Vancouver (pcJ News Briefs) – Tower Resources Ltd. (TSX-V: TWR) has signed a $1 million financing package with Sandstorm Gold Ltd. (NYSE MKT: SAND) and has also agreed to a concurrent non-brokered private placement for proceeds of up to $2.7 million.
“We are extremely happy to have Sandstorm as an investor in Tower and believe that this transaction is an endorsement of both Tower’s people and properties. “The funds provided by the sale of the royalty as well as the private placement will allow Tower to aggressively explore each of our core assets in BC and opportunistically add prospective properties to our pipeline,” said Mark Vanry, President and CEO of Tower Resources.
Sandstorm Transaction
As part of the financing package, Tower will receive a $500,000 payment in return for granting Sandstorm a two percent (2%) NSR on Tower’s Rabbit North Extension, Nechako Gold and More Creek properties. Tower will have the option to buyback one percent (1%) of the NSR on each of the properties from Sandstorm for cash consideration of $500,00 per property. In addition, Tower will assign to Sandstorm the right to purchase one percent (1%) of Tower’s two percent buyback right underlying the Rabbit North property. Concurrent with the NSR investment, Sandstorm will subscribe for 3.44 million units of a private placement at $0.145 per unit for total proceeds of $500,000. Each unit is to consist of one common share and one half of one transferable share purchase warrant. Each whole warrant will be exercisable at $0.22 for a period of five years. Fort Capital Partners acted as an advisor to the company in connection with the Sandstorm financing package and will be issued units in consideration for their services.
Private Placement
Concurrent with the Sandstorm Transaction, Tower has arranged a non-brokered private placement of up to 18.62 million units of the company for gross proceeds of $2,700,000. As with the Sandstorm private placement, each unit is to consist of one common share and one half of one transferable share purchase warrant exercisable at $0.22 for a period of five years. Proceeds from the private placement will be used for exploration of Tower’s mineral property portfolio and general working capital purposes. Tower will pay finder’s fees to qualified finders in amounts permitted by the TSX Venture Exchange.
Both the Sandstorm Transaction and concurrent private placement remain subject to regulatory approval.
Tower Resources Ltd. is a Vancouver-based junior mineral exploration company focused on the discovery and advancement of economic mineral properties, primarily in British Columbia. The company’s key exploration assets are Rabbit North, Nechako Gold and More Creek.
photo credit: Tower Resources