In conjunction with the Offering, certain officers, directors and employees of Rubellite and their associates intend to purchase, on a non-brokered private placement basis, a minimum of 2.4 million Common Shares at a price of $3.55 per Common Share for gross proceeds of approximately $8.5 million (the “Private Placement”).
In the first quarter of 2022, Rubellite has invested approximately $11 million to acquire crown land prospective for the Clearwater formation. In addition, as previously announced, Rubellite signed a letter of intent to pursue a farm-in and option agreement in the Peavine area, in the vicinity of recent industry Clearwater drilling and southwest of Rubellite’s existing option acreage at West Dawson in northern Alberta. The Company has plans to drill four to six (3.0 – 4.0 net) exploratory wells at Peavine and on its other northern exploratory blocks to earn acreage and delineate area type curves. In addition, Rubellite plans to continue to grow its Clearwater land base and expand its inventory of prospective drilling locations through strategic transactions and land purchases.
The net proceeds from the Offering and Private Placement will initially be used to pay down outstanding bank debt, and subsequently to fund the Company’s ongoing capital expenditures and for general corporate purposes. Completion of the Offering and Private Placement is subject to customary closing conditions, including the receipt of all necessary regulatory approvals, including the approval of the Toronto Stock Exchange. Closing of the Offering and Private Placement is expected to occur on or before March 30, 2022.
The Common Shares issued pursuant to the Offering will be distributed by way of a short form prospectus in all provinces of Canada, other than Quebec, and may also be placed privately in the United States to Qualified Institutional Buyers (as defined under Rule 144A under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”)) pursuant to the exemption provided by Rule 144A under the U.S. Securities Act, and may be distributed outside Canada and the United States on a basis which does not require the qualification or registration of any of the Company’s securities under domestic or foreign securities laws. The Common Shares have not been and will not be registered under the U.S. Securities Act, and this news release does not constitute an offer of securities for sale in the United States. The Common Shares may not be offered or sold in the United States absent registration or an exemption from registration.
No securities regulatory authority has either approved or disapproved of the contents of this news release. This news release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any State in which such offer, solicitation or sale would be unlawful.