Focus Metals Inc.
TSX VENTURE : FMS

Focus Metals Inc.

August 19, 2010 09:30 ET

Focus Metals to Acquire Lac Knife Graphite Project from IAMGOLD and to Conduct a Private Placement of $350,000

OTTAWA, ONTARIO--(Marketwire - Aug. 19, 2010) - Focus Metals Inc. (TSX VENTURE:FMS) ("Focus" or the "Corporation") is pleased to announce that it has reached an agreement with a subsidiary of IAMGOLD Corporation ("IAMGOLD"), to acquire the Lac Knife Graphite Project (the "Property"). The Property is located 35 kilometers south of Fermont, Quebec, which is in north-eastern Quebec near the border with Labrador.

All amounts are in Canadian dollars, unless otherwise stated.

"We are very pleased to announce the acquisition of the Lac Knife project. This acquisition represents the third major component in our strategy. The first being the Ni-Cu-PGE properties in the Labrador Trough area and the second being the REE Kwyjibo project in Quebec. When fully developed, this graphite property may be amongst the largest graphite producing properties in the world", stated Gary Economo, President and Chief Executive Officer.

Pursuant to the terms of the share purchase agreement by the parties (the "Agreement"), Focus will acquire all of the issued and outstanding shares of 3765351 Canada Inc. ("3765351"), a subsidiary of IAMGOLD and registered owner of the Property, in exchange for (i) a cash payment of $250,000, (ii) the issuance of common shares of the Corporation (the "Common Shares") equal to 9.9% of the issued and outstanding Common Shares of Focus following the closing of the concurrent private placement (see below for details) for a maximum of 4,016,361 Common Shares, and (iii) the execution of an indemnity agreement in favour of IAMGOLD. Each Common Share will be accompanied by one-half of one share purchase warrant, each whole warrant entitling IAMGOLD the right to acquire an additional Common Share of Focus for a period of twenty-four (24) months following the closing of the transaction at a price equal to the lesser of (i) a 20% premium to the offering price of the concurrent private placement and (ii) the minimum exercise price permitted by the policies of the TSX Venture Exchange.

The closing of the transaction and the concurrent private placement is scheduled to occur within a delay of forty-five (45) days from the date of the Agreement and is subject to several conditions customary to this type of transaction, including, (i) satisfactory legal, technical and environmental due diligence on the Property, 3765351 and its business, (ii) final approval of the Corporation's board of directors, (iii) regulatory approval, and (iv) the Corporation having completed a concurrent private placement for minimum gross proceeds of $100,000. All securities issued in connection with the transaction and the private placement will be subject to a four month hold period from the closing date.

Private Placement

Concurrently with the transaction, Focus announces a non-brokered private placement for maximum gross proceeds of $350,000 (the "Offering"). The Offering is comprised of a maximum of 3,500,000 units (the "Units"), at a price of $0.10 per Unit, each Unit being comprised of one (1) Common Share and one-half of one share purchase warrant. Each whole warrant shall entitle the holder thereof the right to acquire one (1) additional Common Share of the Corporation for a period of twenty-four (24) months from the closing of the Offering at a price of $0.15 per share. The proceeds of the Offering will be used to cover the acquisition costs of the Property and the Corporation's expenses related thereto.

In connection with the Offering, Focus will pay a cash finders' fee of up to 8% of the gross proceeds of the Offering. Also, in certain circumstances, Focus will also issue, as additional compensation, non-transferable warrants entitling the holder to purchase up to 8% of the Common Shares issued in connection with the Offering for a period of twenty-four (24) months from the closing at a price of $0.10 per share. The Offering is subject to regulatory approval.

Profile

Focus Metals Inc. is an emerging mid-tier junior mining exploration company with excellent discovery stage base metals and industrial minerals opportunities in Quebec. A determined management team with extensive mining business experience lead the Corporation. 

This News Release may contain or refer to "forward-looking statements" which reflect Management's expectations regarding the Company's future growth, results of operations, performance and business prospects and opportunities. These statements reflect Management's current beliefs at the time of this news release and are based on information currently available to Management. All statements other than statements of historical fact, included in this release, including, without limitation, statements regarding potential mineralization and reserves, exploration results, and future plans and objectives of the Company, are forward-looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from Management's expectations are exploration risks detailed herein and from time to time in the filings made by the Company with securities regulators. While the Company anticipates that subsequent events and developments may cause its views to change, it specifically disclaims any obligation to update these forward-looking statements, except in accordance with applicable securities laws. Accordingly, readers are advised not to place undue reliance on forward-looking information.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Contact Information

  • Focus Metals Inc.
    Gary Economo
    President and Chief Executive Officer
    613-691-1091 Ext.101
    gary@focusmetals.ca