Gatling Exploration Inc (CVE:GTR)(OTCQB:GATGF) announced Wednesday a marketed private placement to raise up to $5 million.
In addition, prior to the completion of the offering, the company said it will complete a two for one (2:1) common share consolidation of all of its outstanding securities.
In a statement, Gatling said there are currently 62,031,340 common shares issued and outstanding. Upon completion of the consolidation, there will be about 31,015,670 shares issued and outstanding.
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The company said the offering will consist of a combination of 5,454,545 post-consolidated shares issued on a flow-through basis (FT shares) at $0.55 each and 4 million units at $0.50 apiece.
Each unit will consist of one post-consolidated common share and one-half of one transferable share purchase warrant, exercisable into one additional post-consolidated common share at $0.70 each. The warrants will be exercisable for two years from the date of issue.
In connection with the offering, the agents led by Sprott Capital Markets LP will be entitled to a cash fee in an amount equal to 6% of the gross proceeds. The company also will grant the agents common share purchase warrants entitling them to subscribe for that number of common shares equal to 6% of the aggregate number of units placed and 5% of the aggregate number of FT shares placed. Subject to regulatory approval, each broker warrant will be exercisable to acquire one common share at $0.70 each for a period of 24 months after the closing date.
The gross proceeds will be used for Canadian exploration expenses, and will qualify as "flow-through mining expenditures,” which will be renounced to the subscribers with an effective date no later than December 31, 2020.
