Sabina Gold & Silver Corp. (SBB.T/SGSVF.OTCQX),
(“
Sabina” or the “
Company”) has
announced today that it has entered into an agreement with a
syndicate of underwriters led by BMO Capital Markets and RBC
Capital Markets, under which the underwriters have agreed to buy on
a bought deal basis, a combination of common shares (the “Common
Shares”), flow-through common shares (the “Flow-Through Common
Shares”), charity flow-through common shares (the “Charity
Flow-Through Common Shares”), and super charity flow-through common
shares (the “Super Charity Flow-Through Common Shares,” and
together with the Common Shares, Flow-Through Common Shares, and
Charity Flow-Through Common Shares, the “Securities”) to provide
the Company with gross proceeds of approximately C$49 million (the
“Offering”). 12,500,000 Common Shares will be offered at a price of
C$2.00 per Common Share, for gross proceeds of approximately C$25
million. 2,100,000 Flow-Through Common Shares will be offered at a
price of C$2.40 per Flow-Through Common Share for gross proceeds of
approximately C$5 million. 5,224,000 Charity Flow-Through Common
Shares will be offered at a price of C$2.68 per Charity
Flow-Through Common Share for gross proceeds of approximately C$14
million. 1,638,000 Super Charity Flow-Through Common Shares will be
offered at a price of C$2.90 per Super Charity Flow-Through Common
Share for gross proceeds of approximately C$5 million. The Company
has granted the Underwriters an option, exercisable at the offering
price for a period of 30 days following the closing of the
Offering, to purchase up to an additional 15% of Securities issued
as Common Shares to cover over-allotments, if any. The Offering is
expected to close on or about June 3, 2020 and is subject to Sabina
receiving all necessary regulatory approvals.
The Company has provided a financing notice to
Zhaojin International Mining Co., Ltd. (“Zhaojin”) about the
exercise of Zhaojin’s participation right (the “Zhaojin
Participation Right”) under its Shareholder Agreement with the
Company dated December 19, 2017, as amended. Pursuant to the
Zhaojin Participation Right, Zhaojin has a 48 hour right to elect
to purchase such number of Common Shares at the Offering Price by
way of a private placement to either maintain its 9.9% holdings in
Sabina’s Common Shares or to subscribe for such number of Common
Shares as is equal to 33% of the Common Shares sold under the
Offering and prior private placements in which Zhaojin did not
participate at the 33% level.
The net proceeds from the sale of the Common
Shares will be used to advance development of the Company’s Back
River Gold Project, including completion of detailed engineering,
extension of the airstrip at Goose, completion of geotechnical
drilling and acquisition of accommodation complex for future mine
construction and operations, to commence the advancement of an
underground decline to advance exploration on the Umwelt zone, and
for working capital and general corporate purposes.
The gross proceeds from the sale of the
Flow-Through Common Shares and Super Charity Flow-Through Common
Shares will be used for expenditures which qualify as “Canadian
exploration expenses” (“CEE”) and “flow-through mining
expenditures” both within the meaning of the Income Tax Act
(Canada). The gross proceeds from the sale of the Charity
Flow-Through Common Shares will also be used for expenditures which
qualify as CEE. The Company will renounce such CEE with an
effective date of no later than December 31, 2020.
The Securities will be offered pursuant to the
Company's base shelf prospectus dated May 15, 2020. The terms of
the Offering will be described in a prospectus supplement to be
filed with securities regulators in each of provinces and
territories of Canada, other than Quebec and the Common Shares may
also be offered by way of private placement in the United
States.
The Securities offered have not been
registered under the U.S. Securities Act of 1933, as amended, and
may not be offered or sold in the United States absent registration
or an applicable exemption from the registration requirements. This
press release shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of the
Securities in any jurisdiction in which such offer, solicitation or
sale would be unlawful.
About Sabina Gold &
SilverSabina Gold & Silver Corp. is well-financed and
is an emerging precious metals company with district scale,
advanced, high grade gold assets in one of the world’s newest,
politically stable mining jurisdictions: Nunavut, Canada.
