Cerro de Pasco closes placements for $22.73-million

Executive Summary

• Cerro de Pasco Resources Inc. has closed a combined $22.7 million private placement consisting of both brokered (LIFE) and non-brokered components.
• The financing includes significant participation from insider Eric Sprott, who invested approximately $4 million, triggering related party transaction disclosures.
• Net proceeds are designated to advance the Quiulacocha tailings project through the feasibility stage and for general corporate purposes.

Key Details

• Total Gross Proceeds: $22,736,139.36.
• LIFE Offering (Brokered):
  • Gross Proceeds: $14,998,179.36.
  • Units Issued: 31,246,207 units.
  • Price: $0.48 per unit.
  • Agents: SCP Resource Finance LP and Raymond James Ltd. (co-lead agents/joint bookrunners); Canaccord Genuity Corp. and CIBC World Markets Inc. (syndicate agents).
• Non-Brokered Offering:
  • Gross Proceeds: $7,737,960.00.
  • Units Issued: 16,120,750 units.
  • Price: $0.48 per unit.
• Unit Structure: Each unit consists of one common share and one-half of one common share purchase warrant.
• Warrant Terms:
  • Exercise Price: $0.68 per share.
  • Expiration: November 7, 2027.
  • Restriction: Exercise restricted for 61 days from the closing date.
• Agent Compensation:
  • Cash Fee: $899,620.76.
  • Broker Warrants Issued: 1,874,772 warrants.
  • Broker Warrant Terms: Entitle holder to purchase one unit at the offering price for 24 months from closing.
• Third-Party Compensation:
  • Cash Paid: $17,337.60.
  • Broker Warrants Issued: 36,120 warrants.
• Insider Participation:
  • Eric Sprott (via 2176423 Ontario Ltd.) purchased 8,333,333 units for approximately $4 million.
  • This participation classifies the offering as a related party transaction under Multilateral Instrument 61-101.
  • Exemptions from formal valuation and minority shareholder approval were relied upon as the transaction value does not exceed 25% of market capitalization.
• Use of Proceeds: Advancing technical, environmental, and engineering work for the feasibility stage of the Quiulacocha tailings project, plus general corporate purposes.
• Project Status: The company continues technical, environmental, and engineering work at the Quiulacocha tailings project under current permits and is preparing for the next stage requiring additional regulatory authorizations.

Notable Quotes

• "With the completion of this financing, Cerro de Pasco is in a stronger financial position to advance the Quiulacocha project through the full feasibility stage and toward preconstruction readiness. Our immediate focus is on executing the technical, environmental and engineering programs that will define the project's design and secure the highest standards of performance and sustainability. This additional capital reinforces our commitment to transforming the historic Cerro de Pasco district into a model of responsible resource development and long-term value creation." — Guy Goulet, Chief Executive Officer