TORONTO, ONTARIO -- (Marketwired) -- 04/05/13 -- Apogee Silver Ltd. (TSX VENTURE: APE) ("Apogee" or the "Company") has closed a private placement offering (the "Offering") of 70,370,000 Units of the Company ("Units"), at a price of $0.05 per Unit, for aggregate gross proceeds of $3,518,500, subject to final approval from the TSX Venture Exchange (the "TSXV").
Each Unit consists of one common share of the Company (a "Common Share") and 0.6 of a purchase warrant, with each whole Warrant entitling the holder thereof to purchase one Common Share at an exercise price of $0.10 per share for a period of 36 months following the closing of the Offering.
Neil Ringdahl, Chief Executive Officer, commented: "Apogee is pleased to complete this successful private placement in very difficult market conditions. We believe this reflects the quality of the resource assets and near-term production potential of our Pulacayo project. Subsequent to our successful trial mining and toll milling (processing) operations (see press releases dated January 15, 2013 & March 1, 2013), we believe we are well positioned to increase production to over 2,500 tonnes per month using a newly trained mining team sourced from local communities. Our mining and processing activities will continue to be conducted under the Company's mining environmental license with full community support.
"This funding provides Apogee with the opportunity to ramp up current mining and toll processing activities with the aim of the Company becoming cash positive within the next 12 months. It also provides sufficient time for the Company to select an attractive funding option for our larger 1,000 tonnes per day mining and milling production plan that was outlined in the recently disclosed positive feasibility study (see press release dated 17 January, 2013)."
The Offering was completed with both brokered and non-brokered tranches. The Units sold through the brokered tranche were sold pursuant to an agency agreement between Apogee and D&D Securities Inc. (the "Agent").
The Agent will be paid a corporate finance fee equal to 2.5% of the aggregate proceeds of the Offering payable in Units (being approximately 1,759,250 Units) plus compensation options (the "Compensation Options") equal to 2.5% of the aggregate Units subscribed for (being 1,759,250 Compensation Options). Additionally, sub-agents were paid a cash commission equal to 6% (being $96,390) plus Compensation Options equal to 3% of the aggregate proceeds received from the brokered tranche of the Offering (being 963,900 Compensation Options). Each Compensation Option entitles its holder to acquire a Unit that will be exercisable for a period of 24 months from closing at a price of $0.05 per Unit. In addition, the Company will also pay aggregate referral fees equal to $57,000 plus 570,000 Compensation Options in relation to the non-brokered tranche of the Offering.
In order to maximize the proceeds of the Offering, the Company has also entered into agreements dated April 4, 2013 with certain service providers (the "Service Providers") of the Company to settle debts owed by the Company to the Service Providers through the issuance of Units, rather than cash payments. Subject to the receipt of approval from the TSXV, the Company proposes to issue an aggregate of 3,720,000 Units to the Service Providers, in lieu of the $186,000 that is owing.
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