X-Tal Minerals Corp.
TSX VENTURE : XMT.H

X-Tal Minerals Corp.

December 23, 2010 14:19 ET

X-Tal Closes $11.5 Million Private Placement

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Dec. 23, 2010) -

NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN UNITED STATES

X-Tal Minerals Corp. (TSX VENTURE:XMT.H) (the "Company") is pleased to announce that, further to its press release dated November 18, 2010, it has closed its $11.5 million private placement financing (the "Offering"). The financing is being conducted in conjunction with the Company's announced merger (the "Transaction") with American Eagle Resources, Inc. ("AME").

The Company engaged MGI Securities Inc. and PI Financial Corp. as agents (the "Agents") in connection with the financing and in addition, the Company also concluded a portion of the financing on a non-brokered basis. The financing consisted of 10,000,000 subscription receipts (the "Subscription Receipts") priced at $1.00 per Subscription Receipt for gross proceeds of $10,000,000. In addition, the Agents fully exercised the option granted to them by the Company to sell an additional 1,500,000 Subscription Receipts at the same issue price for additional gross proceeds of $1,500,000.

Upon completion of the Transaction, each Subscription Receipt will automatically be exercised into one unit of the Company. Each unit will consist of one common share and one half of one share purchase warrant of the Company, with each whole warrant entitling the holder to purchase one common share of the Company at a price of $2.00 for a period of 12 months following the closing of the Offering. The Subscription Receipts and the underlying common shares and warrants will be subject to a four month hold period expiring on April 22, 2011. The gross proceeds of the financing, less certain fees, costs and expenses of the Agents, will be held in escrow pursuant to the terms of a subscription receipt indenture entered into between the Company, the Agents and Computershare Trust Company of Canada, and will be released to the Company, less the Agents' fees, upon the completion of the Transaction. The Transaction is subject to TSX Venture Exchange. Unanimous shareholder approvals were obtained at the shareholder meetings of the Company and of AME held on December 21, 2010.

The Company has agreed to pay cash commissions of up to 6% of the gross proceeds raised under the Offering with the assistance of the Agents, and issue agent's warrants of up to 6% of the number of Subscription Receipts sold under the Offering with the assistance of the Agents, as well as certain additional costs and expenses payable to the Agents.

ON BEHALF OF THE BOARD OF DIRECTORS

Walter H. Berukoff, Chairman

This press release is not an offering of securities for sale in the United States. The subscription receipts and their underlying securities 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 absent registration or an exemption from the registration requirements of that Act.

Contact Information

  • X-Tal Minerals Corp.
    311 West 1st Street
    North Vancouver BC V7M 1B3
    604-998-1250
    604-998-1253 (FAX)
    www.xtalminerals.com