Continental Precious Minerals Inc.
TSX VENTURE : CZQ

Continental Precious Minerals Inc.

May 11, 2006 16:30 ET

Continental Closes Final Tranche of Private Placement Financings

TORONTO, ONTARIO--(CCNMatthews - May 11, 2006) - Continental Precious Minerals Inc. (the "Company") (TSX VENTURE:CZQ) announces that it has issued to RAB Special Situations (Master) Fund Ltd. ("RAB"), with shareholder approval obtained earlier today at a special meeting of shareholders, 3,439,622 units at a price of $0.75 per unit for gross proceeds of $2,579,716.50 as part of a private placement of 6,000,000 units to RAB initially announced on March 29, 2006. Each unit consists of one common share of the Company and one common share purchase warrant. Each warrant entitles the holder thereof to purchase one common share at a price of $1.00 for three years.

The Company also announces that it has issued to RAB, with shareholder approval, 2,000,000 units at a price of $0.90 per unit for gross proceeds of $1,800,000 as part of a private placement of 8,250,000 units initially announced on April 10, 2006. Each unit consists of one common share of the Company and one common share purchase warrant. Each warrant entitles the holder thereof to purchase one common share at a price of $1.20 for two years.

In total, the Company has raised gross proceeds from the two private placements initially announced on March 29, 2006 and April 10, 2006 of an aggregate $11,925,000 from investors that included RAB, Sprott Asset Management Inc. and Pinetree Capital Ltd. and associates. The Company now has an aggregate 25,622,917 common shares issued and outstanding.

In connection with the private placement of 6,000,000 units for gross proceeds of $4,500,000, the Company has agreed, pending final TSXV approval, to pay a finder's fee of $360,000 and 240,000 finder warrants, each exercisable to purchase one common share at a price of $0.75 for two years. In connection with the private placement of 8,250,000 units for gross proceeds of $7,425,000, the Company has agreed, pending final TSXV approval, to pay a finder's fee of $360,000, 220,000 common shares and 290,000 finder warrants, each of which is exercisable to purchase one common share at a price of $0.90 for two years.

The securities issued in the financing, including securities issued as finder's fees, are subject to a 4 month hold period from the date of issuance.

The Company intends to use the net proceeds from the financings to, among other things, undertake the following on its MMS Licences in northwest Sweden which are described in more detail in its press release of January 16, 2006: initial compilation of historical exploration data, re-analyze existing core samples from historical drilling, check and exploration drilling, bulk sampling and metallurgical testing. On the Company's HRU Licences which are described in more detail in its press releases of July 29, 2005 and October 5, 2005 and National Instrument 43-101 technical report available on SEDAR (www.sedar.com), the Company intends to complete its environmental assessment on three of the licences and to commence confirmatory drilling to validate previous drilling results.

Cautionary Statement Regarding Forward-Looking Statements

This press release contains forward-looking statements regarding final regulatory approvals and the Company's intended use of proceeds of the financing. Actual developments may differ materially from those contemplated by these statements depending upon, among other things, the decisions made by regulators and any change in the Company's exploration and drilling programs which could occur as the result of a variety of factors including the Company's ongoing assessment of results thereof. The forward-looking statements contained in this press release represent the Company's views and expectations as of the date of this release and should not be relied upon as representing its views and expectations at any subsequent date.

This press release was prepared by continental, which accepts responsibility for its accuracy.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of the content of the information contained herein.

Contact Information

  • Continental Precious Minerals Inc.
    Ed Godin
    President
    (416) 805-3036