at a price of $0.25 per Unit in the second tranche of a non-brokered private placement of Japan Gold (the "Private Placement") for the subscription price of $880,000. Each Unit consists of one Japan Gold Share and one half of one transferable common share purchase warrant (each whole warrant, a "Warrant"). Each Warrant entitles Southern Arc to purchase one Japan Gold Share at an exercise price of $0.40 per Japan Gold Share until May 29, 2022, subject to acceleration in certain circumstances.

Related Party Transaction and Early Warning Disclosure

Southern Arc's participation in the Private Placement constitutes a "related party transaction" pursuant to Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61-101"). Southern Arc is exempt from the requirements to obtain a formal valuation or minority shareholder approval in connection with the participation in the Private Placement in reliance on the exemptions contained in sections 5.5(a) and 5.7(1)(a) of MI 61-101, respectively, as the fair market value of the transaction does not exceed 25% of Southern Arc's market capitalization.

Following the sale of the 3,520,000 Japan Gold Shares on May 20, 2020 and its subscription for 3,520,000 Units in the Private Placement, Southern Arc beneficially owns or has control or direction over a total of 40,250,000 Japan Gold Shares and 18,084,100 Warrants exercisable to acquire an additional 18,084,100 Japan Gold Shares. As a result of the disposition, the acquisition and the dilution from other securities issued in the Private Placement, Southern Arc's beneficial ownership of, or control or direction over, the Japan Gold Shares decreased from 26.07% to 23.08% on an undiluted basis, and decreased from 33.14% to 30.31% on a partially-diluted basis, assuming the exercise of the Warrants held by Southern Arc. In these transactions, Southern Arc disposed of and acquired securities in an amount equal to 2% or more of the issued and outstanding Japan Gold Shares on an undiluted and partially-diluted basis.

Southern Arc both disposed and acquired ownership of, and control over, the securities that triggered the requirement to file an early warning report and the early warning disclosure in this news release. Southern Arc acquired ownership of the 3,520,000 Units pursuant to the subscription agreement entered into between Southern Arc and Japan Gold. Southern Arc acquired the securities of Japan Gold for investment purposes only and has no present intention to dispose of or acquire further securities of Japan Gold. Southern Arc may increase or decrease its beneficial ownership of, or control or direction over, securities in Japan Gold as circumstances arise.

For further information or to obtain a copy of the early warning reports to be filed on SEDAR, pursuant to National Instrument 62-103, please contact Southern Arc using the contact details below. Japan Gold's head office and Southern Arc's head office is located at Suite 650, 669 Howe Street, Vancouver, BC, V6C 0B4.

On behalf of the Board of Southern Arc Minerals Inc.

"John Proust"
Chairman & CEO

About Southern Arc

Southern Arc is a Canadian company incorporated in the province of British Columbia focused on enhancing shareholder value through strategic investments in mineral resource companies with a focus on gold and copper-gold. Southern Arc's management team identifies highly prospective assets in politically safe jurisdictions and seeks to unlock their value by providing strategic investments, proven technical skills, global knowledge, and increased access to industry relationships. More information is available at or by email at

Southern Arc Contact

John Proust
Chairman & CEO
Phone: 778-725-1490

Cautionary Note

Neither the TSX Venture Exchange nor its Regulation Services Provider (as such term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Certain information contained herein constitutes "forward-looking information" under Canadian securities legislation. Forward-looking information includes, but is not limited to, statements with respect to the use of proceeds and the filing of a material change report. Generally, forward-looking information can be identified by the use of forward-looking terminology such as "will be" or variations of such words and phrases or statements that certain actions, events or results "will" occur. Forward-looking statements are based on the opinions and estimates of management as of the date such statements are made and they are subject to known and unknown risks, uncertainties and other factors that may cause the actual results to be materially different from those expressed or implied by such forward-looking statements or forward-looking information. Although management of Southern Arc have attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements or forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements and forward looking information. The Company will not update any forward-looking statements or forward-looking information that are incorporated by reference herein, except as required by applicable securities laws.

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