Castle Peak Announces Closing of its Non-Brokered Private Placement
THIS NEWS RELEASE IS INTENDED FOR DISTRIBUTION IN CANADA ONLY AND IS NOT FOR DISSEMINATION IN THE UNITED STATES OR FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES
Vancouver, B.C., July 30, 2012 - Castle Peak Mining Ltd. ("Castle Peak" or the "Company", TSX.V: CAP) is pleased to announce the closing on July 27, 2012 of the private placement offering (the "Offering") previously announced on July 4, 2012 and as amended July 24, 2012. Pursuant to the Offering the Company issued 14,823,528 units ("Units") at a price of $0.17 per Unit for gross proceeds of approximately $2,520,000.
Each Unit consists of one common share of the Company and one share purchase warrant, where each warrant entitles the subscriber to purchase one additional common share of the Company at an exercise price of $0.25 per share for a period of 24 months from the date of closing, subject to adjustment/acceleration under certain circumstances.
The securities issued pursuant to the Offering are subject to customary securities legislation hold periods. In addition, the subscription agreements contain lock-up provisions such that the securities issued pursuant to the Offering cannot be traded prior to January 27, 2013 (which date is six months after closing of the Offering).
Grizal Enterprises Ltd. ("Grizal"), a "control person" of the Company (as that term is defined in the TSXV policies), has subscribed for 5,882,353 Units of the Offering for gross proceeds of $1 million (the "Grizal Units"), which constitutes a "related party transaction" within the meaning of Multilateral Instrument 61-101 and TSXV Policy 5.9 (together, the "Policies"). Grizal, upon closing of the Offering, now holds a total of 17,882,353 common shares (undiluted) representing 23.5% of the issued and outstanding common shares of the Company. Pursuant to the terms of its subscription agreement for the Units, Grizal holds the right to nominate a director to the board of directors of the Company.
Candel and Partners SAS ("Candel"), a company wholly-owned by Allan Green, a director of the Company, has subscribed for 5,882,353 Units of the Offering for gross proceeds of $1 million (the "Candel Units"), which constitutes a "related party transaction" within the meaning of the Policies. As a result of Candel's subscription, Mr. Green now holds, directly and indirectly, a total of 7,436,353 common shares (undiluted) representing 9.8% of the issued and outstanding common shares of the Company.
Darren Lindsay (together with Grizal and Candel, the "Insiders"), director and President and Chief Executive Officer of the Company, has subscribed for 58,824 Units of the Offering for gross proceeds of $10,000, which constitutes a "related party transaction" within the meaning of the Policies. Mr. Lindsay, upon closing of the Offering, now holds a total of 192,323 common shares (undiluted) representing 0.2% of the issued and outstanding common shares of the Company.
The remaining investors subscribed for 2,999,998 Units under the Offering for gross proceeds of approximately $510,000. The Company has also paid a finder's fee of $35,000, representing 7% of the gross proceeds of certain subscriptions.
The Offering was approved by a majority of the independent directors of the Company as being in the best interests of the Company, and the Board has determined exemptions from the formal valuation and minority approval requirements under the Policies are available. Mr. Green and Mr. Lindsay each abstained from voting due to their interest in the Offering.
Neither the Company, nor to the knowledge of the Company after reasonable inquiry, the Insiders, have knowledge of any material information concerning the issuer or its securities, that has not been generally disclosed.
Proceeds from the Offering will be used to fund the ongoing exploration program at Castle Peak's Akorade Project in Ghana as well as working capital.
The securities being offered have not been, nor will they be, registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States, or to, or for the account or benefit of, U.S. persons absent registration or an applicable exemption from registration requirements. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any jurisdictions in which such offer, solicitation or sale would be unlawful. Any offering made will be pursuant to available prospectus and registration exemptions and restricted persons to whom the securities may be sold in accordance with the laws of such jurisdictions and by persons permitted to sell the securities in accordance with the laws of such jurisdictions.
About Castle Peak
Castle Peak Mining Ltd. is a Canadian-based exploration and development company focused on advancing greenfields and early stage gold projects. The Company holds a strategic land package in the Ashanti belt adjacent to several producing gold mines in Ghana, West Africa. The Ashanti belt is known as one of the most prolific gold belts in the world with over 150 million proven ounces uncovered and current investment in excess of $3.3 B USD.
On behalf of the Board of Castle Peak Mining Ltd.:
President and Chief Executive Officer
Except for statements of historical fact, this news release contains certain 'forward-looking information' and 'forward-looking statements' within the meaning of applicable securities laws including statements regarding the proposed use of proceeds and the rights of Grizal to an appointee on the board of directors of the Company. Such forward-looking statements are based on the opinions and estimates of management at the date the statements are made, and are subject to known and unknown risks, uncertainties and assumptions that could cause actual results to vary materially from the anticipated results or events predicted in these forward-looking statements, including those risk factors identified in the Company's Filing Statement filed under the Company's SEDAR profile. As a result, readers are cautioned not to place undue reliance on these forward-looking statements. The forward-looking statements contained in this news release are made as of the date of this release. Except as required by applicable law, Castle Peak disclaims any intention and assumes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
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.