Sprott Resource Holdings Press Releases


Press Release

Sprott Resource Corp. announces closing of Stonegate Agricom Ltd. initial public offering



TORONTO, April 28 /CNW/ - (TSX: SCP) - Sprott Resource Corp. ("SRC") is pleased to announce that Stonegate Agricom Ltd. ("Stonegate") (TSX: ST) has closed its initial public offering of 45,000,000 units (the "Units") of Stonegate at a price of $1.00 per Unit for gross proceeds of $45,000,000 (the "Offering"). Each Unit consists of one common share (a "Common Share") of Stonegate and one-half of one common share purchase warrant (each whole common share purchase warrant, a "Warrant"). Each Warrant entitles the holder to acquire one Common Share at an exercise price of $1.50 until April 28, 2013. Stonegate has granted to the underwriters an over-allotment option, exercisable for a period of 30 days from the date of closing of the Offering, to cover over-allotments, if any, and for market stabilization purposes. If such option is exercised in full, additional gross proceeds of the Offering will be $6,750,000.

SRC purchased 12,000,000 Units under the Offering. Following completion of the Offering, SRC owns 75,662,000 Common Shares (or approximately 57% of the issued and outstanding Common Shares on a non-fully-diluted basis) and 6,000,000 Warrants. In addition, SRC beneficially holds 500,000 stock options (the "Stock Options") exercisable to acquire Common Shares at a price of $1.00 per share until April 28, 2015. SRC holds its Common Shares, Warrants and Stock Options for investment purposes and does not at this time intend to acquire ownership of, or control over, additional securities of Stonegate.

SRC has entered into a lock-up agreement with the underwriters which provides that SRC will not, without the prior consent of the underwriters or except in limited circumstances, sell, transfer, pledge, assign or otherwise dispose of the Stonegate securities it holds for a period of 120 days. SRC has also entered into a voting agreement with Stonegate whereby it has agreed to not vote its Common Shares in favour of non-management nominees to the board of directors of Stonegate for a period of three years, so long as one nominee is a representative of SRC.

The underwriting syndicate for the Offering was led by GMP Securities L.P. and included BMO Capital Markets, Canaccord Financial Ltd., Wellington West Capital Markets Inc., CIBC World Markets Inc., Dahlman Rose & Company, LLC, Global Maxfin Capital Inc. and Toll Cross Securities Inc.

The Common Shares and the Warrants are listed on the Toronto Stock Exchange under the symbols "ST" and "ST.WT", respectively.

The offer and sale of the securities referred to in this press release have not been, nor will they be, registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act"), and may not be offered or sold in the United States or to, or for the account or benefit of, U.S. persons absent registration or an exemption from the registration requirements of the U.S. Securities Act. This press release does not constitute an offer to sell or the solicitation of an offer to buy the securities in the United States.

About Sprott Resource Corp.

SRC is a Canadian based company, the primary purpose of which is to invest, directly and indirectly, in natural resources. Through acquisitions, joint ventures and other investments, SRC seeks to provide its shareholders with exposure to the natural resource sector for the purposes of capital appreciation and real wealth preservation. SRC is well positioned to draw upon the considerable experience and expertise of both its Board of Directors and Sprott Consulting Limited Partnership ("SCLP"), of which Sprott Inc. (TSX:SII) is the sole limited partner. Pursuant to a management services agreement between SCLP and SRC, SCLP provides day-to-day business management for SRC as well as other management and administrative services.

Cautionary Note Regarding Forward-Looking Statements

This press release contains "forward-looking statements" and "forward-looking information" within the meaning of applicable law relating to SRC's intention not to acquire ownership of, or control over, additional securities of Stonegate. These forward-looking statements are based on management's current reasonable expectations and assumptions. These forward-looking statements and forward-looking information are subject to known and unknown risks, uncertainties and other factors that may cause results to be materially different from those expressed or implied by such forward-looking statements and forward-looking information, including but not limited to risk that SRC may decide in the future to purchase additional securities of Stonegate. Although SRC has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements and forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements or information. Accordingly, readers should not place undue reliance on forward-looking statements or forward-looking information. SRC does not undertake to update any forward-looking statement or forward-looking information that is included herein, except in accordance with applicable securities laws.

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