| ||September 24, 2009|
Hawthorne Announces Equity Offering to Raise up to $4.5 Million
| ||THIS NEWS RELEASE IS NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES|
Hawthorne Gold Corp. ("Hawthorne" or the "Company") (TSX-V: HGC, US: HWTHF) is pleased to announce that it has arranged a non-brokered private placement consisting of up to 5,555,555 units (the "Units") at $0.45 per Unit to raise gross proceeds of up to $2,500,000 (the "Non-Brokered Offering"). Each Unit will consist of one common share in the capital of the Company (a "Common Share") and one-half of a transferable share purchase warrant (a "Warrant"). Each whole Warrant will entitle the holder thereof to purchase one Common Share at a price of $0.55 per Common Share for a period of 12 months following the closing of the Non-Brokered Offering. The Warrants will be subject to an accelerated exercise provision in the event that the Common Shares have closed at or above the price of $0.75 or more for a period of 10 consecutive trading days after closing of the Non-Brokered Offering. If this occurs, the Company can elect to give notice to the Warrant holders via news release that the Warrants will expire 30 days following the date of such news release.
The Company also announces that it has entered into an engagement letter with J.F. Mackie & Company Ltd. (the "Agent") for a brokered private placement of up to 3,710,000 flow-through Common Shares of the Company (the "FT Shares") at a price of $0.54 per FT Share for total proceeds of up to approximately $2,000,000 (the "Brokered Offering"). The Agent is acting as lead agent for the Brokered Offering and will offer the FT Shares on a commercially reasonable efforts agency basis. Pursuant to the terms of the engagement letter, the Agent will have the option, exercisable up to 48 hours prior to closing of the Brokered Offering, to increase the size of the Brokered Offering by up to an additional 1,845,555 FT Shares at the same price per FT Share as is applicable to the Brokered Offering (the "Agent's Option"). If the Agent exercises the Agent's Option in full, the Brokered Offering will consist of 5,555,555 FT Shares for total proceeds of up to approximately $3,000,000.
The Units and the FT Shares will be made available by way of private placement exemptions to accredited investors (as such term is defined in National Instrument 45-106 - Prospectus and Registration Exemptions) in the provinces of British Columbia, Alberta and Ontario and in certain jurisdictions outside of Canada as may be agreed upon by the Agent and the Company.
It is anticipated that the Non-Brokered Offering and the Brokered Offering will close concurrent with one another and that such transactions will close on or before October 15, 2009.
On closing of the Non-Brokered Offering, Hawthorne may pay a fee in connection with funds sourced by eligible finders up to the maximum amount permitted by the policies of the TSX Venture Exchange (the "TSX-V").
On closing of the Brokered Offering, Hawthorne will pay the Agent a cash commission equal to 7% of the gross proceeds of the FT Shares sold, and will issue the Agent non-transferable broker warrants (the "Broker Warrants"), equal to 7% of the aggregate number of the FT Shares sold. Each Broker Warrant will entitle the holder thereof to purchase one Common Share at a price of $0.68 per Common Share for a period of 12 months following the closing of the Brokered Offering. The Company will also reimburse the Agent for reasonable fees and expenses incurred in connection with the Brokered Offering.
Closing of the Non-Brokered Offering and the Brokered Offering is subject to a number of conditions, including the receipt of all necessary corporate and regulatory approvals, including approval from the TSX-V. All securities issued in connection with the Non-Brokered Offering and the Brokered Offering will be subject to a statutory hold period of four months plus one day from the date of issuance in accordance with applicable securities legislation.
Proceeds from the Non-Brokered Offering and the Brokered Offering will be used to fund the continued resource and mine development of the Company's Cassiar Gold Mine and Taurus gold deposit and for general corporate working capital.
About Hawthorne Gold Corp.
Hawthorne Gold Corp. is a Canadian-based gold exploration and development company with key properties in British Columbia, Canada. Hawthorne is led by well-respected mining leaders Richard Barclay and Michael Beley. Hawthorne's goal is to become a junior gold producer by working towards production at Cassiar Gold Mine and to continue resource development of the nearby Taurus deposit, as well as the Frasergold deposit in the south central British Columbia Cariboo region. Hawthorne continues to review potential acquisitions, focusing on high quality, advanced gold development opportunities.
For more information on Hawthorne, contact Todd Hanas toll free at 1-866-869-8072 or the Company at (604) 629-1505, or you can visit Hawthorne's website at www.hawthornegold.com.
ON BEHALF OF HAWTHORNE GOLD CORP.
"Richard J. Barclay"
President & CEO
Certain information regarding the Company including management's assessment of future plans and operations, may constitute forward-looking statements under applicable securities laws and necessarily involve risks associated with mining exploration and development, volatility of prices, currency fluctuations, imprecision of resource estimates, environmental and permitting risks, access to labour and services, competition from other companies and ability to access sufficient capital. As a consequence, actual results may differ materially from those anticipated in the forward-looking statements. A feasibility study has not been completed and there is no certainty the disclosed targets will be reached nor that the proposed operations will be economically viable.
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 of accuracy of this release.
You can view the Next News Releases item: Thu Oct 1, 2009, Hawthorne Gold and Eureka Resources Announce Independent Mineral Resource Estimate for Frasergold Project Confirms Gold System
You can view the Previous News Releases item: Tue Sep 22, 2009, Hawthorne Identifies New High Grade Gold Zone At Hill 88 Zone within Taurus Deposit; Assays 33.4 g/t Au over 1.24 metres (estimated true width of 0.99 metres)
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