American Eagle Gold Corp (TSX-V:AE) said it plans to complete a non-brokered private placement of up to 7,142,857 flow-through (FT) units at a price of C$0.14 each to raise gross proceeds of C$1 million.
Each FT unit will consist of one common share — issued as a "flow-through share" within the meaning of Canada’s Income Tax Act — and one-half of one common share purchase warrant, the company said in a statement, adding that each warrant entitles the holder to purchase one common share at C$0.25 within two years from the time the offering closes.
Proceeds will be used for expanded exploration work at the recently purchased NAK project in the Babine Copper-Gold Porphyry district in central British Columbia.
READ: American Eagle Gold says it is to begin drilling program at its flagship Golden Gate property
“The gross proceeds from the issuance of the FT Shares will be used for 'Canadian Exploration Expenses' which will be renounced with an effective date no later than December 31, 2021 to the purchasers of the FT shares in an aggregate amount not less than the gross proceeds raised from the issue of the FT shares,” American Eagle said.
“If the Qualifying Expenditures are reduced by the Canada Revenue Agency, the company will indemnify each subscriber of FT Shares for any additional taxes payable by such subscriber as a result of the company's failure to renounce the Qualifying Expenditures,” it added.
Traded on the TSX Venture Exchange, American Eagle is focused on exploring its flagship property, Golden Gate, situated on the Cortez Trend, which hosts three large Carlin-type gold deposits operated by Barrick and Newmont's joint venture, Nevada Gold Mines.