SOURCE: Colorado Goldfields Inc.

Colorado Goldfields Inc.

February 26, 2009 13:30 ET

Colorado Goldfields Inc. Announces Class B Common Ready for Issue; All Brokers And Shareholders Step Lively

LAKEWOOD, CO--(Marketwire - February 26, 2009) - Colorado Goldfields Inc. (OTCBB: CGFIA) announces that NASDAQ will be making an announcement on their Daily List today regarding Colorado Goldfield's issuance of Class B Securities. The announcement will be under the classification of "Any Other Type," and have a record date of 02/27/2009.

An instruction letter will be sent to all brokers that contains the following.

1. Effective February 27, 2009, the Company shall issue to beneficial owners of record (as determined by Rule 13d-3 promulgated under the Securities Exchange Act of 1934, as amended (the "Beneficial Owners")), of the Company's Class A Common Stock, for every four shares of Class A Common Stock, one share of restricted Class B Common Stock, and one restricted Class B Warrant. There will be no proration, and in the event a fractional number of Class B shares and class B warrants were to be issued, the number to be issued will be rounded down to the nearest whole number of shares. Each restricted Class B Common share shall enjoy two votes per share. The Class B Warrant shall have a term of one year, at an exercise price of $.50 per share. No fraction of a share will be issued upon any exercise of a Warrant. If the holder of a Warrant would be entitled to receive a fraction of a Share upon any exercise of a Warrant, the Company shall, upon such exercise, round up to the nearest whole number the number of Shares to be issued to such holder.

2. Instructions for Class A Common Shares Held in Certificated Form Held Directly by the Beneficial Owners: Certificated Class A Common shareholders, who are Beneficial Owners, shall receive Class B Common Stock shares and Class B Common Stock Warrants without further action on their part.

3. Instructions for Shares Held on Behalf of Beneficial Owners: In order for a Beneficial Owner of Class A Common Stock held through a broker to receive Class B Common Stock shares and Class B Warrants, the following instructions and compliance conditions must be met:

     a. All brokers whose customers beneficially own shares of Class A
        Common Stock are hereby instructed to present their respective
        lists of named Class A Common Stock Beneficial Owners, as of
        the Record Date, (include shareholder individual or legal entity
        legal name, complete street address, landline telephone number,
        email address (if available), and number of Class A Common Stock
        shares beneficially owned), to the Company's Transfer Agent via
        facsimile transmission (303) 777-7363, no later than 3:30 p.m. MST
        on Friday, February 27, 2009. The Transfer Agent will, within
        four business days of receipt of same, send a copy of all such
        brokers' submissions to the Company.

     b. Upon receipt and immediate verification of each broker's list, the
        appropriate number of Class B Common Stock shares and Class B
        Warrants shall be issued in the name of each named Beneficial
        Owner.

     c. Regarding brokers who do not timely provide a list of their account
        customers Class A Common Stock Beneficial Owners as per Section
        3(a) above by February 27, 2009, such brokers no later than 3:30
        p.m. MST on March 2, 2009 shall provide to the Transfer Agent in
        writing a statement indicating the reasons for such delay and
        affirmatively  state the date upon which they will submit to the
        Transfer Agent the required list of Beneficial Owners and
        supplemental information, which shall be a date no later than 3:30
        p.m. MST on Thursday March 5, 2009.

     d. At any time after March 5, 2009, and without risk of forfeiture,
        should such brokers fail to timely comply with Sections 3(a) and
        (c) hereinabove, then at any time after March 5, 2009 at the time
        of presentment by such brokers to the Transfer Agent of the
        information required by Section 3(a) and (c), such brokers shall
        submit to the Transfer Agent a signed written statement
        affirmatively stating, that:

        "There presently exist no 'open fails to deliver' in Colorado
        Goldfields Inc. Class A Common Stock settlements resulting from
        short sales of Class A Common Stock shares CUSIP 19647Y302 as
        associated with the broker's customer accounts representing
        Beneficial Owners."

