St Andrew Goldfields Ltd.
TSX : SAS

St Andrew Goldfields Ltd.

December 12, 2008 17:00 ET

St Andrew to Issue $2.9 Million of Debentures and Notes

OAKVILLE, ONTARIO--(Marketwire - Dec. 12, 2008) -

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

St Andrew Goldfields Ltd. (TSX:SAS) ("St Andrew" or the "Company") announced that it has agreed to issue to Technifund Inc., a private company controlled by Herbert Abramson, the Chairman of the Company, a secured debenture in the principal amount of $2.8 million and an unsecured demand promissory note in the principal amount of approximately $0.1 million. The promissory note and the debenture will each bear interest at the rate of 10 percent per annum. The debenture is one of a series of debentures issued by the Company maturing December 31, 2009 and is secured by a general security agreement over the Company's assets as well as by mortgages over certain of the Company's mining claims in the Timmins, Ontario area. The debenture and the note are being issued in satisfaction of the Company's obligation to indemnify Technifund with respect to eligible exploration expenses that were not incurred by the Company within the permitted statutory time period. The Company had previously accrued $3 million in respect of this liability. Completion of the transaction is expected to occur prior to year end.

The transaction constitutes a "related party transaction" under Multilateral Instrument 61-101 and has been approved by the Company's independent directors. An exemption from the requirement to prepare a formal valuation and to obtain minority shareholder approval in respect of the transaction will be relied upon on the basis that the fair market value of the transaction constitutes less than 25% of the Company's market capitalization.

FORWARD LOOKING STATEMENTS

The information in this release may contain forward-looking information under applicable securities laws. All statements, other than statements of historical fact, are forward-looking. We use words such as "may", "will", "should", "anticipate", "plan", "expect", "believe", "estimate" and similar terminology to identify forward looking information, including with respect to our intent to issue the securities herein described. Such are based upon assumptions, estimates, opinions and analysis made by management in light of its experience, current conditions and its expectations of future developments as well as other factors which it believes to be reasonable and relevant. and statements and accordingly, readers should not place undue reliance on those statements This forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause actual results to differ materially from those implied by the forward-looking information. Factors that may cause actual results to vary material include, but are not limited to, inaccurate assumptions concerning the exploration for and development of mineral deposits, political instability, currency fluctuations, unanticipated operational or technical difficulties, changes in laws or regulations, the risks of obtaining necessary licenses and permits, changes in general economic conditions or conditions in the financial markets and the inability to raise additional financing. Readers should refer to the Company's Annual Information Form filed at www.sedar.com for a further discussion of such risks, uncertainties and factors. Readers are cautioned not to place undue reliance on this forward-looking information. St Andrew does not assume the obligation to revise or update this forward-looking information after the date of this release or to revise such information to reflect the occurrence of future unanticipated events, except as may be required under applicable securities laws.

Contact Information

  • St Andrew Goldfields Ltd.
    Jacques Perron
    President and CEO
    Toll Free: 1-800-463-5139 or (905) 815-9855
    (905) 815-9437 (FAX)
    Email: jperron@standrewgoldfields.com
    or
    St Andrew Goldfields Ltd.
    Ben Au
    CFO and VP Finance & Administration
    Toll Free: 1-800-463-5139 or (905) 815-9855
    (905) 815-9437 (FAX)
    Email: bau@standrewgoldfields.com