Treasury Metals Inc.

Treasury Metals Inc.

October 18, 2010 08:30 ET

Treasury Metals Announces Private Placement Financings

TORONTO, ONTARIO--(Marketwire - Oct. 18, 2010) -


Treasury Metals Inc. ("Treasury" or the "Company") (TSX:TML) is pleased to announce that it intends to complete, on a private placement basis, an offering of up to 4,000,000 common shares of the Company issuable as flow-through shares for purposes of the Income Tax Act (Canada) of the Company (the "Flow-Through Shares") at a price of $0.75 per Flow-Through Share and up to 967,741 units of the Company (the "Units") at a price per Unit of $0.62 for aggregate gross proceeds of up to $3,600,000 (the "Offering"). Each Unit will consist of one common share and one-half of one common share purchase warrant (each whole warrant being referred to as a "Warrant") of the Company. Each Warrant will entitle the holder thereof to purchase one additional common share (a "Warrant Share") of the Company at an exercise price of $0.75 per Warrant Share for a period of 18 months from the closing date of the Offering, provided that if, at any time after the closing date, the Company's common shares trade on a stock exchange at a price of $1.24 or greater per common share for a period of 20 consecutive trading days, the Company may accelerate the expiry date of the Warrants by giving notice to the holders thereof and in such case the Warrants will expire on the 30th day after the date on which such notice is received or deemed to be received by such holders. The Company has engaged a syndicate of agents, led by MGI Securities and including Casimir Capital L.P. and M Partners Inc. (collectively, the "Agents"), to act as the agents in respect of the Offering.

The Company is also offering up to an additional 1,333,333 flow-through shares at a price of $0.75 per flow-through share on a non-brokered basis for aggregate gross proceeds of up to $1,000,000 (the "Non-Brokered Offering"). The Company will pay a finder's fee of 5% per cent of the gross proceeds raised pursuant to the Non-Brokered Offering.

The Offering is being made by the Agents on a "best efforts" basis and is subject to certain conditions, including, but not limited to, the receipt of all necessary regulatory approvals. The Flow-Through Shares and Units will be offered and sold by way of private placement exemptions in all provinces of Canada. It is anticipated that the Units will be offered and sold in jurisdictions outside of Canada and the U.S., as to be mutually agreed to by the Company, subject to compliance with applicable laws. The Offering and the Non-Brokered Offering are expected to close on or about November 28, 2010, or on such other date or dates as the Company and the Agents may agree.

The Company has agreed to pay the Agents a cash commission equal to 7% of the gross proceeds of the Offering and to issue to the Agents compensation options entitling the Agents to purchase that number of common shares of the Company that is equal to 7% of the aggregate number of Units and Flow-Through Shares sold under the Offering at an exercise price of $0.62 per common share for a period of 18 months following the closing date of the Offering.

The Company intends to use the net proceeds from the Offering and the Non-Brokered Offering to advance the Company's 100% owned Goliath Gold Project towards pre-feasibility by commencing up to 20,000 metres of diamond drilling and for general working capital purposes. Work will focus on upgrading the current resources through in-fill drilling, exploration drilling aimed at building additional ounces for a future updated mineral resource estimate and implementing recommendations from the recently completed Preliminary Economic Assessment.

The securities being 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 in the absence of registration or an applicable exemption from the registration requirements. This press release does not constitute an offer to sell or the solicitation of an offer to purchase securities in the United States.

About Treasury Metals

Treasury Metals Inc. is a Canadian mining company that is focussed on expanding the Company's gold resources and developing its 100% owned flagship Goliath Gold Project located in the Kenora Gold District of northwestern Ontario. The NI 43-101 compliant gold resource contains non-diluted underground Indicated Resources of 490,000 tonnes grading 5.7 g/t Au (90,000 ounces) and Inferred Resources of 5,200,000 tonnes grading 4.4 g/t Au (740,000 ounces) and surface Indicated Resources of 2,900,000 tonnes grading 1.9 g/t Au (180,000 ounces) and Inferred Resources of 5,400,000 tonnes grading 1.1 g/t Au (190,000 ounces). Treasury also receives revenue from a Net Smelter Royalty they hold on Goldgroup Mining Inc.'s Cerro Colorado Mine located in Mexico.

Technical information in this press release has been reviewed and approved by Scott Jobin-Bevans, Treasury's President and CEO, who is a qualified person under the definitions established by National Instrument 43-101.

The Company has implemented a quality assurance and control (QA/QC) program to ensure sampling and analysis of all exploration work is conducted in accordance with the CIM Exploration Best Practices Guidelines. The drill core is sawn in half with one half of the core samples shipped to Accurassay Laboratories in Thunder Bay, Ontario. The other half of the core is retained for future assay verification. Other QA/QC procedures include the insertion of blind blanks and standards for every tenth sample in the sample stream. Blind quarter core duplicates were assayed for 5% of the samples. The laboratory re-assays at least 10% of all samples (pulps and rejects) and additional checks may be run on anomalous values. Gold analysis is conducted by lead collection, fire assay with atomic absorption or gravimetric finish on a 30 gram sample. Check assays by a secondary lab will be completed in the future.

For additional information on Treasury Metals and its projects, please visit the Company's website at

Forward-looking Statements

This press release contains forward-looking statements such as the closing date of the private placement, the anticipated net proceeds from the private placement and the expected use of such proceeds, our future financial condition, results of operations and business. Such statements are based on operations, estimates, forecasts and projections. They are not guarantees of future performance and involve risks and uncertainties that are difficult to predict and may be beyond Treasury Metals' control. A number of important factors could cause actual outcomes and results to differ materially from those expressed in forward-looking statements, including those set forth in other public filings. In addition, such statements relate to the date on which they are made. Consequently, undue reliance should not be placed on such forward-looking statements. Treasury Metals disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, save and except as may be required by applicable securities laws.

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