CALGARY, AB, May 29, 2024 /CNW/ - Fiddlehead Resources Corp. ("Fiddlehead" or the "Company") is pleased to announce that Company along with a wholly owned subsidiary of Fiddlehead ("FinanceCo"), together the ("Parties"), have entered into a definitive agreement dated May 29, 2024 (the "Definitive Agreement") pursuant to the acquisition ("Acquisition") of South Ferrier, Strachan area assets ("Assets") from a senior Canadian producer.
In addition, Fiddlehead has entered into an agreement with Research Capital Corporation to act as the lead underwriter and sole bookrunner (the "Underwriter"), in connection with a marketed underwritten, private placement offering of subscription receipts of FinanceCo (the "Subscription Receipts") at a price of $0.20 per Subscription Receipt for minimum aggregate gross proceeds of $10,000,000 (the "Offering"). It is expected that the management and directors of the Company will be participating alongside investors in the Offering, in conjunction with a "presidents list", for an aggregate minimum of $4,000,000.
Each Subscription Receipt will entitle the holder thereof, without payment of any additional consideration and without further action on the part of the holder, upon the satisfaction of the Escrow Release Conditions (as defined herein) to receive one unit of the Company ("Unit"). Each Unit will consist of one common share of FinanceCo ("Underlying Share") and one common share purchase warrant of FinanceCo ("Underlying Warrant"). Each Underlying Warrant entitles the holder thereof to purchase one common share of FinanceCo (a "Warrant Share") at an exercise price of $0.24 per Warrant Share at any time up to 60 months following the satisfaction or waiver of the Escrow Release Conditions. The Units, Underlying Shares, Underlying Warrants and Warrant Shares are collectively referred to herein as the "Underlying Securities". In addition, the Company will use commercial reasonable efforts to obtain the necessary approvals to list the Underlying Warrants that will be exchanged for warrants of Fiddlehead ("Fiddlehead Warrants") on equivalent terms on the TSX Venture Exchange ("TSXV").
The total consideration for the Assets will be $22,500,000 in cash, subject to customary adjustments (the "Purchase Price"). The Purchase Price is expected to be satisfied through a combination of: (i) the net proceeds of the Offering; and (ii) a $15,000,000 credit facility ("Credit Facility"). The Company has entered into a term sheet for the Credit Facility with a private lender.
Full details, including acquisition highlights, can be found within the press release available through Newswire https://www.newswire.ca/news-releases/fiddlehead-announces-transformational-acquisition-of-producing-south-ferrier-strachan-assets-25-million-in-financings-and-public-listing-of-its-securities-808826099.html
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