NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR FOR DISSEMINATION IN THE U.S.
Confederation Minerals Ltd. (“Confederation”) (TSXV:CFM) is pleased to announce that it has entered into an agreement with a syndicate of underwriters co-led by Cormark Securities Inc. and Fraser Mackenzie Limited and including Casimir Capital Ltd. (collectively the “Underwriters”) pursuant to which the Underwriters have agreed to purchase 11,950,000 units ("Units"), each Unit to consist of one common share (a “Common Share”) and one half of one common share purchase warrant (each whole warrant, a “Warrant”), to be issued from treasury at a price of $0.67 per Unit and 2,500,000 common shares to be issued on a flow-through basis ("Flow-Through Common Shares") from treasury at a price of $0.80 per Flow-Through Common Share (the "Offering"). Each Warrant can be exercised for up to sixteen months following closing of the financing to purchase one Common Share at an exercise price of $1.00 per Common Share.
Confederation has also granted the Underwriters an option (the "Underwriters’ Option") to purchase up to an additional 1,792,500 Units, for additional gross proceeds of approximately $1.2 million. The Underwriters’ Option is exercisable in whole or in part up until closing of the Offering.
The Offering is scheduled to close on or about March 3, 2011 and is subject to certain conditions including, but not limited to, the receipt of all necessary approvals, including the approval of the TSX Venture Exchange.
Proceeds of the Offering will be used to fund Confederation’s exploration program with gross proceeds from the sale of the Flow-Through Common Shares used to fund ongoing exploration activities eligible for Canadian Exploration Expenses which will be renounced in favour of the subscribers of the Flow-Through Common Shares effective on or before December 31, 2011. The Units and the Flow-Through Common Shares will be offered in all provinces of Canada on a private placement basis.
The securities offered have not been and will not be 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 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 jurisdiction in which such offer, solicitation or sale would be unlawful.
For more information please contact:
Director, President & Chief Executive Officer
Confederation Minerals Ltd.
Suite 1980, 1075 West Georgia Street
This press release contains forward-looking statements and forward-looking information within the meaning of applicable Canadian securities legislation (collectively, "forward-looking statements"). Specifically, this press release contains forward-looking statements relating to the use of proceeds of the Offering, the renouncing of Canadian exploration expenses, the filing of the short form prospectus and the closing date of the Offering. The forward-looking statements are based on certain key expectations and assumptions made by Confederation Minerals Ltd., including assumptions concerning the timing of obtaining regulatory approvals and the state of the economy and the exploration and production business, which expectations and assumptions management of Confederation Minerals Ltd. believes to be reasonable at this time. Although Confederation Minerals Ltd. believes that the expectations and assumptions on which such forward-looking statements and information are based are reasonable at the date of this press release, undue reliance should not be placed on the forward-looking statements and information as Confederation Minerals Ltd. can give no assurance that they will prove to be correct. Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. The closing of the Offering could be delayed if Confederation Minerals Ltd. is not able to obtain the necessary regulatory and stock exchange approvals on the timelines it has planned. The Offering will not be completed at all if these approvals are not obtained or some other condition to the closing is not satisfied. Accordingly, there is a risk that the Offering will not be completed within the anticipated time or at all. Additionally, the intended use of the proceeds of the Offering by Confederation Minerals Ltd .may change if the board of directors of Confederation Minerals Ltd. determines that it would be in the best interests of Confederation Minerals Ltd. to deploy the proceeds for some other purpose. The forward-looking statements contained in this press release are made as of the date hereof and Confederation Minerals Ltd . undertakes no obligation to update publicly or revise any forward-looking statements, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.
The TSX Venture Exchange has neither approved nor disapproved the contents of this press release.