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VANCOUVER, BC / ACCESSWIRE / June 6, 2024 / Arras Minerals Corp. (TSXV:ARK) ("Arras" or the "Company") is pleased to announce that further to its news release dated May 29, 2024, it has closed its previously announced non-brokered private placement (the "Offering") for an aggregate of 20,268,662 units of the Company ("Units") at a price per Unit of C$0.26 for aggregate gross proceeds of approximately C$5.3 million. Pursuant to the Offering, Teck Resources Limited ("Teck") acquired 1,141,000 Units and, following closing, holds approximately 9.3% of the issued and outstanding common shares of the Company (on a partially diluted basis) ("Common Shares").
Darren Klinck, President of Arras, commented, "We are very pleased to close this upsized financing and wish to acknowledge and express appreciation for the strong endorsement our shareholders, including Teck, have shown in supporting the next exploration phase for Arras in Kazakhstan. Our third summer field program is well-underway and we look forward to having steady news flow over the coming months from the more than 3,300 sq km land package we have assembled in northeastern Kazakhstan. During 2024, we expect to be drill-testing targets at Elemes, Tay as well as on projects within the Arras-Teck Strategic Exploration Alliance. As an early-mover into Kazakhstan approximately three years ago, Arras is well-positioned to continue to rapidly evaluate, advance and test copper-gold targets across the third largest land package assembled for copper exploration in the country."
Each Unit is comprised of one (1) Common Share and one-half of one (1/2) non-transferable Common Share purchase warrant (each whole warrant, a "Warrant"). Each whole Warrant entitles the holder thereof to purchase one (1) additional Common Share at a price of C$0.40 for a period of (3) years from the closing of the Offering (the "Expiry Date").
In the event the volume weighted average trading price of the Common Shares on the TSX Venture Exchange (the "TSXV") meets or exceeds C$0.60 for fifteen (15) consecutive trading days at any time after four months and one day following closing of the Offering, the Company shall have the option, but not the obligation, at any time thereafter to accelerate the Expiry Date to a date that is thirty (30) days following the date of issuance of a news release by the Company announcing the acceleration of the Expiry Date.
The securities issued pursuant to the Offering are subject to a four-month hold period in Canada are subject to U.S. resale restrictions under U.S. securities laws as applicable. Finders fees were paid on a portion of the Offering.
Certain insiders have participated in the Offering and thus a portion of the Offering constitutes a "related party transaction" within the meaning of Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61-101"). Pursuant to sections 5.5(a) and 5.7(1)(a) of MI 61-101, the Company is exempt from obtaining a formal valuation and minority approval of the Company's shareholders as the fair market value of the insider participation is below 25% of the Company's market capitalization as determined in accordance with MI 61-101.
The net proceeds of the Offering will be used to advance exploration activities at the Company's projects in northeastern Kazakhstan and for general corporate purposes.
Qualified Person: The scientific and technical disclosure for this news release has been prepared under supervision of and approved by Matthew Booth, Vice President of Exploration, of Arras Minerals Corp., a Qualified Person for the purposes of NI 43-101. Mr. Booth has over 19 years of mineral exploration experience and is a Qualified Person member of the American Institute of Professional Geologists (CPG 12044).
About Arras Minerals Corp. Arras is a Canadian exploration and development company advancing a portfolio of copper and gold assets in northeastern Kazakhstan, including the Option Agreement on the Beskauga copper and gold project. The Company has established the third-largest license package in the country prospective for copper and gold (behind Rio Tinto and Fortescue). In December 2023, the Company entered into a strategic alliance with Teck Resources Limited ("Teck") in which Teck will sole fund a US$5 million generative exploration program over a portion of the Arras license package in 2024-2025 focusing on critical minerals. The Company's shares are listed on the TSXV under the trading symbol "ARK".
Cautionary note regarding forward-looking statements: This news release contains forward-looking statements regarding the Offering, future events and Arras' future results that are subject to the safe harbors created under the U.S. Private Securities Litigation Reform Act of 1995, the Securities Act of 1933, as amended, and the Exchange Act, and applicable Canadian securities laws. Forward-looking statements include, among others, statements regarding the Offering, the receipt of TSXV and other required regulatory and third party approvals in respect of the Offering, exercise of the Company's acceleration right in respect of the Warrants (or the satisfaction of the acceleration condition in respect thereof), use of the net proceeds of the Offering by the Company, and plans and expectations of the exploration program Arras is in the process of undertaking. These statements are based on current expectations, estimates, forecasts, and projections about Arras' exploration projects, the industry in which Arras operates and the beliefs and assumptions of Arras' management. Words such as "expects," "anticipates," "targets," "goals," "projects," "intends," "plans," "believes," "seeks," "estimates," "continues," "may," variations of such words, and similar expressions and references to futureperiods, are intended to identify such forward-looking statements. Forward-looking statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond management's control, including investor interest in the Offering and perception of the Company and its business and assets, regulatory approval of the Offering, changes to the market price for the Company's securities, changes to economic conditions, changes to metals and commodity prices, price of inputs, expected costs and timelines to achieve the Company's goals, that general business and economic conditions will not change in a materially adverse manner, financing will be available when needed on economically reasonable terms, undertaking further exploration activities, the results of such exploration activities and that such results support continued exploration activities, unexpected variations in ore grade, types and metallurgy, volatility and level of commodity prices, the availability of sufficient future financing, and other matters discussed under the caption "Risk Factors" in the Management Discussion and Analysis filed on the Company's profile on SEDAR+ on February 28, 2024 and in the Company's Annual Report on Form 20-F for the fiscal year ended October 31, 2023 filed with the U.S. Securities and Exchange Commission on February 28, 2024 and available at www.sec.gov. Readers are cautioned that forward-looking statements are not guarantees of future performance and that actual results or developments may differ materially from those expressed or implied in the forward-looking statements. Any forward-looking statement made by the Company in this news release is based only on information currently available and speaks only as of the date on which it is made. The Company undertakes no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments, or otherwise.
Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accept responsibility for the adequacy or accuracy of this news release.
