Star Metro - Gabriel Resources Announces US$3.4 Million Private Placement

Assuming completion of the full Offering, aggregate subscriptions will comprise approximately US$1.825 million in new cash and approximately US$1.575 million satisfied by set-off of outstanding bridge-loan principal and accrued interest, as described below.

The Company has entered into binding subscription agreements, on a non-brokered basis, with certain existing institutional investors, including Electrum Global Holdings L.P. ("Electrum"), Paulson & Co. Inc. ("Paulson") and Swiss Capital S.A. ("Swiss Capital", and together with Electrum and Paulson, the "Subscribers") for aggregate subscriptions of approximately US$2.97 million, including amounts to be satisfied through the Debt Settlement (as defined below). The remaining approximately US$0.43 million of the Offering is expected to be subscribed for on a non-brokered basis by eligible investors, including clients of Swiss Capital.

The financing is critical to addressing the Company's immediate funding needs by extinguishing its outstanding bridge debt and providing working capital to sustain essential operations. It will also support the continued pursuit of the Company's application to annul the award rendered on March 8, 2024 in ICSID arbitration proceedings ARB/15/31 (the "Annulment Application") and the preservation of its assets and interests in Romania.

Closing is expected on or around October 15, 2026, subject to the required acceptance of the TSX Venture Exchange (the "TSXV") and satisfaction of the other applicable closing conditions. There can be no assurance that the Offering will close as contemplated or at all.

Terms of the Offering

The Subscription Price represents a 25% discount to the closing price of the Common Shares on the TSXV on the trading day immediately preceding this announcement, being C$0.11 (the "Market Price").

Each Warrant will entitle its holder to acquire one Common Share at an exercise price of C$0.11, equal to the Market Price, for five years from closing. Exercise will be subject to at least 90 days' prior written notice in accordance with the warrant certificate.

Subscription obligations will be denominated in United States dollars, with the number of Units determined using the agreed exchange rate of US$1.00 = C$1.4188.

Bridge Debt Settlement

On April 28, 2026, the Company entered into bridge loan agreements with Electrum and Paulson (the "Bridge Lenders") for an aggregate principal amount of US$1.5 million, comprising US$750,000 advanced by each lender (the "Bridge Loans"). The Bridge Loans bear interest at 12% per annum. The agreements were subsequently amended to require completion of the financing no later than November 1, 2026.

The Company has entered into debt settlement agreements with the Bridge Lenders pursuant to which an aggregate of US$1,575,000 in outstanding principal and accrued and unpaid interest will be discharged at closing by set-off against an equal amount of the Bridge Lenders' respective subscription obligations under the Offering, in full and final satisfaction of that indebtedness (the "Debt Settlement").

An aggregate of 27,086,182 Units will be issued in respect of subscriptions satisfied through the Debt Settlement, comprising 13,543,091 Units to Electrum and 13,543,091 Units to Paulson. The balance of their subscription obligations, and Swiss Capital's subscription obligation, will be paid in cash.

The Debt Settlement forms part of the US$3.4 million Offering and will reduce the Company's indebtedness without generating cash proceeds.

Impact of the Offering

Assuming aggregate subscriptions of US$3.4 million, the Company will issue in aggregate 58,471,757 Common Shares under the Offering, representing approximately 17.42% of its issued and outstanding Common Shares immediately following closing.

Electrum, Paulson and Swiss Capital are existing insiders of the Company and collectively hold approximately 59.75% of the currently issued and outstanding Common Shares. Following completion of the Offering and assuming exercise of all Warrants issued under the Offering, their combined holdings would represent approximately 67.95% of the then issued and outstanding Common Shares.

All insiders of the Company, including those not participating in the Offering, currently hold approximately 72.87% of the issued and outstanding Common Shares. Following completion of the Offering and exercise of all Warrants issued under the Offering, the persons who would then be insiders would collectively hold approximately 77.18% of the then issued and outstanding Common Shares.

These calculations assume exercise of all Warrants issued under the Offering and no exercise or conversion of any existing warrants or other convertible securities.

Compliance with MI 61-101

The participation of insiders in the Offering and the Debt Settlement constitutes a "related party transaction" within the meaning of Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61-101").

The Company intends to rely on the financial difficulty exemptions from the formal valuation and minority approval requirements under sections 5.5(g) and 5.7(1)(e) of MI 61-101. The Board of Directors and at least two-thirds of the directors who are independent in respect of the transactions, each acting in good faith, have determined that the Company is in serious financial difficulty, the Offering and Debt Settlement are designed to improve its financial position, and their terms are reasonable in the circumstances.

The circumstances described in section 5.5(f) of MI 61-101 are not applicable, and there is no requirement, corporate or otherwise, to hold a shareholder meeting to obtain approval of the transactions.

The Company expects to file a material change report less than 21 days before the anticipated closing of the Offering. The Company considers this shorter period reasonable and necessary given its immediate funding requirements and the need to complete the financing promptly to sustain essential operations, address outstanding liabilities and continue pursuing the Annulment Application.

Cash Proceeds and Use of Funds

Assuming completion of the full Offering, the Company expects to receive approximately US$1.825 million in gross cash proceeds (before payment of transaction expenses). The Debt Settlement will be effected by set-off against the relevant subscription obligations and will not generate cash proceeds.

The net cash proceeds will provide working capital to sustain essential operations, support the continued pursuit of the Annulment Application and preserve the Company's assets and interests in Romania.

