Sprott Enhances Flexibility for Accretive Growth for the Physical Silver and Physical Platinum and Palladium Trusts
June 24 2016 - 4:30PM
Sprott Asset Management LP (“Sprott” or the “Manager”), on behalf
of the Sprott Physical Silver Trust (NYSE:PSLV) (TSX:PHS.U) and the
Sprott Physical Platinum and Palladium Trust (NYSE:SPPP)
(TSX:PPT.U) (together, the “Trusts”) is pleased to announce that it
has positioned the Trusts for potential growth in a manner that is
intended to be accretive to the Trusts’ unitholders on a net asset
value per trust unit basis.
The Trusts have entered into sales agreements
with Cantor Fitzgerald & Co. (“Cantor”) whereby the Trusts may,
at their sole discretion and subject to their operating and
investment restrictions, offer and sell trust units through “at the
market offering” programs (the “ATM Programs”). The Trusts
intend to use the proceeds from any sales to acquire physical
bullion in accordance with the Trusts’ objectives and subject to
the Trusts’ investment and operating restrictions. Under the
trust agreements governing the Trusts, the net proceeds from the
sale of any trust units pursuant to the ATM Programs must be not
less than 100% of the most recently calculated net asset value per
trust unit prior to, or upon, determination of pricing of any sales
(the “Accretion Condition”). Given this Accretion Condition,
the Trusts expect that any sales pursuant to the ATM Programs will
be accretive to the Trusts’ unitholders on a net asset value per
trust unit basis and will increase the physical bullion
attributable to each trust unit. In addition, Sprott believes
that the Trusts may realize other secondary benefits from any sales
made pursuant to the ATM Programs including enhancing the trading
liquidity of the Trusts and decreasing the Trusts’ operating
expenses on a per unit basis.
James Fox, President of Sprott, commented, “We
are pleased to enter into these agreements with Cantor which are
consistent with other recent growth initiatives undertaken by
Sprott. We believe that the ATM programs can provide a number
of tangible and intangible benefits to our unitholders, including
providing the potential for increased liquidity and lower fixed
cost per unit as well as the potential for increased exposure to
institutional clients.”
Sales of trust units, if any, pursuant to the
ATM Programs would be made in transactions on the NYSE Arca or
other existing trading markets that are deemed to be “at the market
offerings” pursuant to Rule 415(a)(4) of the Securities Act of
1933, as amended (the “Securities Act”). Registration
statements on Form F-10 (Sprott Physical Silver Trust: File No.
333-212156, Sprott Physical Platinum and Palladium Trust: File No.
333-211504) relating to the securities being offered by each Trust
have become effective under the Securities Act. For each Trust, the
offering is being made by means of a prospectus supplement to the
prospectus contained in the registration statement and such
prospectus, which has been filed by each Trust with the U.S.
Securities and Exchange Commission. Copies of the prospectuses and
prospectus supplements relating to each Trust’s offerings may be
obtained from the offices of Cantor at Cantor Fitzgerald & Co.,
Attention: Equity Capital Markets, 110 East 59th Street, New York,
New York, 10022, telephone: 212-829-7122 or by email at
CFControlledEquityOffering@cantor.com.
No trust units will be sold on the TSX or on
other trading markets in Canada as at the market distributions or
otherwise.
This press release does not constitute an offer
to sell or the solicitation of an offer to buy securities and shall
not constitute an offer, solicitation or sale in any jurisdiction
in which such offer, solicitation or sale is unlawful.
Forward-Looking Statements
This document includes certain statements that
constitute “forward-looking statements” and “forward-looking
information” within the meaning of applicable securities laws
(collectively, “forward-looking statements”). These statements
include statements regarding each of the Trust’s or the Manager’s
intent, including with respect to the use of the net proceeds of
the ATM Programs. Such statements are typically identified by words
such as “believe”, “anticipate”, “estimate”, “project”, “intend”,
“expect”, “may”, “will”, “plan”, “should”, “would”, “contemplate”,
“possible”, “attempts”, “seeks” and similar expressions.
Forward-looking statements may relate to each Trust’s future
outlook and anticipated events or results.
By their very nature, forward-looking statements
involve numerous assumptions, inherent risks and uncertainties,
both general and specific, and the risk that predictions and other
forward-looking statements will not prove to be accurate. Do not
unduly rely on forward-looking statements, as a number of important
factors, many of which are beyond the Manager’s or each Trust’s
control, could cause actual results to differ materially from the
estimates and intentions expressed in such forward-looking
statements.
Forward-looking statements speak only as of the
date those statements are made. Except as required by applicable
law, neither the Manager nor the Trusts assume any obligation to
update, or to publicly announce the results of any change to, any
forward-looking statement contained herein to reflect actual
results, future events or developments, changes in assumptions or
changes in other factors affecting the forward-looking
statements.
For more information:
Glen Williams
Director of Communications, Sprott Group
416-943-4394