Energizer Resources Inc. (TSX:EGZ) (OTCQX:ENZR) (FWB:YE5) (“Energizer” or the “Company”) is pleased to announce it has engaged GMP Securities L.P. as lead agent (the "Agent") to conduct a brokered private placement, on a best efforts basis, of common shares (the “Common Shares”) of the Company (the "Offering") to raise gross proceeds of up to US$4,800,000 with an issue price of US$0.14 per Common Share (the “Offering Price”). The Offering Price was negotiated between the Company and the Agent, in the context of the market price for shares of the Company following the engagement of the Agent in respect of the Offering, and prior to the recent appreciation of the Company's share price.
In connection with the Offering, Energizer will pay to the Agent a cash fee equal to up to 6% of the gross proceeds raised under the Offering and will issue to the Agent warrants (the "Broker Warrants") to purchase that number of Common Shares equal to 6% of the aggregate number of Common Shares sold in the Offering. Each Broker Warrant will have a term of 24 months following its issue and be exercisable at the same exercise price as the Common Shares.
All securities issued in connection with the Offering will be subject to a minimum six month hold period. The closing of the Offering is subject to the final approval of the Toronto Stock Exchange (the “TSX”) and other conditions, including satisfactory due diligence. The closing of the Offering is expected to be on or around September 24, 2014.
The net proceeds from the Offering will be used primarily to fund the production of additional graphite concentrate samples from the Molo Project in Madagascar for distribution to potential offtake groups and end users of graphite which the Company are in advanced discussions with and for general working capital purposes.
The Company has obtained conditional approval from the TSX for the listing of all Common Shares issuable pursuant to the Offering (including those underlying the Broker Warrants). Listing will be subject to satisfying all of the requirements of the TSX.
This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”) or any state securities laws and may not be offered or sold within the United States or to, or for the account or benefit of, U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws, unless an exemption from such registration is available.
About Energizer Resources
Energizer Resources Inc. is a mineral exploration and development company based in Toronto, Canada, which is focused on developing its 100%-owned flagship Molo flaked Graphite Project located near Fotadrevo, in southern Madagascar.
For more information, please visit our website at www.energizerresources.com or contact: Brent Nykoliation, Senior Vice President, Corporate Development
Toll Free: 800.818.5442 or 416.364.4911
or Craig Scherba, President and COO
This press release contains statements that may constitute “forward-looking statements” within the meaning of applicable Canadian securities legislation. These forward-looking statements include, among others, statements regarding the completion of the Offering and the expected use of proceeds of the Offering. Readers are cautioned not to place undue reliance on such forward-looking statements. Forward-looking statements are based on current expectations, estimates and assumptions that involve a number of risks, which could cause actual results to vary and in some instances to differ materially from those anticipated by the Company and described in the forward-looking statements contained in this press release. No assurance can be given that any of the events anticipated by the forward-looking statements will transpire or occur or, if any of them do so, what benefits the Company will derive there from. The forward-looking statements contained in this news release are made as at the date of this news release and the Company does not undertake any obligation to update publicly or to revise any of the forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable securities laws.
The National Instrument 43-101 ("NI 43-101") compliant technical report, titled "Molo Graphite Project Fotadrevo Province of Toliara, Madagascar Preliminary Economic Assessment Technical Report Update and dated April 12, 2013, was prepared by DRA Mineral Projects Pty Ltd and authored by John Hancox, Pri.Sc.Nat, Desmond Subramani, Pri.Sc.Nat, Dave Thompson and Glenn Bezuidenhout, all Qualified Persons as defined by NI 43-101, and independent of Energizer Resources for the purposes of NI 43-101 requirements. The Technical Report is available on SEDAR at www.sedar.com and on the Company's website at www.energizerresources.com
The above resource estimates were calculated in accordance with NI 43-101 as required by Canadian securities regulatory authorities. For United States reporting purposes, Industry Guide 7 (under the Securities Exchange Act of 1934), as interpreted by the Staff of the SEC, applies different standards in order to classify mineralization as a reserve. Among other things, the terms “measured”, “indicated” and “inferred” mineral resources are required pursuant to National Instrument 43-101, the U.S. Securities and Exchange Commission does not recognize such terms. Canadian standards differ significantly from the requirements of the U.S. Securities and Exchange Commission, and mineral resource information contained herein is not comparable to similar information regarding mineral reserves disclosed in accordance with the requirements of the U.S. Securities and Exchange Commission. Mineral resources are not mineral reserves and do not have demonstrated economic viability. The mineral resource estimates in this press release include inferred resources that are normally considered too speculative geologically to have economic considerations applied to them that would enable them to be categorized as mineral reserves. There is also no certainty that the inferred mineral resource will be converted to the measured and indicated mineral resource categories through further drilling, or into a mineral reserve once economic considerations are applied. U.S. investors should understand that “inferred” mineral resources have a great amount of uncertainty as to their existence and great uncertainty as to their economic and legal feasibility. In addition, investors are cautioned not to assume that any part or all of the Company’s mineral resources constitute or will be converted into reserves. Cautionary Statement: Neither TSX Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Exchange) accepts responsibility for the adequacy or accuracy of this release.