        All submissions provided by brokers pursuant to Section 3 to the
        Transfer Agent are to be copied by the Transfer Agent to the
        Company within four business days of the Transfer Agent's receipt
        of same.

     e. All brokers' lists of Beneficial Owners must reconcile with records
        on file with The Depository Trust & Clearing Corporation (DTCC) as
        of the Record Date before Class B Common Stock and Class B Common
        Stock Warrants will be issued in the name of such Beneficial
        Owners.

4. In accordance with 17 CFR Sec. 240.13d-3, DTCC and its nominee, Cede & Co. are not in fact, nor at law, Beneficial Owners of Class A Common Stock. Thus, certificated ownership of Class A Common Stock as a predicate for obtaining Class B Common Stock and Class B Warrants, and Class B Warrant shares, excludes nominee possession of Class A Common Stock in certificate form in the name of DTCC and/or Cede & Co. or any other nominee in possession in certificate form. In connection with this Information Letter and the instructions and compliance conditions set forth hereinabove, we have instructed the Transfer Agent that it may NOT under any circumstances provide Class B Common Stock shares, or Class B Warrants to any Class A Common Stock certificated nominee in possession including Cede & Co. and/or the DTCC.

5. All Class B Common Stock certificates shall bear the following Notice, in addition to a customary restricted stock legend:

             CLASS B COMMON STOCK CUSIP NUMBER 19647Y500
                               NOTICE

      PENALTIES AND SANCTIONS REGARDING OPEN FAILS TO DELIVER IN
                COLORADO GOLDFIELDS INC. COMMON SHARES
                 SECURITIES AND EXCHANGE ACT OF 1934,
                  ANTI-FRAUD RULE 17 CFR 242.10B-21
PURSUANT TO THE SECURITIES EXCHANGE ACT OF 1934, AND APPLICABLE RULES AND
REGULATIONS PROMULGATED THEREUNDER REGARDING "SHORT SALES," THE ISSUER'S
CLASS B COMMON STOCK EVIDENCED BY THIS CERTIFICATE AND ASSIGNED CUSIP
19647Y500, MAY NOT BE TRANSFERRED, PLEDGED, HYPOTHECATED, REHYPOTHECATED,
PLEDGED IN A BUY-IN, SHARE BORROW, OR USED AS SHARES TO CLOSE, TO FILL, OR
OFF-SET ANY OPEN "FAILS TO DELIVER," RESULTING FROM SHORT SALE TRANSACTIONS
IN ISSUER'S CLASS A COMMON STOCK CUSIP 19647Y302 NOR BE DEPOSITED OR
TRANSFERRED IN FULFILLMENT OF AN INTRA OR INTER BROKER/DEALER ELECTRONIC
BOOK ENTRY, INCLUDING "SHARES DUE BILL" RESULTING FROM SHORT SALE
TRANSACTIONS IN ISSUER'S CLASS A COMMON STOCK.
6. All Class B Common Stock Warrant certificates shall bear the following Notice, in addition to a customary restricted securities legend:
         CLASS B COMMON STOCK WARRANT CUSIP NUMBER 19647Y120
                              NOTICE

      PENALTIES AND SANCTIONS REGARDING OPEN FAILS TO DELIVER IN
              COLORADO GOLDFIELDS INC. COMMON SHARES
                SECURITIES AND EXCHANGE ACT OF 1934,
                 ANTI-FRAUD RULE 17 CFR 242.10B-21
PURSUANT TO THE SECURITIES EXCHANGE ACT OF 1934, AND APPLICABLE RULES AND
REGULATIONS PROMULGATED THEREUNDER REGARDING "SHORT SALES," THE ISSUER'S
CLASS B COMMON STOCK WARRANT EVIDENCED BY THIS CERTIFICATE AND ASSIGNED
CUSIP 19647Y120, MAY NOT BE TRANSFERRED, PLEDGED, HYPOTHECATED,
REHYPOTHECATED, PLEDGED IN A BUY-IN, SHARE BORROW, OR USED AS SHARES TO
CLOSE, TO FILL, OR OFF-SET ANY OPEN "FAILS TO DELIVER," RESULTING FROM
SHORT SALE TRANSACTIONS IN ISSUER'S CLASS A COMMON STOCK CUSIP 19647Y302
NOR BE DEPOSITED OR TRANSFERRED IN FULFILLMENT OF AN INTRA OR INTER
BROKER/DEALER ELECTRONIC BOOK ENTRY, INCLUDING "SHARES DUE BILL" RESULTING
FROM SHORT SALE TRANSACTIONS IN ISSUER'S CLASS A COMMON STOCK.

