/NOT FOR DISTRIBUTION TO UNITED STATES NEWS WIRE SERVICES OR FOR
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TORONTO, Nov. 23,
2023 /CNW/ - Spitfyre Capital Inc. (the
"Corporation" or "Spitfyre") (TSXV: FYRE.P) is
pleased to announce the closing of its upsized brokered private
placement financing (the "Private Placement") with NeoTerrex
Corporation ("NeoTerrex"). The Private Placement was led by
iA Capital Markets, a division of iA Private Wealth Inc. (the
"Lead Agent") and Canaccord Genuity Corp. (together with the
Lead Agent, the "Agents").
The Private Placement was completed pursuant to an agency
agreement dated November 23, 2023
between Spitfyre, NeoTerrex and the Agents. Aggregate gross
proceeds for the Private Placement were $3,516,600, with 600,000 subscription receipts of
the Corporation (each, a "Spitfyre Subscription Receipt") at
$0.25 per Spitfyre Subscription
Receipt, 8,038,000 subscription receipts of NeoTerrex (each, a
"NeoTerrex Subscription Receipt") at $0.25 per NeoTerrex Subscription Receipt and
4,523,688 flow-through subscription receipts of NeoTerrex (each, a
"FT Subscription Receipt") at $0.30 per FT Subscription Receipt (together, the
"Subscription Receipts") being issued.
It is intended that the net proceeds from the Private Placement
will be used for the exploration and development of NeoTerrex's
Mount Discovery project (the "Mount Discovery Project"),
claim renewal and maintenance cost, the identification and
evaluation of future potential acquisitions of rare earth and
lithium projects, the exploration and evaluation of NeoTerrex's
other rare earth and lithium projects and general working capital
following completion of the qualifying transaction between Spitfyre
and NeoTerrex (the "Qualifying Transaction"). Upon
completion of the Qualifying Transaction, Spitfyre will be referred
to as the "Resulting Issuer".
Upon satisfaction or waiver of the escrow release conditions in
the Subscription Receipt Agreement (as defined below) (the
"Escrow Release Conditions"): (i) each NeoTerrex
Subscription Receipt will be converted and will entitle the holder
thereof to receive, without payment of any additional consideration
or further action on the part of the holder, one common share of
NeoTerrex and one-half of one warrant of NeoTerrex, which will be
automatically exchanged for one common share of the Resulting
Issuer (each, a "Resulting Issuer Share") and one-half of
one warrant of the Resulting Issuer (each, a "Resulting Issuer
Warrant"); (ii) each Spitfyre Subscription Receipt will be
converted and will entitle the holder thereof to receive, without
payment of any additional consideration or further action on the
part of the holder, one common share of Spitfyre and one-half of
one warrant of Spitfyre; and (iii) each FT Subscription Receipt
will be converted and will entitle the holder thereof to receive,
without payment of any additional consideration or further action
on the part of the holder, one NeoTerrex flow-through share which
will be subsequently automatically exchanged for one Resulting
Issuer flow-through share. Each whole Resulting Issuer Warrant will
entitle the holder thereof to acquire one Resulting Issuer Share at
a price of $0.40 until the date which
is 24 months following the satisfaction of the Escrow Release
Conditions, subject to the terms of the warrant indenture entered
into between the Corporation, NeoTerrex and Computershare Trust
Company of Canada
("Computershare"), as warrant agent, dated November 23, 2023.
The gross proceeds of the Private Placement net of the Agents'
expenses and 50% of the Agents'
commission (the "Escrowed Funds"), are being held in
escrow pursuant to the terms of a subscription receipt agreement
dated November 23, 2023 between
Spitfyre, the Agents and Computershare, as registrar and transfer
agent for the Subscription Receipts and as escrow agent for the
Escrowed Funds (the "Subscription Receipt Agreement"). Upon
satisfaction or waiver of the Escrow Release Conditions, the
Escrowed Funds together with any interest earned thereon, will be
released to the Resulting Issuer (and the Agents in respect of the
remaining Agents' commission) in accordance with the terms set out
in the Subscription Receipt Agreement. If the Escrow Release
Conditions are not satisfied or waived, the Subscription Receipts
will be cancelled without any further action and the Escrowed Funds
together with any interest earned thereon will be returned to
subscribers on a pro rata basis with any shortage of funds being
paid by NeoTerrex.
