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.
