ALS/RMX newsRubicon Minerals Announces Financing for Newfoundland Spinout Vehicle-Paragon Minerals Corporation; Altius Resources to Invest $1.9 Million in New Company
12:06 EDT Thursday, June 22, 2006
VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - June 22, 2006) -
David W. Adamson, President and CEO of Rubicon Minerals Corporation (TSX:RMX)(AMEX:RBY) is pleased to announce that its Newfoundland spinout vehicle, Paragon Minerals Corporation, has entered into an agreement with Altius Resources Inc, a wholly-owned subsidiary of Altius Minerals Corporation of St. Johns, Newfoundland, under which Altius will subscribe for 2.5 million flow through special warrants to be priced at $0.60 each and 800,000 non flow-through special warrants to be priced at $0.50 each, for a total investment of $1.9 million. The investment by Altius is intended to form the largest component of a proposed minimum $3.0 million non-brokered private placement financing. Of the remaining $ 1.1 million, Rubicon reserves the right to subscribe for up to $500,000 with the remainder to be placed with private and/or institutional investors.
On the effective date of Rubicon's proposed Plan of Arrangement, announced in November 2005, each flow-through special warrant will automatically convert into one flow-through Paragon common share; and each non flow-through special warrant will automatically convert into one non flow-through Paragon common share and a one-half (1/2) non flow-through Paragon share purchase warrant, where one whole non flow-through Paragon share purchase warrant entitles the holder to purchase one additional non flow-through Paragon common share at a price of $0.80 for a term of one year.
Paragon and Altius have also agreed to general terms that will allow Paragon to earn a 100% interest in the highly prospective South Tally Pond property, which covers extensive alteration and mineralized zones in rocks correlative with the Duck Pond deposit being developed by Aur Resources.
Adamson said "We are very pleased that Altius has agreed to become a shareholder of Paragon. Rubicon has been committed to Newfoundland and Labrador exploration since its formation in 1996 and the principals of both Rubicon and Altius have developed a long term association and mutual respect. The spinout of the Newfoundland assets into Paragon is an important step to realize the value of Newfoundland opportunities for Rubicon shareholders. We welcome the participation of Altius in the initial financing and look forward to establishing Paragon as the pre-eminent Newfoundland explorer to the benefit of its shareholders and the people of Newfoundland and Labrador."
Altius stated "We are very pleased to be a participant in the formation of Paragon. The exploration team that has been assembled under Garfield MacVeigh has proven itself in central Newfoundland over the past several years with its impressive track record of gold and base metal discoveries. As a significant shareholder, Altius believes that it can help and support the creation of additional value within Paragon and it very much looks forward to the association".