| | Mon Apr 6, 2009
Farallon Announces Financing Update: Additional Private Placement Secured
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| | PROCEEDS TO BE UTILIZED TO PAY OFF NOTES ISSUED IN OCTOBER 2008
NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR DISSEMINATION IN THE UNITED STATES
April 6, 2009 Vancouver, BC. Farallon Resources Ltd. ("Farallon" or the "Company") (TSX: FAN) announces that the Company has completed the closing of a private placement financing for gross proceeds of $8.3 million through the issuance of 41.7 million shares at a price of $0.20 per share.
The proceeds will be used to pay off the $7.75 million in promissory notes issued in October 2008 (see press release dated October 17, 2008). By paying off the notes, the Company will reduce its short-term liabilities. In conjunction with the repayment, a bonus fee of $581,250 and an aggregate of 620,000 bonus shares will be issued to the note holders.
The Company also announces the final closing of the brokered offering arranged by a syndicate led by Paradigm Capital Inc and including Wellington West Capital Markets Inc. (the "Agents"), which raised $5 million through the issuance of 25 million shares at the price of $0.20 per share (see press release dated February 26, 2009).
Dick Whittington said "Together with the proceeds from the private placement that was partially closed in February, the Company has raised a total of $13.3 million. This is a great achievement given the current market situation. Both financings were completed at current market prices and no warrant was included. The funds received will allow us to reduce the Company's short-term debt, improve our working capital position and strengthen our balance sheet. Coupled with the recent extension of the remaining $25 million promissory notes, the Company's short-term outlook has strengthened considerably."
The securities issued under the offering will be subject to a four month hold period under Canadian securities legislation and these securities will not be registered under the United States Securities Act of 1933 and may not be offered or resold in the United States absent an exemption from registration under that Act.
Farallon has advanced the G-9 polymetallic (zinc, copper, silver, gold, lead) project at its Campo Morado Property in Mexico through a 'Parallel Track' program in 2007 and 2008. Surface facilities were largely completed in mid 2008, followed by mill commissioning and underground stope development during the balance of 2008. The mine is currently in commercial production and reached design capacity of 1500 tpd on a sustained basis in March (see separate news release of today's date April 6, 2009). Vessel shipments of concentrates commenced in February 2009 and are now expected on a regular basis throughout the year.
For further details on Farallon Resources Ltd., please visit the Company's website at www.farallonresources.com or contact Investor Services at (604) 638-2160 or within North America at 1-800-667-2114.
ON BEHALF OF THE BOARD OF DIRECTORS
J.R.H. (Dick) Whittington
President & CEO
No regulatory authority has approved or disapproved the information contained in this news release
Forward Looking Information
This release includes certain statements that may be deemed "forward-looking statements." All statements in this release, other than statements of historical facts, that address future production, reserve or resource potential, continuity of mineralization, exploration drilling, operational activities, production rates, costs to completion and events or developments that the Company expects are forward-looking statements. Although the Company believes that the expectations expressed in such forward looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward looking statements and may require achievement of a number of operational, technical, economic and legal objectives. The likelihood of continued future mining at Campo Morado is subject to a large number of risks, including obtaining lower than expected grades and quantities of mineralization and resources, lower than expected mill recovery rates and mining rates, changes in and the effect of government policies with respect to mineral exploration and exploitation, the possibility of local disputes including blockades of the company's property, the possibility of adverse developments in the financial markets generally, fluctuations in the prices of zinc, gold, silver, copper and lead, obtaining additional mining and construction permits, preparation of all necessary engineering for ongoing underground and processing facilities as well as receipt of additional financing to fund mine construction, development and operation, if needed. Such funding may not be available to the Company on acceptable terms or on any terms at all. There is no known ore at Campo Morado and there is no assurance that the mineralization at Campo Morado will ever be classified as ore. For more information on the Company and the risk factors inherent in its business, investors should review the Company's Annual Information Form at www.sedar.com. |
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| | You can view the Next News Releases item: Mon Apr 6, 2009, Farallon Announces Commercial Production At G-9 Mine
You can view the Previous News Releases item: Wed Apr 1, 2009, Farallon Announces Year-End 2008 Financial Results
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