International Tower Hill Mines Announces US$2.5 Million Non-Brokered Private Placement

Rhea-AI Summary

International Tower Hill Mines Ltd. completed a non-brokered private placement, issuing common shares to existing major shareholders to raise approximately USD $2.5 million. The Private Placement consisted of 3,807,911 common shares, representing approximately 1.9% of the 195.9 million common shares issued and outstanding prior to the completion. The Company intends to use the net proceeds for general working capital purposes. The Private Placement has received regulatory approvals, including approval of the Toronto Stock Exchange and the NYSE American. The shares issued are subject to hold periods and resale restrictions. The Private Placement was a 'related party transaction' within the meaning of Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions.

Financial Analyst

The completion of a non-brokered private placement by International Tower Hill Mines Ltd. resulting in raising $2.5 million through the issuance of 3,807,911 common shares is a strategic move for the company. The price per share at $0.664, which aligns with the closing price on NYSE American prior to the placement, suggests a fair market approach without offering a discount to the investors, which is a common practice in private placements to incentivize participation. The participation of existing major shareholders, such as Paulson & Co. Inc., Sprott Asset Management USA, Inc. and Kopernik Global Investors, LLC, indicates a continued confidence in the company's prospects, particularly in the Livengood Gold Project.

For stakeholders, the short-term implications include a slight dilution of their holdings by approximately 1.9%. However, the long-term prospects may be positive if the use of proceeds for working capital strengthens the company's position in a strong gold market. The company's focus on minimizing general and administrative expenses and leveraging the Livengood Gold Project's fundamentals could enhance its financial stability and growth potential in the gold industry.

Mining Sector Analyst

The Livengood Gold Project's mention by Karl Hanneman, the CEO, underscores its significance to International Tower Hill Mines Ltd.'s growth strategy. The project's size, fundamentals and location near Fairbanks are highlighted as key leverage points in a bullish gold market. Investors in the mining sector often seek out projects with large resources and favorable logistics, as these can lead to cost efficiencies and improved project economics.

It is also noteworthy that the private placement adhered to regulatory requirements, including the hold period for the issued shares in Canada and the U.S., which is standard to prevent immediate resale that could put downward pressure on the stock price. The transaction's classification as a 'related party transaction' under MI 61-101 and the reliance on exemptions from formal valuation and minority shareholder approval requirements could raise questions about corporate governance. However, the company's assertion that the fair market value of the shares issued does not exceed 25% of the market capitalization may mitigate concerns about potential conflicts of interest or unfair advantage to related parties.

Legal Expert

The Private Placement's compliance with Multilateral Instrument 61-101 (MI 61-101) is a crucial legal aspect of this transaction, especially considering the participation of related parties. The use of exemptions based on the transaction's value relative to the company's market capitalization is permissible under securities regulations, provided it does not disadvantage minority shareholders. The four-month hold period in Canada and the adherence to U.S. federal and state securities laws for resale restrictions are standard measures to ensure regulatory compliance and market stability.

Investors should be aware that these legal frameworks are designed to protect their interests by preventing market manipulation and ensuring transparency in transactions involving insiders. The company's disclosure about the nature of the transaction and its reliance on specific exemptions is a positive sign of its commitment to regulatory compliance and shareholder communication.

VANCOUVER, BC, Jan. 22, 2024 /PRNewswire/ - International Tower Hill Mines Ltd. (the "Company") - (TSX: ITH) (NYSE American: THM) today announced that it has completed a non-brokered private placement (the "Private Placement") pursuant to which it has issued common shares to existing major shareholders to raise gross proceeds of approximately USD $2.5 million.

The Private Placement consisted of 3,807,911 common shares of the Company, representing approximately 1.9% of the 195.9 million common shares issued and outstanding prior to the completion of the Private Placement, at a price of USD$0.664 per common share, the closing price of the Company's common shares on the NYSE American on January 12, 2024.  The Private Placement was taken up by current institutional shareholders of the Company, Paulson & Co. Inc., Sprott Asset Management USA, Inc., and Kopernik Global Investors, LLC on behalf of Heptagon plc Kopernik Global All-Cap Equity Fund. The Company intends to use the net proceeds of the Private Placement for general working capital purposes. Following completion of the Private Placement, the Company has 199,693,442 common shares issued and outstanding.

Karl Hanneman, Chief Executive Officer, said "This modest financing was completed with respect for our current shareholders to minimize dilution and reflects our low G&A expenses as we position the Livengood Gold Project to respond to a strong gold market.  We remain appreciative of our major shareholders who recognize the great leverage that the Livengood Gold Project offers in a rising gold market, given the size of the gold resource, its unique and positive fundamentals, and our land status and proximity to Fairbanks."

The Private Placement has received the required regulatory approvals including approval of the Toronto Stock Exchange and the NYSE American. All common shares issued in the Private Placement are subject to a hold period in Canada of four months and one day from the closing of the Private Placement. All common shares issued in the United States will be subject to resale restrictions under U.S. federal and state securities laws.

As certain of the institutional shareholders qualify as related parties of the Company, the Private Placement was a "related party transaction" within the meaning of Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions ("MI 61-101"). The Company is relying upon exemptions from the formal valuation and minority shareholder approval requirements of MI 61-101 on the basis that the fair market value of the shares issued to such shareholders does not exceed 25% of the Company's current market capitalization.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy any of the common shares issued in the Private Placement, nor shall there be any offer or sale of the common shares issued in the Private Placement in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction.

About International Tower Hill Mines Ltd.

International Tower Hill Mines Ltd. has a 100% interest in its Livengood Gold Project located along the paved Elliott Highway, 70 miles north of Fairbanks, Alaska.

On behalf of
International Tower Hill Mines Ltd.

(signed) Karl L. Hanneman
Chief Executive Officer

This news release is not, and is not to be construed in any way as, an offer to buy or sell securities in the United States.

View original content:https://www.prnewswire.com/news-releases/international-tower-hill-mines-announces-us2-5-million-non-brokered-private-placement-302039955.html

SOURCE International Tower Hill Mines Ltd.

FAQ

What is the purpose of the Private Placement completed by International Tower Hill Mines Ltd.?

The purpose of the Private Placement was to raise gross proceeds of approximately USD $2.5 million for general working capital purposes.

How many common shares were issued in the Private Placement?

3,807,911 common shares were issued in the Private Placement.

What percentage of the total common shares does the Private Placement represent?

The Private Placement represented approximately 1.9% of the 195.9 million common shares issued and outstanding prior to the completion.

Who are the major shareholders that participated in the Private Placement?

The major shareholders include Paulson & Co. Inc., Sprott Asset Management USA, Inc., and Kopernik Global Investors, LLC on behalf of Heptagon plc Kopernik Global All-Cap Equity Fund.

What regulatory approvals did the Private Placement receive?

The Private Placement received approval of the Toronto Stock Exchange and the NYSE American.

What are the restrictions on the common shares issued in the Private Placement?

The shares issued are subject to a hold period in Canada of four months and one day from the closing of the Private Placement, and resale restrictions under U.S. federal and state securities laws.

How is the Private Placement classified within the meaning of Multilateral Instrument 61-101?

The Private Placement was a 'related party transaction' within the meaning of Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions.

What is the total market capitalization threshold for exemptions from formal valuation and minority shareholder approval requirements?

The fair market value of the shares issued to related parties does not exceed 25% of the Company's current market capitalization, allowing exemptions from formal valuation and minority shareholder approval requirements.