Trilogy Metals Inc. (TSX/NYSE American: TMQ) is pleased to announce that it has closed its previously announced bought deal financing of 24,784,482 common shares, including the exercise in full by the underwriters of the over-allotment option, at a price of $1.16 per share for aggregate gross proceeds of approximately $28.7 million. All amounts are in US dollars.
Certain large shareholders participated in the Offering with South32 Limited taking approximately 40% or $11.5 million, Electrum Strategic Opportunities Fund L.P. taking approximately 20% or $5.8 million, The Baupost Group LLC taking approximately 10% or $2.8 million, and Selz Capital LLC taking approximately 4% or $1.2 million. South32’s involvement in this financing represented their maximum allocation of their participation rights in the Company’s financings to participate to a minimum of 20% to a maximum of 40% in future financings, private or public, to a maximum ownership of 19.9% in the Company.
Trilogy Metals intends to use the net proceeds from the Offering for an anticipated period of three years (i) to finance advancing the Arctic Project towards feasibility and permitting, (ii) for exploration in the Ambler mining district, and (iii) for general corporate purposes.
“We are very pleased with the support we have received from our shareholders. The funds raised puts the Company in a strong position to advance the Arctic Project towards feasibility and permitting over the next three years. This keeps us aligned with the expected progress on advancing the Ambler Mining District access road through permitting and a construction decision. Additional funds could be used to explore the Ambler VMS belt to look for additional polymetallic resources which could potentially extend the mine life at Arctic. Any of this work would be in addition to completing the $10 million exploration program at Bornite this year that has been fully funded by South32”, said Rick Van Nieuwenhuyse, President and CEO of Trilogy Metals.
The Offering was made through a syndicate of underwriters led by Cantor Fitzgerald Canada Corporation as sole bookrunner and included Cormark Securities Inc., BMO Capital Markets and Roth Capital Partners, LLC.
The Offering was completed by way of a final prospectus supplement in both Canada and the United States to the Company’s Canadian short form base shelf prospectus dated November 21, 2017 and its U.S. shelf registration statement on Form S-3 that was declared effective on November 21, 2017. Before investing, you should read the Supplement and the risk factors set out therein, the Canadian Base Prospectus as well as the Registration Statement and other documents the Company has filed with the United States Securities and Exchange Commission and the Canadian securities regulators for more complete information about the Company and the Offering. Copies of the Supplement, Underwriting Agreement, the Canadian Base Prospectus and the Registration Statement are available for free by visiting the Company’s profiles on SEDAR at www.sedar.com or EDGAR at www.sec.gov/edgar.shtml, as applicable. Alternatively, investors may ask the Underwriters or the Company to send them the Supplement, the Canadian Base Prospectus and/or the base prospectus contained in the Registration Statement by contacting Cantor Fitzgerald Canada Corporation, attention: Equity Capital Markets, 181 University Avenue, Suite 1500, Toronto, ON, M5H 3M7, email: email@example.com or Cantor Fitzgerald & Co., Attention: Equity Capital Markets, 499 Park Avenue, 6th Floor, New York, New York, 10022 or by email at firstname.lastname@example.org.
This press release shall not constitute an offer to sell or a solicitation of an offer to buy, nor shall there be any sale of Offered Shares in any state, province or other jurisdiction in which such offer, solicitation or sale would be unlawful, prior to registration or qualification under the securities laws of any such state, province, or other jurisdiction.
Early Warning Disclosure for South32
Pursuant to the Offering South32 International Investment Holdings Pty Ltd. an affiliate of South32, acquired 9,913,793 common shares at an issue price of $1.16 per share for a total purchase price of $11.5 million (or C$14.5 using an exchange rate of 1.26).
Prior to the closing of the Offering, South32 Holdings held 6,499,700 common shares of Trilogy Metals representing 6.1% of the outstanding common shares of Trilogy. Following its participation in the Offering, South32 Holdings now holds 16,413,493 common shares of Trilogy Metals representing approximately 12.5% of the outstanding common shares of Trilogy Metals.
Trilogy Metals has been advised by South32 that the common shares acquired pursuant to the Offering were acquired for investment purposes. Subject to the terms of its investment agreement with Trilogy Metals, South32 may, depending on market and other conditions, or as future circumstances may dictate, from time to time, increase or dispose of some or all of the existing or additional securities it holds or will hold, or may continue to hold its current position.
A copy of South32 Holding’s early warning report will appear with Trilogy Metal’s documents on the System for Electronic Document Analysis and Retrieval (SEDAR) at www.sedar.com and may also be obtained by contacting South32’s Company Secretary at +61 8 9324 9000.
South32 Holding’s address is South32 International Investment Holdings Pty Ltd, Level 35, 108 St Georges Terrace, Perth WA 6000 Australia.
About Trilogy Metals
Trilogy Metals Inc. is a metals exploration company focused on exploring and developing the Ambler mining district located in northwestern Alaska. It is one of the richest and most-prospective known copper-dominant districts located in one of the safest geopolitical jurisdictions in the world. It hosts world-class polymetallic VMS deposits that contain copper, zinc, lead, gold and silver, and carbonate replacement deposits which have been found to host high grade copper mineralization. Exploration efforts have been focused on two deposits in the Ambler mining district – the Arctic VMS deposit and the Bornite carbonate replacement deposit. Both deposits are located within the Company’s land package that spans approximately 143,000 hectares. The Company has an agreement with NANA Regional Corporation, Inc., a Regional Alaska Native Corporation that provides a framework for the exploration and potential development of the Ambler mining district in cooperation with local communities. Our vision is to develop the Ambler mining district into a premier North American copper producer.
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We acknowledge the [financial] support of the Government of Canada.