Oct. 20, 2009 (Filing Services Canada) -- Mega Precious Metals Inc. (MGP - TSX Venture), ("Mega") announces that it has sold, on a best efforts agency basis, 8,050,000 flow-through units, after full exercise of the over-allotment option ("Units"), at a price of $0.75 per Unit. Each Unit consists of one flow-through common share (each a "Flow-Through Share") and one whole share purchase warrant. Each share purchase warrant entitles the holder to acquire one additional common share of Mega at any time up to October 20, 2011 for an exercise price of $1.15.
PowerOne Capital Markets Limited acted as lead agent on behalf of a syndicate of agents including Research Capital Corporation and Laurentian Bank Securities Inc. (the "Agents").
The Company shall, pursuant to the provisions in the Income Tax Act (Canada), incur Canadian Exploration Expenses (the "Qualifying Expenditures") for the issue of the Flow-Through Shares and prior to December 31, 2010 in the aggregate amount of not less than the commitment amount of the gross proceeds raised from the issue of Flow-Through Shares. The Company shall renounce the Qualifying Expenditures so incurred to the purchasers of the Flow-Through Shares such that C$0.74 per Flow-Through Share shall be deductible against the income of the Flow-Through Share subscribers for the fiscal year ended December 31, 2009.
The securities issued in this private placement are subject to a four month hold period that expires February 21, 2010.
The private placement remains subject to receipt of final approval from the TSX Venture Exchange.
The Agents received an aggregate commission equal to 6% of the gross proceeds of the offering and broker warrants in an aggregate amount of 10% of the number of Units sold. Each Broker Warrant is exercisable by the Agents to acquire one common share of Mega at a price of $0.75 per share at any time up to October 20, 2011.
The Securities have not, nor will they be registered under the United States Securities Act of 1933, as amended, and may not be offered or sold within the United States or to, or for the account or benefit of, U.S. persons absent U.S. registration or an applicable exemption from the U.S. registration requirements. This release does not constitute an offer for sale of securities in the United States.
Mega Precious Metals Inc. is a well financed Canadian-based mineral exploration company with several projects in Northwestern Ontario, Nunavut and the Yukon. The Company is committed to an accelerated growth strategy and is backed by a team of experienced mining experts and a strong financial position. The Company is poised for rapid expansion through quick response to new opportunities and changes in the market. Mega's common shares trade on the TSX Venture Exchange under the symbol MGP.
For further information and presentation material, please review the Mega website at www.megapmi.com
For further information, please contact:
Mega Precious Metals Inc.
Jim Rogers, President and Chief Executive Officer
This news release includes certain forward-looking statements concerning the future performance of our business, its operations and its financial performance and condition, as well as management's objectives, strategies, beliefs and intentions. The Company does not intend, and does not assume any obligation, to update these forward-looking statements. Forward-looking statements are frequently identified by such words as "may", "plan", "expect", "anticipate", "estimate", "intend" and similar words referring to future events and results. These forward-looking statements represent management's best judgment based on current facts and assumptions that management considers reasonable. The Company makes no representation that reasonable business people in possession of the same information would reach the same conclusions. All forward-looking information is inherently uncertain and subject to a variety of assumptions, risks and uncertainties, including the speculative nature of mineral exploration and development, fluctuating commodity prices, competitive risks and the availability of financing and as described in more detail in our recent securities filings available at www.sedar.com. Actual events or results may differ materially from those projected in the forward looking-statements and we caution against placing undue reliance thereon.
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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