NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR
DISSEMINATION IN THE UNITED
STATES
MONTREAL,
Feb. 7, 2013 /CNW Telbec/ - Geovencap
Inc. (TSXV: GOV) ("Geovencap" or the "Company") announces that it
has entered into an agreement with MGI Securities Inc. (the
"Agent") to proceed with a private placement on a "best efforts"
basis for gross proceeds of up to $1,000,000 (the "Offering"). The Offering
consists of the issuance of a maximum of 3,076,923 flow-through
common shares (the "Flow-Through Shares") at a price of
$0.13 per Flow-Through Share for
maximum gross proceeds of $400,000
and a maximum of 6,000,000 units (the "Units") at a price of
$0.10 per Unit for maximum gross
proceeds of $600,000. Each Unit will
be comprised of one common share at a price of $0.10 and one-half common share purchase warrant.
Each warrant entitles its holder to purchase a common share at a
price of $0.15 per share for a period
of 24 months following the closing of the Offering.
Geovencap 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, Geovencap will raise gross proceeds of
$1,150,000 from the Offering.
At the closing of the Offering, the Agent will
receive a cash commission equal to a maximum of 8% of the gross
proceeds raised under the Offering. In addition, the Agent
shall receive non-transferable warrants at a price of $0.15 exercisable for a period of two years from
the date of closing to acquire such number of common shares of the
Company as is equal to 8% of the aggregate number of Flow-Through
Shares and Units issued under the Offering.
The Offering is scheduled to close on or about
February 27, 2013 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.
The net proceeds from the Units shall be used
for exploration working capital and for general corporate purposes.
Proceeds from the Flow-Through Shares will be used to advance
Geovencap's California Lake and Upsalquitch projects, which will constitute
Canadian exploration expenses (as defined in the Income Tax
Act (Canada)) and will be
renounced for the 2013 tax year.
About Geovencap
GeoVenCap is a mineral company focused on
exploration principally for silver and gold in northern
New Brunswick. Its priority is to
explore and develop four highly prospective projects located
between 30 and 105 km west and southwest of the city of
Bathurst, New Brunswick: the
California Lake Silver Project, the Upsalquitch Gold Project, the
Williams Brook Gold Project and the Bathurst Mining Camp - Base
Metal Project. These projects are in close proximity of mines and
advanced projects owned by Xstrata, Votorantim and Trevali
Mining.
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)
Geovencap's management will not identify and pursue other business
objectives using the proceeds of the Offering and (v) the price of
gold, silver and other metals will remain sufficiently high and the
costs of advancing the Company's gold projects sufficiently low so
as to permit Geovencap 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, silver and other metals 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."
SOURCE GeoVenCap Inc.