Red Pine Exploration Inc (TSX-V:RPX, OTCQB:RDEXF) has announced a bought deal financing agreement involving flow-through (FT) and non-flow-through company shares with Haywood Securities Inc, acting as lead underwriter and sole bookrunner, on behalf of a syndicate of underwriters including Canaccord Genuity (TSX:CF, LSE:CF) Corp and Laurentian Bank Securities Inc, to raise gross proceeds to the company of over C$5 million.
The gold project developer said it plans to use the net proceeds from the sale of the non-flow-through shares for exploration at its Wawa Gold project and for working capital and general corporate purposes, while gross proceeds from the sale of the FT shares will be used to incur eligible Canadian Exploration Expenses as defined in the Income Tax Act (Canada).
Red Pine noted the offering will involve issuing more than 7.6 million non-flow-through company common shares, at a price of C$0.26 per share, as well as 10 million FT Red Pine common shares at a price of C$0.30 per FT share.
READ: Red Pine Exploration reports new results from its 2022 exploration program, which is continuing to expand the footprint of mineralization
The company added that it has agreed to grant the underwriters an over-allotment option to purchase up to an additional 15% of the offering’s total gross proceeds, exercisable in whole or in part for the non-flow-through company shares at any time and from time to time on or before the date that is 30 days following the closing of the offering to cover over-allotments, if any, and for market stabilization purposes.
If this option is exercised in full, an additional C$750,027 in gross proceeds will be raised pursuant to the offering and the total gross proceeds of the offering will be C$5,750,207, Red Pine said.
The offering is scheduled to close on or about September 29 and is subject to certain conditions including, but not limited to, the receipt of all necessary approvals including the approval of the TSX Venture Exchange and the securities regulatory authorities.
Red Pine’s flagship Wawa Gold project is spread over 6,986 hectares and hosts several former mines with a combined historic production of 120,000 ounces of gold. The company's attractive Wawa property in Ontario has Barrick Gold's Hemlo mine to the west and Newmont's Borden mine to the east - the two largest gold producers in the world. The project also has other successful neighbors like Alamos Gold and Argonaut Gold.
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