St George Mining Ltd (ASX:SGQ) has invited shareholders to take part in a share purchase plan (SPP) to raise up to $1.6 million with applications set to open tomorrow.
This follows a placement of fully paid ordinary shares at 8 cents per share to sophisticated and professional investors, which raised approximately $3.6 million.
The SPP and placement will provide the company with total new funds of around $5.2 million for exploration activities, including the 2020 drill program at the Mt Alexander Project scheduled to start later this month.
Participation optional
Participation under the SPP is optional and is available exclusively to shareholders of the company who are registered as holders of shares at 5:00pm (WST) on Friday, May 8, and whose registered address is in Australia or New Zealand.
The plan entitles eligible shareholders, irrespective of the size of their shareholding, to purchase up to $20,000 worth of shares at an issue price of 8 cents per share, which is the same price as the shares offered to sophisticated and professional investors under the placement, without incurring brokerage or transaction costs.
Discount to VWAP
The price represents a discount of 13.17% to the volume-weighted average market price (VWAP) of the shares over the last five trading days on which sales in the shares were recorded before the day on which the plan was announced, being 9.21 cents.
Its closing date is Friday, May 29, and St George reserves the right to close the plan earlier than this date.
Right to accept additional applications
All eligible shareholders are encouraged to submit their application as early as possible.
If $1.6 million is raised under the plan, the number of new shares to be issued will be 20 million.
Depending on applications received, St George may undertake a scale back.
While the company intends to raise $1.6 million under the plan, the company reserves the right to accept additional applications subject to shareholder demand.
However, the maximum number of shares which can be issued under the plan is limited by the ASX Listing Rules to a maximum of more than 123.78 million shares, which is equal to 30% of the company’s existing issued share capital.
The plan will not be underwritten.