Century Mining Announces Financing Updates

    
       - Files circular for shareholder meeting for approval of private
                                 placement -

         - Closes $1.3 million of "flow-through" equity financing -

         - Increases equity financings by an additional $5 million -
    

BLAINE, WA, Nov. 2 /CNW/ - Century Mining Corporation (CMM: TSX-V) ("Century" or the "Company") announces that it has closed a portion of the flow-through equity financing originally announced on October 14, 2009 (the "Flow-Through Financing") and has filed on SEDAR the circular for a special meeting of shareholders to approve the private placement of units to Kirkland Intertrade Corp. ("Kirkland") and Gravity Ltd. ("Gravity") (together, the "Investor") which was announced originally on September 15, 2009 (the "Private Placement").

The Company announced today that the Flow-Through Financing of $5.25 million comprised of common shares issued on a "flow-through" basis at $0.20 per share has been reduced to $4 million and that $1.3 million of that amount has been closed. The remaining $2.7 million is expected to close in November. Proceeds from the Flow-Through Financing will be used for surface exploration at the Lamaque property and to further delineate reserves and resources.

The special meeting of shareholders has been scheduled for Monday November 23, 2009 at 11:00am Pacific Standard Time at the Vancouver Club in Vancouver, British Columbia. The proxy circular has been mailed to shareholders and is available for review on SEDAR.

The Company's Board of Directors has unanimously recommended that shareholders approve, among other things, the amendment of the Company's Shareholder Rights Plan to enable the Private Placement to the Investor to be completed. Members of management holding common shares of the Company have executed voting support agreements to vote their shares in favour of the resolution authorizing and approving a $21 million private placement of units of the Company (as described below), the creation of new 'control persons' of the Company and the consequent amendment of the Company's Shareholder Rights Plan.

With respect to the Private Placement, Century has agreed, subject to entering into mutually agreeable subscription agreements, to issue an aggregate of 105,000,000 units ("Units") at $0.20 per Unit for gross proceeds of $21,000,000 increased from $20,000,000 originally announced on September 15, 2009. Each Unit will consist of one common share of the Company and one-half of one common share purchase warrant. Each whole warrant will entitle the holder to purchase one common share of the Company at a price of $0.30 for a period of 18 months. Of the 105,000,000 Units to be issued under the Private Placement, the common shares issued in connection with up to 20,000,000 Units may be issued on a 'flow-through' basis (the "Flow-Through Units"). All other aspects of the Flow-Through Units, if issued as such, will remain the same as for the Units. The Flow-Through Units, if issued, will be issued at $0.20 per Flow-Through Unit with each Flow-Through Unit consisting of one 'flow-through' common share and one-half of one common share purchase warrant. Each whole warrant will entitle the holder to purchase one common share at a price of $0.30 for a period of 18 months. In combination with the $4 million of flow-through shares described above, the total equity issuance of $25 million represents a $5 million increase in the amount of funds raised through equity financings.

The Investor has agreed, subject to entering into mutually acceptable subscription agreements, that with its associates and affiliates, it will subscribe for $16,000,000 of Units. If additional purchasers acceptable to Century and the Investor are not identified and binding subscription agreements are not entered into prior to closing of the Private Placement for the remaining $5,000,000 of Units, the Investor has agreed, subject to entering into mutually agreeable subscription agreements, to subscribe for the remaining $5,000,000 of Units.

Together with previously acquired securities, following closing of the Private Placement, assuming full subscription of the $21,000,000 and excluding any flow-through shares purchased by the Investor pursuant to the Flow-Through Financing, the Investor, together with its associates and affiliates, will hold 112,142,857 Common Shares (164,642,857 Common Shares assuming exercise of its warrants) representing approximately 33.9% of the issued and outstanding Common Shares (42.9% assuming exercise of its warrants).

The Company also announced an update to the prepaid gold forward sale financing facility (the "Bank Financing") with a major international bank ("the Bank") which was originally announced on July 30, 2009. Pursuant to the Bank Financing, subject to minor variations of certain terms based upon fluctuations in gold prices prior to closing of the Bank Financing, the Bank is expected to purchase from Century approximately 61,000 ounces of gold over a five-year term, for which the Bank has agreed to pay to Century, upon closing, US$33 million (of which no more than US$10 million is to be deposited into a performance reserve account). One of the conditions of closing of the Bank Financing is that the Company raise US$16 million of equity, which will be satisfied by the proposed Private Placement.

The Private Placement, when combined with the Bank Financing, will provide the Company with approximately $57 million of capital to restart the Lamaque underground gold mine project, located in Val d'Or Quebec. Furthermore, the additional $4 million from the Flow-Through Financing will allow for continued exploration on Century's extensive land position.

