Northern Lights Raises Up to US$2 Million to Expand Exploration at Secret Pass
Rhea-AI Summary
Northern Lights Resources Corp. has entered a financing agreement with Precious Metals Capital Group to raise up to US$2 million (approx. C$2.43 million) through unsecured zero-coupon convertible securities. This funding will support exploration at the Secret Pass Gold Project in Arizona and the Medicine Springs silver project in Nevada. The Investor will purchase an initial US$890,000 Convertible Security at US$800,000, convertible at C$0.06 per share. Proceeds will also be utilized for general working capital.
Positive
- Secured funding of up to US$2 million to enhance exploration efforts.
- First funding agreement of a Canadian-based company by Precious Metals Capital Group.
- Opportunity to expand exploration at two significant projects: Secret Pass and Medicine Springs.
Negative
- Dependence on the Investor's conditions to finalize the funding.
- Potential dilution of shares due to the conversion of securities at a predetermined price.
News Market Reaction – NLRCF
In the trading session that priced this news, NLRCF gained 15.14%, reflecting a significant positive market reaction.
Data tracked by StockTitan Argus on the day of publication.
AI-generated analysis. How Rhea-AI works. Not financial advice.
VANCOUVER, BC / ACCESSWIRE / May 28, 2021 / Northern Lights Resources Corp. ("Northern Lights" or the "Company") (CSE:NLR)(OTCQB:NLRCF) is pleased to announce that it has entered into a financing agreement (the "Agreement") with Precious Metals Capital Group, LLC ("Investor"), a U.S.-based institutional investor, in connection with an issuance by the Company of unsecured zero-coupon non-redeemable convertible securities (each, a "Convertible Security") to raise aggregate gross proceeds of up to US
Northern Lights, CEO, Jason Bahnsen commented "We are extremely pleased to complete this funding agreement with Precious Metals Capital Group. This transaction represents the first funding of a Canadian based company by Precious Metals Capital Group and provides Northern Lights with funding to expand the Company's current 2021 exploration program at our
At the initial closing of the Transaction, the Investor will (subject to satisfaction of certain conditions) purchase a Convertible Security from the Company with a principal amount of US
Each Convertible Security will have a term of 24 months, a zero coupon or interest rate, and a mandatory
In the event that the prevailing Share price, as determined below, at the time a conversion is greater than the Conversion Price, the Company may elect to reduce the number of Shares issuable in that conversion by utilising the prevailing (and more beneficial to the Company) Share price as the conversion price instead of the Conversion Price. The "prevailing Share price" will be determined by the Investor as
Alternatively, in the event that the prevailing Share price is less than the Conversion Price, the conversion will occur at the Conversion Price, and the Company will pay the Investor an amount equal to the value of Shares foregone as a result of the conversion price being the Conversion Price rather than the prevailing Share price. The Company may elect to make this payment in Shares in lieu of cash, in its sole discretion. The Company will have a cash repayment right in relation to any conversion so that, instead of issuing conversion shares, the Company may, at its option, make a payment to the Investor equal to the number of Shares that would have otherwise been issued in the conversion multiplied by the greater of the Conversion Price, the prevailing Share price, and the market value of the Shares at that time.
The Investor has agreed to certain, substantial, limitations on its ability to dispose of the Shares following a conversion of the Convertible Securities. The Investor is also contractually precluded from shorting the Shares.
The Company will make an initial issuance of 1.8 million conversion Shares to the Investor at the time of the initial closing, towards the ultimate number of Shares to be issued in the conversion of the Convertible Securities. Alternatively, in lieu of applying these Shares towards the aggregate number of the conversion Shares to be issued by the Company, the Investor may make a further payment to the Company equal to the value of these Shares determined using the prevailing Share price, as determined above, at the time of the payment.
The Company will issue 3,122,743 Shares to the Investor in satisfaction of a fee. In addition, the Company will issue 2.8 million warrants with an exercise period of 48 months from the date of issue (the "Warrants") to the Investor entitling the Investor (or any subsequent holder of the Warrants) to subscribe for one Share per Warrant at the exercise price equal to C
Proceeds from the Transaction will be used for funding exploration activities on the Company's projects and for general working capital purposes.
For further information, please contact:
Albert Timcke, Executive Chairman and President
Email: rtimcke@northernlightsresources.com
Tel: +1 604 608 6163
Jason Bahnsen, Chief Executive Officer
Email: Jason@northernlightsresources.com
Tel: +1 604 608 6163
Shawn Balaghi, Investor Relations
Email: shawn@northernlightsresources.com
Tel: +1 604 773 0242
About Northern Lights Resources Corp.
Northern Lights Resources Corp is a growth-oriented exploration and development company that is advancing two projects: The
Northern Lights Resources trades under the ticker of "NLR" on the CSE. This and other Northern Lights Resources news releases can be viewed at www.sedar.com and www.northernlightsresources.com.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION: This news release includes certain "forward-looking statements" under applicable Canadian securities legislation. Forward-looking statements include, but are not limited to, statements with respect to: the terms and conditions of the proposed private placement; use of funds; the business and operations of the Company after the proposed closing of the Offering. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking statements. Such factors include, but are not limited to: general business, economic, competitive, political and social uncertainties; delay or failure to receive board, shareholder or regulatory approvals; and the uncertainties surrounding the mineral exploration industry. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward looking statements. The Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
SOURCE: Northern Lights Resources Corp.
View source version on accesswire.com:
https://www.accesswire.com/649544/Northern-Lights-Raises-Up-to-US2-Million-to-Expand-Exploration-at-Secret-Pass