West Kirkland Mining (WKM-V) closes $5.6-million private placement
Jan 7th, 2013 - News Release
West Kirkland Mining Inc. has closed a brokered, best-efforts private placement initially announced on Jan. 18, 2013, and updated on Jan. 24, 2013, and Jan. 31, 2013, with Cormark Securities Inc. and PI Financial Corp. as co-leads. The company completed the sale of all 22.4 million units of the company at a price of 25 cents per unit for gross proceeds of $5.6-million.
Each unit consists of one common share in the capital of the company and one share purchase warrant. Each warrant will entitle the holder to acquire one common share at a price of 40 cents for a period of one year following the closing date.
All securities issued pursuant to the offering will be subject to a four-month hold period.
As consideration for their services, the brokers have received a cash commission of $392,000, representing 7 per cent of the gross proceeds of the offering.
The net proceeds of the offering will be used for exploration activities on the company's properties and for general corporate purposes.
As announced in the company's Jan. 31, 2013, news release, certain private investment funds managed by Wexford Capital LP subscribed for 11,325,000 units in the offering, which has increased Wexford's aggregate holdings in the company to 11,918,100 common shares (which comprises 19.8 per cent of the issued and outstanding common shares of the company) and 11,325,000 share purchase warrants (which warrants formed part of Wexford's units). As the full exercise of the warrants would increase Wexford's holdings of common shares in the company to 32.5 per cent on a partially diluted basis, Wexford will be restricted, under the policies of the TSX Venture Exchange, from exercising any warrants that would result in Wexford's holdings of common shares in the company exceeding 19.9 per cent without the company having obtained shareholder approval for such exercise. The company is to seek shareholder approval of the exercise of such warrants at the next annual general meeting of the company.
Additionally, as announced in the company's Jan. 31, 2013, news release, Newmont Canada Holdings ULC, a subsidiary of Newmont Mining Corp., has subscribed for a total of two million units under the offering. Newmont Canada is a related party of the company (as such term is defined under Multilateral Instrument 61-101 -- Protection of Minority Security Holders in Special Transactions) as Newmont Canada prior to closing held securities of the company representing approximately 13 per cent of the company's issued and outstanding common shares on a partially diluted basis. Newmont Canada now holds approximately 14 per cent of the issued and outstanding common shares of the company on a partially diluted basis.
Finally, as announced in the company's Jan. 31, 2013, news release, R. Michael Jones, director, president and chief executive officer of the company, has subscribed for 300,000 units; Frank Hallam, director, chief financial officer and corporate secretary of the company, has subscribed for 60,000 units; and Michael G. Allen, vice-president of exploration of the company, has subscribed for 20,000 units under the offering. With respect to the Newmont subscription, and the management and director subscriptions, the company has relied upon the exemptions from the formal valuation and minority shareholder approval requirements of MI 61-101 contained in sections 5.5(a) and 5.7(1)(a) of MI 61-101 in respect of the related party transaction based on the fact that the fair market value of the related party participation in the offering will not exceed 25 per cent of the company's market capitalization prior to the closing of the offering.
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