TORONTO, Dec. 5, 2012 /CNW/ - Sprott Resource Corp. (TSX: SCP) - Sprott
Resource Corp. ("SRC") announced today that, through Sprott Resource Partnership ("SRP"), it holds 16,144,746 common shares of Potash Ridge Corporation ("Potash Ridge"), which based on information contained in documents publically filed
by Potash Ridge, represents approximately 19.9% of the total issued and
outstanding common shares of Potash Ridge (the "Potash Shares").
Pursuant to Potash Ridge's previously announced initial public offering
(the "Offering"), which closed on December 5, 2012, SRP acquired 2,944,746 Potash
Shares at a purchase price of $1.00 per Potash Share (the "Offering Price"). Prior to the Offering, SRP owned 13,200,000 Potash Shares at an
average purchase price of $0.52 per Potash Share.
Concurrent with the closing of the Offering, SRC, through SRP, purchased
5,055,254 units of Potash Ridge at a price of $1.00 per unit pursuant
to a subscription agreement dated November 27, 2012. Each unit
consists of one non-voting share in the capital of Potash Ridge (the "Potash Non-Voting Shares") and one warrant (the "Potash Warrants") to acquire one Potash Non-Voting Share exercisable at a price equal
to the Offering Price for a period of two years following the closing
of the Offering. The Potash Non-Voting Shares are convertible into
Potash Shares on a one-for-one basis under certain circumstances,
however the terms of the Potash Non-Voting Shares do not allow SRP to
own more than 19.9% of the Potash Shares upon conversion. According to
information contained in documents publically filed by Potash Ridge,
the Potash Non-Voting Shares and Potash Warrants acquired by SRP
represent 100% of such issued and outstanding securities.
SRP acquired the Potash Shares, the Potash Non-Voting Shares and the
Potash Warrants for investment purposes. SRP may purchase or sell
securities of Potash in the future on the open market, in private
transactions or otherwise, depending on market conditions and other
factors material to the investment decisions of SRP.
About Sprott Resource Corp.
SRC is a Canadian-based company, the primary purpose of which is to
invest and operate 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. 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. SRC invests and operates through SRP, a
partnership between SRC and Sprott Resource Consulting Limited
Partnership, an affiliate of SCLP which is the managing partner of SRP.
Forward-looking information and statements
Certain statements contained herein may constitute "forward-looking
statements" or "forward looking information" under applicable
securities laws. Some of the forward-looking statements may be
identified by words such as "expects", "intends", "anticipates",
"should", "believes", "plans", and similar expressions. Forward-looking
statements, which are based on management's current expectations and
assumptions, including statements with respect to SRC's and SRP's
future intentions regarding the purchase or sale of securities of
Potash Ridge, involve a number of risks and uncertainties. Actual
results or achievements could differ materially from those expressed
in, or implied by, these forward-looking statements. Factors that could
cause actual results to differ from those expressed in, or implied by,
these forward-looking statements include, without limitation, market
conditions and other factors material to the investment decisions of
SRC and SRP. No assurance can be given that any events anticipated by
these forward-looking statements will occur. These forward-looking
statements are made as at the date of this news release. SRC does not
undertake any obligation to publicly update or revise any of these
forward-looking statements, except as required by applicable securities
SOURCE: Sprott Resource Corp.
For further information:
Chief Financial Officer
Sprott Resource Corp.
200 Bay Street, Suite 2750
Tel: (416) 977-7333
Fax: (416) 977-9555