Aura Silver Resources Inc. announces that it is undertaking a non-brokered private placement offering to raise gross proceeds of up to $500,000. The Company has applied for, and received, conditional approval from the TSX Venture Exchange for a waiver from the five-cent minimum price requirement. Under the terms of the proposed offering, Aura Silver would issue a minimum of 6,666,667 units for gross proceeds of $100,000 and a maximum of 33,333,333 units for gross proceeds of $500,000. The units would be issued at $0.015 (1.5 cents) per unit (the “Offering”).
Each unit consists of one common share of the Company and one common share purchase warrant. Each warrant entitles the holder to purchase one common share of the Company at a price of five cents per share for a period of 36 months following the date of issuance. Any securities issued under the Offering would be subject to a statutory hold period of four months and one day from the date of issuance.
The Offering will be conducted by the Company utilizing the Existing Security Holder Prospectus Exemption under OSC Rule 45-501 Ontario Prospectus and Registration Exemptions and other provincial equivalents, except the Province of Newfoundland and Labrador, under Multilateral CSA Notice 45-313 Prospectus Exemption for Distributions to Existing Security Holders (collectively, the “Existing Security Holder Exemptions”) as well as the “accredited investor” exemption under National Instrument 45-106 Prospectus and Registration Exemptions and also other exemptions available to the Company.
The Company will make the Offering available to all shareholders of the Company as of May 21, 2015 (the “Record Date”) who are eligible to participate under the Existing Security Holder Exemptions and who have notified the Company by no later than June 19, 2015 at 5:00 pm (Eastern) of their intention to participate in the Offering. The Existing Security Holder Exemptions limit a shareholder to a maximum investment of $15,000 unless the shareholder certifies in the subscription agreement that he or she has obtained advice regarding the suitability of the investment from a registered investment dealer or otherwise qualifies to rely on another private placement exemption.
In the subscription agreement, shareholders will be required to certify the number of common shares of the Company held as of the record date and the total number of units they wish to subscribe for at the specified price of 1.5 cents per unit. Each existing shareholder on the record date will be entitled to purchase that number of units equal to at least their pro rata share based on the common shares owned on the record date, subject to a $1,500-minimum subscription. Any additional available units will be allocated by the Company based on subscriptions received and units available. Orders will be processed by the Company on a first come, first served basis such that it is possible that a subscription received from a shareholder may not be accepted by the Company if the Offering is over subscribed. Any person who becomes a shareholder of the Company after the Record Date shall not be entitled to participate in the Offering under the Existing Security Holders Exemptions.
It is anticipated that officers and directors of the Company will participate in the Offering.
The aggregate proceeds raised under the Offering will be used for working capital purposes and for further exploration work on the Company’s East Taviche, Mexico property. Specifically, of the first $100,000 raised, which would primarily be used for working capital for the next six months, no more than 25 percent would be paid by way of fees or salary to Company management. No other payments would be made to related parties from this amount. Any additional proceeds will be used primarily for further exploration on the Company’s East Taviche, Mexico property to fund additional exploration drilling of previously defined drill targets (see Press Release, January 29, 2015) and for additional working capital purposes. No more than 25 percent of any additional proceeds would be paid by way of fees or salary to Company management.
Aura Silver may pay commissions to finders in connection with the Offering. Any finder fees paid would be in accordance with TSX Venture Exchange policies.
The offered securities will not be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”) and may not be offered or sold within the United States or to or for the account or benefit of U.S. persons, except in certain transactions exempt from the registration requirements of the U.S. Securities Act. This press release does not constitute an offer to sell, or the solicitation of an offer to buy, securities of the Company in the United States.
Closing of the Offering is subject to receipt by Aura Silver of final acceptance from the TSX Venture Exchange.
About Aura Silver
Aura Silver is a Venture listed company engaged in the acquisition, exploration and development of precious metal prospects in Canada (100% owned Greyhound project under option to Agnico Eagle) and in Oaxaca, Mexico (73% owned East Taviche project). Aura Silver has 101,680,844 common shares outstanding.