Deal with Cartesian Royalty could include up to 11,500 ounces of gold
By Devika Patel
Knoxville, Tenn., June 6 – Equitas Resources Corp. said it plans a $1 million private placement of units and a $5 million revolving secured gold prepay facility with Cartesian Royalty Holdings Pte. Ltd.
The company will sell units of one common share and one warrant at C$0.07 per unit. The deal will settle in two tranches of $250,000 and $750,000.
Each warrant is exercisable at C$0.117 for two years. The strike price reflects a 46.25% premium to the June 5 closing share price of C$0.08.
The gold prepay facility is due in five years. For every $1 million drawn down, the company must pay the investor 2,100 ounces of gold if it repays the funds within one year or 2,300 ounces of gold if it repays the funds after one year but within three years. If the full $5 million is drawn, repayments would require between 10,500 ounces of gold and 11,500 ounces of gold.
The first drawdown will be for $250,000 and must be advanced within 90 days. After the first drawdown, the minimum loan drawdown size will be $1 million.
Each drawdown has up to three years to be repaid, with payments starting after six months. Any repayments made within the first year may be drawn again.
Cartesian will be paid a 0.5% net smelter royalty, which is payable on production from the company’s current assets and on any new assets acquired or developed with the gold prepay funds. The net smelter royalty may be repurchased by the company in stages for a total of $4 million.
The company paid a 2% upfront loan establishment fee of $120,000.
Proceeds will be used for development, exploration, overhead costs, and new projects.
The natural resource exploration and development company is based in Vancouver, B.C.
| Issuer: | Equitas Resources Corp.
|
| Issue: | Units of one common share and one warrant, revolving secured gold prepay facility
|
| Amount: | $6 million
|
| Investor: | Cartesian Royalty Holdings Pte. Ltd.
|
| Pricing date: | June 7
|
| Stock symbol: | TSX Venture: EQT
|
| Stock price: | C$0.08 at close June 6
|
| Market capitalization: | C$6.97 million
|
|
|
| Units
|
| Amount: | $1 million
|
| Price: | C$0.07
|
| Warrants: | One warrant per unit
|
| Warrant expiration: | Two years
|
| Warrant strike price: | C$0.117
|
|
|
| Loan
|
| Amount: | $5 million
|
| Maturity: | Five years
|
| Fees: | $120,000
|
|
|
© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere.
For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.