Each shareholder should consult his/her tax advisor as to the particular consequences of the Class B Securities issuance under US federal, state, local, and foreign tax laws.

About Colorado Goldfields Inc.

Colorado Goldfields Inc. (OTCBB: CGFIA) (http://www.cologold.com) is a Denver-based junior exploration and mining company primarily exploring for gold and silver. Our seasoned management team targets historic gold camps with strong potential for multiple deposit discoveries. Currently, our business model in Colorado provides an outstanding combination of former producing properties with excellent exploration and production potential and a currently inactive, modern, up to 700 ton per day capacity mill facility to allow for an attractive short-term production time frame. We expect that this strategic plan will allow Colorado Goldfields to reach its goal of profitability, potentially within the next 18 months.

The Company has made available a current CGFIA Fact Sheet in PDF format at http://www.cologold.com/s/pdfs/CGFIFactSheet.pdf. An audio presentation of the CGFI 2009 business plan is available on the web at http://www.cologold.com/s/multimedia/audiopresentation.wmv. The most recent live investor conference (of September 4, 2008), is available at http://www.cologold.com/s/audio/CGFI_Live_Investor_CC.wma.

Notice regarding forward-looking statements

This news release may contain forward-looking statements or information within the meaning of the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements or information includes statements regarding the expectations and beliefs of management. Forward-looking statements or information include, but are not limited to, statements or information with respect to known or unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements or information. Forward-looking statements or information are subject to a variety of risks and uncertainties which could cause actual events or results to differ from those reflected in the forward-looking statements or information, including, without limitation, risks and uncertainties relating to obtaining financing to meet the Company's exploration program and operating costs during its exploratory stage, the interpretation of exploration results and the estimation of mineral resources and reserves, the geology, grade and continuity of mineral deposits, the possibility that future exploration, development or mining results will not be consistent with the Company's expectations, accidents, equipment breakdowns, title matters, or other unanticipated difficulties with or interruptions in production and operations, the potential for delays in exploration or development activities or the completion of feasibility studies, the inherent uncertainty of production and cost estimates and the potential for unexpected costs and expenses, commodity price fluctuations, currency fluctuations, regulatory restrictions, including the inability to obtain mining permits and environmental regulatory restrictions and liability, the speculative nature of mineral exploration, dilution, competition, loss of key employees, and other risks and uncertainties, including those described under "Risk Factors" in the Company's Annual Report on Form 10-KSB filed on December 27, 2007, and as amended on March 3, 2008, which is on file with the Securities and Exchange Commission, as well as the Company's other SEC filings. Should one or more of these risks and uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described in forward-looking statements. Accordingly, readers are advised not to place undue reliance on forward-looking statements or information. The Company does not undertake any obligation to release publicly revisions to any "forward-looking statement," to reflect events or circumstances after the date of this news release, or to reflect the occurrence of unanticipated events, except as is required under applicable securities laws.

Cautionary note to U.S. Investors -- The United States Securities and Exchange Commission permits U.S. mining companies, in their filings with the SEC, to disclose only those mineral deposits that a company can economically and legally extract or produce. We use certain terms on this website (or press release), such as "measured," "indicated," and "inferred" "resources," which the SEC guidelines strictly prohibit U.S. registered companies from including in their filings with the SEC. U.S. Investors are urged to consider closely the disclosures in our 10-KSB which may be secured from us, or from the SEC's website at http://www.sec.gov/edgar.shtml. This press release may contain information about adjacent properties on which we have no right to explore or mine. We advise U.S. investors that the SEC's mining guidelines strictly prohibit information of this type in documents filed with the SEC. U.S. Investors are cautioned that mineral deposits on adjacent properties are not indicative of mineral deposits on our properties.

Contact Information

  • Contact:
    Brad Long
    Director of Investor Relations
    Colorado Goldfields Inc.
    866-579-2434 or 303-984-0524
    10920 W. Alameda Avenue
    Suite 207
    Lakewood, CO 80226
    http://www.cologold.com