Reunion Gold Corp said it has entered into a revised agreement with Sprott Capital Partners, on behalf of a syndicate of underwriters, to increase the size of the previously announced bought deal private placement financing to an aggregate purchase price of $30.3 million, up from an initial $20 million.
Under the amendment, the underwriters have agreed to purchase 115.5 million units of the company at a price of 26 cents per unit. The other terms of the offering, including the overallotment option, remain unchanged from the company's news release dated June 14, 2022.
Each unit will consist of one common share of the company and one-half of one common share purchase warrant. Each warrant will entitle the holder thereof to purchase one common share at an exercise price of 39 cents for a period of 24 months following the closing of the offering.
READ: Reunion Gold set for C$20M bought deal financing to advance its projects
If the volume-weighted average closing price of the common shares of the company on the TSX Venture Exchange or such other stock exchange on which the common shares are traded is equal to or greater than 55 cents for a period of 10 consecutive trading days, the company may at its option elect to accelerate the expiry of the warrants.
Concurrent non-brokered private placement
Reunion Gold noted that Dundee Resources Ltd, a 16.48% shareholder of the company, has a right to elect to purchase a proportionate number of units, at the same price and having the same terms and conditions as the units, to maintain its interest in the company.
Any such participation, representing approximately 22.8 million units for gross proceeds of $5,928,000, will occur by way of a concurrent non-brokered private placement. The company anticipates that the non-brokered private placement will be completed concurrently with the closing of the offering.
All securities issued under the offering and non-brokered private placement will have a hold period of four months and one day.
Reunion Gold is a leading gold explorer in the Guiana Shield, South America, with a portfolio of projects in Guyana, Suriname and French Guiana. In 2021 the company made an exciting new gold discovery at its Oko West project in Guyana, where to date it has outlined continuous gold mineralization at the Kairuni zone over 2,500 metres of strike and to a depth of 575 metres.
Contact the author at jon.hopkins@proactiveinvestors.com