Eagle Hill Enters Into $30 Million Financing Arrangement With IBK Capital Corporationadmin
Wednesday, August 12th 2009
Eagle Hill Exploration Corp., a Canadian mineral exploration company focused on the exploration and development of gold and precious metal prospects announce it has entered into an arrangement with IBK Capital Corp. (“IBK Capital” or the “Agent”) through which IBK Capital will use its best efforts to secure private placements of up to $30 million by the issuance of common and flow-through shares and warrants (the “Arrangement”). These financings will be completed in separate tranches concurrent with the expenditure requirements the Company has for exploration work on the previously announced acquisition of the Windfall Lake property in Quebec, Canada (the Property”). The Property was acquired through a binding property option agreement (the “Agreement”) with Noront Resources Ltd. (“Noront”), a Toronto-based exploration company, to earn up to a 100% interest, subject to a 2% net smelter royalty.
“IBK Capital is the most logical investment banking firm to lead Eagle Hill’s financing for the Windfall Lake Property,” stated Brad Kitchen, President. “IBK Capital’s intimate knowledge of the project and its previous investors will help expedite access to the capital markets for Eagle Hill, now and for future tranches.”
The Company would also like to announce the first two equity financing tranches under this Arrangement. The Agent will use its best efforts to raise $3.0 million for Eagle Hill by way of a flow-through and common share unit private placement. This will be raised in the following allotments:
1. $1.5 million in common share units, priced at $0.10 per unit, consisting of one common share of the Company and one warrant, with each warrant being exercisable for one common share of the Company at an exercise price of $0.20 for a period of 12 months following the close of the offering; and
2. $1.5 million in flow-through units, priced at $0.15 per unit, consisting of one flow-through common share of the Company and one half of one warrant, with each whole warrant being exercisable for one non-flow-through common share of the Company at an exercise price of $0.20 for a period of 12 months following the close of the offering.
The proceeds will be used to satisfy both flow-through and non-flow-through exploration expenditures on the Property and general operating expenses. With respect to the flow-through offering, these activities will be eligible for Canadian Exploration Expenses and renounced in favour of the subscribers of the flow-through shares effective on or before December 31, 2009.
The Company will pay the Agent a cash fee equal to nine percent (9%) of the gross proceeds raised in connection with the Arrangement. IBK Capital may elect to receive its cash fee in common shares of the Company at the issue price of the units of the financing. In addition, IBK Capital will receive warrants equal to ten percent (10%) of the number of units subscribed for, exercisable over a four year period at $0.10 per share for the non-flow-through offering and $0.15 per share for the flow-through offering.
Closing of the $3.0 million financing is anticipated to occur on or before August 28, 2009, and is subject to certain conditions including, but not limited to, the receipt of all necessary approvals including the approval of the TSX Venture Exchange.