Palmarejo Silver and Gold Corporation
TSX VENTURE : PJO

Palmarejo Silver and Gold Corporation

March 28, 2006 08:12 ET

Palmarejo Silver and Gold Corporation Announces $60 Million Special Warrant Offering

TORONTO, ONTARIO--(CCNMatthews - March 28, 2006) -

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

PALMAREJO SILVER AND GOLD CORPORATION (TSX VENTURE:PJO) is pleased to announce that it has entered into an agreement with Sprott Securities Inc. on behalf of a syndicate of underwriters, including Dundee Securities Corporation and Haywood Securities Inc., pursuant to which the underwriters have agreed to purchase 6,315,790 special warrants on an underwritten private placement basis, at a price of $9.50 per special warrant for aggregate proceeds to Palmarejo of $60 million. The underwriters have the option to purchase an additional 1,578,947 special warrants at the issue price at any time prior to the closing date for additional gross proceeds of $15.0 million. Each special warrant will entitle the holder to acquire one common share and one-half of one share purchase warrant. Each whole share purchase warrant will be exercisable at a price of $12.50 for a period of 18 months. In the event that Palmarejo fails to obtain receipts for a final prospectus within 60 days of the closing date, each special warrant will entitle the holder to acquire 1.04 common shares and 0.52 share purchase warrants. The offering is scheduled to close on or about April 18th, 2006 and is subject to certain conditions including, but not limited to, satisfactory due diligence and the receipt of all necessary approvals including the approval of the TSXV.

The securities offered 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 absent registration or an applicable exemption from the registration requirements. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any State in which such offer, solicitation or sale would be unlawful.

Contact Information

  • Palmarejo Silver and Gold Corporation
    James Crombie
    President & CEO
    (450) 677-2253
    (450) 677-2601 (FAX)
    jcrombie@pjogold.com
    or
    Palmarejo Silver and Gold Corporation
    Gerri Paxton
    Manager, Investor Relations
    (450) 677-2054
    (450) 677-2601 (FAX)
    gpaxton@pjogold.com