VANCOUVER, Dec. 1 /CNW/ - Mandalay Resources Corporation ("Mandalay" or the "Company") (TSX-V: MND) is pleased to announce that it has completed its acquisition of AGD Mining Pty Ltd. ("AGD") and a private placement of units ("Units") at a price of $0.25 per Unit. Each Unit consists of one common share and one warrant to acquire a common share for a period of five years at a price of $0.465 per share.
Brad Mills, CEO of Mandalay, said "We are pleased to have completed the acquisition of AGD and the private placement. They are both important milestones for Mandalay- the acquisition of AGD's Costerfield gold mine provides the Company with its initial production platform, and the private placement gives it the resources it needs to fund redevelopment of Costerfield and to advance our Chilean projects. We are excited about the Company's prospects and look forward to a period of significant growth through acquisitions and project development."
Mandalay acquired all of the issued and outstanding shares of AGD in exchange for consideration consisting of 44,000,000 Mandalay common shares, warrants to acquire an aggregate of 40,000,000 Mandalay common shares for a period of five years (50% of which have an exercise price of $0.31 per share and 50% of which have an exercise price of $0.465 per share) and a promissory note in the principal amount of $1,500,000.
Under the private placement, Mandalay issued 24,400,000 Units at a price of $0.25 per Unit for gross proceeds of $6,100,000. This is in addition to 1,600,000 Units that Mandalay issued on October 16, 2009 for gross proceeds of $400,000. In connection with the private placement, and as compensation for certain other services provided, Mandalay issued to Audley Capital Management Limited ("Audley") a finder's fee consisting of warrants to purchase up to 3,950,000 common shares of Mandalay at a price of $0.31 per share for a period of five years. Mandalay has agreed to issue warrants to purchase up to an additional 3,050,000 common shares of Mandalay to Audley at a price of $0.31 per share for a period of five years subject to receiving TSX Venture Exchange approval.
After giving effect to these transactions, Mandalay has 94,302,850 common shares and warrants to acquire an additional 73,000,000 common shares outstanding. Western Coal Corp. and its affiliates currently own 44,000,000 common shares (or approximately 46.6% of the outstanding common shares) and Arcourt Resources NL currently owns 10,138,136 (or approximately 10.7% of the outstanding common shares).
About Mandalay Resources Corporation:
Mandalay Resources is a Canadian-based natural resource company with assets in production. The Company is focused on executing a roll-up strategy which involves aggregation of gold, copper, silver and antimony projects, creating critical mass through the acquisition of near-term or in-production assets in Australia and the Americas.
This news release contains "forward-looking statements" within the meaning of applicable securities laws relating to the proposal to complete the proposed transaction, including statements regarding the terms and conditions of the proposed transaction and its anticipated completion. Readers are cautioned not to place undue reliance on forward-looking statements. Actual results and developments may differ materially from those contemplated by these statements depending on, among other things, Mandalay's ability to secure additional financing, changes in commodity prices and general market and economic conditions. The factors identified above are not intended to represent a complete list of the factors that could affect Mandalay. Although Mandalay has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements.
THE TSX VENTURE EXCHANGE HAS NOT YET REVIEWED AND DOES NOT TAKE RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THE CONTENT OF THIS NEWS RELEASE.
SOURCE Mandalay Resources Corporation
For further information: For further information: Bradford Mills, Chief Executive Officer, Greg DiTomaso, Investor Relations, Contact: (647) 436-2592