Osisko Mining Corporation Completes Strategic Investment
MONTREAL, QUEBEC--(July 3, 2009) - Osisko Mining Corporation ("Osisko") (TSX : OSK) (FRANKFURT : EWX) is pleased to announce that it closed its previously announced strategic investment in Bowmore Exploration Ltd. (TSX VENTURE:BOW) ("Bowmore") through an investment of $3.0 million of a proposed $4.2 million non-brokered private placement (the "private placement"). Osisko now owns 15,000,000 common shares (39.1%) of the 38,364,984 shares outstanding on a non-diluted basis and 22,500,000 common shares (40.4%) of the shares outstanding on a fully diluted basis. Furthermore, Osisko has the right to appoint two nominees to Bowmore's five member board of directors.
On May 11, 2009, Bowmore announced a $1.0 million non-brokered private placement which has been restructured as a $4.2 million non-brokered private placement consisting of the sale of 21,000,000 units at $0.20 per unit for gross proceeds of $4.2 million. Osisko agreed to acquire 15,000,000 units for gross proceeds to Bowmore of $3.0 million and the remaining 6,000,000 units were acquired by insiders of Osisko and Bowmore and by other accredited investors. Each unit consists of one (1) common share of Bowmore (the "share") and one-half (1/2) of one common share purchase warrant (the "warrants"). Each whole warrant entitles the holder to acquire a common share of Bowmore (the "warrant shares") at a price of $0.35 for a period of 48 months, provided that after two years have elapsed from the closing date, and upon the closing trading price of Bowmore's common shares being at or above the price of $0.75 for 10 consecutive trading days, the warrants shall expire o n the earlier of: (i) the expiry date of such warrants, or (ii) such date which is 30 days after the first business day following the date Bowmore provides written notice to the holders of warrants that the warrants will expire at the end of such 30-day period.
Osisko's primary business objective is the exploration and development of the flagship Canadian Malartic gold deposit. Osisko has also identified a number of grass-roots gold exploration opportunities in Canada and has selected Bowmore as an exploration partner to advance these projects. Bowmore currently has an option to acquire a 100% interest in the Santa Elvira gold-copper property in Mexico, which is of interest to Osisko. The parties believe that their strategic alliance should create shareholder value for both Osisko and Bowmore, as Osisko intends to involve Bowmore in exploration projects that would not be suitable for Osisko given its focus on the Canadian Malartic gold project, and thereby reduce Osisko's exploration risk, and Bowmore will benefit from deal flow generated by Osisko.
Mr. Robert Wares, Executive Vice-President and COO of Osisko is currently a director of Bowmore. Pursuant to the private placement, Osisko has the right to appoint two nominees to Bowmore's five member board of directors. Mr. Wares and Mr. Sean Roosen, President and CEO of Osisko will be the two nominees of Osisko.
The proceeds from the private placement will be used by Bowmore for exploration work on the Santa Elvira property, new project acquisitions, development and for working capital purposes.
About Osisko
Osisko Mining Corporation is currently developing the Canadian Malartic gold deposit and evaluating adjacent areas for a large-scale open pit, bulk-tonnage mining operation. The Canadian Malartic deposit currently represents one the biggest gold reserves in Canada for a single deposit, and is still growing through ongoing drilling on new mineralized zones. Current reserves for the Canadian Malartic property are 6.28 million ounces, plus (including the Barnat deposit) a measured and indicated resource of 3.65 million ounces and an inferred resource of 0.84 million ounces. Osisko is well-funded with approximately $420 million on hand.
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.
As disclosed above, Osisko acquired 15,000,000 Units in the private placement for a total subscription price of $3,000,000. Osisko did not own any shares or other securities of Bowmore prior to the private placement. As a result of the transactions announced herein, Osisko owns 15,000,000 Bowmore shares representing approximately 39.1% of the 38,364,984 issued and outstanding Bowmore shares. Assuming no other issuance of shares pursuant to the exercise of warrants or options, Osisko also owns 7,500,000 warrants or 22,500,000 shares on a fully diluted basis which would represents 49.1% of the issued and outstanding shares of Bowmore. The Bowmore shares are listed for trading on the TSX Venture Exchange under the trading symbol, "BOW". For the purposes of National Instrument 62-103 early warning reporting, the address of Osisko is 1100, rue De La Gauchetiere Ouest, Bureau 300, Montreal, Quebec H3B 2S2. Osisko has acquired the shares and warrants of Bowmore for investment purposes, and has no current intention to increase the beneficial ownership, control or direction of Bowmore.
Cautionary Notes Concerning Estimates of Mineral Resources
This news release uses the terms measured, indicated and inferred resources as a relative measure of the level of confidence in the resource estimate. Readers are cautioned that mineral resources are not economic mineral reserves and that the economic viability of resources that are not mineral reserves has not been demonstrated. In addition, inferred resources are considered too geologically speculative to have any economic considerations applied to them. It cannot be assumed that all or any part of an inferred mineral resource will ever be upgraded to a higher category. Under Canadian rules, estimates of inferred mineral resources may not form the basis of feasibility or pre-feasibility studies or economic studies except for Preliminary Assessment as defined under NI 43-101. Readers are cautioned not to assume that that further work on the stated resources will lead to mineral reserves that can be mined economically.
Forward Looking Statements
Certain statements contained in this press release may be deemed "forward-looking statements". All statements in this release, other than statements of historical fact, that address events or developments that the Corporation expects to occur, are forward looking statements. Forward looking statements are statements that are not historical facts and are generally, but not always, identified by the words "expects", "plans", "anticipates", "believes", "intends", "estimates", "projects", "potential", "scheduled" and similar expressions, or that events or conditions "will", "would", "may", "could" or "should" occur. Although the Corporation believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, including, without limitation that all technical, economical and financial conditions will be met in order to put the Canadian Malartic Project into commercial production, such statements are not guarantees of future performance and actual results may differ materially from those in forward looking statements. Factors that could cause the actual results to differ materially from those in forward-looking statements include gold prices, access to skilled consultants, mining development and mill production personnel, results of exploration and development activities, the Corporation's limited experience with production and development stage mining operations, uninsured risks, regulatory changes, defects in title, availability of personnel, materials and equipment, timeliness of government approvals, actual performance of facilities, equipment and processes relative to specifications and expectations, unanticipated environmental impacts on operations market prices, continued availability of capital and financing and general economic, market or business conditions. These factors are discussed in greater detail in the Corporation's most recent Annual Information Form filed on SEDAR, which also provides additional general assumptions in connection with these statements. The Corporation cautions that the foregoing list of important factors is not exhaustive. Investors and others who base themselves on the Corporation's forward-looking statements should carefully consider the above factors as well as the uncertainties they represent and the risk they entail. The Corporation believes that the expectations reflected in those forward-looking statements are reasonable, but no assurance can be given that these expectations will prove to be correct and such forward-looking statements included in this press release should not be unduly relied upon. These statements speak only as of the date of this press release.
CONTACT INFORMATION:
Osisko Mining Corporation
John Burzynski
Vice-President Corporate Development
(514) 735-7131
www.osisko.com
or
Daniel Boase
Investor Relations
(416) 742-5600 or Toll Free: 1-866-580-8891
Renmark Financial Communications Inc.
John Boidman: jboidman@renmarkfinancial.com
Dan Symons: dsymons@renmarkfinancial.com
Tel.: 514 939-3989 or 416 644-2020
www.renmarkfinancial.com
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