Blue Note Arranges a Private Placement with Industrial Alliance Securities
/NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR DISSEMINATION IN THE UNITED STATES/
MONTREAL, June 6, 2011 /CNW Telbec/ - Blue Note Mining Inc. (TSXV: BNT) ("Blue Note" or the "Company") announces that it has entered into an agreement with Industrial Alliance Securities Inc. (the "Agent") to proceed with a private placement on a "best efforts" basis for gross proceeds of up to $2,000,000 (the "Offering"). The Offering consists of the issuance of a maximum of 9,090,909 flow-through common shares (the "Flow-Through Shares") at a price of $0.11 per Flow-Through Share for maximum gross proceeds of $1,000,000 and a maximum of 12,500,000 units (the "Units") at a price of $0.08 per Unit for maximum gross proceeds of $1,000,000. Each Unit will be comprised of one (1) common share at a price of $0.08 and one-half common share purchase warrant at a price of $0.11 per share for a period of eighteen (18) months following the closing of the Offering, subject to an acceleration provision if the price of the common shares of Blue Note listed on the TSX Venture Exchange is above $0.20 for a period of 20 consecutive trading days. In this event, the warrants must be exercised or will expire thirty calendar days after notice is mailed to the holders of warrants.
Blue Note will grant an over-allotment option to the Agent, which may be exercised for 30 days following the closing of the Offering, pursuant to which the Agent will have the right to sell additional Flow-Through Shares and/or Units in a maximum amount equal to 15% of the number of Flow-through Shares and Units sold in the Offering, respectively. If the over-allotment option is exercised in full, Blue Note will raise gross proceeds of $2,300,000 from the Offering.
At the closing of the Offering, the Agent will receive a cash commission equal to 7.5% of the gross proceeds raised under the Offering. In addition, the Agent shall receive non-transferable warrants at a price of $0.11 exercisable for a period of two (2) years from the date of closing to acquire such number of common shares of the Company as is equal to 4% of the aggregate number of Flow-Through Shares and Units issued under the Offering.
The Offering is scheduled to close on or about June 17, 2011 and is subject to certain conditions including, but not limited to, the receipt of all necessary approvals including the approval of the TSX Venture Exchange. All securities issued pursuant to the Offering will be subject to a four month and one day hold period from the date of closing of the Offering.
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The net proceeds from the Units shall be used for working capital and for general corporate purposes. Proceeds from the Flow-Through Shares will be used to advance Blue Note's Croinor and Chimo projects, which will constitute Canadian exploration expenses (as defined in the Income Tax Act (Canada)) and will be renounced for the 2011 tax year. |
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About Blue Note Mining
Blue Note Mining is a mineral exploration and mining company headquartered in Montreal with properties located in known gold regions of Canada, including the prolific Val-d'Or region of Quebec and northern New Brunswick.
Forward-Looking Statements
This news release contains discussion of items that may constitute forward-looking statements within the meaning of securities laws that involve risks and uncertainties. Such statements include those with respect to the Company's ability to raise funds under the Offering. Although the Company believes the expectations reflected in such forward-looking statements are based on reasonable assumptions, it can give no assurances that its expectations will be achieved. Such assumptions, which may prove incorrect, include the following: (i) the Agent will fulfill its contractual obligations to complete the Offering on a "best-efforts" basis, (ii) the Agent will be successful in its efforts to identify subscribers under the Offering, (iii) the subscribers under the Offering will complete the subscriptions they have agreed to make under their subscription agreements, (iv) Blue Note's management will not identify and pursue other business objectives using the proceeds of the Offering and (v) the price of gold will remain sufficiently high and the costs of advancing the Company's gold projects sufficiently low so as to permit Blue Note to implement its business plans in a profitable manner. Factors that could cause actual results to differ materially from expectations include (i) the inability or unwillingness of the subscribers under the Offering or of the Agent to fulfill their contractual obligations, in whole or in part, (ii) the Company's failure to make effective use of the proceeds of the Offering, (iii) the Company's inability to obtain the necessary regulatory approvals for the Offering, (iv) a decrease in the price of gold below what is necessary to sustain the Company's operations, (v) an increase in the Company's operating costs above what is necessary to sustain its operations, (vi) accidents, labour disputes or the materialization of similar risks, (vii) a deterioration in capital market conditions that prevents the Company from raising the funds it requires on a timely basis and (viii) generally, the Company's inability to develop and implement a successful business plan for any reason. These factors and others are more fully discussed in the Company's filings with Canadian securities regulatory authorities available at www.sedar.com. Actual results may vary from the forward-looking information.
"Neither the 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."