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Amarillo Gold Corp. (TSX Venture: AGC) (the �Company�) has
entered into an agreement with PI Financial Corp. (the �Agent�) to
raise on a best efforts private placement basis up to $10 million (the
�Private Placement�) through the issuance of units of the Company at a
price of $1.50 per unit (the �Unit�). Each Unit of the Company shall
consist of one common share and one half common share purchase warrant
(a �Warrant�), each whole Warrant exercisable to acquire one additional
common share at a price of $2.00 per common share, for a period of 18
months after the closing date of the Private Placement (the �Closing�).
If on any day during the exercise period of the warrants the twenty-day
volume weighted average trading price of the Company�s common shares on
the TSX Venture Exchange exceeds $2.50 per share, the Company may
notify the holders of the warrants in writing within 3 business days of
such date, and the Warrants shall expire on that day which is 30 days following
the date of such notice.
The Company will pay the Agent a cash commission equal to 6% of the
gross proceeds from the sale of the Units, not including sales of Units
to the members of the �president�s list�, and 2% of the gross proceeds
from the sale of Units under the Private Placement to the members of
the �President�s list�. In addition, the Agent will receive broker
warrants equal to 6% of the number of Units sold under the Private
Placement (not including Units sold to insiders of the Company and
close persons of the Company included on the �president�s list�), with
each broker warrant being exercisable at any time for one common share
of the Company at the issue price of the units of the Private Placement
for a period of 18 months following the Closing.
All securities issued in connection with the Private Placement will be
subject to a minimum four month hold period.
The net proceeds from the Private Placement will be used for the
further exploration and development of the Company�s Mara Rosa and Lavras do Sul projects in
Brazil, and for general corporate purposes.
Closing of the Private Placement is scheduled to take place on or about
April 28, 2011 and is subject to the approval of the TSX Venture
Exchange.
This news release does not constitute an offer to sell or a
solicitation of an offer to sell any of the securities in the United
States. The securities have not been and will not be registered under
the United States Securities Act of 1933, as amended (the �U.S.
Securities Act�) or any state securities laws and may not be offered or
sold within the United States or to U.S. Persons unless registered
under the U.S. Securities Act and applicable state securities laws or
an exemption from such registration is available.
About Amarillo Gold:
Amarillo Gold Corp. is focused on the acquisition, discovery, and
definition of gold resources in Brazil. The Company�s principal
projects are the Mara Rosa Project in the state of Goias,
and the Lavras do Sul
Project in the state of Rio Grande do Sul.
The Posse Deposit at Mara Rosa contains 623,000 ounces of gold
indicated from 11.9 MT at 1.62 g/t Au, and 451,000 ounces of gold
inferred from 10.1 MT at 1.38 g/t Au (0.5 g/t cut-off grade) (NI 43-101
compliant resource as independently determined by Australian
Exploration Field Services Pty. AEFS) The Mara Rosa
Gold Project is in the Pre-feasibility stage.
The Posse Deposit was successfully mined by Western Mining Company
(WMC) during the 1990s (mined areas are excluded from the above-stated
resource figures), and is located in an area of excellent
infrastructure approximately 35 km NE of Yamana�s
Chapada open pit Cu-Au operation, 105 km NE
of Serra Grande�s underground Au mine, 105 km NNW of Anglo American�s
Ni laterite project (in construction), 95 km
NW of Votarintim�s Niquelandia
Ni laterite mine, and some 60 km NE of Yamana�s Pilar Au project
(in Feasibility).Grid power to the site was established during WMC�s
open pit mining operation, and the Serra da
Mesa (450 MW) hydro-electric dam lies 35 km to the east.
The Lavras do Sul
Project is an advanced exploration stage property (190 sq. km.)
comprised of more than 19 prospects centered on historic gold workings,
with encouraging gold mineralization discovered and defined by more
than 16,000 metres of drilling. The initial
resource estimate at the Butia prospect
reported 215,000 ounces of gold indicated from 6.4 MT at 1.05 g/t Au,
and 308,000 ounces of gold inferred from 12.9 MT at 0.74 g/t Au ((0.3
g/t cut-off grade)(NI 43-101 compliant resource as independently
determined by Atticus Consulting 2010). Lavras
do Sul is also located near excellent
infrastructure. The Company also has a portfolio of earlier stage
projects and all properties under Amarillo�s management are located in
areas of good infrastructure and mining-friendly communities.
ON BEHALF OF THE
BOARD OF DIRECTORS
AMARILLO GOLD CORP.
Per: "Buddy Doyle"
Buddy Doyle, President
Contacts: Amarillo Gold Corp. +1-604-689 1799 (Canada) +55-31-3261 5974 (Brazil) info@amarillogold.com
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.
FORWARD LOOKING
STATEMENTS:
This news release
contains Forward Looking Statements regarding our intentions and plans.
Various factors may prevent or delay our plans, including but not
limited to, contractor availability and performance, weather, access,
mineral prices and success and failure of the exploration and
development carried out at various stages of the program. Readers
should review risk factors applicable to junior mining exploration
companies generally to understand the variety of risks that can affect
the Company.
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