MGold Resources Inc.

February 16, 2011 20:46 ET

MGold Announces Private Placement Offering

MONTREAL, QUEBEC--(Marketwire - Feb. 16, 2011) - MGold Resources Inc. ("MGold" or the "Company") (TSX VENTURE:MNI) announced that it intends to raise up to $500,000 by way of a non-brokered private placement of up to 4,545,454 units (the "Units") at a price of $0.11 per Unit (the "Offering"). Each Unit consists of one (1) common share and one (1) common share purchase warrant. Each warrant entitles its holder thereof to purchase one additional common share in the capital of MGold for a period expiring on December 21, 2012, at an exercise price of $0.17 per common share.

Insiders of the Company may subscribe for in excess of 25% of the aggregate proceeds of the Offering, constituting a "related party transaction" as defined under Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61-101"). The transaction will be exempt from the formal valuation and minority shareholder approval requirements of MI 61-101 as neither the fair market value of any shares issued to or the consideration paid by such persons will exceed 25% of the Company's market capitalization. The securities issued will be subject to a four month and one day hold period.

The Offering is subject to the approval of the TSX Venture Exchange.

Net proceeds of the Units will be used for general working capital purposes.

MGold is engaged in mineral exploration for precious and base metals. The Company holds the Burchell Lake property in the Shebandowan area of Northwestern Ontario.

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

  • In Canada
    MGold Resources Inc.
    Joel Scodnick, President and Chief Executive Officer
    (705) 522.4439
    (705) 522.8694 (FAX)
    MGold Resources Inc.
    Douglas G. Reeson, Chief Financial Officer and Director
    (416) 533.0323
    (416) 533.2890 (FAX)
    In Europe
    MGold Resources Inc.
    W. Ian L. Forrest, Chairman and Director (FAX)