(TheNewswire)
Calgary, Alberta – TheNewswire - June 30, 2022 – Tocvan Ventures Corp. (the“ Company ”) (CSE:TOC ) ; ( OTC:TCVNF ) ( WKN:TV3/A2PE64), is pleased to announcethe closing of a private placement to an institutional investor (the" Placement ") to raise an aggregate amount of $5.125 million (CAD).The proceeds from the Placement will be deposited with a third-partyescrow agent (the “ EscrowAgent ”) and delivered to the Corporation inmonthly tranches over the next 24 months pursuant to the terms andconditions of a Sharing Agreement (as defined below) and an escrowagreement dated June 28, 2022 between the Corporation, Sorbie BornholmLP, and Orrick, Herrington & Sutcliffe (UK)LLP (the “ Escrow Agreement ”).The funds will go towards the advancement of the Pilar and El PicachoAu-Ag projects in Sonora, Mexico and for general working capitalpurposes.
In connection with the Placement, the Company hasentered into a series of agreements with Sorbie Bornholm LP(" Sorbie "), a UK based institutional investor, to issue thefollowing securities for aggregate net consideration of $5.125 millionover the next 24 months:
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3,200,000 units of the Company (each a" Unit ") Each Unit consists of one common share in the capitalof the Company (a " Subscription Share ") at a price of $0.82per Unit and one common share purchase warrant (a " Warrant "), witheach Warrant entitling the holder to purchase an additional commonshare at an exercise price of $1.20 for a period of three years fromthe closing date; and
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2,501 Convertible Loan Notes (" Notes ") in theprincipal amount of $1,000 per Note, bearing an interest rate of 1%per annum. Each Note is convertible into 1,220 common shares for aperiod of 3 years from the date of issuance. Each Note includes detachable warrant allowing the holder toacquire up to 1,220 common shares per Note, exercisable for 3 years.Of the 1,220 warrants, 610 Warrants can be exercised at C$1.30 pershare, and 610 Warrants can be exercised at $1.40 per share.Conversion of the Notes is limited to only when shares issued combinedwith the then current holdings of the holder will not take the holderabove 9.9% ownership of the Company. The Corporation shall also beentitled to issue an additional 308 Notes to Sorbie for proceeds of$307,500 pursuant to the terms of the Sharing Agreement describedbelow.
“We are very pleased to align witha strategic investor to support us through our next phase of growthand guarantee we are funded to develop our projects for the next twoyears and beyond” , commented BrodieSutherland, CEO. “We have atrack record of performing exceptionally well with a limited budget;this agreement has us seeing the potential upside of continuing thatperformance whilst we advance our gold-silver assets inMexico.”
In order to facilitate and secure the delivery of thefunds over the next 24 months, the Company has entered into a sharingagreement dated June 28, 2022 with Sorbie (the “ Sharing Agreement ”)and the Escrow Agreement. This structure allows the Company to retainmuch of the economic interest in the Sorbie Subscription Shares andNotes. The Sharing transaction will allow the Company to secure thepotential upside on 4,659,091 of the Sorbie Subscription Sharesarising from news flow over the next 24 months. The Sharingtransaction provides that the Company's economic interest will bedetermined and payable in 24 monthly settlement tranches as measuredagainst a benchmark price of $1.10 per share. If the measured shareprice exceeds the benchmark price, for that month, the Company willreceive more than 100 per cent of the monthly settlement due. Themeasured share price is determined based on a VWAP for 20 trading daysprior to the monthly settlement. There is no upper limit placed on theadditional proceeds receivable by the Company as part of the monthlysettlements. Should the share price be below the benchmark price, theCompany will receive less than 100 per cent of the expected monthlysettlement on a pro rata basis. In no case would a decline in theCompany's share price result in any increase in the number of ordinaryshares to be issued to Sorbie or any other advantage accruing toSorbie.
The structure of this Placement is designed to providethe Company with flexibility in continuing to advance the Company'sProjects in Mexico while maintaining a constant source of fundscovering a portion of the Company's short to medium term cash flowrequirements.
Pursuant to the terms of the Sharing Agreement, theCompany will receive the funds from the Placement based on thefollowing payment schedule over the next 24 months.
