Crosshair Exploration has entered into an engagement letter with Dundee Securities for the private placement of up to four million flow-through common shares at a price of 25 cents per share for maximum total gross proceeds of $1-million.
Dundee will receive a cash commission of 8 per cent of the total gross proceeds of the private placement. In addition, the company will issue to Dundee compensation warrants exercisable for non-flow-through shares of the company equal in number to 8 per cent of the number of shares sold under the private placement. The compensation warrants will be exercisable at a price of 25 cents per common share for a period of 12 months after the closing date.
All securities issued under the private placement will be subject to a four-month hold period from the closing date. Closing of the private placement is subject to the execution of a definitive agency agreement, satisfactory due diligence and regulatory approval. Closing of the private placement is expected to occur by May 15, 2004.
Proceeds from the financing have been allocated to the company's Newfoundland exploration properties, where drilling will commence in May on the company's Wing's Point-Titan project. The company has a full $900,000 exploration program planned for 2004 and early 2005, with approximately $500,000 earmarked for drilling on the Wing's Point-Titan, Golden Promise and Glenwood Break properties.