Non-brokered deal finances work on properties, general working capital
By Devika Patel
Knoxville, Tenn., Oct. 18 - Northern Vertex Capital Inc. said it plans a C$12.65 million non-brokered private placement of units. The deal was announced Sept. 26 and is being conducted to finance a joint venture agreement with Idaho State Gold Co., LLC.
The company will sell 11 million units of one common share and one half-share warrant at C$1.15 per unit.
Each whole warrant will be exercisable at C$1.55 for two years. The strike price represents a 19.23% premium to the Oct. 17 closing share price of C$1.30.
Proceeds will be used to finance the acquisition and additional work on the company's Lemhi property, its other properties and for general working capital.
The joint venture agreement is dated Sept. 21 and the companies have formed a joint venture entity named Lemhi Gold Trust, LLC.
Under the agreement, Lemhi Gold Trust has consolidated and acquired the Lemhi Gold Project from four vendors for a total acquisition cost of $9.5 million. Of the cost, $5.75 million was paid on Sept. 23; $2.65 million will be paid one year from closing; $150,000 will be paid on the second and third anniversaries of the closing date; and $200,000 will be paid on the fourth through seventh anniversaries of closing.
Northern Vertex will be the operator at the Lemhi project and the company plans an initial drill program of at least 30,000 feet to validate and expand the resource.
The company and Idaho State Gold have agreed to an initial funding commitment of $15 million which will cover the cost of the acquisition and the initial work program.
Northern Vertex is a gold exploration and development company based in Vancouver, B.C.
| Issuer: | Northern Vertex Capital Inc.
|
| Issue: | Units of one common share and one half-share warrant
|
| Amount: | C$12.65 million
|
| Units: | 11 million
|
| Price: | C$1.15
|
| Warrants: | One half-share warrant per unit
|
| Warrant expiration: | Two years
|
| Warrant strike price: | C$1.55
|
| Agent: | Non-brokered
|
| Announcement date: | Sept. 26
|
| Pricing date: | Oct. 18
|
| Stock symbol: | TSX Venture: NEE
|
| Stock price: | C$1.30 at close Oct. 17
|
| Market capitalization: | C$33.68 million
|
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