Luna Gold Corp.
TSX VENTURE : LGC
BVLAC : LGC

Luna Gold Corp.

September 22, 2011 09:37 ET

Luna Gold Announces Terms of Equity Financings

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Sept. 22, 2011) -

NOT INTENDED FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR DISSEMINATION IN THE UNITED STATES

Luna Gold Corp. (TSX VENTURE:LGC)(BVLAC:LGC) ("Luna Gold" or the "Company") is pleased to announce the terms of its previously announced marketed public offering (the "Offering") of units (the "Units"). Under the terms of the Offering, National Bank Financial Inc., and including Raymond James Ltd., BMO Capital Markets, and Scotia Capital Inc. (the "Agents") will offer up to 51,923,077 Units on a "best efforts" basis at a price of C$0.52 per Unit for gross proceeds of up to $27,000,000. Each Unit will consist of one common share of the Company plus one half of one common share purchase warrant (each whole warrant, a "Warrant"), with each Warrant being exercisable to acquire one common share at a price of C$0.70 for a period of 24 months from the closing of the Offering. A final short form prospectus will be filed by the Company with each of the provincial securities regulators, other than Quebec.

Luna Gold has granted the Agents an option, exercisable in whole or in part at the discretion of the Agents, for a period of 30 days from the closing date of the Offering, to purchase up to that number of additional Units, common shares or warrants or combination thereof which in aggregate equal to 15% of the Units sold pursuant to the Offering, to cover over-allotments, if any, and for market stabilization purposes. The Agents will receive an aggregate cash commission equal to 6% of the gross proceeds raised from the Offering.

Concurrent to the Offering, the Company is conducting a private placement offering of up to 38,461,539 units to investors in South America (the "South American Placement") through Celfin Capital S.A. SAB ("Celfin") as lead Agent of the South American Placement for gross proceeds of up to $20,000,000. The South American Placement will be sold at the same price and on the same terms as the Units sold in the Offering, and will not be qualified for distribution under the prospectus. Celfin will receive a cash commission equal to $150,000 plus 6.0% of the gross proceeds raised from the South American Placement.

The common shares and warrants underlying the units issued in the South American Placement will be subject to a four month hold period in Canada from the date of issuance.

Luna Gold intends to use the net proceeds of the Offering and the South American Placement for the Aurizona expansion scoping study, Aurizona resource definition expansion, Maranhão Greenfields discovery exploration, Cachoeira social impact study, corporate development, debt reduction and for general corporate purposes. The closing of the Offering is subject to a minimum of $20,000,000 being raised in gross proceeds in the Offering and the South American Placement.

The closings of the Offering and the South American Placement are expected to occur on or about the week of September 26, 2011 and are subject to certain conditions including, but not limited to, the receipt of all necessary approvals including the approval of the TSX Venture Exchange and the securities regulatory authorities.

The above information related to the South American Placement (private placement) is only for informative purposes and does not constitute an offer to any investors under the applicable regulation of each South American jurisdiction.

About Luna Gold Corp.

Luna Gold is a producing gold company with development and exploration projects. Gold production is from the Aurizona Mine in Maranhão, Brazil, and development is focused on the Cachoeira deposit in Para, Brazil. The Company is exploring Maranhão Greenfields, a large strategically placed land position in Maranhão, Brazil.

On behalf of the Board of Directors

LUNA GOLD CORP.

John Blake – President and CEO

Regulatory Footnotes

This news release does not constitute an offer to sell or a solicitation of an offer to sell 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 registered under the United States Securities Act of 1933 and applicable state securities laws or an exemption from such registration is available.

Forward-Looking Statements

All statements other than statements of historical fact included in this news release are forward-looking information that involve various risks and uncertainties, including, without limitation, statements regarding the expected size and timing of the Offering and the South American Placement, the proposed use of proceeds, the filing of the final prospectus and the closing of the Offering. These statements are identified through the words "intend", "plan" and "expected" (or derivations thereof) in this news release. Such forward-looking information represents management's best judgment based on information currently available. 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 the Company's plans or expectations include risks detailed from time to time in the filings made by the Company with Canadian securities regulators. These factors include the inherent risks involved in equity finance activities and the capital markets as a result of frequent and significant shifts in commodity prices and uncertainties in the global economy, the exploration and development of mineral properties, the uncertainties involved in interpreting drill results and other exploration data, the potential for delays in exploration or development activities, 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, labor disputes or other unanticipated difficulties with or interruptions in exploration and operations, fluctuating metal prices, uncertainties relating to the availability and costs of financing needed in the future, the inherent uncertainty of production and cost estimates and the potential for unexpected costs and expenses, currency fluctuations, regulatory restrictions, including environmental regulatory restrictions and liability, competition, loss of key employees, and other related risks and uncertainties. The Company expressly disclaims any intention or obligation to update or revise any forward-looking statements or information whether as a result of new information, future events or otherwise, except as otherwise required by applicable securities legislation.

NEITHER THE TSX VENTURE 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

  • Luna Gold Corp.
    Investor Relations
    (604) 689-7317 or Toll Free: 1-866-689-7317
    www.lunagold.com