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Sparton Resources
Sparton Announces Revision to Closing of Second
Tranche of Private Placement Offering For its Critical
Metals Exploration Programs
TORONTO, Jan. 05, 2024 (GLOBE NEWSWIRE) — Sparton Resources Inc. (TSXV-SRI) (“Sparton” or the “Company”) is pleased to announce the closing on December 29(th) , 2023, of the second tranche of the non-brokered private placement (the “Offering”) announced on December 8(th) , 2023, for gross proceeds of C$205,000, (formerly reported as $207,000).
This financing is fully closed effective December 31(st), 2023.
Sparton has issued 1,500,000 Flow-Through Share (“FTS”) Units of the Company (each, a FTS Unit”) at a price of C$0.05 per FTS Unit for proceeds of C$75,000. Each FTS Unit consists of one common share of the Company and a 1/2 (one half) non-flow through Share Purchase Warrant (“SPW”) (1,500,000 one-half (1/2) or 750,000 full SPWs). Each FTS will consist of one common share of the Company to be issued as a Critical Metals “flow-through share” within the meaning of the Income Tax Act (Canada).
Each full SPW will entitle the holder thereof to purchase one common share of the Company (each, a “Warrant Share”) at a price of C$0.08 for a period of 24 months following the effective issue date, or December 29(th), 2025.
The Company has also issued 3,250,000 Non-Flow Through Share Units (NFTSUs) at a price of $0.04 for each NFTSU for proceeds of C$130,000, (formerly reported as $132,000). Each NFTSU consists of one Common Share of the Company and one-half ( 1/2 ) SPW.
Each full SPW will entitle the holder thereof to purchase one common share of the Company (each, a “Warrant Share”) at a price of C$0.06 for a period of 24 months following the effective issue date, or December 29(th) , 2025.
The Company intends to use the proceeds of the offering for general corporate purposes and the exploration of the Company’s Critical Metals projects in Ontario and Quebec. These include the Pense -Montreuil polymetallic metals project east of Englehart, Ontario, and straddling the Ontario- Quebec border where historical work has identified zinc-copper-nickel mineralization with minor cobalt values, and little work has been done for over 20 years. The Oakes gold and related copper mineralization project near Matachewan, Ontario, has over 5 untested drill targets in close proximity to the former producing Ryan Lake copper and molybdenum mine, and the current Young Davidson gold producer. Work will consist of airborne electromagnetic surveys, follow up ground truthing of anomalies and diamond core drilling. The Oakes project has a number of untested Induced Polarization zones outlined by the Company that have never been tested and some of these are related to rock units similar to those hosting the nearby copper and molybdenum mineralization.
The gross proceeds from the issuance of the FTS will be used to incur resource exploration expenses which will constitute “Canadian exploration expenses” as defined in subsection 66.1(6) of the Income Tax Act and “flow through mining expenditures” as defined in subsection 127(9) of the Income Tax Act (the “Qualifying Expenditures”), which will be renounced with an effective date no later than December 31(st) , 2023, to the purchasers of the FTS Units in an aggregate amount not less than the gross proceeds raised from the issue of the FT Shares. If the Qualifying Expenditures are reduced by the Canada Revenue Agency, the Company will indemnify each subscriber of FTS Units for any additional taxes payable by such subscriber as a result of the Company’s failure to renounce the Qualifying Expenditures.
The closing of the Offering has received all necessary regulatory approvals including the TSX Venture Exchange.
No finder’s fees have been paid for these placements.
The FTS, NFTS shares and, Warrant Shares and any common shares of the Company that are issuable from exercising any warrants will be subject to a hold period ending on the date that is four months plus one day following the issue date of December 29(th) , 2023, in accordance with applicable securities laws.
The securities offered have not been, and will not be, registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”) or any U.S. state securities laws, and may not be offered or sold in the United States or to, or for the account or benefit of, United States persons absent registration or an applicable exemption from the registration requirements of the U.S. Securities Act and applicable U.S. state securities laws. This press release does not constitute an offer to sell or the solicitation of an offer to buy securities in the United States, nor in any other jurisdiction.
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