TORONTO, ONTARIO--(Marketwire - Nov. 22, 2011) -
NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES
Carpathian Gold Inc. (TSX:CPN) ("Carpathian" or the "Corporation") is pleased to announce that it has closed its previously announced "bought deal" financing. A syndicate of investment dealers co-led by Cormark Securities Inc., Macquarie Capital Markets Canada Ltd. and Canaccord Genuity Corp., and including Haywood Securities Inc., Jennings Capital Inc. and Stonecap Securities Inc. (the "Underwriters"), bought a total of 115,000,000 subscription receipts (the "Subscription Receipts") of Carpathian at a purchase price of $0.40 each, for aggregate gross proceeds in the amount of $46.0 million (the "Offering"). The aggregate Subscription Receipts issued include 15,000,000 Subscription Receipts bought pursuant to the over-allotment option which was fully exercised.
The Subscription Receipts were created pursuant to a subscription receipt agreement (the "Subscription Receipt Agreement") among the Corporation, Cormark Securities Inc. (on behalf of the Underwriters) and Equity Financial Trust Company (the "Subscription Receipt Agent"). The gross proceeds of the Offering have been delivered to and are being held by the Subscription Receipt Agent pursuant to the terms of the Subscription Receipt Agreement.
Each Subscription Receipt entitles the holder to receive, upon satisfaction, or waiver by holders of at least 75%of outstanding Receipts, of the Release Conditions (as that term is defined in the Subscription Receipt Agreement) without payment of additional consideration, one common share of the Corporation, subject to adjustment.
The Release Conditions include the ratification of the Licença Instalaçáo ("LI") by COPAM, one of the Brazilian environmental authorities having jurisdiction over the Company's Riacho dos Machados gold project in Brazil (the "RDM Gold Project"), on substantially the same terms and conditions as the current Ad Referendum LI.
If the Release Conditions have not been satisfied or waived by 5:00 p.m. (Toronto time) on December 21, 2011, the holders of Subscription Receipts will be entitled to a full refund of the original subscription price of the Receipts held by them plus a pro rata share of interest earned thereon.
If and when released from escrow, the net proceeds of the Offering will be used primarily for construction and continued development of the RDM Gold Project in Brazil, exploration and for general corporate purposes.
This press release shall not constitute an offer to sell or solicitation of an offer to buy the securities in any jurisdiction. The common shares will not be and have not been registered under the United States Securities Act of 1933 and were not and may not be offered or sold in the United States absent registration or applicable exemption from the registration requirements.
Caution regarding forward-looking information:
Statements contained in this document which are not historical facts are forward-looking statements that involve risk, uncertainties and other factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements. This forward-looking information includes, or may be based upon, estimates, forecasts, and statements as to management's expectations with respect to, among other things, obtaining required regulatory approvals for the Offering, the outcome of legal proceedings, the issue of permits, the size and quality of the company's mineral resources, progress in development of mineral properties, future production and sales volumes, capital and mine production costs, demand and market outlook for metals, future metal prices and treatment and refining charges, and the financial results of the company. Factors that could cause such differences, without limiting the generality of the following, include: volatility and sensitivity to market metal prices; impact of change in foreign currency exchange rates and interest rates; imprecision in reserves estimates; environmental risks including increased regulatory burdens; unexpected geological conditions; adverse mining conditions; political risks arising from operating in developing countries; legal title to properties, outcome of litigation, changes in government regulations and policies, including laws and policies; and failure to obtain necessary permits and approvals from government authorities; and other development and operating risks.
Mineral resources that are not mineral reserves do not have demonstrated economic viability. Inferred mineral resources are considered too speculative geologically to have economic considerations applied to them that would enable them to be categorized as mineral reserves. There is no certainty that mineral resources will be converted into mineral reserves.
Although the Company believes that the assumptions inherent in the forward-looking statements are reasonable, undue reliance should not be placed on these statements, which only apply as of the date of this document. The Company disclaims any intention or obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.
The TSX does not accept responsibility for the adequacy or accuracy of this news release.