Frontline Gold Corporation
TSX VENTURE : FGC

Frontline Gold Corporation

December 06, 2010 08:00 ET

Frontline Announces Pricing of Private Placement

HALIFAX, NOVA SCOTIA--(Marketwire - Dec. 6, 2010) -

(figures in Canadian dollars)

NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR FOR DISSEMINATION IN THE U.S.

Frontline Gold Corporation (TSX VENTURE:FGC) (the "Company") announces that it has finalized the terms of its previously announced marketed, best efforts private placement of units (the "Units"). Stonecap Securities Inc. and CIBC World Markets Inc. are acting as joint agents on the offering. The offering of Units (the "Unit Offering") will raise gross proceeds of up to $4,000,080 pursuant to the issue of up to 28,572,000 Units at a price of $0.14 per Unit. Each Unit will be comprised of one common share and one-half of one common share purchase warrant (the "Warrants"). Each whole Warrant shall entitle the holder thereof to acquire one common share of the Company for three years following closing of the Unit Offering (the "Closing"). Each Warrant shall be exercisable at a price of $0.18 per common share up to and including the second anniversary of the Closing and at a price of $0.20 per common share following the second anniversary of the Closing and up to and including the third anniversary of the Closing.

Additionally, the Company will offer up to 7,353,000 flow-through common shares ("Flow-Through Shares") at a price of $0.17 per Flow-Through Share for gross proceeds of up to $1,250,010 (the "Flow-Through Offering" and together with the Unit Offering, the "Offering").

The net proceeds of the Unit Offering will be used for exploration at the Company's Niaouleni property in Mali, working capital and general corporate purposes. The gross proceeds from the Flow-Through Offering will be used to incur certain types of Canadian Exploration Expense ("CEE") as defined in the Income Tax Act (Canada) and the Company will renounce, for the 2010 taxation year, such CEE in favour of original purchasers of the Flow-Through Shares in an amount equal to the issue price for each Flow-Through Share.

The Offering will be made by way of private placement to accredited investors in all provinces of Canada and such other jurisdictions as may be determined by the Company and the agents. The Offering is expected to close on or about December 15, 2010, and is subject to certain conditions including, but not limited to, the receipt of all necessary regulatory approvals including the approval of the TSX Venture Exchange. The Units and Flow-Through Shares will be subject to a four-month hold period.

This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended, or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless an exemption from such registration is available.

Some of the statements contained in this release are forward-looking statements, such as estimates and statements that describe the Company's future plans, objectives or goals, including words to the effect that the Company or management expects a stated condition or result to occur. Since forward-looking statements address future events and conditions, by their very nature, they involve inherent risks and uncertainties. Actual results in each case could differ materially from those currently anticipated in such statements.

Neither the TSX Venture Exchange nor its Regulation Services Provider accepts responsibility for the adequacy or accuracy of this release.

Contact Information

  • Frontline Gold Corporation
    1550 Bedford Highway Suite 802, Sun Tower
    Bedford, NS B4A 1E6
    (902) 832-5555
    (902) 832-2223 (FAX)
    info@frontlinegold.com