Eloro Resources Closes C$10.9 Million Bought Deal Financing

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TORONTO, Jan. 27, 2023 (GLOBE NEWSWIRE) -- Eloro Resources Ltd. (the “Company” or “Eloro”) (TSX-V: ELO; OTCQX: ELRRF; FSE: P2QM) announces that it has closed today its previously announced bought deal financing (the “Offering”). Pursuant to the Offering, Eloro issued 3,466,530 units of the Company (the “Units”) at a price of C$3.15 per Unit for total gross proceeds of C$10,919,570. This includes 266,530 Units issued in connection with the partial exercise of the over-allotment option granted to the underwriters under the Offering.

Each Unit comprises one common share in the capital of the Company (each, a “Common Share”) and one-half (1/2) of one Common Share purchase warrant of the Company (each whole warrant, a “Warrant”). Each Warrant entitles the holder to purchase one Common Share at a price of C$4.25 at any time on or before the date that is 24 months after the closing date of the Offering.

The Offering was led by Cantor Fitzgerald Canada Corporation (“Cantor”) as lead underwriter and sole bookrunner, with Cormark Securities Inc., Haywood Securities Inc., National Bank Financial Inc., Scotia Capital Inc., and Stifel Nicolaus Canada Inc. (collectively with Cantor, the “Underwriters”) as part of the syndicate of underwriters.

The net proceeds from the Offering will be used for exploration and development at the Company’s projects in Bolivia, and for general working capital and corporate purposes as set out in the Prospectus Supplement (defined below).

As consideration for the services provided by the Underwriters in connection with the Offering, the Underwriters received a cash commission of C$655,174 equal to 6% of the gross proceeds of the Offering.

The Units were offered by way of a prospectus supplement (the “Prospectus Supplement”) to the Company’s existing short form base shelf prospectus dated May 11, 2022. The Prospectus Supplement and the related base shelf prospectus are available on the Company’s SEDAR profile at www.sedar.com.

Two directors of the Company participated in the Offering (“Insiders”).  The part of the Offering in respect of the issuance of Units to the Insiders constitutes a “related party transaction” within the meaning of Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions (“MI 61-101”).  A formal valuation was not required under MI 61-101 as the fair market value of the consideration for the transaction involving the Insiders was only C$147,420 and, accordingly, does not exceed 25% of the Company’s market capitalization as of the date of the Offering.  Similarly, minority shareholder approval was also not required under MI 61-101 as the fair market value of the consideration for the transaction involving the Insiders does not exceed 25% of the Company’s capitalization as of the date of the Offering.  The Insiders who participated in the Offering made their decisions to do so close to the completion of the Offering and, given the short timeline for the transaction (it was first announced on January 19, 2023), the Company did not have the opportunity to announce this related party transaction 21 days in advance of closing of the Offering.