The Company anticipates closing of the Private Placement and the Bank Financing on or before December 4, 2009. All securities issued under the above transactions will be subject to a four-month restriction on resale.

For more information, please refer to the Company's press releases of July 30, 2009, September 15 and 23, 2009 and October 14, 2009, all of which are available on SEDAR and on the Company's web site.

Margaret Kent, President and CEO of Century, commented, "We are very pleased to announce these updates with respect to the equity private placements and the prepaid gold forward sale facility. My management team and I have been working diligently with all of the investor groups and we are encouraged by the progress we have achieved in satisfying the requirements to enable the closing of all of the transactions. Management and the Board of Directors recommend that shareholders approve the Private Placement to Kirkland and Gravity which will facilitate achievement of Century's vision of creating a formidable mid-tier gold producer. This funding allows us to immediately restart our flagship asset and aggressively pursue other production opportunities."

About the Investor

Kirkland is beneficially owned by Maxim Finskiy. Mr. Finskiy is Chief Executive Officer of LLC Intergeo Managing Company, the mining and exploration arm of the private Russian conglomerate Onexim Group, which is Russia's largest investment fund with $25 billion in assets. From 2001 to 2008 he was Deputy General Director and Deputy Chairman of the Management Board of MMC Norilsk Nickel. Mr. Finskiy sits on the Board of Polyus Gold, one of the top world gold producers, incorporated in Russia.

Gravity is the personal investment vehicle of Fran Scola. Mr. Scola is a partner at LFM Partners, a partnership with extensive investments in the natural resources sector. He is a board member of seven different public and private mining companies. He is a former partner of Weintraub Investments, a San Francisco-based hedge fund.

About Century Mining Corporation

Century Mining Corporation is a junior gold producer. The Company owns and is working towards the start up of the Lamaque mine in Québec that historically has produced over 9.2 million ounces of gold. In Peru, Century's wholly-owned subsidiaries own an 82.6% interest in the San Juan Mine where the Company accounts for 100% of gold production. Total gold production for 2007 and 2008 was 63,124 and 14,252 ounces of gold, respectively.

    
    "Margaret M. Kent"
    Chairman, President & CEO


    Neither TSX Venture Exchange nor its Regulation Services Provider (as
    that term is defined in the policies of the TSX Venture Exchange) accepts
    responsibility for the adequacy or accuracy of this release.
    

Caution Concerning Forward-Looking Information

This press release contains forward looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995 and forward-looking information within the meaning of applicable Canadian securities laws. We use words such as "may", "will", "should", "anticipate", "plan", "expect", "believe", "estimate" and similar terminology to identify forward-looking statements and forward-looking information. Such statements and information are based on assumptions, estimates, opinions and analysis made by management in light of its experience, current conditions and its expectations of future developments as well as other factors which it believes to be reasonable and relevant. Forward-looking statements and information involve known and unknown risks, uncertainties and other factors that may cause our actual results to differ materially from those expressed or implied in the forward-looking statements and information and accordingly, readers should not place undue reliance on such statements and information. Risks and uncertainties that may cause actual results to vary include but are not limited to the conditional nature of the above transactions, the speculative nature of mineral exploration and development, including the uncertainty of reserve and resource estimates; operational and technical difficulties; the availability to the Company of suitable financing alternatives; fluctuations in gold and other commodity prices; changes to and compliance with applicable laws and regulations, including environmental laws and obtaining requisite permits; political, economic and other risks arising from our South American activities; fluctuations in foreign exchange rates; as well as other risks and uncertainties which are more fully described in our most recent annual and quarterly Management's Discussion and Analysis, in our Annual Information Form and in other filings made by us with the Securities and Exchange Commission and with Canadian securities regulatory authorities and available at www.sedar.com.

While the Company believes that the expectations expressed by such forward-looking statements and forward-looking information and the assumptions, estimates, opinions and analysis underlying such expectations are reasonable, there can be no assurance that they will prove to be correct. In evaluating forward-looking statements and information, readers should carefully consider the various factors which could cause actual results or events to differ materially from those expressed or implied in the forward-looking statements and forward-looking information.

SOURCE CENTURY MINING CORPORATION

For further information: For further information: Century Mining Corporation, Phone: (877) 284-6535 or (360) 332-4653, Fax: (360) 332-4652, Website: www.centurymining.com

Organization Profile

CENTURY MINING CORPORATION

More on this organization


Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

CNW Membership

Fill out a CNW membership form or contact us at 1 (877) 269-7890

Learn about CNW services

Request more information about CNW products and services or call us at 1 (877) 269-7890