Auryn Resources Inc. (TSX:AUG) (NYSE
American:AUG) (“Auryn” or the “Company”) announces that it has
entered into an agreement dated March 13, 2018 with Cantor
Fitzgerald Canada Corporation (“
CFCC”), as
bookrunner and lead underwriter, on behalf of itself and a
syndicate of underwriters (collectively, the
“
Underwriters”) to purchase, on a bought deal
basis, 5,230,770 common shares of the Company (the “
Offered
Shares”) at the price of US$1.30 per Offered Share (the
“
Issue Price”) for aggregate gross proceeds of
approximately US$6.8 million (the
“
Offering”). In addition, the Company plans
to complete a concurrent private placement of flow-through common
shares for proceeds of up to US$1.7 million, as described below.
In addition, the Company has agreed to grant to
the Underwriters an over-allotment option (the
“Over-Allotment Option”) exercisable, in whole or
in part, in the sole discretion of the Underwriters to purchase up
to an additional 784,615 Offered Shares at the Issue Price for a
period of up to 30 days after the closing of the Offering for
potential additional gross proceeds to the Company of up to
approximately US$1.02 million. The Company has agreed to pay
the Underwriters a cash commission equal to 6% of the gross
proceeds of the Offering, including proceeds received from the
exercise of the Over-Allotment Option.
CFCC is acting as the sole book-running manager
for the Offering. The Offering will be made in the United States
through CFCC’s U.S. affiliate, Cantor Fitzgerald & Co.
The Company plans to concurrently conduct a
private placement financing involving the sale of up to 955,384
flow-through common shares of the Company (the
“Flow-Through Shares”) at a 40% premium to the
Issue Price (the “FT Share Issue Price”) for
anticipated proceeds of up to US$1.7 million. In the event the
Over-Allotment Option is exercised, up to an additional 98,077
Flow-Through Shares may be issued under the concurrent private
placement. It is anticipated that the Flow-Through Shares will be
initially purchased by certain private investors who will commit to
resell the Flow-Through Shares to Goldcorp Inc. Under the terms of
the January 2017 Investor Rights and Obligations Agreement between
Goldcorp and Auryn, Goldcorp is entitled to, among other things,
participate in any subsequent offering in order to maintain up to a
12.5% interest in the Company. The Flow-Through Shares will be
offered in Canada pursuant to available prospectus exemptions and
will be subject to a four month hold period in Canada. The
Flow-Through Shares have not been and will not be registered under
the United States Securities Act of 1933, as amended, and will not
be offered or sold in the United States. The bought deal Offering
is not conditional on the sale of the Flow-Through Shares. Except
for certain non-material Canadian tax benefits available for
investors in the Flow Through Shares, these shares are identical in
all respects to common shares.
The Offering is expected to close on or about
March 23, 2018 and is subject to certain conditions including, but
not limited to, the receipt of all necessary approvals including
the approval of the Toronto Stock Exchange and the NYSE American
stock exchange. Proceeds of the Offering are anticipated to
be used for (i) drilling and exploration at the Company’s principal
mineral projects, Committee Bay and Homestake Ridge; (ii)
continuation of exploration programs at Huilacollo and Sombrero in
Peru, (iii) general corporate purposes, and (iv) working capital
requirements.
The Offered Shares will be offered by way of a
short form prospectus in the provinces of British Columbia, Alberta
and Ontario, and will be offered in the United States pursuant to a
prospectus filed as part of a registration statement under the
Canada/U.S. multi-jurisdictional disclosure system. A registration
statement on Form F-10 relating to these securities has been filed
with the United States Securities and Exchange Commission (the
“SEC”) but has not yet become effective. The
securities may not be sold nor may offers to buy be accepted in the
United States prior to the time the registration statement becomes
effective. This news release shall not constitute an offer to sell
or the solicitation of an offer to buy nor shall there be any sale
of the Offered Shares in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of that jurisdiction. The
Offered Shares have not been approved or disapproved by any
regulatory authority, nor has any such authority passed upon by the
accuracy or adequacy of the prospectus or the registration
statement.
The preliminary short form prospectus is
available on SEDAR at www.sedar.com. The registration statement on
Form F-10, including the U.S. form of the preliminary short form
prospectus, is available on the SEC’s website at www.sec.gov.
Alternatively, a written prospectus relating to the Offering may be
obtained upon request by contacting the Company or Cantor
Fitzgerald Canada Corporation in Canada, attention: Equity Capital
Markets, 181 University Avenue, Suite 1500, Toronto, ON, M5H 3M7,
email: ecmcanada@cantor.com; or Cantor Fitzgerald & Co. in the
United States, Attention: Equity Capital Markets, 110 East 59th
Street, New York, New York, 10022, telephone: (212) 829-7122.
ON BEHALF OF THE BOARD OF DIRECTORS OF
AURYN RESOURCES INC.
“Shawn Wallace” President and CEO of Auryn Resources Inc.
For further information on Auryn Resources Inc., please contact
Ivan Bebek, Executive Chairman (778) 729-0600 or
info@aurynresources.com
About Auryn
Auryn Resources is a technically driven junior
mining exploration company focused on delivering shareholder value
through project acquisition and development. Auryn is focused on
scalable high-grade gold deposits in established mining
jurisdictions, which include the Committee Bay and Gibson MacQuoid
gold project’s located in Nunavut, the Homestake Ridge gold project
in British Columbia and a portfolio of gold projects in southern
Peru, through Corisur Peru SAC.
Forward Looking Information
This news release contains “forward-looking
information” within the meaning of applicable Canadian securities
legislation, and “forward-looking statements” within the meaning of
the United States Private Securities Litigation Reform Act of 1995
(collectively referred to as “forward-looking information”).
Forward-looking information is information that includes implied
future performance and/or forecast information including
information relating to, or associated with completion of
financings, access to capital, exploration of the Company’s
projects and improved trading liquidity. These statements include
expectations about the likelihood of completion of the Offering,
the amount of funds to be raised, the use of proceeds of the
Offering, and the ability of the Company to secure required
Canadian and US regulatory and stock exchange acceptances for the
Offering. These statements involve known and unknown risks,
uncertainties and other factors which may cause actual results,
performance or achievements of the Company to be materially
different (either positively or negatively) from any future
results, performance or achievements expressed or implied by such
forward-looking statements. Readers should refer to the risks
discussed in the Company’s Annual Information Form and MD&A for
the year ended December 31, 2016 and subsequent continuous
disclosure filings with the Canadian Securities Administrators
available at www.sedar.com and the Company’s registration statement
on Form 40-F filed with the United States Securities and Exchange
Commission and available at www.sec.gov.
Disclaimer
The Toronto Stock Exchange nor the Investment
Industry Regulatory Organization of Canada accepts responsibility
for the adequacy or accuracy of this release.