Reconnaissance Energy Africa Ltd has announced that it has completed its previously announced overnight marketed offering of units of the Company for gross proceeds of US$7,475,000 (about N$136 million) including the full exercise of the over-allotment option in the amount of US$975,000.
The Offering was completed by way of a short form prospectus filed in all of the provinces of Canada, except Québec, and the Units were sold outside of Canada on a private placement basis.
Pursuant to the Offering, a total of 6,795,454 Units were sold at a price of US$1.10 per Unit. Each Unit consists of one common share in the capital of the Company and one common share purchase warrant of the Company. Each Warrant entitles the holder to acquire one Common Share at a price of US$1.35 until July 18, 2025.
The Offering was made through Canaccord Genuity Corp. and Haywood Securities Inc. The Underwriters received a cash commission equal to 6.0% of the gross proceeds of the Offering (other than from the sale of Units to purchasers on the president’s list, for which a 3.0% cash commission was paid). In addition, the Underwriters were issued an aggregate of 295,227 compensation options, equal to 6.0% of the number of Units sold under the Offering (other than with respect to those sold to purchasers on the president’s list, for which no Compensation Options were issued).
Each Compensation Option entitles the holder to acquire one Unit at a price of US$1.10 until July 18, 2025. As additional compensation, the Underwriters received cash equal to 1.0% of the gross proceeds of the Offering (other than from the sale of Units to purchasers on the president’s list, for which 0.5% cash was paid) as a corporate finance fee.
The net proceeds from the Offering will be used for site preparation of a future drilling location, wellsite and rig maintenance, in addition to other geologic and subsurface projects, geophysical processing and working capital as outlined in the Company’s final short form prospectus dated July 12, 2023.
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