Yellowhead Mining Inc.
TSX VENTURE : YMI

Yellowhead Mining Inc.

April 05, 2011 09:26 ET

Yellowhead Mining Announces Closing of Bought Deal Private Placement for Gross Proceeds of CDN$20,488,000

VANCOUVER, BRITISH COLUMBIA--(Marketwire - April 5, 2011) -

NOT FOR DISTRIBUTION TO THE UNITED STATES NEWS WIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES

Yellowhead Mining Inc. (TSX VENTURE:YMI) ("Yellowhead" or the "Company") is pleased to announce the closing of its previously announced bought deal private placement, including the partial exercise of the over-allotment option (the "Offering"). Under the Offering, the Company issued an aggregate of 14,129,655 units of the Company at a price of $1.45 per unit for gross proceeds of $20,488,000. Each unit consists of one common share of the Company and one-half of one common share purchase warrant, with each whole warrant exerciseable for an additional common share of the Company at a price of $2.00 per share for a period of 24 months following the closing.

The Offering was led by Canaccord Genuity Corp. and included Clarus Securities Inc., Jennings Capital Inc. and Stonecap Securities Inc. (the "Underwriters"). 

"We are pleased to have completed the private placement," stated Ian Smith, Chief Executive Officer of the Company. "It provides us the funds to continue engineering and increase step-out drilling on the project."

The proceeds of the Offering will be used for exploration and development of the Company's Harper Creek project and for general working capital purposes. Directors and officers of the Company, and their related parties and associated entities, purchased a total of 40,000 Units under the Offering and now hold, in the aggregate, approximately 3.2% of the issued and outstanding common shares of the Company.

The Underwriters received a total cash commission of 6% of the gross proceeds of the Offering and were issued a total of 847,779 underwriter's warrants (the "Underwriter's Warrants"). Each Underwriter's Warrant entitles the holder thereof to purchase one Common Share at a price of $1.45 per Common Share prior to April 5, 2013. 

All securities issued pursuant to the Offering are subject to customary securities legislation hold periods and will not become freely tradeable until August 6, 2011.

This news release does not constitute an offer to sell or a solicitation of an offer to buy nor shall there be any sale of any of the Securities in any jurisdiction in which such offer, solicitation or sale would be unlawful. The Securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States or to, or for the benefit of, U.S. persons (as defined in Regulation S under the U.S. Securities Act) unless registered under the U.S. Securities Act and applicable state securities laws or pursuant to an exemption from such registration requirements.

About Yellowhead

Yellowhead has a 100% interest in the Harper Creek Project, (subject to the payment of a 3% NSR royalty capped at $2.5 million, adjusted for inflation and an additional 2.5% NSR royalty on roughly 3.3 million tonnes of ore which is expected to be mined beginning in year 9 within the NI 43-101 resource). The Harper Creek Project is a large copper-gold-silver project located in south-central British Columbia, approximately 150 kilometres by highway from Kamloops.

Forward Looking Statements

Except for statements of historical fact, this material change report contains certain "forward-looking information" within the meaning of applicable securities laws. Forward-looking information is frequently characterized by words such as "plan", "expect", "project", "intend", "believe", "anticipate", "estimate" and other similar words, or statements that certain events or conditions "may" or "will" occur. Forward-looking statements are based on the opinions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those anticipated in the forward-looking statements, including, among others, the anticipated proceeds and use of proceeds of the Offering, closing of the Offering, as well as those risk factors identified in the Company's annual information form filed under the Company's SEDAR profile. Yellowhead undertakes no obligation to update forward-looking information if circumstances or management's estimates or opinions should change except as required by law. The reader is cautioned not to place undue reliance on forward-looking statements. More detailed information about potential factors that could affect financial results is included in the documents filed from time to time with the Canadian securities regulatory authorities by Yellowhead.

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.

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