Funds from the raising will be used to progress work at the company’s flagship Hayes Creek Zinc-Gold-Silver Project, including completion of a definitive feasibility study (DFS), as well as ongoing assessment of the high-grade Fountain Head Gold Project.
PNX has secured commitments and underwriting for the full amount, with key shareholders showing strong support and Hartleys Limited acting as lead manager.
PNX Metals managing director James Fox said: “This support for the rights issue is a strong endorsement of the quality of the Hayes Creek Zinc-Gold-Silver Project and PNX’s NT exploration assets.
“The funding will see the company through a transformative period over the next 12 months.
“It allows for all technical aspects of the project to be de-risked through the completion of a DFS, as well as for the relevant project government and environmental applications to be progressed for approval.
“Additionally, and following on from successful exploration in 2018 where drilling highlighted exceptional grades and scale potential of a gold system at the Fountain Head project, this new project will be advanced as a distinct opportunity to augment the already robust economics of the Hayes Creek project.”
DFS work at Hayes Creek to be funded through the rights issue includes:
All application work for environmental and governmental approvals;
Project management, drilling and assays and technical studies relating to geology, resources and mining;
Metallurgical test work including process plant engineering and design;
An options study for the Fountain Head project;
Project holding and management costs, including rentals, environmental and statutory reporting; and
Exploration activities to keep tenements in good standing and meet minimum expenditure commitments.
The rights issue will comprise three new shares for every five shares held, with the issue price of 0.6 cents representing a discount of about 8.4% to PNX’s volume weighted average market price in the five trading days prior to April 18.
The offer price also represents a discount of about 14.3% to the last traded price of PNX shares on April 16.
Substantial shareholders Sochrastem SAS and DELPHI Unternehmensberatung Aktiengesellschaft will participate in the rights issue, with Sochrastem to apply for $850,000 in shares and DELPHI agreeing to underwrite the balance of the offer.
Eligible shareholders will be invited to participate in the offer through underwriter Hartleys by way of a sub-underwriting from Monday April 29 until May 8, 2019.
DELPHI’s underwriting commitment will be reduced to the extent of allocations to shareholders that subscribe for entitlements.