Sun Metals Closes First Tranche of Previously Announced Bought Deal Financing

by ahnationtalk on October 23, 201925 Views

Vancouver, B.C. – Sun Metals Corp. (TSX-V: SUNM) (the “Company” or “Sun Metals”) is pleased to announce the successful closing of the first tranche of its bought deal financing initially announced on October 7, 2019 and later on October 9, 2019 with respect to an upsize (the “Offering”). The closing of the first tranche of the Offering was led by Sprott Capital Partners LP (the “Lead Underwriter”), on behalf of a syndicate of underwriters including Cormark Securities Inc., Haywood Securities Inc. and PI Financial Corp. (the “Underwriters”).

Pursuant to the closing of the first tranche of the Offering, the Company issued a total of 9,880,000 common shares of the Company issued on a flow-through basis (the “FT Shares”) at a price of $0.25 per FT Share for gross proceeds of $2,470,000. The Company has agreed to pay the Underwriters a cash commission of $148,200 in connection with the closing of the first tranche of the Offering.

An amount equal to the gross proceeds from the issuance of the FT Shares will be used for Canadian exploration expenses that will qualify as “flow-through mining expenditures”, as defined in subsection 127(9) of the Income Tax Act (Canada) and as “BC flow-through mining expenditures”, as defined in the Income Tax Act (B.C.) (the “Qualifying Expenditures”), which will be renounced with an effective date no later than December 31, 2019 to the initial purchasers of the FT Shares (other than the Underwriters) in an aggregate amount not less than the gross proceeds raised from the issue of the FT Shares, and, if the Qualifying Expenditures are reduced by the Canada Revenue Agency, the Company will indemnify each initial purchaser (other than the Underwriters) for any additional taxes payable by such subscriber as a result of the Company’s failure to renounce the Qualifying Expenditures as agreed.

The FT Shares to be issued in connection with the closing of the first tranche of the Offering will be subject to a hold period of four months and one day from the date of issue in accordance with applicable Canadian securities laws.

The second tranche of the Offering is currently expected to close on or about October 30, 2019 (as originally proposed) or such other date or dates as the Company and the Lead Underwriter may agree.

For more information, please contact Susie Bell, Investor Relations for Sun Metals at sbell@sunmetals.ca, 604-697-4953, or Steve Robertson, President and CEO of Sun Metals, at srobertson@sunmetals.ca, 604-697-4952.

On behalf of the Board of Directors,

SUN METALS CORP.

Steve Robertson
Chief Executive Officer

NT4

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