Lion One Metals (LIO.V) shares rose 4% on Friday after it said it intends to complete a non-brokered private placement offering of up to 14,000 convertible debenture units at $1,000 per debenture unit for up to $14 million.
The offering is expected to involve Concept Capital Management, an arm's-length shareholder of the company, as lead subscriber and will include other existing shareholders of the company, it said. Closing of the offering may occur in one or more tranches and is expected to occur on or about June 30.
Each debenture unit will consist of one 10% subordinated secured convertible debenture having a face value of $1,000, convertible into 7,692 common shares at a conversion price of $0.13 per common share, with a maturity date of 4 years from issuance, and 7,692 common share purchase warrants, each entitling the holder to buy a common share for $0.175 apiece for a four-year period from issuance. Interest on the convertible debentures will accrue starting on the issuance date at a rate of 10% per annum and shall be payable annually in arrears.
The company also intends to proceed with a non-brokered private placement of up to 23.1-million units at $0.13 apiece for $3 million. Each unit consists of one common share and one common share purchase warrant, each such warrant exercisable at $0.175 per common share and expiring three-years from the date of issue.
The private placement may occur in one or more tranches and is expected to complete concurrently with the offering on or about June 30. Proceeds of the offering and the private placement will be used to satisfy upcoming payment obligations under the facility and cure its ongoing working capital covenant default under the facility.
Additional proceeds will be used for general corporate and working capital needs.
Shares of the company were last seen up $0.005 at $0.125 on the TSX Venture Exchange.
Price: $0.13, Change: $+0.01, Percent Change: +4.17%