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TORONTO, Sept. 9, 2016 /CNW/ - Royal Nickel Corporation ("RNC") (TSX: RNX) is pleased to announce that it has entered into an agreement with Haywood Securities Inc., as lead underwriter on behalf of a syndicate of underwriters (collectively, the "Underwriters"), under which the Underwriters have agreed to purchase, on a bought deal private placement basis, 17,648,000 units (the "Units") of RNC, at a price of $0.34 per Unit (the "Issue Price") for gross proceeds of $6,000,320 (the "Private Placement"). Each Unit will consist of one common share (a "Common Share") and one-half of one common share purchase warrant (each whole common share purchase warrant, a "Warrant"). Each Warrant will entitle the holder thereof to purchase one additional common share (a "Warrant Share") at an exercise price of $0.50 per Warrant Share for a period of 24 months from the date of closing of the Private Placement. RNC has granted the Underwriters an option to purchase up to an additional 2,647,200 Units at the Issue Price, exercisable at any time, in whole or in part, until 48 hours prior to the closing of the Private Placement.
The net proceeds of the Private Placement will be used for continued ramp up and development of RNC's Beta Hunt Mine, as well as for working capital and general corporate purposes.
RNC is pleased to announce that it has been informed that Eric Sprott (or his designate) has agreed to purchase (i) Units in the Private Placement and, (ii) as part of a separate transaction facilitated by the Underwriters (involving secondary market sales of approximately 15 million shares to institutional and high net worth investors), secondary market shares, resulting in ownership of at least 10% of the outstanding shares of RNC on a partially diluted basis.
Mark Selby, President & CEO of RNC, commented, "Mr. Sprott is a highly respected and well known leader in the resource investment community and one of the world's premiere gold and silver investors. RNC is very pleased to have Mr. Sprott as a large shareholder of the Company and appreciates his support as RNC ramps up gold production and unlocks the gold exploration potential at Beta Hunt."
The Units issued shall be subject to a four-month hold period from the closing date in accordance with applicable securities legislation. Closing of the Private Placement and sale of secondary shares via the off-market transaction is expected to occur on or about September 23, 2016. Closing of the Private Placement is subject to receipt of customary regulatory approvals, including approval of the TSX.
The securities offered have not been registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.
RNC is a multi-asset mineral resource company focused primarily on the acquisition, exploration, evaluation and development of precious metal and base metal properties. RNC's principal assets are the producing Beta Hunt gold and nickel mine in Western Australia, the Dumont Nickel Project located in the established Abitibi mining camp in Quebec and a 30% stake in the producing Reed copper-gold mine in the Flin Flon-Snow Lake region of Manitoba, Canada. RNC also owns a majority interest in the West Raglan and Qiqavik projects in Northern Quebec. RNC has a strong management team and Board with over 100 years of mining experience at Inco and Falconbridge. RNC's common shares trade on the TSX under the symbol RNX. RNC shares also trade on the OTCQX market under the symbol RNKLF.
Cautionary Statement Concerning Forward-Looking Statements
This news release contains "forward-looking information" including without limitation statements relating to the completion of the Offering.
Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of RNC to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Factors that could affect the outcome include, among others: failure of the parties to sign definitive agreements and satisfy conditions of closing; future prices and the supply of metals; the results of drilling; inability to raise the money necessary to incur the expenditures required to retain and advance the properties; environmental liabilities (known and unknown); general business, economic, competitive, political and social uncertainties; accidents, labour disputes and other risks of the mining industry; political instability, terrorism, insurrection or war; or delays in obtaining governmental approvals, projected cash costs, failure to obtain regulatory or shareholder approvals. For a more detailed discussion of such risks and other factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements, refer to RNC's filings with Canadian securities regulators available on SEDAR at www.sedar.com.
Although RNC has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results to differ from those anticipated, estimated or intended. Forward-looking statements contained herein are made as of the date of this news release and RNC disclaims any obligation to update any forward-looking statements, whether as a result of new information, future events or results or otherwise, except as required by applicable securities laws.
SOURCE Royal Nickel Corporation