Tocvan Ventures Corp said it has executed a binding term sheet in connection with a proposed financing for C$5,125,000.00 with a UK institutional investor, the terms of which will be announced once all due diligence has been completed, which is expected by June 30, 2022.
The company has agreed to pay a refundable due diligence deposit of C$75,000 via the issuance of 81,522 common shares of the company at a deemed issue price of $0.92 per common share.
The deposit shares, and the securities to be issued pursuant to the proposed financing, will distributed to an institutional investor in the United Kingdom under Ontario Securities Commission Rule 72-503 - Distributions Outside Canada and, as such, will not be subject to a statutory hold period in accordance with applicable securities laws.
"Over the last year it has been our goal to align with an institutional investor that sees the potential of our Sonora projects and wants to be part of our next stage of growth," commented Brodie Sutherland, the company's CEO in a statement.
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"An investment of this size will ensure we can actively drill and advance both our projects for the next two-years and beyond. This is a big endorsement of our team and the hard work they have put in. Having an investment partner with a passion for mining and a track record of success is critical for our continued growth. We look forward to continuing our drill campaign at Pilar and moving Picacho towards a maiden drill program," he added.
Tocvan also said it has closed a non-brokered private placement of 243,500 units at C$0.82 per unit, for gross proceeds of C$199,670.
Each unit is comprised of one common share of the company and one common share purchase warrant. Each warrant will entitle the holder to acquire one additional share in the capital of the company at a price of C$1.40 for a period of 24 months from the date the units are issued, subject to the accelerated expiry provision described in the notes below.
If, on any 10 consecutive trading days occurring after four months and one day has elapsed following the closing date of the offering, the closing sales price of Tocvan shares (or the closing bid, if no sales were reported on a trading day) as quoted on the Canadian Securities Exchange (CSE) is greater than C$1.65 per common share, the company may provide notice in writing to the holders of the warrants by issuance of a press release that the expiry date of the warrants will be accelerated to the 30th day after the date on which the company issues such press release.
Closing of the offering is subject to several conditions, including receipt of all necessary corporate and regulatory approvals, including the CSE. All securities issued in connection with the offering will be subject to a statutory hold period of four months plus a day from the date of issuance in accordance with applicable securities legislation in Canada.
The company said the proceeds from the offering will go towards drilling at the Pilar Au-Ag project in Sonora, Mexico, payment of finder's fees under the offering, and for general working capital purposes.
The company said it has also agreed to issue 54,878 common shares at a deemed issue price of $0.82 to an arm's length consultant to settle an account for $45,000 for services rendered to the company by the consultant. The common shares issued in connection with the debt settlement will be subject to a statutory hold period of four months plus a day from the date of issuance, in accordance with applicable securities legislation in Canada.
Tocvan was created in order to take advantage of the prolonged downturn the junior mining exploration sector, by identifying and negotiating interest in opportunities where management feels they can build upon previous success. .
The company has approximately 32 million shares outstanding and is earning 100% into two exciting opportunities in Sonora, Mexico: the Pilar Gold-Silver project and the El Picacho Gold-Silver project. Its management feel both projects represent tremendous opportunity to create shareholder value.
Contact the author at jon.hopkins@proactiveinvestors.com