Absolutely the Right Move
Inca One to roll back shares one for five, raise $4M
2016-07-08 08:48 ET - News Release
Mr. Edward Kelly reports
INCA ONE GOLD CORP. ANNOUNCES EQUITY FINANCING AND PROPOSED SHARE CONSOLIDATION
Inca One Gold Corp. is undertaking a non-brokered private placement for gross proceeds of up to $4-million. Concurrent with the private placement, the company will also conduct a one-for-five share consolidation of its common shares.
Financing
Inca One will undertake, on a postconsolidation basis, a non-brokered private placement of up to 16 million units of the company at a subscription price of 25 cents per unit for gross proceeds of up to $4-million. Each unit will comprise one common share and one-half of a transferable common share purchase warrant. Each whole warrant will be exercisable to purchase an additional common share of the company at a postconsolidation exercise price of 40 cents for a period of 36 months from the closing date. The private placement will feature an acceleration clause that will trigger the exercise of the warrants in the event the closing price of company's common shares on the TSX Venture Exchange is higher than 60 cents postconsolidation for a period of 15 consecutive trading days.
The proceeds from the offering will be used for purchases of mineral, inventory supplies and materials, select debt repayments, and general working capital requirements. All securities issued in connection with the private placement will be subject to a statutory hold period of four months plus a day from the placement closing date in accordance with applicable securities legislation.
In connection with the offering, the company may pay a finder's fee to eligible finders up to 8 per cent cash and 8 per cent warrants of the gross proceeds received, as applicable. Closing of the private placement is subject to the execution of definitive transaction documents and the approval of the TSX Venture Exchange. The company will no longer be pursuing the convertible debenture offering announced on April 19, 2016.
Debt restructuring and settlement
As a condition of the private placement, the company will be finalizing the debt restructuring and settlement agreements as previously announced in the press release dated April 19, 2016. Certain amendments to the settlement terms will be enacted to reflect select adjustments to the capital structure arising from the private placement and consolidation.
Share consolidation
In connection with the private placement, Inca One has received board approval for the consolidation of its issued and outstanding common shares on the basis of one postconsolidation share for every five preconsolidation shares. The consolidation is subject to the approval of the TSX-V.