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Sprott Resource Corp Announces Update to Equity Financing By Subsidiary Orion Oil & Gas Ltd.
Sprott Resource Corp Announces Update to Equity Financing By Subsidiary Orion Oil & Gas Ltd.
About this update from Sprott Inc.
[{"type":"text","content":"\n\n\n\nNov. 10, 2009 (Canada NewsWire Group) -- TORONTO, Nov. 10 /CNW/ -- Sprott Resource Corp. (TSX: SCP) - Sprott Resource Corp. (\"SRC\") is providing an update on the proposed capital raise by its subsidiary Orion Oil & Gas Ltd. (\"Orion\"). On October 15, 2009, SRC announced that Orion had entered into an equity financing agreement, on a best efforts basis, with a syndicate of agents co-led by Cormark Securities Inc., FirstEnergy Capital Corp. and TD Securities Inc. (collectively, the \"Agents\"), pursuant to which Orion agreed to raise $100,000,000 (the \"Offering\") from the sale of subscription receipts (\"Subscription Receipts\") at a price of $5.00 per Subscription Receipt. It was proposed that each Subscription Receipt would be exchanged for one (1) common share of Orion Oil & Gas Corporation (\"New Orion Share\"), the resulting issuer from the completion of a proposed plan of arrangement (the \"Arrangement\") between Wintraysan Capital Corp. (\"Wintraysan\"), a wholly-owned subsidiary of Wintraysan (1498513 Alberta Ltd.) and Orion. The completion of the Offering under the terms set forth above is a mutual condition for completing the Arrangement (the \"Condition\"). For further details on the Arrangement, please see the press releases issued by SRC on October 15, 2009 and November 2, 2009.SRC and Orion have been informed by the Agents that they are unable to complete the Offering under the terms set forth above. Accordingly, the Agents have recommended that the terms of the Offering be amended. SRC and Orion have agreed to amend the terms of the Offering to $4 per Subscription Receipt whereby each Subscription Receipt will entitle each Subscription Receipt holder to one New Orion Share and one-half of one New Orion Share purchase warrant exercisable for $5 for a period of two years following the closing of the Offering.If the Agents are unable to complete the Offering, or if the Arrangement is not completed for any reason, including the failure by Orion to satisfy the Condition, Orion will remain a private company, 79.3% owned by SRC, and SRC would revert to its original plan of advancing Orion as a private company through the development of its assets and accretive acquisitions both domestically and abroad.About Sprott Resource Corp.SRC is a Canadian based company, the primary purpose of which is to invest, directl...