Azimut Exploration Inc. (TSX-V: AZM) is pleased to announce that it has closed its previously announced bought deal private placement financing for total gross proceeds of approximately $28.75 million, consisting of 3,463,900 common shares of the Company that qualify as “flow-through shares” (within the meaning of subsection 66(15) of the Income Tax Act (Canada) and section 359.1 of the Taxation Act (Québec)) at a price of $3.32 per FT Share and 9,078,472 common shares of the Company on a non-flow-through basis at a price of $1.90 per Share, which includes the exercise of the underwriters’ option to purchase 1,973,172 additional Shares.
Paradigm Capital Inc. acted as lead underwriter in connection with the Offering with a syndicate including Laurentian Bank Securities Inc. and Sprott Capital Partners LP. As consideration for the services provided by the Underwriters in connection with the Offering, the Underwriters received: (a) a cash commission representing 6.0% of the aggregate gross proceeds from sales of the Offered Shares under the Offering (reduced to 3% for certain subscribers on the president’s list of the Company); and (b) non-transferable compensation options, representing 4% of the total number of Offered Shares sold under the Offering, each exercisable for one common share of the Company at a price of $1.90 per share until January 16, 2023.
The Company will use an amount equal to the gross proceeds received by the Company from the sale of the FT Shares, pursuant to the provisions in the Income Tax Act (Canada) and the Taxation Act (Québec), to incur eligible “Canadian exploration expenses” that qualify as “flow-through mining expenditures” as both terms are defined in the Income Tax Act (Canada) on or before December 31, 2022, and to renounce all the Qualifying Expenditures in favour of the subscribers of the FT Shares effective December 31, 2021. In addition, with respect to Québec resident subscribers of the FT Shares who are eligible individuals under the Taxation Act (Québec), the Canadian exploration expenses will also qualify for inclusion in the “exploration base relating to certain Québec exploration expenses” within the meaning of section 726.4.10 of the Taxation Act (Québec) and for inclusion in the “exploration base relating to certain Québec surface mining expenses or oil and gas exploration expenses” within the meaning of section 718.104.22.168 of the Taxation Act (Québec). The net proceeds from the sale of the Shares will be used for exploration and for general corporate purposes.
The strategic investor, who participated in the February 2020 private placement, also participated in the Offering and following the Offering will have pro-forma ownership of approximately 9.79%.
All securities issued in connection with the Offering are subject to a statutory hold period in Canada expiring on November 17, 2021. The Offering remains subject to final acceptance of the TSX Venture Exchange.
The securities have not been, and will not be, registered under the Unites States Securities Act of 1933, as amended (the “U.S. Securities Act“), or any U.S. state securities laws, and may not be offered or sold in the Unites States without registration under the U.S. Securities Act and all applicable state securities laws or compliance with requirements of an applicable exemption therefrom. This press release shall not constitute an offer to sell or the solicitation of an offer to buy securities in the Unites States, nor shall there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.
Azimut is a mineral exploration company whose core business centres on target generation and partnership development. The Company is actively advancing the Patwon gold discovery on its 100%-owned flagship Elmer Property in the James Bay region.
The Company uses a pioneering approach to big data analytics (the proprietary AZtechMineTM expert system), enhanced by extensive exploration know-how. Azimut maintains rigorous financial discipline and has 81.7 million shares outstanding. Azimut’s competitive edge against exploration risk is founded on systematic regional-scale data analysis and multiple concurrently active projects
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We acknowledge the [financial] support of the Government of Canada.