Rhyolite Resources Ltd.
TSX VENTURE : RYE

February 08, 2010 14:29 ET

Rhyolite Resources Ltd. Announces Brokered Private Placement

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Feb. 8, 2010) -

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

Rhyolite Resources Ltd. ("Rhyolite" or the "Company") (TSX VENTURE:RYE) announces plans to offer a brokered private placement of its securities comprised of 4,000,000 units ("Unit") at a price of $0.25 per Unit for gross proceeds of $1,000,000 (the "Offering").

Each Unit will consist of one common share and one share purchase warrant of Rhyolite ("Warrant"). Each Warrant shall entitle the holder thereof to acquire one additional common share of Rhyolite at an exercise price of $0.32 per share at any time on or before the date which is 12 months after the closing date of the Offering.

Jones Gable & Company Limited (the "Agent") is acting as agent for the Offering. On closing, the Company will pay the Agent a commission equal to 7.5 per cent of the gross proceeds of the units sold payable in cash and will issue the agent non-transferable warrants equal to 7.5 per cent of the units sold. Each Agent's warrant will entitle the holder thereof to purchase one common share at a price of $0.32 per common share for a period of 12 months from the closing.

Closing of the Offering is subject to a number of conditions, including the receipt of all necessary corporate and regulatory approvals, including that of the TSX Venture Exchange, as well as the negotiation and execution of certain documentation, including an agency agreement between the Agent and Rhyolite.

The funds raised from the issuance of the Units shall be used to finance potential acquisitions of new properties, for the Company's Paxson gold project in Alaska and for general working capital purposes.

ON BEHALF OF THE BOARD OF DIRECTORS OF RHYOLITE RESOURCES LTD.

Richard Graham, Director, President and CEO

Cautionary Statement for Forward Looking Information

Certain information set forth in this press release contains forward-looking statements. Specifically, this press release contains forward-looking statements concerning the anticipated use of proceeds of the Offering and the anticipated closing of the Offering. The anticipated closing date assumes that prior to that date, the Company will obtain all necessary regulatory approvals. The anticipated use of proceeds assumes that the Offering will occur as contemplated and assumes the existence of certain other conditions with respect to the capital expenditure program of the Company, general economic conditions, industry conditions, currency fluctutations, commodity prices. In each case, the risk factors that could cause actual results to vary from results expressed or implied by the forward looking statements contained in this press release are primarily events beyond the Company's control that preclude the Company from satisfying all applicable pre-conditions and include the risks that the Offering may not close, general economic conditions, industry conditions, currency fluctutations, volatility of commodity prices, exploration risk, escalation of operating and capital costs, the ability to access sufficient capital from internal and external sources and competition from other industry participants for, among other things, capital, services, acquisitions of new properties . These forward-looking statements may prove to be incorrect and undue reliance should not be placed on them. These forward-looking statements are made as of the date hereof and unless otherwise required by applicable law, the Company does not intend and does not assume any obligation to update or revise such forward-looking statements, whether as a result of new information, future events or otherwise.

Neither the 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

  • Rhyolite Resources Ltd.
    Richard Graham, P.Geol.
    604-689-1428
    604-681-4692 (FAX)