Josemaria Resources Inc. (TSX:JOSE) (OMX:JOSE) is pleased to announce that it has closed its previously announced bought deal financing as well as the previously announced concurrent private placement for aggregate gross proceeds of approximately C$31 million.
Pursuant to the Offering, a total of 17,250,000 common shares of the Company, including 2,250,000 common shares issued pursuant to the over-allotment option which was exercised in full, were sold at a price of C$0.67 per common share, for aggregate gross proceeds of approximately C$11.6 million. The Offering was conducted through a syndicate of underwriters led by BMO Capital Markets and including Canaccord Genuity Corp., PI Financial Corp., Cormark Securities Inc., and Haywood Securities Inc.
Pursuant to the Concurrent Private Placement, a total of approximately 29 million common shares were sold at the Issue Price for additional aggregate gross proceeds of approximately C$19 million. The Concurrent Private Placement was to certain investors introduced to the Company by Pareto Securities Ltd. and to certain other investors, including Lorito Holdings S.à.r.l and Zebra Holdings and Investments S.à.r.l. No commission or other fee was paid to the Underwriters in connection with the sale of common shares pursuant to the Concurrent Private Placement. The Company paid finder fees to Pareto Securities equal to 5% of the gross proceeds raised by investors in the Concurrent Private Placement introduced to the Company by Pareto Securities. No commission or other fee was paid to any party in connection with the sale of common shares under the Concurrent Private Placement to the Significant Shareholders. The common shares issued pursuant to the Concurrent Private Placement are subject to a statutory hold period in Canada expiring on December 19, 2020. The Concurrent Private Placement is subject to final TSX approval.
The net proceeds of the Offering and the Concurrent Private Placement will be used for advancement of the feasibility study, environmental and social impact assessment, basic engineering, repayment of certain outstanding debentures of the Company and general corporate purposes.
Zebra and Lorito are insiders of the Company and held 26.22% and 10.34%, respectively, of the issued and outstanding common shares, on a non-diluted basis, prior to the closing of the Offering and the Concurrent Private Placement. Pursuant to the Concurrent Private Placement, Zebra and Lorito each subscribed for 19,746,269 common shares and 2,194,030 common shares, respectively, for a total of 21,940,299 common shares. Following completion of the Offering and the Concurrent Private Placement, Zebra and Lorito each hold 86,079,003 common shares and 28,346,247 common shares, respectively, representing 28.73% and 9.46%, respectively, of the issued and outstanding common shares, on a non-diluted basis. Such participation in the Concurrent Private Placement constitutes a “related party transaction” as defined in Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions. The Offering is exempt from the formal valuation and minority shareholder approval requirements of 61-101 as neither the fair market value of the securities issued to related parties nor the consideration for such securities exceed 25% of the Company’s market capitalization. The Company filed a material change report less than 21 days before closing the Offering as the shorter period was necessary in order to permit the Company to close the Offering and Concurrent Private Placement in a timeframe consistent with usual market practice for transactions of this nature.
This news release is not a prospectus under Regulation (EU) 2017/1129 (the “EU Prospectus Regulation”). The Company has not authorized any offer of securities to the public (as defined in the EU Prospectus Regulation) in any EEA member state and no such prospectus has been or will be prepared in connection with the Offering or the Concurrent Private Placement.
This news release does not constitute an offer to sell or a solicitation of an offer to sell any of securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act“), or any state securities laws and may not be offered or sold within the United States unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.
ABOUT JOSEMARIA RESOURCES
Josemaria Resources Inc. is a Canadian natural resources company focused on advancing the development of its wholly-owned Josemaria copper-gold project in San Juan Province, Argentina. The Company is a reporting issuer in in all provinces and territories of Canada and its corporate head office is in Vancouver, B.C.
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We acknowledge the [financial] support of the Government of Canada.