The Company will not pay any finder's fees in connection with the Offering.

Resale Restrictions

The securities issued under the Offering will be subject to a Canadian hold period of four months and one day from closing, together with any other applicable resale restrictions. Common Shares issued on exercise of the Warrants during that period will be subject to the remainder of the applicable hold period.

The securities being offered have not been, and will not be, registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act"), or any state securities laws. They may not be offered or sold within the United States or to U.S. persons, as defined in Regulation S under the U.S. Securities Act, except pursuant to an exemption from, or in a transaction not subject to, applicable registration requirements. This news release does not constitute an offer to sell or a solicitation of an offer to buy securities in the United States or to, or for the account or benefit of, U.S. persons.

For further information, please contact:

Nicolae Suciu
Chief Executive Officer
Email: [email protected]
Tel: +40 729 399 407

Simon Lusty
Group General Counsel
Email: [email protected]
Tel: +44 782 599 3401

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

About Gabriel

Gabriel Resources Ltd. is a Canadian resource company listed on the TSX Venture Exchange under the symbol GBU. The Company's current focus is pursuing the Annulment Application and preserving its assets and interests in Romania.

Gabriel holds an 80.69% interest in Roșia Montană Gold Corporation S.A. ("RMGC"), with the remaining 19.31% held by Minvest Roșia Montană S.A., a Romanian state-owned company. RMGC holds the Company's interests in the Roșia Montană gold and silver project. In June 2024, the competent Romanian authority rejected RMGC's application to extend the project's exploitation licence. RMGC is challenging that refusal before the Romanian courts.

Forward-Looking Statements

This press release contains forward-looking information within the meaning of applicable Canadian securities legislation ("forward-looking statements"). These statements reflect management's current expectations, estimates and assumptions concerning future events and are not guarantees of future performance.

Forward-looking statements in this press release include statements concerning the size, terms, investor participation and anticipated closing of the Offering; completion of the Debt Settlement; receipt of TSXV acceptance; the anticipated cash proceeds and their use; the resulting shareholdings and dilution; and the Company's ability to fund essential operations, pursue the Annulment Application and preserve its assets and interests in Romania.

Forward-looking statements may be identified by words such as "expects", "anticipates", "believes", "plans", "estimates", "intends", "proposes", "may", "could", "would", "should" and "will", and similar expressions, although not all forward-looking statements contain these words.

These statements are based on assumptions that management considers reasonable as at the date of this press release, including that subscribers will fulfil their subscription obligations; the required regulatory approvals will be obtained; the applicable closing conditions will be satisfied; the Debt Settlement will complete concurrently with the Offering; and the Company's funding requirements, expenses and proposed use of proceeds will remain substantially as anticipated.

Forward-looking statements are subject to significant risks and uncertainties that could cause actual results to differ materially from those expressed or implied. These include, without limitation:

• the risk that the Offering or Debt Settlement is delayed, completed on different terms or not completed at all;
• the ability to obtain the required TSXV acceptance;
• the Company's ability to satisfy its obligations under the Bridge Loans, including completing a financing of at least US$2 million by November 1, 2026, and the risk of default, acceleration and enforcement if those obligations are not met;
• the Company's serious financial difficulty, limited liquidity and ability to obtain sufficient funding to meet its obligations and continue as a going concern, particularly if the Offering is delayed or not completed;
• the possibility that the proceeds of the Offering will be insufficient to meet the Company's funding requirements;
• the duration, costs and outcome of the proceedings concerning the Annulment Application, including the risk of an unsuccessful outcome, delays and costs exceeding the Company's expectations;
• the consequences of the ad hoc committee's decision not to maintain the provisional stay of enforcement during the proceedings concerning the Annulment Application, and the risk that enforcement by Romania of the costs order contained in the arbitral award dated March 8, 2024 could result in restrictions on, attachment of or enforcement against the Company's or its subsidiaries' assets, additional legal costs and disruption to operations;
• the duration, costs and outcome of the legal proceedings challenging the refusal to extend the Roșia Montană exploitation licence, including the risk that the challenge is unsuccessful;
• the timing and outcome of the pending applications for exploitation licences for the Bucium (Rodu-Frasin and Tanita) projects, including the risk of further delays or refusal of those applications;
• legal, fiscal, regulatory and enforcement actions affecting the Company and its subsidiaries, including allegations concerning historical conduct;
• Romania's actions following the inscription of the Roșia Montană Mining Landscape as a UNESCO World Heritage site;
• dilution resulting from the Offering and the exercise or conversion of new or existing securities;
• the Company's ability to maintain its listing on the TSXV;
• changes in laws, governments, fiscal regimes and political or economic conditions in the jurisdictions in which the Company operates;
• adverse financial market conditions, inflation, geopolitical instability and currency fluctuations; and
• the continued availability of key employees and consultants.

This list is not exhaustive. Further information about risks and uncertainties affecting the Company is contained in its public filings, including its most recent management's discussion and analysis, available at www.sedarplus.ca.

Readers are cautioned not to place undue reliance on forward-looking statements. Such statements speak only as at the date of this press release and are expressly qualified by this cautionary statement. Except as required by applicable securities laws, the Company undertakes no obligation to update or revise any forward-looking statement as a result of new information, future events or otherwise.

SOURCE: Gabriel Resources Ltd.

View the original press release on ACCESS Newswire

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