/THIS NEWS RELEASE IS NOT FOR DISTRIBUTION IN THE UNITED STATES OR TO
U.S. NEWS AGENCIES/
TSX Venture Exchange: PMV
Issued & Outstanding: 87,617,570
Fully Diluted: 127,267,481
VANCOUVER, Feb. 19 /CNW/ - PMI Gold Corporation (TSX.V:PMV), the Company
is pleased to announce that it has entered into an Engagement Agreement with
Jesup & Lamont Securities Corporation of New York (the "Agent") to raise US$20
million in Senior Convertible Promissory Notes (the "Notes"). The Notes will
be offered on a private placement basis to accredited investors and qualified
institutional buyers. Closing is expected on or before March 17, 2009. The
engagement is on a non exclusive, best efforts basis.
The principal and accrued interest will be due on the third anniversary
of the closing (the "Closing Date") of the offering. Annual interest of 12%,
will be payable quarterly with payments starting the first anniversary after
the closing date.
A unique feature of the placement is that the principal and interest are
convertible into gold bullion at 110% of the one week average closing price of
an ounce of gold on the New York Mercantile Exchange at the time of closing.
The investors may elect to convert the then due interest of the Note into gold
bullion at anytime, but if before the third anniversary of the Closing Date,
as to only up to an aggregate of 1/2 of the amount of gold actually produced
at the Kubi Gold mine to the date of conversion and any remaining balance then
due at the 3 year anniversary date. The investors will also receive a total of
10 million warrants exercisable at US$0.50 for two years to purchase a Common
Share of the Company.
The Company will pay the Agent a fee equal to 8% of the gross aggregate
proceeds of the Notes, payable on the Closing Date. In addition, the Company
will issue to the Agent on the Closing Date Agent's Warrants entitling the
Agent to purchase 3.2 million warrants exercisable at US$0.50 for two years to
purchase a Common Share of the Company. In the event that the closing is
expedited and occurs on or before March 3, 2009, the Agents fee will increase
to 10% and the number of Agent's Warrants will increase to 4 million.
Proceeds of the financing are to be utilized to pay out in full the
financing facility entered into with Trafalgar Capital Specialized Investment
Fund, FIS ("Trafalgar") in July 2008 for $3.5 million including accrued
interest, to fund the pre-production development costs to bring our Kubi Gold
project into production, and for general working capital purposes.
The closing of this Transaction is subject to the approval of Trafalgar
Capital Specialized Investment Fund FIS, the TSX Venture Exchange, and the
customary closing conditions precedent.
Further information will be released when and as available.
On behalf of the Board,
"Douglas R. MacQuarrie"
President & CEO
THE TSX VENTURE EXCHANGE HAS NOT REVIEWED AND DOES NOT ACCEPT
RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.
This news release contains forward-looking statements which involve known
and unknown risks, delays and uncertainties not under the Company's control
which may cause actual results, performance or achievements of the Company to
be materially different from the results, performance or expectations implied
by these forward-looking statements. We Seek Safe Harbour.
For further information:
For further information: Douglas MacQuarrie, President & CEO, Telephone:
(604) 682-8089, Toll-Free: 1-888-682-8089, Facsimile: (604) 682-8094; or for
European Investors: Florian Riedl-Riedenstein: Tel: 43-2774-28814, e-mail:
firstname.lastname@example.org; or John Mullen: Tel: 41-79-694-8671, e-mail: John
Mullen@bluewin.ch; Or visit the PMI Gold Corporation website at