In connection with the Private Placement, NeoTerrex paid to the
Agents a cash commission, equal to 7.5% of the gross proceeds
raised pursuant to the Private Placement (reduced to 3.0% in
respect of certain purchasers on the president's list). In
addition, Spitfyre will issue to the Agents, on satisfaction of the
Escrow Release Conditions, 45,000 non-transferable compensation
options of the Corporation and NeoTerrex will issue to the Agents,
on satisfaction of the Escrow Release Conditions, 807,125
non-transferable NeoTerrex compensation options (collectively, the
"Compensation Options"). Each Compensation Option will
entitle the holder thereof to purchase one Resulting Issuer Share
following completion of the Qualifying Transaction at an exercise
price of: (i) $0.25 in respect of
Compensation Options issued pursuant to sales of NeoTerrex
Subscription Receipts and Spitfyre Subscription Receipts, and (ii)
$0.30 in respect of Compensation
Options issued pursuant to sales of FT Subscription Receipts,
subject to adjustment, for a period of 24 months commencing upon
satisfaction of the Escrow Release Conditions, respectively.
Closing of the Private Placement is subject to certain
conditions, including but not limited to, the receipt of all
necessary approvals including acceptance by the TSX Venture
Exchange (the "Exchange"). The Spitfyre Subscription
Receipts will be subject to a statutory hold period of four months
and one day in accordance with applicable securities
legislation.
ABOUT SPITFYRE
Spitfyre is a capital pool company that has not commenced
commercial operations and has no assets other than cash. Except as
specifically contemplated in the Exchange's policies, until the
completion of the Qualifying Transaction, Spitfyre will not carry
on business, other than the identification and evaluation of
businesses or assets with a view to completing a proposed
qualifying transaction.
ABOUT NEOTERREX
NeoTerrex is a private company incorporated under the Canada
Business Corporations Act. It is currently advancing its
prospective rare earths and lithium projects located in the
province of Quebec, with most of
its activities focused on its Mount Discovery Project. NeoTerrex
owns a 100% undivided interest in certain mineral claims located in
southwestern Quebec constituting
the Mount Discovery Project. The property was acquired due to its
rare earth elements potential.
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in policies of the TSX Venture
Exchange) accepts responsibility for the adequacy or accuracy of
this release.
Forward-Looking Information Cautionary Statement
Certain statements contained in this news release constitute
forward-looking information within the meaning of Canadian
securities laws which may include, but are not limited to,
statements with respect to the Private Placement, satisfaction
of the Escrow Release Conditions, the issuance of the Compensation
Options, the expected use of proceeds, the completion of the
Qualifying Transaction and approval of the Exchange. Such
forward-looking information is often, but not always, identified by
the use of words and phrases such as "plans", "expects", "is
expected", "budget", "scheduled", "estimates", "forecasts",
"intends", "anticipates", or "believes" or variations (including
negative variations) of such words and phrases, or state that
certain actions, events or results "may", "could", "would", "might"
or "will" be taken, occur or be achieved. Various assumptions or
factors are typically applied in drawing conclusions or making the
forecasts or projections set out in forward-looking
information.
These statements are based upon assumptions that are subject to
significant risks and uncertainties. Because of these risks and
uncertainties and as a result of a variety of factors, the actual
results, expectations, achievements or performance of each of
Spitfyre and NeoTerrex may differ materially from those anticipated
and indicated by these forward looking statements. Although each of
Spitfyre and NeoTerrex believes that the expectations reflected in
forward-looking information herein are reasonable, there may be
other factors that cause actions, events or results to differ from
those anticipated, estimated or intended and they can give no
assurances that the expectations of any forward-looking information
herein will prove to be correct. Except as required by law, each of
Spitfyre and NeoTerrex disclaims any intention and assume no
obligation to update or revise any forward looking statements
herein to reflect actual results, whether as a result of new
information, future events, changes in assumptions, changes in
factors affecting such forward looking statements or otherwise.
SOURCE Spitfyre Capital Inc.
