RENO, Nev., Dec. 1, 2005 (PRIMEZONE) -- Battle Mountain Gold Exploration Corp. (OTCBB:BMGX) ("Battle Mountain" or the "Company") is pleased to announce that it has entered into a $10 million bought deal financing agreement with Northern Securities Inc. ("Northern"), subject to certain conditions, for the sale of Subscription Receipts. Northern may raise an additional $2,000,000 by exercising its option within thirty days of the closing.
Subscription Receipts have been priced at $0.45 per receipt with each receipt exchangeable into Units on the closing date of the IAMGOLD acquisition. Each Unit consists of one common share and one-half warrant with an exercise price of $0.62 for a term of two years. The Company currently has 42,530,000 issued shares, will issue 22,222,222 common shares in the $10,000,000 financing and an additional 4,444,444 common shares if Northern fully exercises its option to raise an additional $2,000,000. The Company will also issue 12,000,000 common shares to IAMGOLD.
The proceeds from the financing will be used to complete the previously announced purchase of the gold royalty assets of IAMGOLD Corporation which consist of eleven net smelter royalty assets including the Williams Mine, Don Mario Mine and El Limon Mine. The cash portion of the purchase price is $15,850,000 which will be funded as to approximately $8,850,000 from the equity financing with Northern and approximately $7,000,000 from a gold loan facility provided by Macquarie Bank Limited. Funds raised in excess of the purchase price requirements in the IAMGOLD acquisition will be used for working capital purposes.
The financing is expected to close by December 22, 2005 and the financing proceeds will be retained in escrow pending the closing with IAMGOLD which is expected to close in early January 2006.
The Company has agreed to list its common shares on the American Stock Exchange or the Toronto Stock Exchange.
On behalf of the Board of Directors
Mark Kucher Chairman & C.E.O.
Safe Harbor for Forward-Looking Statements: This release contains certain "forward-looking statements" as defined by the Private Securities Litigation Reform Act of 1995, including, without limitation, expectations, beliefs, plans and objectives regarding the potential transactions and ventures discussed in this release. Among the important factors that could cause actual results to differ materially from those indicated by such forward-looking statements are the risks inherent in minerals exploration, the need to obtain additional financing, the availability of needed personnel and equipment for future exploration and development, fluctuations in the price of minerals, and general economic conditions.