Lachlan Star Limited
ASX : LSA

Lachlan Star Limited

August 03, 2011 13:39 ET

Lachlan Star Limited Private Placement Financing

TORONTO, ONTARIO and PERTH, WESTERN AUSTRALIA--(Marketwire - Aug. 3, 2011) -

THIS NEWS RELEASE IS NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES, AND DOES NOT CONSTITUTE AN OFFER OF THE SECURITIES DESCRIBED HEREIN

Lachlan Star Limited (ASX:LSA) (the "Company") announced today that it has entered into an engagement letter with Dundee Securities Ltd. ("Dundee") pursuant to which Dundee (as lead agent) and Salman Partners Inc. (together, the "Agents") will act as exclusive agents of the Company to coordinate the sale of special warrants of the Company ("Special Warrants") on a private placement basis in each of the provinces of Canada (other than Quebec) (the "Offering").

Each Special Warrant will be exercisable for no additional consideration into one unit (a "Unit"), each Unit consisting of one ordinary share (an "Ordinary Share") and one-half Ordinary Share purchase warrant ("Warrants") of the Company,.

All unexercised Special Warrants will be deemed to be exercised at 4:00 pm (EST) on the earlier of:

  1. the fifth business day after the date that a receipt is obtained for a final prospectus qualifying for distribution the Units underlying the Special Warrants (the "Qualification Date"); and
  1. the date that is four months and a day following the closing of the Offering (the "Qualification Deadline").

If the Qualification Date has not occurred on or before the Qualification Deadline, each Special Warrant shall thereafter entitle the holder to receive upon exercise, for no additional consideration, 1.1 Units (instead of one Unit). A formal agency agreement has not yet been entered into.

The net proceeds of the Offering will be used to fund ongoing development and exploration of the Company's 100% CMD Gold Mine in Chile, and for general working capital purposes.

The Special Warrants and the underlying securities have not been registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States unless registered under the Act or unless an exemption from registration is available.

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