White Rock Minerals Ltd (ASX:WRM, OTCQX:WRMCF) is out to raise roughly A$2.4 million through a share placement to institutional and sophisticated investors.
Participants can buy in at A$0.15 per WRM share and are also in line to receive one free-attaching, unlisted option for every two shares subscribed for.
As long as shareholders approve the placement options, White Rock also intends to open a loyalty options offer, executed as one option for every two shares held, to eligible shareholders.
On production path
White Rock plans to use the funding to support recruitment, re-capitalisation and pre-production development activities as it works to bring gold production online at the Morning Star Gold Mine in Victoria.
The capital raise will also keep one diamond drill spinning to delineate near-term ore sources at Morning Star, as well as target expansion opportunities by testing the Gap Zone.
Once Morning Star reaches nameplate production and White Rock hits breakeven, it plans to invest in exploration at its Red Mountain asset in Alaska.
“Victoria’s next gold producer”
White Rock managing director and CEO Matt Gill said: “White Rock acquired the Woods Point Gold Project in Victoria in August 2021 and by October diamond drilling had commenced at the high-grade Morning Star Gold Mine, with two diamond rigs testing multiple mineralised quartz reefs.
“The team on site has done a sterling job, with at least three possible production areas subsequently identified for potential mining.
“This capital raising will now allow us to take the next big step for the company and its shareholders — becoming Victoria’s next gold producer.”
Joining a new league
Gill continued: “In addition to recommencing gold production, White Rock is excited by the regional potential of the Woods Point Gold Project across its extensive 660-square-kilometre tenement package.
“Work has commenced to advance permitting, which will allow drilling at the highly prospective Wallaby prospect, our first priority of a broader program that aims to find the next Cohen’s Reef, where 1.5 million ounces at better than an ounce per tonne (32 g/t gold) was mined historically.
“This capital raise will allow for certain works to be undertaken and propel White Rock into the league of gold producers — a step many junior exploration companies aspire to make.
“White Rock intends to continue with this aggressive exploration focus on the significant in-mine and regional exploration potential of the project with the driving objective of making a new discovery that adds to the re-emergence of Victoria’s gold mining industry.
“The board is very appreciative of the support shown from current shareholders and the interest and support being shown from the new investors now joining the White Rock journey through this equity raising.”
Convertible note and equity facility term sheet
In addition, White Rock has entered a non-binding term sheet with Obsidian Global Partners to advance a proposed convertible note and equity facility.
Under the non-binding agreement, Obsidian may invest up to $30 million in White Rock over a 24-month period, either through convertible notes or new, fully paid ordinary shares.
The term sheet outlines that Obsidian will initially invest $3.5 million through convertible notes, while any further investments will be made under the terms of the proposed funding facility.
The transactions contemplated by the term sheet are subject to various conditions, including completion of due diligence to Obsidian’s satisfaction, entering definitive documentation and certain shareholder approvals.