Gensource Potash Corporation (TSXV: GSP) (“Gensource” or the “Company“), a fertilizer development company focused on sustainable potash production, is pleased to announce the first closing of a private placement offering of units (“Units“) of the Company at a price of $0.15 per Unit (the “Offering“). Each Unit consists of one common share in the capital stock of the Company (a “Common Share“) and one Common Share purchase warrant of the Company (a “Warrant“). Each Warrant is exercisable for one Common Share (a “Warrant Share“) at an exercise price of $0.25 per Warrant Share for a period of 18 months following the date of issuance, subject to the Call Right of the Company described below. The Company anticipates holding a second closing of the Offering in the coming days.
At the first closing of the Offering, the Company issued 9,598,500 Units for aggregate gross proceeds of $1,439,775.00. The Common Shares and Warrants comprising the Units issued pursuant to the Offering are subject to a statutory hold period of four months and a day from the date of issuance.
In the event that the Common Shares have a closing price on the TSX Venture Exchange, or other exchange on which they may be traded, at or exceeding $0.30 per Common Share for ten (10) consecutive trading days, the Company reserves the right to call the Warrants at their exercise price of $0.25 per Warrant (the “Call Right“). If the Company wishes to exercise its Call Right, the Company must provide written notice to the holders of the Warrants that it is calling the Warrants. Warrant holders will have thirty (30) days from the date of such notice to exercise the Warrants and, in the event that any Warrants are not exercised, such Warrants shall be cancelled.
The Company intends to use the net proceeds from the sale of the Units to support its previously announced transaction with a large and diversified Southeast Asian conglomerate and for general corporate purposes.
“We are very pleased to have completed the first tranche of this financing, a meaningful milestone that strengthens Gensource’s balance sheet and reinforces our strategic momentum. The proceeds from this closing, together with our anticipated second tranche, will allow us to continue advancing our previously announced partnership in Southeast Asia and our shared commitment to sustainable potash development. In addition, the funds will support ongoing work toward a Final Investment Decision (FID). I would like to thank our team and financial partners for their continued support as we position the Company to execute on our strategy and create long-term value for all stakeholders,” said Mike Ferguson.
In consideration for their services, certain persons (each, a “Finder“) received a cash commission equal to 6% of the gross proceeds of the Common Shares sold buy such Finder and compensation warrants to purchase Common Shares equal to 6% of the total number of Units sold by such Finder, exercisable for 18 months from the first closing date at $0.15 per common share (the “Broker Warrants“). The Broker Warrants are subject to the same Call Right of the Company as the Warrants, as described above. At the first closing of the Offering, the Company paid $86,386.50 in cash commissions and issued 575,910 Broker Warrants.
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