BLAINE, WA, Sept. 2 /CNW/ - Century Mining Corporation (CMM: TSX-V) today announced that, subject to regulatory approval, it will complete a non-brokered private placement of up to C$400,000 comprised of flow-through shares.
The Company will issue 2,857,143 common shares on a flow-through basis at an issue price of $0.14 per share.
The Company will pay Union Securities Ltd. for introducing subscribers to the Company a finder's fee of cash equal to 6% of the aggregate gross proceeds, and broker warrants equal to 6% of the aggregate number of flow-through shares. Each broker warrant shall be exercisable for 18 months from the date of issue and shall entitle the holder to purchase a common share of the Company for a price of $0.14. The flow-through share issuance is subject to approval by the TSX Venture Exchange. All of the securities issued under these private placements will be subject to a four-month hold period.
The proceeds from this offering will be used for the ongoing Vulcan computer modeling project, which is currently defining additional resources at Lamaque from the 2,000 to 3,000 foot levels, as well as further geological studies at Lamaque and the surrounding properties.
Margaret Kent, President and CEO of Century commented, "As discussed in the announcement of the Company's second quarter financial results, a special committee of the Board of Directors is reviewing proposals for a major project financing that is expected to close this fall. In the meantime, Century is continuing work on Vulcan computer modeling project for Lamaque."
2 comments:
So, with the announcement of the private placement, we see the stock under some pressure. I bought some more, but you have to ask youself. If they are pricing $400,000 of Flow Through at 14 cents, which is suppose to be at a premium to regular stock, what will the price be for 20,000,000 or regular stock! That does cause me some concern!! I was thinking, as the CEO stated, "Gold is our currency" if it wouldn't be a better idea to either boost the 25 million rasie in exchange for almost 50,000 ounces, to 45 million, of find another party willing to take 40,000 ounces in exchange for 20 million, and forget about issuing more shares. Just an idea or suggestion, but with the pressure the stock is under, I'm not sure I want to see the pricing of the 20 million in shares!! Luck to the longs, which includes me!!
Likely reasons for the selloff today:
1) possibly the investors that subscribed to the flow-through financing earily in the year (via Union) are now selling those shares on the open market so they could fund this current $400K financing (assuming they are participating in this financing also, and looking to get the extra flow-through tax benefits).
and
2) some existing shareholders may also be moving their money to other investments (out of frustration)of the stagnant CMM while the gold price is spiking today.
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