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Newstrike Resources raises additional C$12M

Toronto-based Newstrike Resources Ltd. raised an additional C$12 million after underwriters of its previously announced equity offering exercised their overallotment option.

Infor Financial Inc. and Cormark Securities Inc. co-led the syndicate of underwriters, which included Eight Capital and Haywood Securities Inc.

The company had previously raised C$80 million through an upsized equity offering and had granted the underwriters an option to purchase additional 9,091,500 units at C$1.32 apiece.

Each unit consisted of a common share and a share purchase warrant. The warrants expire Feb. 16, 2020, and have an exercise price of C$1.75.

The underwriters fully exercised their overallotment option.

As part of the overallotment, the underwriters also received an aggregate of 545,490 compensation options entitling them to acquire one unit at C$1.32 apiece until Feb. 16, 2020.

Canadian medical cannabis producer Newstrike plans to use the proceeds for building its production facilities, retiring debt obligations and funding general corporate purposes.