/NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR DISSEMINATION IN THE
VANCOUVER, Sept. 21 /CNW/ - Farallon Mining Ltd. ("Farallon" or the "Company")(TSX:FAN) has today entered into an agreement with a syndicate of underwriters led by Paradigm Capital Inc. and Raymond James Ltd., and including Wellington West Capital Markets Inc. under which the underwriters have agreed to buy from Farallon 24,096,500 common shares at an issue price of $0.415 per common share (the "Offering") for gross proceeds of approximately $10 million. Proceeds will be used to advance programs aimed at evaluating a mill expansion to 2,000 tpd by July 1, 2010 and the restarting of exploration drilling on site in early October as well as other corporate and working capital purposes.
The underwriters will have an over-allotment option, exercisable at any time prior to 30 days after the closing date, to acquire up to an additional number of common shares equal to 15% of the number of common shares sold pursuant to the Offering, at the issue price. The Company expects to file a short form prospectus with the securities regulatory authorities to qualify the common shares for distribution. Closing of the Offering is expected to occur on or about October 14, 2009 and is subject to certain customary terms and conditions, including normal regulatory approvals, including the approval of the Toronto Stock Exchange.
The Offering is being made in all provinces of Canada, except Quebec. The securities offered have not been registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any State in which such offer, solicitation or sale would be unlawful.
President and CEO Dick Whittington said "The additional $10 million in financing comes at a time when the Company is poised to capitalize on the recent strength in the world metal markets. The funds will backstop our cash flow from the G-9 operations and allow us to aggressively advance our mill expansion and exploration programs".
Farallon's G-9 zinc, copper, silver, gold and lead mine at the Campo Morado Property in Mexico reached commercial production in April 2009. The Company is targeting to produce at an annualized production rate of 120 million pounds of zinc and 15 million pounds of copper per year.
ON BEHALF OF THE BOARD OF DIRECTORS
J.R.H. (Dick) Whittington
President & CEO
No regulatory authority has approved or disapproved the information
contained in this news release
Forward Looking Information
This release includes certain statements that may be deemed "forward-looking statements." All statements in this release, other than statements of historical facts, that address future production, reserve or resource potential, continuity of mineralization, exploration drilling, operational activities, production rates, costs to completion and events or developments that the Company expects are forward-looking statements. Although the Company believes that the expectations expressed in such forward looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward looking statements and may require achievement of a number of operational, technical, economic, financial and legal objectives. The likelihood of continued future mining at Campo Morado is subject to a large number of risks, including obtaining lower than expected grades and quantities of mineralization and resources, lower than expected mill recovery rates and mining rates, changes in and the effect of government policies with respect to mineral exploration and exploitation, the possibility of local disputes including blockades of the company's property, the possibility of adverse developments in the financial markets generally, fluctuations in the prices of zinc, gold, silver, copper and lead, obtaining additional mining and construction permits, preparation of all necessary engineering for ongoing underground and processing facilities as well as receipt of additional financing to fund mine construction, development and operation, if needed. Such funding may not be available to the Company on acceptable terms or on any terms at all. There are no mineral reserves at Campo Morado and there is no assurance that the mineralization at Campo Morado will ever be classified as mineral reserves. For more information on the Company and the risk factors inherent in its business, investors should review the Company's Annual Information Form at www.sedar.com.
SOURCE Farallon Mining Ltd.
For further information: For further information: on Farallon Mining Ltd., please visit the Company's website at www.farallonmining.com or contact Neil MacRae, Investor Relations Manager, at (604) 638-2160 or within North America at 1-800-667-2114