Feb 7 2011
Marathon Gold Corporation (TSX:MOZ) announces that it has entered into an agreement with a syndicate of underwriters, led by Stonecap Securities Inc. and including Octagon Capital Corporation, whereby the Underwriters have agreed to purchase, on a bought deal basis, 1,945,000 flow-through common shares of the Company at a price of $1.80 per Flow-Through Common Share for gross proceeds of $3,501,000.
The Company has granted the Underwriters an option to purchase up to an additional 15% of the Flow-Through Common Shares at the Issue Price exercisable up to 48 hours prior to closing of the Offering for additional gross proceeds of up to $525,150.
The gross proceeds from the sale of the Flow-Through Common Shares will be used for exploration at the Company's Canadian exploration properties.
The Offering will be made by way of private placement to accredited investors in all provinces of Canada. The Offering is expected to close on or about March 1, 2011, and is subject to certain conditions including, but not limited to, the receipt of all necessary approvals including the approval of the Toronto Stock Exchange and the securities regulatory authorities. The Flow-Through Common Shares will be subject to a four-month hold period.
The Underwriters shall receive a cash commission equal to 7% of the gross proceeds of the Offering and broker warrants (the "Broker Warrants") equal to 7% of the number of Flow-Through Common Shares issued pursuant to the Offering. Each Broker Warrant shall entitle the holder thereof to acquire one non-flow-through common share of the Company at the Issue Price for 24 months following closing of the Offering.
Source: Marathon Gold Corporation