Power Metallic Closes C$50 Million Private Placement Successfully
Power Metallic Announces Successful Funding Round
Power Metallic Mines Inc. (the "Company" or "Power Metallic") has recently finalized its previous offering known as the "best efforts" private placement. This strategic move has successfully garnered an impressive total of C$49,999,800. This funding will play a crucial role in enhancing the company's exploration and operational activities.
Details of the Offering
Under this private placement, Power Metallic issued a total of 14,135,000 flow-through shares (referred to as the "FT Shares") priced at C$2.83 per share, raising gross proceeds of C$40,002,050. Additionally, the company launched 6,895,000 non-flow-through common shares (collectively referred to as the "HD Shares") priced at C$1.45 each, contributing C$9,997,750 to the total.
Role of Financial Agents
BMO Capital Markets in collaboration with Hannam & Partners served as co-lead agents and joint bookrunners for the offering. As a thank-you for their expertise, Power Metallic compensated these agents with a total cash commission of C$2,499,990, which was deducted from the gross proceeds of the HD Shares sold.
Exploration Expansion Plans
Power Metallic's CEO, Terry Lynch, expressed enthusiasm about the financial boost, stating, "Raising the C$50 Million will enable us to accelerate the pace of exploration dramatically. We just added a third drill rig testing the western flank of the Lion Zone." This investment aims to expedite ongoing tests in both the Lion Zone and the Tiger Zone, located 700 metres East.
Strategic Use of Funds
The proceeds from the sale of FT Shares are planned for expenses defined under the Canadian exploration expense (CEE) tax regulations. The company ensures that these expenses qualify as "flow-through critical mineral mining expenditures," providing valuable tax credits to the investors involved.
Special Tax Benefits for Quebec Residents
For investors based in Quebec, an additional 20% deduction for tax purposes may arise from these investments, enhancing the attractiveness of the offering to local stakeholders. The structure of this tax benefit reflects Power Metallic's commitment to encouraging local investment in its mining operations.
Commitments and Responsibilities
In adherence to the agreed terms, if Power Metallic is unable to renounce CEE by the end of the year, the company is prepared to indemnify investors for additional taxes incurred due to this. This commitment highlights the company’s dedication to its shareholder's financial interests.
Post-Funding Corporate Strategy
The funds raised from selling HD Shares will be allocated toward working capital and further corporate advancements, securing Power Metallic's operational agility in the competitive mining sector.
Regulatory Compliance and Future Steps
The Offered Securities are currently under a statutory hold period until June 28, 2025, and are awaiting final acceptance from the TSX Venture Exchange (the "TSXV"). Upon receipt, this acceptance will confirm the offering's compliance with regulations.
About Power Metallic Mines Inc.
Power Metallic is a Canadian mining exploration firm passionate about transforming its High-Grade Nickel Copper PGM, Gold, and Silver Nisk project into what could become Canada’s next premier poly-metallic mine. With an expansive land position of significant strike length, Power Metallic is poised to unveil new discoveries and expand its operational footprint.
Innovation and Future Outlook
The journey of Power Metallic is underway as it continues to innovate and explore for high-grade mineral deposits. The company’s recent acquisition of the Nisk project has laid the groundwork for future success, along with a dedicated team of professionals focused on maximizing exploration outcomes.
Frequently Asked Questions
What is the purpose of the private placement funding?
The funding aims to enhance Power Metallic's exploration activities and support corporate operations.
How much did Power Metallic raise through the offering?
Power Metallic raised a total of C$49,999,800 from the private placement.
What are FT Shares and HD Shares?
FT Shares are flow-through shares used for exploration funding, while HD Shares are non-flow-through common shares intended for general corporate use.
How will the funds be utilized in exploration?
Proceeds from FT Shares will be allocated for exploration expenses compliant with Canadian tax regulations.
What’s next for Power Metallic after the offering?
With the raised capital, Power Metallic will initiate new drilling programs and enhance its exploration efforts for the Nisk project.
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