GR Silver Mining (TSX-V:GRSL) Ltd said it has completed its previously announced 'best-efforts' private placement offering, issuing 27,236,755 special warrants at a price of $0.27 each for aggregate gross proceeds of $7,353,923.85
The gross proceeds included 1,236,755 special warrants sold under the partial exercise of the option granted to the agents under the agency agreement.
The net proceeds raised under the offering will be used for working capital and general corporate purposes, the company said.
Each special warrant is automatically exercisable into one unit of the company, with each unit being comprised of one common share in the capital of the company and one-half of one common share purchase warrant. Each whole warrant shall be exercisable to acquire one share for a period of 36 months following closing of the offering at an exercise price of $0.37 per share.
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All special warrants shall be automatically exercisable, for no additional consideration and without any further action on the part of the holder thereof, into units on the date that is the earlier of: the fifth business day on which a final receipt is obtained from the British Columbia Securities Commission, on behalf of the securities regulatory authorities in each of the applicable Provinces of Canada for the filling of the final short form prospectus under the National Instrument 44-101 - Short Form Prospectus Distributions, qualifying the distribution of the securities to be issued upon exercise or deemed exercise of the special warrants; and 4.59pm Toronto time on the date that is four months and a day following the closing date.
The company will use its commercially reasonable efforts to obtain a receipt from the Securities Commissions for the final prospectus before the date that is 70 days following the date hereof, provided, however, that there is no assurance that it will be filed or that a receipt therefor will be issued by the Securities Commissions prior to the expiry of the statutory four-month hold period.
Notwithstanding the foregoing, in the event the company has not received a receipt from the Securities Commissions for the final prospectus before the date that is 70 days following the date hereof, each unexercised special warrant will thereafter entitle the holder to receive, upon the exercise thereof, for no additional consideration, instead of a unit, a penalty unit, with each penalty unit being comprised of one share and one full warrant (in place of one-half of one warrant).
Certain directors and officers of the company participated in the offering and purchased an aggregate of 809,000 special warrants for aggregate gross proceeds of $218,430. Marcio Fonseca, the company's president, COO and a director, purchased 370,000 special warrants for $99,900; Eric Zaunscherb, the company's CEO, chairman and a director, purchased 75,000 special warrants for $20,250; Brenda Dayton, the company's VP of Corporate Communications, purchased 72,000 special warrants for $19,440; Trevor Woolfe, the company's VP of Corporate Development and VP of Exploration, purchased 92,000 special warrants for $24,840, and Jonathan Rubenstein, a director of the company, purchased 200,000 special warrants for $54,000 through a privately held corporation.
The company entered into an agency agreement for the offering with Beacon Securities Limited and Red Cloud Securities Inc. as co-lead agents, and Echelon Wealth Partners Inc, under which the company paid the agents a cash commission totalling $422,930.63 and issued an aggregate of 1,566,410 special broker warrants, each of which is exercisable for one broker warrant upon the earlier of the qualifying date and July 30, 2022. Each Bboker warrant shall be exercisable for one common share of the company at a price of $0.27 per share, for a period of 36 months from the date hereof.
Prior to the filing of the final prospectus and the automatic exercise of the special warrants and the special broker warrants, they will be subject to a hold period expiring July 30, 2022, in addition to any other restrictions under applicable law.
The securities offered have not been registered under the US Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements.
GR Silver Mining is a Canadian-based, Mexico-focused junior mineral exploration company engaged in cost-effective silver-gold resource expansion on its 100%-owned assets, located on the eastern edge of the Rosario Mining District, in the southeast of Sinaloa State, Mexico.
The company controls 100% of two past producer precious metal underground and open-pit mines, within the expanded Plomosas Project, which includes the integrated San Marcial Area and La Trinidad acquisition. In conjunction with a portfolio of early to advanced-stage exploration targets, GR Silver Mining holds 734 square kilometres of concessions containing several structural corridors totaling over 75 kilometers in strike length.
Contact the author at jon.hopkins@proactiveinvestors.com