U3O8 Corp. announces approximately C$15 million private placement
TORONTO, Ontario ? January 28, 2011 ? U3O8
Corp. (TSX Venture: UWE) (U3O8 Corp. or ?the Company?) is pleased to announce
that it has entered into an agreement with a syndicate of underwriters led by
GMP Securities L.P. and including Dundee Securities Corporation, PowerOne Capital Markets Ltd. and Haywood Securities Inc.
(collectively, the ?Underwriters?), pursuant to which the Underwriters have
agreed to purchase, on a bought deal private placement basis, 17,650,000 units
of the Company (the ?Units?), at a price of C$0.85 per Unit (the ?Offering
Price?) for aggregate gross proceeds to U3O8 Corp. of C$15,002,500 (the
?Offering?). Each Unit will consist of one common share in the capital of
the Company (each a ?Common Share?) and one-half of
one common share purchase warrant (each whole common share purchase warrant, a
?Warrant?). Each Warrant will entitle the holder thereof to purchase one
Common Share (a ?Warrant Share?) at a price of C$1.00
per Warrant Share (the ?Exercise Price?) for a period of 2 years following the
closing of the Offering. Insiders of U3O8 Corp.
intend to purchase, directly or indirectly, up to C$3.5 million of the
Offering.
The Company has agreed to grant an underwriters'
option to purchase up to an additional 2,647,500 Units at the Offering Price,
exercisable in whole or in part, at any time up to 48 hours prior to the
closing of the Offering. If this option is exercised in full, an additional
C$2,250,375 will be raised pursuant to the Offering and the aggregate gross
proceeds of the Offering will be C$17,252,875.
The Company has agreed to pay to the Underwriters, in
aggregate, a cash fee up to 6% of the gross proceeds of the Offering (and any
gross proceeds in connection with the exercise of the Underwriters? Option) and
to grant to such Underwriters, in aggregate, that number of broker warrants
which is up to 6% of the number of shares sold under the Offering, including
the Underwriters? Option, with each such broker warrant
entitling the holder to purchase one Unit of the Company at a price of C$0.85
for a period of 24 months from closing.
The net proceeds are
intended to be used by the Company to advance the exploration and development
of its projects in Guyana, Colombia and Argentina and for general working
capital purposes.
The Offering is
expected to close on or about February 15, 2011 and is subject to the receipt
of all necessary regulatory and stock exchange approvals, including the
approval of the TSX Venture Exchange and applicable securities regulatory
authorities.
This news release
does not constitute an offer to sell or solicitation of an offer to sell any
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 unless registered under the U.S.
Securities Act and applicable state securities laws or an exemption from such
registration is available.
About
U3O8 Corp.
U3O8 Corp.
is a Toronto-based exploration company focused on exploration of uranium and
associated commodities in South America. The Company has one of the most
advanced portfolios of uranium projects in the region comprising NI 43-101
compliant resources in Guyana, significant historic resources in Colombia and
near resource potential in Argentina.
Additional information on U3O8
Corp., each material project and technical reports are available on the company?s web site at
www.u3o8corp.com and on SEDAR at www.sedar.com.
For information, please contact:
U3O8 Corp. (416) 868-1491
Nancy
Chan-Palmateer
Richard Spencer
Vice President, Investor
Relations
President & CEO
nancy@u3o8corp.com
richard@u3o8corp.com
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.
Forward-Looking
Statements
Certain information
set forth in this news release may contain forward-looking statements that
involve substantial known and unknown risks and uncertainties. These
forward-looking statements are subject to numerous risks and uncertainties,
certain of which are beyond the control of U3O8 Corp., including, but not
limited to, the impact of general economic conditions, industry conditions,
volatility of financial markets and commodity prices, risks associated with the
uncertainty of exploration results and estimates and that the resource
potential will be achieved on exploration projects, currency fluctuations,
dependence upon regulatory approvals, and the uncertainty of obtaining
additional financing and exploration risk. There is no assurance that the Kurupung Project, Berlin Project and Laguna Salada Projects will add to U3O8 Corp?s resource base in the short-term, or at all.
Readers are cautioned that the assumptions used in the preparation of such
information, although considered reasonable at the time of preparation, may
prove to be imprecise and, as such, undue reliance should not be placed on
forward-looking statements.