Alexis Minerals Corporation
TSX VENTURE : AMC

Alexis Minerals Corporation

May 11, 2006 16:47 ET

Alexis Closes Successful Debenture Private Placement with Industrial Alliance

TORONTO, ONTARIO--(CCNMatthews - May 11, 2006) - Alexis Minerals Corporation (TSX VENTURE:AMC) is pleased to announce that the company has completed its recently announced offering of units through Industrial Alliance Securities Inc. for gross proceeds of $ 4,210,000 (see Press Release: April 12, 2006).

"The financing provides strategic support for our 2006 - 2007 business plan," said David M. Rigg, President and CEO of Alexis Minerals. "Alexis will purchase the Aurbel gold mill and remaining 50% property interests in the Aurbel Property in May. Alexis will now be able to continue exploration and bulk sampling in Phase II and Phase III at the ongoing Lac Herbin underground project. Results from the program will facilitate a feasibility study and potential production decision in December, 2006."

Alexis is following a business plan which will potentially advance the Lac Herbin project towards production in 2007. Lac Herbin will be supplemented by the by further development of the Lac Pelletier property in Rouyn-Noranda. Total production from the two deposits would be for an initial combined rate of 55,000 ounces gold per year by 2008.

The proceeds of the offering will be used to support Alexis' gold strategy to advance Lac Herbin through underground exploration to a production decision in 2006 while also advancing gold and base metal exploration objectives across the region. Alexis is also currently developing a new Resource estimate for the Lac Pelletier property, expected during May. Additional exploration drilling and initial engineering work will be undertaken on Lac Pelletier commencing in July.

Under the terms of the private placement, Alexis issued units (the "Units") which are comprised of CAN$1,000 principal convertible debentures (the "Debentures"), maturing April 28, 2010 and 150 common share purchase warrants (the "Warrants"). The $1,000 face value Debentures are unsecured and subordinated obligations of Alexis, have a coupon of 6.0% and are convertible, any time after the closing date, into common shares of Alexis at an exercise price of CAN$0.75 for the first and second year, CAN$0.825 for the third year, and CAN$0.9075 for the fourth year (the "Conversion Prices"), which represents a premium of 25% for the first and second year, 37.5% and 51.3%, respectively for third and fourth year, over market closing price on May 4, 2006. Common shares issued as result of conversion of the debenture within the first six months after the closing date are non-transferable for a period of 6 months from the closing date. Each Warrant is exercisable for one common share at a price of CAN$0.75 per common share until May 11, 2008. The securities issued in connection with the private placement are subject to a statutory hold period of four months and one day from the closing date.

Additionally, the Company has the right to redeem the debentures in their fourth year provided that the shares of the Company are trading in excess of CAN$1.13. The redemption price is equal to 90% of the 20 day trading average for the 5 days prior to the date of redemption.

The Institutional Group of Industrial Alliance Securities acted as Underwriter on the first $3.5 million of the financing and has exercised an additional $810,000 of the Underwriter option. As compensation for arranging the debenture financing, Industrial Alliance Securities received a commission equal to 6% of the total amount of the debentures issued and was issued 336,800 broker warrants exercisable for one common share at a price of $0.75 per share until May 11, 2008.

About Alexis Minerals

Alexis Minerals Corporation is a Canadian exploration and development company listed on the TSX Venture Exchange. Alexis holds a portfolio of properties covering approximately 212 square kilometres in the Val-d'Or area and considered highly prospective for both gold and base metals. Alexis has a clear route to 100% ownership in the properties and has reached an agreement to purchase the 1400 tonne per day Aurbel gold mill. The Company has also entered into option agreement with Falconbridge Limited (formerly Noranda Inc.) wherein Alexis will earn a 50% interest in all of Falconbridge's properties in the prospective Rouyn-Noranda base metal and gold camp, Quebec. The Falconbridge properties cover approximately 825 square kilometres in the Rouyn-Noranda area.

Statements in this release that are not historical facts are "forward-looking statements" within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Readers are cautioned that any such statements are not guarantees of future performance and that actual developments or results may vary materially from those in these "forward looking statements"



The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.

Contact Information

  • Alexis Minerals Corporation
    David Rigg
    President and CEO
    (416) 861-5889
    (416) 861-8165 (FAX)
    or
    Alexis Minerals Corporation
    Peter Cashin
    Investor & Corporate Affairs
    (416) 861-5905
    or
    Alexis Minerals Corporation
    Louis Baribeau
    Relationiste, Quebec
    (514) 605-0576
    info@alexisminerals.com
    www.alexisminerals.com