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Sage Potash provides updates to equipment purchase and financing

Published by , Editorial Assistant
World Fertilizer,


Sage Potash Corp. has announced that the equipment purchase transaction contemplated in its 9 September 2024 news release will now be carried out through an alternative equipment leaseback arrangement, which, in management's view, is more financially beneficial to the company than the direct purchase transaction. Consequently, the purchase agreement previously entered into with a subsidiary of International Process Plants (IPP), as well as the associated concurrent financing on the terms described in the prior news release, have been terminated in favour of such leaseback arrangement.

On execution of the purchase agreement, the company paid a cash deposit of US$500 000 to IPP, which will be refunded to the company and offset against the future equipment leaseback arrangement described above. Such arrangement has not yet been executed and is under negotiation between the company, IPP and other applicable parties, and may be subject to TSX Venture Exchange acceptance, if required. There are no security arrangements in place with respect to the deposit.

Other than the deposit, no funds have been advanced, and no securities of the company have been issued, to IPP, and there are no residual liabilities or guarantees of the company in connection with termination of the purchase agreement.

The company further announces that it still intends to carry out a non-brokered private placement of up to 12 500 000 common shares at US$0.20 each, for gross proceeds to Sage of up to US$2.5 million (the offering).

The proceeds of the offering will be used for general working capital purposes. All securities issued under the offering will be subject to a hold period of four months and one day from the date of issuance under applicable securities laws. The company may pay finders' fees in cash and/or securities of the company in connection with the offering.

Certain directors and officers of the company may acquire securities under the offering. Any such participation will be considered to be a ‘related party transaction’ as defined under Multilateral Instrument 61-101 (MI 61-101). The company expects that the offering will be exempt from the formal valuation and minority shareholder approval requirements of MI 61-101 as the company is listed on the TSX Venture Exchange and neither the expected fair market value of securities being issued to related parties nor the consideration being paid by related parties would exceed 25% of the company's market capitalisation.

Closing of the offering is subject to TSX Venture Exchange acceptance.

Read the article online at: https://www.worldfertilizer.com/potash/23012025/sage-potash-provides-updates-to-equipment-purchase-and-financing/

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