Algold Announces Closing Of An Oversubscribed $4 Million Private Placement

Algold Resources Ltd. (TSXV:ALG) has closed its previously announced private placement financing conducted on a bought deal basis through a syndicate of underwriters led by Beacon Securities Ltd. (and included National Bank Financial Inc.) of 11.5 million units at a price of 30 cents per unit for gross proceeds to the corporation of $3.45-million (including full exercise of the underwriters’ option). Each unit consists of one common share of Algold and one-half of one common share purchase warrant, each whole warrant entitling the holder thereof to subscribe for one common share of Algold at a price of 40 cents for a period of 12 months from the closing date.
Concurrent with the brokered private placement, the corporation closed a non-brokered private placement of 1,666,667 units at a price of 30 cents per unit for additional gross proceeds to the corporation of $500,000 and, together with the brokered private placement, total gross proceeds to the corporation of $3.95-million.
The corporation paid to the underwriters a cash commission equal to 6 per cent of the gross proceeds raised in connection with the brokered portion of the offering and issued to the underwriters that number of compensation options equal to 6 per cent of the number of units issued in connection with the brokered portion of the offering, each option entitling the underwriters to subscribe for one common share of Algold at a price of 30 cents for a period of 24 months from the closing date.
The units, including all underlying securities thereof, are subject to a hold period of four months and one day from their date of issuance under applicable Canadian securities laws.
The net proceeds of the offering will be used for working capital and general corporate purposes.
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