Arizona Gold & Silver Inc (TSX-V:AZS, OTCQB:AZASF, FRA:A9J0) said on Monday that it has closed its previously announced financing with two arm’s-length institutional investors, Sorbie Bornholm LP and Sorbie Investments LLP, raising gross proceeds of C$18 million.
The financing was completed at a price of $0.80 per unit, with each unit consisting of one common share and one-half of one common share purchase warrant. A total of 22.5 million units were issued across the offering.
Each full warrant carries a three-year term, with 5.625 million warrants issued at closing exercisable at $1. The remaining warrants will be issued on a monthly basis under a release schedule and will be priced at a 20% premium to the 20-day volume-weighted average price at the time of issuance, the company said.
Under the structure of the agreement, the investors have committed the full $18 million via cash or portfolios of UK government bonds deposited under an ISDA Credit Support Annex. The company said proceeds will be realized over a 24-month period through monthly settlements tied to market pricing, subject to a Sharing Agreement between the parties.
The shares issued at closing will carry restrictive legends governing scheduled monthly releases, with the release of funds linked to verification of capital movement under the agreement. During the restriction period, the shares will not carry voting rights under a voting trust arrangement. All securities issued in the initial tranche are subject to a four-month-and-one-day hold period.
Sorbie Bornholm LP invested $10 million for 12.5 million units, while Sorbie Investments LLP contributed $8 million for 10 million units.
Arizona Gold & Silver said the proceeds will be used to advance its Philadelphia and Silverton exploration properties, as well as for general working capital.
As part of the transaction, Sorbie Managing Director Whitney Kofford and Founder and CEO Greg Kofford visited the company’s Philadelphia Project in April alongside Arizona Gold & Silver CEO Mike Stark, Senior Vice President of Exploration Dr Lex Lambeck, and Project Geologist Marc Stengel.
Stark said the visit provided an opportunity to demonstrate ongoing drilling activity and the scale potential of the Philadelphia property.
“They were fortunate to observe Hole 166 in progress, arriving just as drilling entered the target zone. The timing offered a meaningful, real-time view of our operations,” Stark said.
“I believe they came away impressed with our team's execution and the level of detailed planning that has gone into, and will continue to guide, our deployment of this $18 million in growth capital across both the Philadelphia and Silverton properties.”
Kofford said the site visit helped reinforce the investment decision, citing the technical expertise of the company’s team and continuity of geological knowledge at the project level.
"Standing at the drill site and spending time with Mike, Lex, Marc, and the local team was invaluable,” Kofford said. “Mike and his team know exactly what they have. In particular, I was impressed to learn that Marc has spent many years exploring and drilling the Philadelphia property. All too often, important data is lost due to people turnover, but Marc has dedicated a large portion of his career to this area.”