Sharing Arrangement Transaction | Applicable Settlement Date (Expressed as a Number ofMonths after the Trigger Date) | Applicable Share Amount | Transfer Amount (Assuming all Applicable SettlementDates occur at earliest possible date) |
Transaction 1 | 1 month after Trigger Date | 454,545 | CAD$500,000 |
Transaction 2 | 2 months after Trigger Date | 182,806 | CAD$201,087 |
Transaction 3 | 3 months after Trigger Date | 182,806 | CAD$201,087 |
Transaction 4 | 4 months after Trigger Date | 182,806 | CAD$201,087 |
Transaction 5 | 5 months after Trigger Date | 182,806 | CAD$201,087 |
Transaction 6 | 6 months after Trigger Date | 182,806 | CAD$201,087 |
Transaction 7 | 7 months after Trigger Date | 182,806 | CAD$201,087 |
Transaction 8 | 8 months after Trigger Date | 182,806 | CAD$201,087 |
Transaction 9 | 9 months after Trigger Date | 182,806 | CAD$201,087 |
Transaction 10 | 10 months after Trigger Date | 182,806 | CAD$201,087 |
Transaction 11 | 11 months after Trigger Date | 182,806 | CAD$201,087 |
Transaction 12 | 12 months after Trigger Date | 182,806 | CAD$201,087 |
Transaction 13 | 13 months after Trigger Date | 182,806 | CAD$201,087 |
Transaction 14 | 14 months after Trigger Date | 182,806 | CAD$201,087 |
Transaction 15 | 15 months after Trigger Date | 182,806 | CAD$201,087 |
Transaction 16 | 16 months after Trigger Date | 182,806 | CAD$201,087 |
Transaction 17 | 17 months after Trigger Date | 182,806 | CAD$201,087 |
Transaction 18 | 18 months after Trigger Date | 182,806 | CAD$201,087 |
Transaction 19 | 19 months after Trigger Date | 182,806 | CAD$201,087 |
Transaction 20 | 20 months after Trigger Date | 182,806 | CAD$201,087 |
Transaction 21 | 21 months after Trigger Date | 182,806 | CAD$201,087 |
Transaction 22 | 22 months after Trigger Date | 182,806 | CAD$201,087 |
Transaction 23 | 23 months after Trigger Date | 182,806 | CAD$201,087 |
Transaction 24 | 24 months after Trigger Date | 182,804 | CAD$201,086 |
The Placement is exempt from the formal valuation andminority shareholder approval requirements of MI 61-101 as neither thefair market value of the subject matter of the Placement, nor theconsideration paid, exceed 25% of the Company's market capitalization.No additional insiders or related parties of the Company participatedin the Placement. No new insiders or control persons were created inconnection with the closing of the Placement.
The closing of the Placement, as well as the issuanceof the Units pursuant thereto, are subject to the final acceptance ofthe Canadian Securities Exchange (the " CSE ").
Management Change
As of July 1 st , the Company wishes to announce theretirement of CFO, Greg Ball. Mr. Ball will remain a Director of theCompany. Mr. Ball’s responsibilities as CFO will be transferred toMs. Yana Silina, a Chartered Professional Accountant and senior accountant at Da Costa Management Corp.
Ms. Silina has worked in the accounting fieldproviding her services mainly to venture capital companies since 2008.Ms. Silina is a Chartered Professional Accountant and holds a Diplomain Management Studies from Thompson Rivers University. Ms. Silina is asenior accountant at Da Costa Management Corp., a Company thatprovides bookkeeping and accounting services to both public andprivate companies. Ms. Silina is currently CFO and director of CellMedX Corp (OTC QB: CMXC), CFO of Stuhini Exploration Ltd. (TSX.V: STU), and a director of Kesselrun Resources Ltd.(TSX.V: KES). Ms. Silina has previously held various managementpositions with other public companies listed on OTC Link alternativetrading system and Canadian Securities Exchange.
“On behalf of the Board we wouldlike to thank Greg for his dedication to the Company since inceptionand we wish him all the best in retirement” ,commented Brodie Sutherland, CEO. “Greg has been a critical part of ourgrowth and we are fortunate to have him stay involved as a Director ofthe Company. Moving forward we are in the capable hands of Ms. Silinaas we continue to create shareholder value through the advancement ofour Mexico gold-silver projects.”
About Tocvan VenturesCorp .
Tocvan is a well-structured exploration developmentcompany. Tocvan was created in order to take advantage of theprolonged downturn the junior mining exploration sector, byidentifying and negotiating interest in opportunities where managementfeels they can build upon previous success. Tocvan has approximately33 million shares outstanding and is earning 100% into two excitingopportunities in Sonora, Mexico: the Pilar Gold-Silver project and theEl Picacho Gold-Silver project. Management feels both projectsrepresent tremendous opportunity to create shareholder value.
Cautionary Statement RegardingForward Looking Statements
This news release contains“forward-looking information” which may include, but is notlimited to, statements with respect to the activities, events ordevelopments that the Company expects or anticipates will or may occurin the future. Forward-looking information in this news releaseincludes statements regarding the use of proceeds from the Offering.Such forward-looking information is often, but not always, identifiedby 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 andphrases, or state that certain actions, events or results “may”,“could”, “would”, “might” or “will” be taken, occur orbe achieved.
These forward-looking statements,and any assumptions upon which they are based, are made in good faithand reflect our current judgment regarding the direction of ourbusiness. Management believes that these assumptions are reasonable.Forward-looking information involves known and unknown risks,uncertainties and other factors which may cause the actual results,performance or achievements of the Company to be materially differentfrom any future results, performance or achievements expressed orimplied by the forward-looking information. Such factors include,among others, risks related to the speculative nature of theCompany’s business, the Company’s formative stage of developmentand the Company’s financial position. Forward-looking statementscontained herein are made as of the date of this news release and theCompany disclaims any obligation to update any forward-lookingstatements, whether as a result of new information, future events orresults, except as may be required by applicable securities laws.There is no certainty that the full Placement will be realized.
There can be no assurance thatforward-looking information will prove to be accurate, as actualresults and future events could differ materially from thoseanticipated in such statements. Accordingly, readers should not placeundue reliance on forward-looking information.
For more information, please contact:
TOCVAN VENTURES CORP.
Brodie A. Sutherland, CEO
820-1130 West Pender St.
Vancouver, BC V6E 4A4
Telephone: 1 888 772 2452
This news release does notconstitute an offer to sell or a solicitation of an offer to sell anyof the securities in the United States. The securities have not beenand will not be registered under the United States Securities Act of1933, as amended (the "U.S. Securities Act") or any statesecurities laws and may not be offered or sold within the UnitedStates or to U.S. Persons unless registered under the U.S. SecuritiesAct and applicable state securities laws or an exemption from suchregistration is available.
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