VANCOUVER, July 20, 2012 /CNW/ - Compass Gold Corporation (TSXV: CVB), which is focused on gold exploration on four properties in Mali, Africa's third largest gold producer, today announced its intention to carry out a private placement of up to 41,666,666 units at a price of C$0.06 per unit for gross proceeds to the company of up to C$2,500,000 (the offering).
Each unit of the offering will consist of one common share and one transferable common share purchase warrant of Compass. Each common share purchase warrant will entitle the holder to acquire one additional common share of the company at a price of $0.10 per common share at any time prior to 5:00 p.m. (Vancouver time) on the date that is 24 months following the closing of the offering subject to the company's right to accelerate the exercise of the warrants if the daily volume weighted average trading price of the common shares of Compass on the TSX Venture Exchange is equal to or exceeds $0.20 per common share for a period of 10 consecutive trading days during the term of the warrant, commencing four months after the date the warrants are issued.
In connection with the offering, Compass will pay a cash commission to eligible finders, equal to 7% of the aggregate gross proceeds raised by the finders and will issue to such finders non-transferable compensation options entitling the holder to subscribe for the number of units that is equal to 7% of the aggregate number of units issued to subscribers introduced by such finders. Such units issued to the finders will have an exercise price equal to the offering price ($0.06) for a period of 24 months from the closing date of the offering. The units issuable on exercise of the compensation options shall have the same terms as the units issued under the offering, except that the warrants comprising the units will be non-transferable.
Compass will apply the net proceeds of the offering to exploration work on the four gold exploration permits noted below in which the company holds an interest through its wholly owned subsidiary Africa Mining SARL and for general working capital purposes.
All securities issued under the offering will be subject to a four-month hold period in accordance with applicable Canadian securities laws, in addition to such other restrictions as may apply under applicable securities laws in jurisdictions outside of Canada.
Closing of this offering is expected to occur on or about July 31, 2012 and is subject to receipt of all necessary regulatory approvals including that of the TSX Venture Exchange.
About Compass Gold Corporation
Compass Gold Corporation, a Tier 2 mining issuer listed on the TSX Venture Exchange, is focused on gold exploration in Mali, Africa's third-largest producer of gold. Compass, through its wholly owned subsidiary, Africa Mining SARL, owns a 100% interest in four gold exploration permits (Yanfolila, Dandoko, Kolondieba, and Solabougouda) as well as holding applications over a further four areas, Mousala, Sirakourou, Yanfolila East, and Kolondieba Nord) covering an aggregate of 1,138 sq kms in key gold-producing regions in south west Mali, West Africa. Further information is available at www.compassgoldcorp.com.
This press release may include "forward-looking statements" including forecasts, estimates, expectations, and objectives for future operations that are subject to a number of assumptions, risks, and uncertainties, many of which are beyond the control of Compass Gold Corporation. Statements regarding future fund raising and capital expenditures are subject to all of the risks and uncertainties normally incident with the raising of capital including, but are not limited to, financing risks, inflation and costs of goods and services. Investors are cautioned that any such statements are not guarantees of future performance and that actual results or developments may differ materially from those projected in the forward-looking statements. Such forward-looking information represents management's best judgment based on information currently available. No forward-looking statement can be guaranteed and actual future results may vary materially. Compass Gold Corporation does not assume the obligation to update any forward-looking statement, except as required by applicable law.
Neither the TSX Venture Exchange nor its regulation services provider accepts responsibility for the adequacy or accuracy of this news release.
COMPASS GOLD CORPORATION
James Henderson, President
For further information:
Investor and Media Relations
Richard W. Wertheim
Wertheim + Company Inc.
+1 (416) 594-1600
+1 (416) 518-8479 (cell)