Successful Private Placement Boosts Funding for High-Grade Silver Exploration

Source: Streetwise Reports 06/26/2024

Silver North Resources Ltd. (SNAG:CVE; TARSF:OTCMKTS) has successfully closed the first tranche of its non-brokered private placement, raising CA$562,500. Read on for details of how Silver North reached this important milestone and what it means.

Silver North Resources Ltd. (SNAG:CVE; TARSF:OTCMKTS) has successfully closed the first tranche of its non-brokered private placement, raising CA$562,500. This significant financial milestone was achieved through the issuance of 2.5 million charity flow-through units (CFT units) at a price of CA$0.22.5 cents per unit. Each unit comprises one common share and one common share purchase warrant, allowing the holder to purchase an additional share at 35 cents until June 21, 2028.

The company intends to use the proceeds to incur eligible Canadian exploration expenses by December 31, 2025, in accordance with the Income Tax Act (Canada). Silver North has committed to renouncing all qualifying expenditures to the CFT unit subscribers effective December 31, 2024, and will indemnify subscribers for any tax implications if the expenditures are reduced by the Canada Revenue Agency.

As part of this first tranche, the company issued 105,000 finders’ warrants and paid a cash commission of CA$16,800 to certain arm’s-length finders, including Red Cloud Securities Inc., Glores Securities Inc., and Ventum Financial Corp. Each finder’s warrant allows the purchase of one share at CA$0.16 cents until June 21, 2025. These finders’ warrants are subject to a statutory hold period until October 22, 2024, as per applicable securities legislation.

Silver Market Sector Overview

According to a June 16 report on Ahead of the Herd, “Silver has been working on a potential bullish expanding falling wedge with a very critical area of support where the bottom rail of the blue expanding falling wedge and the bottom rail of the parallel uptrend channel intersect.” This technical setup is indicative of a strong support level and potential upward movement.

The article highlighted, “The long-term daily chart for Silver shows its very large H&S consolidation pattern. The bar chart on top shows the backtest to the neckline, bullish falling wedge, followed by the strong rally to the April high.” This consolidation pattern suggests a solid foundation for future price increases.

According to a May 22 report by Dominic Frisby of The Flying Frisby, “This move above US$30/oz is long overdue. US$50/oz is coming into view. And if silver goes north of US$50/oz – and one day it will — then the sky really is the limit.” Frisby also emphasized silver’s critical role in modern technology: “Silver is to modern technology as sugar and salt are to modern food: it is in everything. It is almost harder to find things that don’t contain silver than things that do.”

The market dynamics and investment opportunities in silver are also noteworthy. Frisby added, “Despite my long-documented ambivalence towards silver — I’ve gone from being a full-on, silver-fixes-this-and-saves-the-world bug to an unwelcome cynic – I still own physical metal, and I have an oversized position in a Mexican silver development play that will, I hope, turn producer as soon as this year.”

Looking forward, Chen Lin anticipated that “this silver rally is just the beginning.”

A June 19 article by Chen Lin highlighted the remarkable performance of silver in 2024: “In 2024, silver has emerged as one of the top-performing commodities, surging by more than 30% and outpacing even gold.

The month of May witnessed a significant milestone as silver prices surpassed the US$32/oz mark, reaching an impressive 11-year high.” Lin attributes this surge to several factors, including silver’s safe-haven characteristics and the growing demand for industrial applications, particularly photovoltaics in the solar panel industry.

Looking forward, Lin anticipated that “this silver rally is just the beginning, citing minimal technical resistance between the US$30/oz and US$50/oz price levels. Based on these observations, I anticipate that silver will surpass the US$50/oz threshold during this cycle and subsequently stabilize within the US$30-US$50/oz range for the foreseeable future.” The advancement in solar panel technology is expected to further boost silver demand, with innovations such as Tunnel oxide passivated contact (TOPCon) and Heterojunction technology (HJT) significantly increasing the silver load in solar panels.

For investors, Lin recommended focusing on silver production companies with substantial growth potential, noting that “For investors looking to seize this long-term opportunity, I suggest focusing on silver production companies that exhibit substantial growth potential.”

Company Catalysts

According to the company, the successful closing of this private placement marks a pivotal point for Silver North Resources Ltd., setting the stage for future growth and exploration. The funds raised will be channeled into advancing two high-grade silver targets, particularly the promising West Fault discovery at the Haldane silver project in the Yukon. This project is situated in the renowned Keno silver district, which is known for its rich mineral deposits. The second project, called Tim, will be drilled for silver in July 2024, all funded by partner Coeur Mining Inc. Both projects are near producing silver mines, which gives Silver North great advantages if large discoveries are made. [OWNERSHIP_CHART-11042]

Silver North is also poised to close a second tranche of the offering, which is anticipated to include non-flow-through units. This upcoming tranche is subject to customary closing conditions and the approval of the TSX Venture Exchange. The flexibility of the offered securities, available to Canadian residents and other qualifying jurisdictions under the listed issuer financing exemption, enhances the company’s ability to attract a broader range of investors.

Ownership and Share Structure

According to the company 33% of the company is held by management and insiders. 20% is with institutional investors.

The rest is with retail.

Silver North Resources has 43.4 million outstanding shares and 33.87M free float traded shares. Over the past 52 weeks, the company traded between US$0.0250 and US$0.4347 per share.
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1. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Silver North Resources Ltd.
2. James Guttman wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee.
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( Companies Mentioned: SNAG:CVE;TARSF:OTCMKTS, )