Oct 25 2010
Andean American Gold Corp. (TSX VENTURE:AAG)(FRANKFURT:AQN) has announced that it has entered into an agreement with a syndicate of underwriters, led by Haywood Securities Inc. and including Octagon Capital Corp., pursuant to which the Underwriters have agreed to purchase, on a bought deal basis, 16,700,000 common shares of the Company at a price of CDN$0.90 per Common Share, for aggregate gross proceeds of CDN$15,030,000.
In addition, the Company will grant the Underwriters an over-allotment option, exercisable up to 24 hours prior to the closing of the Underwritten Offering, to purchase up to an additional 5,500,000 Common Shares at CDN$0.90 to raise additional gross proceeds of up to CDN$4,950,000 (the "Over-Allotment Option", and together with the Underwritten Offering, the "Offering").
The Company intends to use the proceeds primarily for advancing its Invicta Gold Project in Peru, as well as for general corporate purposes.
The Offering is scheduled to close on or about November 12, 2010 (the "Closing Date"), and is subject to certain conditions, including but not limited to, receipt of all necessary approvals including the approval of the TSX Venture Exchange and the securities regulatory authorities.
"The majority of the funds raised through this bought deal will be used to advance our Invicta Project, a gold, silver and copper project. As mentioned in the press release of October 12, 2010, the Company has retained SRK to upgrade the Feasibility Study completed in July this year and anticipates completion in Q2 2011. Negotiations with the local communities are advancing and orders for long lead items have already been placed. We are focussed on bringing this project into production as soon as possible so that the Company and its shareholders can benefit from the strong demand for our commodities," said David Rae, President of Andean American Gold Corp.
The Common Shares issued in connection with this Offering will be subject to a four-month hold period from the Closing Date, as prescribed by the TSX Venture Exchange and applicable Canadian securities laws.
Source: Andean American Gold Corp.