West Hawk arranges $15-million warrant offering
2006-08-14 11:25 ET - News Release
Mr. Michael Townsend reports
EST HAWK ANNOUNCES $15,000,000 PRIVATE PLACEMENT
West Hawk Development Corp. has signed an agreement with Salman Partners Inc., as lead agent, to raise up to $15-million with an oversubscription allotment for up to an additional $5-million.
The syndicate, led by Salman Partners, includes Bank Insinger de Beaufort NV of London, England. The financing will consist of a reasonable best-efforts agency offering of special warrants by way of a private placement. Each special warrant will be offered at a price of 75 cents per special warrant. Each special warrant will be exercisable into one common share of the company and will include one-half of one transferable share purchase warrant. Each whole share purchase warrant will entitle the holder to purchase one common share of the company at a price of $1 per share for a period of two years from the closing of the financing.
The special warrants, together with the shares and warrants underlying the special warrants will be subject to a four-month hold period, however the company has covenanted to use its best efforts to prepare and file a prospectus qualifying the distribution of the underlying securities by Oct. 15, 2006, failing which holders of the special warrants will be entitled to receive an additional 10 per cent of the number of shares and warrants issuable upon exercise or deemed exercise of the special warrants.
The syndicate will be afforded an opportunity, at their election, to purchase an additional 6,666,700 special warrants on the same price and terms, as an oversubscription allowance. The syndicate will have 30 days from the date of closing of the special warrant financing to exercise their oversubscription allotment. In consideration for acting as agents, members of the syndicate will receive a cash commission of 6.5 per cent of the proceeds of the offering, plus warrants to acquire a number of common shares equal to 10 per cent of the number of special warrants sold under the offering. Such warrants will entitle the holder to acquire one common share at a price of $1 for a period of two years. The offering is expected to close on or around Sept. 7, 2006.
The purpose of the financing is to enable the company to commence drilling operations on the Figure Four property, Piceance basin in Colorado, and for general working capital purposes.
In addition, the company has also granted incentive stock options to directors, officers and consultants to purchase up to a total of 425,000 common shares in the capital stock of the company, exercisable for a period of two years, at a price of 80 cents cents per share. The above is subject to TSX Venture Exchange approval.
