GR Silver Mining Ltd. (CVE:GRSL) said it has completed its previously announced bought deal private placement of an aggregate of 19,550,000 units of the company at a price of $0.59 each for gross proceeds of $11,534,500, which was oversubscribed and included the exercise of the underwriters' option in full.
The company said it intends to use the net proceeds for working capital and general corporate purposes.
Each unit in the offering consists of one common share in the capital of the company and one-half of one common share purchase warrant. Each warrant is exercisable to acquire one common share for a period of 24 months following closing at an exercise price of $0.74 per share.
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The warrants may be accelerated by the company, at its sole option, at any time after the closing date of the offering provided that the volume-weighted average closing price of the common shares of the company on the TSX Venture Exchange is greater than or equal to $1.30 for a period of 60 consecutive trading days.
The offering was led by Beacon Securities as lead underwriter and sole bookrunner on behalf of a syndicate of underwriters including Echelon Wealth Partners. In connection with the offering, the underwriters received a cash commission and non-transferable broker warrants. The underwriters elected to receive a portion of their cash fees in units, resulting in the company paying aggregate cash fees of $617,368.63 and issuing an aggregate of 255,000 units to the Underwriters.
GR Silver also issued the underwriters an aggregate of 1,301,388 broker warrants. Each warrant is exercisable into one common share of the company at the issue price for a period of 24 months from the closing date of the offering. The underwriters were also paid a corporate finance fee in connection with the offering of $22,000 and 37,000 broker warrants.
The offering remains subject to the final acceptance of the TSX Venture Exchange and all securities issued are subject to a hold period in Canada expiring August 28, 2021.
Exploration Program
GR Silver Mining said the upsized bought deal financing provides it with significant funds to advance activities on its three key focus areas – Plomosas, San Marcial and Trinidad.
In 2021, the company said it will continue its aggressive exploration, including drilling programs on these three projects. Existing exploration programs are being expanded, following the discovery of new silver-gold (Ag-Au) exploration targets, and new programs are being added, commensurate with the prospectivity of this historic district, it added.
Surface drilling is progressing at the Plomosas Project, specifically in the San Juan Area, with all resource drilling expected to be finalized by May 2021. GR Silver is advancing two new resource estimates on the Plomosas Project – one at the Plomosas Mine Area and another at the San Juan Area. These resources are expected to result in a maiden NI 43-101 report being completed before the end of Q2/2021, which will add to the company's existing resource inventory.
GR Silver said it will exercise the option to acquire the San Marcial Project in May, which will result in the company holding 100%-ownership and unlimited access across its portfolio in the Rosario Mining District. It will be the first company to exercise the full acquisition of the San Marcial Project in the past 15 years, after completing $4.6 million in exploration expenditures over the past three years, and increasing the Indicated silver resource inventory by 59%.
A full evaluation of the large La Trinidad exploration data package - including existing soil, stream sediment and drill hole geochemical databases - is currently underway, it added, which will be combined with publicly available geological, geochemical and geophysical datasets to focus on areas of interest.
A systematic exploration approach will assure that a pipeline of quality Au and Ag targets are generated and prioritized for exploration, aiming at new discoveries and potential delineation of near-surface resources. Concurrently, field crews will complete ground evaluation and reconnaissance of existing mineral occurrences and areas of limited historical drilling.
Development of multiple 3D deposit models at Plomosas, San Juan and San Marcial, in addition to the company's regional exploration model and information from La Trinidad, will lead to a fully integrated Preliminary Economic Assessment targeting early 2022 completion.
GR Silver Mining is a Mexico-focused company engaged in cost-effective silver-gold resource expansion on its key assets which lie on the eastern edge of the Rosario Mining District, Sinaloa, Mexico.
Contact the author at jon.hopkins@proactiveinvestors.com