Segue Resources (ASX:SEG) has completed a placement of 9,500,000 shares at $0.0125 per share to Newexco and Omni GeoX.
The placement raising $118,750 represents a reinvestment of fees paid by Segue to the technical consultants.
Segue's Managing Director, Mr Steven Michael, said: "Our key technical and marketing consultants have agreed to reinvest a portion of their fees in Segue shares, reflecting their commitment to the Company and the Plumridge Nickel Project.
"Segue has built a strong relationship with these consultants and believe that our interests are clearly aligned in maximising the value to all shareholders."
The placement price represents a 10.7% discount to the current market price and 5 day average closing price of $0.014.
Funding agreement
Segue has also entered into a Controlled Placement Agreement (CPA) with Acuity Capital Pty Ltd to provide Segue with up to $1 million of equity capital over the coming 12 months.
Segue retains full control of the placement process, including having sole discretion as to whether or not to utilise the CPA.
Steven Michael said: "The Company recently raised $3.1 million through two SPP's, for the purpose of advancing exploration and drilling at the exciting Plumridge Nickel Project. This has culminated in Segue's announcement yesterday that a diamond and reverse circulation drilling programme will commence shortly at the E21 Target.
"The capital raising facility with Acuity, if used, will fund the Company's working capital requirements and is completely within the Company's control in terms of raising price/s and timing, thereby minimising the cost of capital and dilution for existing shareholders."
The key features of the CPA are:
1. Standby equity capital of up to $1,000,000 available at the Company's sole discretion;
2. No obligation on the Company to place shares;
3. The CPA provides Segue with full control over the placement process, including the right to determine the following for each new placement.
4. Each new placement is issued at a 10% discount to a VWAP over the Placement Period, subject to the Floor Price determined by the Company
5. The actual issue price per share may be higher than the Floor Price set by the Company for a Placement Period. This will occur where the discounted VWAP of Segue Resources shares over the relevant Placement Period is above the Floor Price;
6. There are no fees for Segue entering into the CPA and there are no options required to be issued;
7. Segue has the right to cancel the CPA at any time for no fee;
8. No restrictions on Segue entering into debt financing arrangements or from undertaking additional
private placements, rights issues or shareholder purchase plans
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