First Light, New Oroperu complete $22.03M financing
2021-07-21 11:08 ET – News Release
See News Release (C-XYZ) First Light Capital Corp
Mr. Jim Currie reports
FIRST LIGHT AND NEW OROPERU COMPLETE C$22,038,500 FINANCING IN CONNECTION WITH BUSINESS COMBINATION TO CREATE ANACORTES MINING
First Light Capital Corp. and New Oroperu Resources Inc., further to their joint news release dated June 17, 2021, have closed the previously announced private placement financing of 55,096,250 subscription receipts at a price of 40 cents per subscription receipt for gross proceeds of $22,038,500. The Private Placement included the partial exercise of the agents’ option, and was co-led by Haywood Securities Inc. ("Haywood") as sole bookrunner, and Clarus Securities Inc. ("Clarus" and together with Haywood, the "Agents") under the brokered portion of the Private Placement. The completion of the Private Placement is a key milestone in the combination of First Light and New Oroperu (the "Transaction"), and in the creation of Anacortes Mining Corp. ("Anacortes"), a new growth-oriented gold company in the Americas, to be completed in accordance with the terms of the previously announced arrangement agreement (the "Arrangement Agreement").
The gross proceeds from the Private Placement, less the reasonable expenses of the Agents incurred in connection with the Private Placement, will be held in escrow pursuant to the terms of subscription receipt agreements (the "Subscription Receipt Agreements") with Computershare Trust Company of Canada (the "Subscription Receipt Agent") and shall be released immediately prior to completion of the Transaction upon satisfaction of the Escrow Release Conditions (as defined in the Subscription Receipt Agreements).
The Private Placement consisted of Subscription Receipts offered by First Light and by 1310612 B.C. Ltd. ("Finco"), a wholly-owned subsidiary of First Light, as follows (i) 4,406,250 Subscription receipts sold by First Light on a brokered basis, (ii) 49,077,500 Subscription receipts sold by Finco on a brokered basis, (iii) 125,000 Subscription receipts sold by First Light on a non-brokered basis, and (iv) 1,487,500 Subscription receipts sold by Finco on a non-brokered basis. Each Subscription Receipt sold by First Light will entitle the holder thereof to receive one First Light common share (each, a "First Light Share") and one-half of one common share purchase warrant of First Light (each full warrant, a "First Light Warrant"). Each Subscription Receipt sold by Finco will entitle the holder to receive one Finco common share (each a "Finco Share") and one-half of one Finco common share purchase warrant (each whole warrant a "Finco Warrant"). After conversion of the Finco Subscription Receipts and in connection with closing of the Transaction, Finco will amalgamate with a wholly-owned subsidiary of First Light which will result in the Finco Shares and the Finco Warrants being exchanged for First Light Shares and First Light Warrants on a "one for one" basis. Each First Light Warrant shall be exercisable for one First Light Share at an exercise price of C$0.55 for a period of 24 months from the closing date of the Private Placement. If the Escrow Release Conditions are not satisfied on or before the November 30, 2021 (subject to extension at the request of the Company or the Agents), or if the Arrangement Agreement is terminated at any earlier time, or if First Light advises the Agents or announces to the public that it does not intend to satisfy the Escrow Release Conditions, then the Subscription Receipt Agent will return to holders of the Subscription Receipts an amount equal to the aggregate Subscription Price for the Subscription Receipts held by them, together with a pro rata portion of interest earned on the escrowed proceeds (less applicable withholding tax, if any) and the Subscription Receipts will be cancelled and of no further force or effect.
Anacortes intends to use the net proceeds of the Private Placement to advance New Oroperu’s Tres Cruces project located in Peru and for general corporate purposes. Key next steps for Tres Cruces include (i) data compilation and validation, (ii) exploration drilling to increase oxide and sulphide mineral resources, (iii) the advancement of a feasibility study for a standalone oxide operation, (iv) permitting, (v) the evaluation of synergies for oxide development, and (vi) the assessment of sulphide development scenarios, including potential synergies.
Jim Currie, President and Chief Executive Officer of First Light, stated, "We are pleased to have closed this financing ahead of completing the combination with New Oroperu and creation of Anacortes. The Private Placement will allow Anacortes to begin its advancement of Tres Cruces in a well capitalized position of strength with the goal of creating significant value for stakeholders through exploration and development of both the oxides and sulphides at Tres Cruces. Furthermore, the Private Placement has allowed the pro forma company to move forward with a strong shareholder registry, introducing additional supportive institutional, high net worth, and retail investors."
Certain insiders of First Light purchased an aggregate of 3,725,000 Subscription Receipts under the Private Placement. Each of these transactions constitutes a "related party transaction" within the meaning of TSX Venture Exchange Policy 5.9 and Multilateral Instrument 61-101 ("MI 61-101"). First Light has relied on the exemptions from the valuation and minority shareholder approval requirements of MI 61-101 (and Policy 5.9) contained in sections 5.5(b) and 5.7(1)(b) of MI 61-101 in respect of such insider participation. First Light did not file a material change report more than 21 days before the expected closing of the Private Placement, as the details and amounts of the insider participation were not finalized until closer to the closing and First Light wished to close the transaction as soon as practicable for sound business reasons.
As consideration for their services, the Agents will receive a cash commission equal to 6.0% of the gross proceeds of the brokered tranche of the Private Placement and that number of compensation subscription receipts equal to 6.0% of the aggregate number of Subscription Receipts sold under the brokered tranche of the Private Placement. In addition, the Agents will receive a corporate finance fee of $35,000 and 95,000 compensation subscription receipts as additional consideration for their services in connection with the Private Placement. On satisfaction of the Escrow Release Conditions, each compensation subscription receipt will automatically convert into a compensation option entitling the holder thereof to purchase one First Light Share at the Subscription Price for a period of 24 months from the closing date of the Private Placement.
The Transaction is expected to close in Q3-Q4 of 2021. Immediately following completion of the Transaction, Anacortes will consolidate its common shares at a ratio of six pre-consolidation shares to one post-consolidation share (the "Consolidation").
About New Oroperu
New Oroperu is a junior exploration company based in Vancouver, B.C., which owns the Tres Cruces gold project in Peru. The Tres Cruces gold project currently hosts a mineral resource estimate of 2.474 million ounces of gold at 1.65 g/t in the Indicated category, which includes 630,000 ounces of leachable gold resources. This mineral resource is described in a NI 43-101 Technical Report & Resource Update for the Tres Cruces project, North-Central Peru, prepared for New Oroperu by Jeffrey D. Rowe, James N. Gray and Ruperto Castro Ocampo with an effective date of March 16, 2021, which has been filed on New Oroperu’s profile on SEDAR and can be viewed at www.sedar.com.
Jeffrey D. Rowe, P.Geo., a Qualified Person as defined by National Instrument 43-101 – Standards of Disclosure for Mineral Projects , has reviewed and approved the scientific and technical information contained in this news release.
For further information, please contact Christina McCarthy, V.P. Corporate Development of New Oroperu, at (416) 712-6151, email [email protected] or K. Wayne Livingstone, President and Chief Executive Officer of New Oroperu, at (604) 638-1408, email [email protected].
About First Light
First Light is a capital pool company pursuant to Policy 2.4 of the TSXV. Except as specifically contemplated in such policy, until the completion of its Qualifying Transaction (as defined in the policy), First Light will not carry on business, other than the identification and evaluation of companies, businesses or assets with a view to completing a proposed QT. Investors are cautioned that trading in the securities of a capital pool company is considered highly speculative.
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