Aquila Resources Announces Marketed Equity Offering
Aquila Resources Inc. (TSX: AQA, OTCQB: AQARF) (“Aquila” or the “Company”) is pleased to announce that it has filed a preliminary short form prospectus in connection with a marketed offering (the “Offering”) of units (the “Units”) for gross proceeds of approximately $10 million from the treasury of the Company, at a price per Unit to be determined in the context of the market (the “Offering Price”). The Offering will be conducted through a syndicate of underwriters led by Scotiabank and including Desjardins Capital Markets and Eight Capital (collectively, the “Underwriters”).
Each Unit will consist of one common share in the capital of the Company (each a “Common Share”) and a common share purchase warrant (a “Warrant”). Each Warrant shall entitle the holder to acquire an additional Common Share at an exercise price to be determined in the context of the market and for a period of time to be determined, to be measured from the date of issuance of such Warrants.
The size and pricing of the Offering will be determined in the context of the market at the time of entering into a definitive underwriting agreement between the Company and the Underwriters. The Company has granted the Underwriters an option (the “Over-Allotment Option”) to purchase up to an additional 15% of the Offering on the same terms exercisable at any time up to 30 days following the closing of the Offering, for market stabilization purposes and to cover over-allotments, if any.
Concurrently with the Offering, the Company also intends to sell Units to certain institutional and strategic investors, including Orion Mine Finance (“Orion”), on a non-brokered private placement basis at the Offering Price (the “Private Placement”). Orion is the Company’s largest shareholder and currently holds approximately 28.6% of the outstanding Common Shares.
Closing of the Offering and the Private Placement is expected to occur on or about April 9, 2021 and is subject to certain conditions, including regulatory approval, including that of the Toronto Stock Exchange.
The Company intends to use the net proceeds from the Offering and the Private Placement to fund development activities at the Back Forty Project, including the completion of an optimized feasibility study and for permitting, environmental, and legal activities, and for general corporate purposes and working capital.
The Units are being offered (i) to the public in each of the provinces and territories of Canada, except for Quebec and (ii) in the United States, only to “qualified institutional buyers” (as defined in Rule 144A under the 1933 Act, “Qualified Institutional Buyers”), in a private placement exempt from the registration requirements of the 1933 Act.