Stuhini Exploration Ltd (TSX-V:STU) has announced a non-brokered private placement to raise total gross proceeds of up to C$1.5 million, with Sprott Asset Management (TSX:SII) LP agreeing to purchase C$495,000 of the financing.
The mineral exploration company said the private placement will consist of a combination of company flow-through (FT) units, at a price of $0.45 per FT unit, as well as non-flow through (NFT) Stuhini units at a price of $0.40 per NFT unit.
“On behalf of the board of directors, I would like to welcome Sprott Asset Management (TSX:SII) LP as an important new cornerstone shareholder,” Stuhini Exploration CEO David O'Brien said in a statement.
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“During these current challenging market conditions for the junior exploration sector, we are very pleased to have secured the support of one of most prominent and successful funds in the mining industry,” O'Brien added.
Stuhini noted that proceeds from the FT offering will be used to fund exploration programs on its Ruby Creek and Big Ledge projects in British Columbia, while money raised from NFT units will be used to fund exploration programs on the company's other mineral properties, including the Que project in the Yukon Territory, the South Thompson Nickel project in Manitoba, and any additional exploration projects acquired or staked in the US through its wholly-owned Arizada Metals Corp subsidiary, as well as general and administrative expenses.
Each FT unit will consist of one flow-through company common share plus one half of one common share purchase warrant, with each FT warrant entitling the holder to acquire one Stuhini common share, at a price of C$0.60 per share, for a period of two years following the closing of the FT unit offering.
Each NFT unit, meanwhile, will consist of one company common share plus one-half of one NFT common share purchase warrant, with each NFT warrant entitling the holder to acquire one Stuhini common share, at a price of $0.60 per share, for a period of two years following the closing of the NFT unit offering.
The company also said it may pay finders' fees in cash of up to 6% of the gross proceeds from the sale of FT units or NFT units and issue finder's warrants entitling the finder to purchase such number of common shares that is equal to up to 6% of the number of FT units or NFT units, as applicable, placed by the finder.
Each finder's warrant will entitle the holder to acquire one Stuhini common share, at a price of C$0.50 per share, for a period of two years following the closing of the private placement.
The company said it anticipates that certain Stuhini directors, officers and other insiders will acquire FT units or NFT units, as applicable, under the private placement.
The private placement may close in multiple tranches and is subject to certain conditions including, but not limited to, the receipt of all necessary regulatory approvals including the approval of the TSX Venture exchange, the company said.
All securities to be issued pursuant to the offering will have a hold period of four months and one day from the closing of the private placement.
Stuhini Exploration's portfolio of exploration properties includes the flagship Ruby Creek property, which sits about 20 kilometres (km) east of Atlin, BC; the Que project, which is about 70 km north of Johnson's Crossing in the Yukon; the South Thompson project around 35 km northwest of Grand Rapids, Manitoba; and the Big Ledge property around 57 km south of Revelstoke, BC.
Contact Sean at sean@proactiveinvestors.com