Take physic, pomp

Goldshore Resources (GSHR.v): Better late than never

In the post dated February 2nd, If Goldshore Resources (GSHR.v) wants its share price higher (it’s time its C-suite faced reality.)”, we pointed out that despite its December placements GSHR was again short of cash and they couldn’t fake it otherwise, so if the company wanted to regain momentum it needed to bite the bullet and raise cash at the price dictated by the market. At that time, it was a 20c stock.

A month went by, the stock dropped to 18.5c, we noted as much in Another wasted month at Goldshore Resources (GSHR.v) dated March 3rd.

It took another three weeks and and further haircut on the stock price for GSHR to face cruel reality, but we finally got there. Today, this:

VANCOUVER, B.C., March 23, 2023: Goldshore Resources Inc. (TSXV: GSHR / OTC Markets: GSHRF / FWB: 8X00) (“Goldshore” or the “Company”), is pleased to announce that it has entered into an engagement letter with Research Capital Corporation and Eventus Capital Corp., as co-lead agents and joint bookrunners (the “Lead Agents”), on their own behalf and on behalf of a syndicate of agents to be formed (together with the Lead Agents, the “Agents”), in connection with a brokered private placement of the following securities for aggregate gross proceeds of up to $5,000,000 (the “Offering”):

  1. conventional common share units of the Company (each, a “Unit”) at a price of $0.17 per Unit, comprised of one of one common share of the Company (each, a “Common Share”) and one-half common share purchase warrant (each whole warrant, a “Warrant”);
  2. flow-through units of the Company (each, a “FT Unit”) at a price of $0.195 per FT Unit, comprised of one Common Share that will qualify as “flow-through shares” within the meaning of subsection 66(15) of the Income Tax Act (Canada) (the “Tax Act”) and one-half of one Warrant.

Each Warrant shall entitle the holder thereof to acquire one Common Share at an exercise price of $0.25, for a period of 24 months following the Closing Date

There’s also a 15% overallotment facility on the brokered deal. As flow-thru shares are for putting into the ground and not for spending on G&A, it will be interesting to see the eventual ratio of the unit types but that’s something for another day. So it may later and even more expensive than it should have been, plus the 25c half warrant make the clippers a latent threat once the financing is closed, but at some point the nitpicking has to stop and we applaud GSHR for doing the right thing. At last. Probably the right size too, as long as they can reel in that overly expensive G&A bill this year. With the MRE expected in April, people buying this placement can look to the potential catalyst to flip out a profit and as such, this placement should be popular and fully fill.

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