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Osisko Development Corp
Symbol ODV
Shares Issued 142,764,305
Close 2022-03-01 C$ 4.44
Recent Sedar Documents

Osisko Dev closes $103.5-million private placement

2022-03-02 12:56 ET - News Release

Mr. Sean Roosen reports

OSISKO DEVELOPMENT CLOSES PREVIOUSLY-ANNOUNCED CDN $103.5 MILLION "BOUGHT DEAL" PRIVATE PLACEMENT, INCLUDING FULL EXERCISE OF UNDERWRITERS' OPTION

Osisko Development Corp. has successfully completed its previously announced bought deal brokered private placement of an aggregate of (i) 13,732,900 subscription receipts of the company, and (ii) 9,525,850 units of the company at a price of $4.45 per offered security, for aggregate gross proceeds of approximately $103.5-million, including the full exercise of the underwriters' option.

Each Unit comprises one common share of the company and one common share purchase warrant, with each warrant entitling the holder thereof to purchase one additional common share at a price of $7.60 per common share for a period of 60 months following the date hereof.

Each subscription receipt entitles the holder thereof to receive one unit, upon the satisfaction of the escrow release conditions (as defined below), and without payment of additional consideration.

The offering was co-led by Eight Capital, BMO Nesbitt Burns Inc. and National Bank Financial Inc., acting as co-lead underwriters and joint bookrunners, and on behalf of a syndicate of underwriters including Canaccord Genuity Corp., RBC Capital Markets, PI Financial Corp. and Desjardins Securities Inc. In consideration for their services, the underwriters were paid a cash commission equal to 5 per cent of the gross proceeds of the offering (other than in respect of subscribers on the president's list for which no commission was paid), subject to 50 per cent of the cash commission payable in respect of the subscription receipts being held in escrow pending the satisfaction of the escrow release conditions (as defined below) and in accordance with the terms of the subscription receipt agreement entered into today among the company, TSX Trust company and Eight Capital.

The gross proceeds from the sale of the subscription receipts, net of 50 per cent of the commission payable to the underwriters in respect of the subscription receipts and certain expenses of the underwriters, have been placed into escrow with TSX Trust company, as subscription receipt agent, and will be released upon the satisfaction of certain escrow release conditions, including the completion, satisfaction or waiver of all conditions precedent to the company's proposed acquisition of Tintic Consolidated Metals LLC, as described in the news release of the company dated Jan. 25, 2022, and all in accordance with the terms of the subscription receipt agreement. If the escrow release conditions are satisfied on or before June 15, 2022 (or such later date as the company and underwriters may agree), the escrowed funds (less the balance of the underwriters' commission) will be released to the company. If the escrow release conditions are not satisfied on or prior to the escrow release deadline or the Tintic acquisition is otherwise terminated at an earlier time, the escrowed proceeds, together with interest earned thereon, will be returned on a pro rata basis to the holders of the subscription receipts, and the subscription receipts will be cancelled and have no further force and effect.

The company intends to use the net proceeds of the offering to advance the development of the company's mineral assets, including the Cariboo gold project, the San Antonio gold project and properties held by Tintic assuming the completion of the Tintic acquisition, and for general corporate purposes.

Certain insiders of the company have subscribed for 21,500 offered securities under the offering for aggregate gross proceeds of $95,675. Each subscription by an insider is considered to be a related party transaction for purposes of Multilateral Instrument 61-101 -- Protection of Minority Security Holders in Special Transactions. The company did not file a material change report more than 21 days before the expected closing date of the offering as the details of the offering and the participation therein by each related party of the company were not settled until shortly prior to the closing of the Offering, and the company wished to close the offering on an expedited basis for sound business reasons. The company is relying on exemptions from the formal valuation and minority shareholder approval requirements available under MI 61-101. The company is exempt from the formal valuation requirement in Section 5.4 of MI 61-101 in reliance on Section 5.5(a) of MI 61-101 as the fair market value of the transaction, insofar as it involves interested parties, is not more than the 25 per cent of the company's market capitalization. Additionally, the company is exempt from minority shareholder approval requirement in Section 5.6 of MI 61-101 in reliance on Section 5.7(b) of MI 61-101 as the fair market value of the transaction, insofar as it involves interested parties, is not more than the 25 per cent of the company's market capitalization.

All securities issued under the offering will be subject to a hold period expiring four months and one day from the date hereof. The offering is subject to final acceptance of the TSX Venture Exchange. The company has agreed to use its commercially reasonable efforts to obtain a receipt from the securities regulatory authorities in each of the provinces and territories of Canada in which subscription receipts have been sold for a (final) prospectus qualifying the distribution of the common shares and the warrants underlying the subscription receipts on or before the closing of the Tintic acquisition.

About Osisko Development Corp.

Osisko Development is uniquely positioned as a premier gold development company in North America to advance the Cariboo gold project and other Canadian and Mexican properties, with the objective of becoming the next mid-tier gold producer. The Cariboo gold project, located in central British Columbia, Canada, is Osisko Development's flagship asset with measured and indicated resource of 21.44 million tonnes at 4.6 grams per tonne gold for a total of 3.2 million ounces of gold and inferred resource of 21.69 million tonnes at 3.9 g/t Au for a total of 2.7 million ounces of gold. The considerable exploration potential at depth and along strike distinguishes the Cariboo gold project relative to other development assets, as does the historically low, all-in discovery costs of $19 (U.S.) per ounce. The Cariboo gold project is advancing through permitting as a 4,750-tonne-per-day underground operation with a feasibility study on track for completion in the first half of 2022. Osisko Development's project pipeline is complemented by potential near-term production targeted from the San Antonio gold project, located in Sonora, Mexico.

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