Roxgold Inc.

Roxgold Inc.

September 21, 2011 15:14 ET

Roxgold Announces Increase to Previously Announced Bought Deal Offering to $20 Million

TORONTO, ONTARIO--(Marketwire - Sept. 21, 2011) -


Roxgold Inc. (TSX VENTURE:ROG) ("Roxgold") is pleased to announce that it has amended the terms of its previously announced bought deal financing to increase the size of the offering from approximately $18.5 million to approximately $20.0 million. Under the amended terms of the offering, a syndicate of underwriters led by Cormark Securities Inc. and including Fraser Mackenzie Limited, GMP Securities L.P., PI Financial Corp., and Pope & Company Limited (collectively, the "Underwriters") have agreed to purchase, on a bought deal basis, 23,530,000 subscription receipts (the "Subscription Receipts") at a price of $0.85 per Subscription Receipt for gross proceeds of approximately $20.0 million (the "Offering").

In consideration of the services to be rendered by the Underwriters in connection with the Offering, Roxgold shall pay to the Underwriters a cash fee equal to 6.0% of the gross proceeds (the "Cash Commission") realized by Roxgold in respect of the sale of the Subscription Receipts pursuant to the Offering, 50% of which shall be payable at closing of the Offering and the balance shall be payable upon satisfaction of the escrow release conditions. As additional compensation, the Underwriters will be issued broker warrants (the "Broker Warrants") exercisable to acquire that number of Common Shares as is equal to 6.0% of the aggregate number of Subscription Receipts issued pursuant to the Offering. Each Broker Warrant shall entitle the holder thereof to acquire one Common Share at a price of $0.85 per share for a period of 24 months following closing of the Offering.

Upon closing of the Offering, the gross proceeds thereof will be deposited with an escrow agent in an interest bearing account.

Each Subscription Receipt issued in connection with the Offering shall be deemed to be exercised, without payment of any additional consideration and without further action on the part of the holder thereof, for one common share ("Common Share") of Roxgold upon satisfaction of the following escrow release conditions; (i) all conditions to the closing of the transaction (the "Transaction") entered into with Riverstone Resources Inc. ("Riverstone"), have been satisfied other than the payment of the cash portion of the purchase price for the Projects; (ii) Roxgold shall have provided the Underwriters with copies of the duly executed transfers of the arrêtés that compromise the Projects in registrable form, copies of the required synthesis reports and expenditure statements, as well as a an opinion in respect of such transfers in a form acceptable to the Underwriters and their counsel, acting reasonably and (iii) Roxgold and Cormark, on behalf of the Underwriters, shall have delivered a joint notice to the escrow agent, confirming that the escrow release conditions have been satisfied.

If the escrow release conditions are not satisfied prior to 5:00 p.m. (Toronto time) on November 30, 2011, the escrow agent shall return to each holder of Subscription Receipts the aggregate offering price of the Subscription Receipts held by that holder plus the pro rata portion of interest or other income earned on the escrowed funds (less any applicable withholding tax). To the extent that the escrowed funds (plus accrued interest) are not sufficient to purchase all of the Subscription Receipts at the offering price, Roxgold will contribute such amounts as are necessary to satisfy any shortfall.

The offering is scheduled to close on or about October 6, 2011 and is subject to certain conditions including, but not limited to, the receipt of all necessary approvals including the approval of the TSX Venture Exchange.

The net proceeds of the offering will be used to fund the cash component of the consideration payable to Riverstone in connection with the Transaction and, as to the balance, for continued exploration of the Projects and for general working capital purposes.

The securities described herein 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.

This news release contains forward-looking information regarding the anticipated timing of closing of the Transaction and the Offering. This information is based on information currently available to Riverstone and Roxgold and there is no assurance that actual events or results will meet the expectations as expressed herein. Forward-looking information is based on the assumption that all conditions to the Transaction and Offering will be met or waived and all necessary approvals obtained. Since forward-looking information is based on assumptions and addresses future events and conditions, by its very nature forward-looking information involves inherent risks and uncertainties. Actual results relating to, among other things, closing of the Transaction and the Offering, could differ materially from those currently anticipated in such statements for many reasons such as: changes in general economic conditions and conditions in the financial markets; changes in demand and prices for minerals; delays in obtaining approvals, litigation, legislative, environmental and other judicial, regulatory, political and competitive developments; technological and operational difficulties encountered in connection with the activities of the companies; and other matters discussed in this news release. This list is not exhaustive of the factors that may affect the companies' forward-looking information. These and other factors should be considered carefully and readers should not place undue reliance on the companies' forward-looking information. Neither of the companies undertakes to update any forward-looking information that may be made from time to time by it or on its behalf, except in accordance with applicable securities laws.

This news release includes certain "forward looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995. Without limitation, statements regarding potential mineralization and resources and reserves, exploration results, and future plans and objectives of the companies are forward looking statements that involve various degrees of risk. The following are important factors that could cause the companies' actual results to differ materially from those expressed or implied by such forward looking statements: changes in the world wide price of mineral commodities, general market conditions, risks inherent in mineral exploration, risks associated with development, construction and mining operations, the uncertainty of future profitability and the uncertainty of access to additional capital.

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

  • Roxgold Inc.
    Robert Sibthorpe
    President, CEO, and Director
    (604) 638-0979

    Roxgold Inc.
    Al Fabbro
    (604) 351-8850