en.Wedoany.com Reported - ValOre Metals has initiated a non-brokered private placement, issuing convertible unsecured debentures with a target maximum fundraising of C$2 million. The proceeds will be primarily directed towards exploration at the company's Pedra Branca platinum group elements (PGE) project in northeastern Brazil, while also covering potential acquisition evaluations in Brazil and general corporate working capital needs.
ValOre Metals is a Canadian mineral exploration company listed on the TSX Venture Exchange. The company focuses on identifying projects with significant prior investment and the potential for large-scale, high-grade mineralization, aiming to create value through exploration and innovation. ValOre is a member of the Discovery Group. Its flagship asset, the Pedra Branca PGE project in northeastern Brazil, consists of 45 exploration licenses covering a total area of 51,096 hectares.
The debentures issued under this offering carry an annual interest rate of 6% and have a term of 18 months. No intermediary fees or commissions are involved in the issuance. All transactions are subject to necessary regulatory approvals, including that of the TSXV, and the securities issued will be subject to a four-month hold period from the date of issuance under Canadian securities laws.
The principal amount of each debenture is convertible into units of the company at a price of C$0.12 per share, with this conversion right exercisable six months after issuance and prior to maturity. Each conversion unit consists of one common share and one-half of a transferable common share purchase warrant, with each whole warrant entitling the holder to acquire one additional common share at a price of C$0.15 for a period of 36 months, with the exercise price being fixed.
The conversion price is subject to a one-way adjustment mechanism: if the company completes a "significant financing" within six months of the debenture issuance, with gross proceeds of no less than C$5 million at a fixed per-share issue price that is higher than C$0.12, the debentures will automatically convert at that higher price, with C$0.12 serving as the floor price. If no such financing occurs within six months, the conversion price is locked at C$0.12.
ValOre plans to use the net proceeds from this financing for three purposes: advancing exploration at the Pedra Branca PGE project, evaluating potential acquisition targets in Brazil, and supplementing general working capital and corporate overhead. Exploration expenditures are designated as the primary use of funds.
An officer and director of the company intends to act as the sole subscriber for this offering. This participation will constitute a related party transaction, subject to TSXV Policy 5.9 and MI 61-101. ValOre plans to rely on exemptions from the formal valuation and minority shareholder approval requirements under Sections 5.5(a) and 5.7(1)(a) of MI 61-101, on the basis that neither the fair market value of the debentures to be issued to the insider, nor the market value of the consideration paid for such debentures, exceeds 25% of the company's market capitalization. The insider plans to sell common shares on the open market through cross-trades at market price prior to the closing of the transaction to fund part or all of the subscription. This participation will not result in a new control person.
Upon receiving TSXV approval, the company plans to deploy the net proceeds as planned into project exploration, acquisition evaluations, and working capital.
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