Sabina released a Feasibility Study on its 100%
owned Back River Gold Project which presents a project that has
been designed on a fit-for purpose basis, with the potential to
produce ~200,000 ounces a year for ~11 years with a rapid payback
of 2.9 years (see “Technical Report for the Initial Project
Feasibility Study on the Back River Gold Property, Nunavut, Canada”
dated October 28, 2015).
The Project received its final Project
Certificate on December 19, 2017. The Project received its Type A
Water License on November 14, 2018 and is now in receipt of all
major authorizations for construction and operations.
In addition to Back River, Sabina also owns a
significant silver royalty on Glencore’s Hackett River
Project. The silver royalty on Hackett River’s silver
production is comprised of 22.5% of the first 190 million ounces
produced and 12.5% of all silver produced thereafter.
The Company had approximately $21.1 million in
cash, cash equivalents and short-term investments as at March 31,
2020.
For further information, please contact:
Nicole Hoeller, Vice-President, Communications:
1 888 648-4218 nhoeller@sabinagoldsilver.com
This news release has been authorized by the
undersigned on behalf of Sabina Gold & Silver Corp.
Bruce McLeod, President & CEO Suite 1800 –
Two Bentall Centre 555 Burrard Street Vancouver, BC V7X 1M7 Tel 604
998-4175 Fax 604 998-1051 http://www.sabinagoldsilver.com
Forward-Looking Information
This news release contains “forward-looking
information” within the meaning of applicable securities laws (the
“forward-looking statements”), including information pertaining to
the Company's filing of the Preliminary Base Shelf Prospectus,
regulatory approval of the Shelf Prospectus and any potential
future offering(s) of securities pursuant to the Shelf Prospectus
(and the use of proceeds therefor). These forward-looking
statements are made as of the date of this news release. Readers
are cautioned not to place undue reliance on forward-looking
statements, as there can be no assurance that the future
circumstances, outcomes or results anticipated in or implied by
such forward-looking statements will occur or that plans,
intentions or expectations upon which the forward-looking
statements are based will occur. While we have based these
forward-looking statements on our expectations about future events
as at the date that such statements were prepared, the statements
are not a guarantee that such future events will occur and are
subject to risks, uncertainties, assumptions and other factors
which could cause events or outcomes to differ materially from
those expressed or implied by such forward-looking statements. Such
factors and assumptions include, among others, the effects of
general economic conditions, commodity prices, changing foreign
exchange rates and actions by government and regulatory authorities
and misjudgments in the course of preparing forward-looking
statements. In addition, there are known and unknown risk factors
which could cause our actual results, performance or achievements
to differ materially from any future results, performance or
achievements expressed or implied by the forward-looking
statements. Known risk factors include risks associated with
exploration and project development; the need for additional
financing; the calculation of mineral resources and reserves;
operational risks associated with mining and mineral processing;
fluctuations in metal prices; title matters; government regulation;
obtaining and renewing necessary licenses and permits;
environmental liability and insurance; reliance on key personnel;
the potential for conflicts of interest among certain of our
officers or directors; the absence of dividends; currency
fluctuations; labour disputes; competition; dilution; the
volatility of the our common share price and volume; future sales
of shares by existing shareholders; and other risks and
uncertainties, including those relating to the Back River Project
and general risks associated with the mineral exploration and
development industry described in our Annual Information Form,
financial statements and MD&A for the fiscal period ended
December 31, 2019 filed with the Canadian Securities Administrators
and available at www.sedar.com. Although we have attempted to
identify important factors that could cause actual actions, events
or results to differ materially from those described in
forward-looking statements, there may be other factors that cause
actions, events or results not to be as anticipated, estimated or
intended. There can be no assurance that forward-looking statements
will prove to be accurate, as actual results and future events
could differ materially from those anticipated in such statements.
Accordingly, readers should not place undue reliance on
forward-looking statements. We are under no obligation to update or
alter any forward-looking statements except as required under
applicable securities laws.
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