StrikePoint Gold sets October 2 consolidation ahead of Northumberland purchase
The miner expects about 102.2 million shares outstanding after receipt conversion and aims to close the Nevada acquisition around Oct. 6.
Mara Quinlan
StrikePoint Gold Inc. CVESKP OTCMKTSSTKXF said on Tuesday that a ten-for-one consolidation of its shares, options and warrants is expected to take effect Oct. 2. Its outstanding common shares are expected to fall to about 7.24 million before conversion of acquisition financing receipts takes the count to about 102.2 million.
Trading in StrikePoint shares will remain halted on the TSX Venture Exchange pending final exchange approval and completion of its Northumberland gold project acquisition, the company said. Google Finance showed C$0.17 for CVESKP as of Aug. 18 at 1:56 p.m. EDT on the TSX Venture Exchange, before the proposed consolidation.
StrikePoint expects to close the Nevada project purchase on or about Oct. 6 and release the proceeds of a previously completed C$190 million bought deal when the required conditions are met. Its subsidiary sold 95 million subscription receipts at C$2 each in the Sept. 9 financing, with each receipt set to convert into one post-consolidation StrikePoint share.
StrikePoint also said it refiled an amended technical report on Northumberland at the TSX Venture Exchange's request. The SEDAR+ filing is titled "NI 43-101 Technical Report Northumberland Gold Project, Nevada, USA," and the company said it made no material changes.
Under the Sept. 9 financing terms, the net proceeds, after certain underwriting expenses, remain in escrow until the acquisition and other release conditions are satisfied, including corporate and regulatory approvals. If the conditions are not met by Oct. 24, or a later date set by the underwriter, the receipts are to be cancelled and holders repaid their subscription price and share of escrow income. The financing was completed on a bought deal basis with Canaccord Genuity Corp. as sole underwriter.
"With the acquisition of the Northumberland Gold Project and the release of the funds from the Financing, StrikePoint will have approximately C$90m in cash to undertake a comprehensive work program to aggressively advance the project," StrikePoint chief executive Michael G. Allen said in the Sept. 29 release.
Allen said the planned work includes resource expansion and infill, along with technical, economic and environmental studies. He described Northumberland as having been idle for more than 15 years.
Under the consolidation terms, a resulting fraction of at least half a share rounds up to one share, while a smaller fraction is cancelled. Registered holders with paper certificates will receive exchange instructions from Computershare Trust Company of Canada; holders in the direct registration system will receive new shares automatically. Beneficial holders whose shares are held through a broker do not need a transmittal letter.
StrikePoint expects the ten-for-one consolidation to take effect Oct. 2.
