Virgin Metals Inc.
TSX VENTURE : VGM

Virgin Metals Inc.

September 24, 2010 08:00 ET

Virgin Metals Inc.: Announces Concurrent Private Placement and Rights Offering

TORONTO, ONTARIO--(Marketwire - Sept. 24, 2010) - 

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Virgin Metals Inc. (the "Company" or "Virgin") (TSX VENTURE:VGM) is pleased to announce that it intends to carry out a non-brokered private placement of up to 3,057,004 units (each, a "Unit") at a price of $0.20 per Unit (the "Private Placement") for aggregate gross proceeds of up to $611,400. Each Unit will be comprised of one common share (each, a "Common Share") and one Common Share purchase warrant (each, a "Warrant") of the Company. Each Warrant will entitle the holder to purchase one Common Share at any time for a period of two years, at a price of $0.25 per Common Share.

In conjunction with the Private Placement and so that existing shareholders of Virgin will have the opportunity to participate in the ongoing financing of the Company following its recent share consolidation, the Company also announces that it is proceeding with a rights offering (the "Rights Offering") which will be made available to all holders of Common Shares residing in all of the provinces and territories of Canada, other than Québec (the "Qualifying Jurisdictions"). Under the Rights Offering, the Company intends to issue to each eligible shareholder one right (each, a "Right") for every one Common Share held. Eight Rights will permit the holder to subscribe for one Unit. Each Unit will be identical to the Units offered in the Private Placement, with the Units issued at a price of $0.20 per Unit and comprised of one Common Share and one Warrant. Each Warrant will entitle the holder thereof to acquire one Common Share at a price of $0.25 per Common Share until expiry two years after the date that the Warrant is issued. The Company anticipates that the record date for the Rights Offering will be on or about October 15, 2010. The Rights Offering will not be subject to any minimum subscription level. The Company currently has 24,456,036 Common Shares issued and outstanding.

"As the Company moves into a new stage of activity, it is the primary objective of the Rights Offering to create an attractive investment opportunity for the benefit of all current shareholders" said Chris Frostad, President and Chief Executive Officer of the Company.

In the event that the Private Placement and the Rights Offering (collectively, the "Offerings") are fully subscribed, Virgin will receive gross proceeds of approximately $1,224,000. The net proceeds to Virgin from the Offerings will be used to advance the pre-feasibility report on the Company's Los Verdes property, as well as for working capital and general administrative purposes.

The Offerings are subject to the receipt of all applicable regulatory approvals.

About the Company

Virgin is a junior exploration and development company; its projects include two copper-molybdenum porphyry properties in Sonora, northern Mexico. One of these, Los Verdes, is currently the subject of a pre-feasibility study while the other, Cuatro Hermanos, is the focus of ongoing exploration efforts.

Except for statements of historical fact contained herein, the information in this press release may constitute "forward-looking information" within the meaning of Canadian securities law. Other than statements of historical fact, all statements are "forward-looking statements", including the size and pricing of the Offerings that involve various known and unknown risk and uncertainties and other factors, such as market conditions. There can be no assurance that such statements will prove accurate. Results and future events could differ materially from those anticipated in such statements. Readers of this press release are cautioned not to place undue reliance on these "forward-looking statements". Except as otherwise required by applicable securities statutes or regulation, Virgin expressly disclaims any intent or obligation to update publicly forward-looking information, whether as a result of new information, future events or otherwise.

Neither the Investment Industry Regulatory Organization of Canada nor the TSX Venture Exchange accepts responsibility for the adequacy or accuracy of this press release.

Contact Information

  • Virgin Metals Inc.
    Chris Frostad
    President and Chief Executive Officer
    (416) 603-8368
    www.virginmetals.com