Eskay Mining Announces Closing First Tranche of Its Flow-Through and Working Capital Private Placement
TORONTO, ONTARIO -- (Marketwire) -- 06/11/10 -- ESKAY MINING CORPORATION (TSX VENTURE: ESK)(FRANKFURT:878 985)(BERLIN:878 985) ('Eskay' or the 'Corporation') wishes to announce that further to its press release of June 4, 2010, the Corporation has completed the sale of 8,200,000 units on a flow-through basis (the 'FT Units') priced at $0.25 per FT Unit for gross proceeds of $2,050,000 (the 'FT Offering'). A cash fee of $100,000 and 640,000 compensation options to acquire units at a price of $0.25 per unit (an 'Agent's Option') were issued in relation to the financing. Each Agent's Option is comprised of one common share and one-half of one non-transferable share purchase warrant of the Corporation. Each full warrant entitles the holder to acquire a common share of Eskay at the price of $0.45 until the earlier of: (i) June 9, 2012; and (ii) in the event that the closing price of the common shares on the TSX Venture Exchange is at least $0.60 for ten (10) consecutive trading days, and the 10th trading day (the 'Final Trading Day') is at least four (4) months from the Closing Date, the date which is thirty (30) days from the Final Trading Day.
In addition, Eskay has also completed the issuance of 960,050 working capital units (the 'WC Units') priced at $0.20 per WC Unit for gross proceeds of $192,010.
The Corporation continues to offer 1,800,000 FT Units and 6,539,950 WC Units on the same terms as in the Corporation's June 4, 2010 press release.
All of the securities referred to herein are legended and restricted from trading until at least October 10, 2010.
The proceeds from the flow-through component will be used to undertake a diamond drilling program on its Eskay (SIB) property, Northwestern BC. The Corporation controls two contiguous mineral tenure assemblies that surround and extend southward from the past producing Eskay Creek Mine property of Barrick Gold. Past technical work by the Corporation has shown that the rich Eskay Creek Au-Ag deposit is hosted within a north-south striking Lower to Middle Jurassic rift that is mapped for 27 km on the Corporation's mineral tenures.
The Corporation has retained Mira Geoscience Ltd. to compile AeroTEM II electromagnetic and magnetic data over the entire 30 km long by 10 km wide swath of the Eskay Rift that encompasses the Corporation's lands and those of the Eskay Creek deposit. Magnetic 3D modeling and electrical plate modeling will follow, with an aim to further enhance drill target selection on the Eskay (SIB) property.
Drilling in 2010 will be targeting a blind, precious-metal mineralized segment of the Eskay Rift that lies concealed below the Coulter Creek thrust fault. The targets lie beneath the crest of the same ridge that hosts the Eskay Creek deposits. The Corporation first discovered this fault-displaced segment in a late 2008 drilling program, following geological modeling work. Incorporation of geophysical modeling in the target definition work should further assist in the success of the pending drilling program.
Drilling is anticipated to commence in July of 2010. The non flow-through funds will be used for working capital.
The geoscience information reported herein is approved by Paul McGuigan, P. Geo., a Qualified Person and member of the Geological Advisory Committee of the Corporation.
The current issued and outstanding capital is 83,009,111, after above mentioned issuance of shares.
Cautionary Note Regarding Forward-Looking Statements: This Press Release contains forward-looking statements that involve risks and uncertainties, which may cause actual results to differ materially from the statements made. When used in this document, the words 'may', 'would', 'could', 'will', 'intend', 'plan', 'anticipate', 'believe', 'estimate', 'expect' and similar expressions are intended to identify forward-looking statements. Such statements reflect our current views with respect to future events and are subject to such risks and uncertainties. Many factors could cause our actual results to differ materially from the statements made, including those factors discussed in filings made by us with the Canadian securities regulatory authorities. Should one or more of these risks and uncertainties, such actual results of current exploration programs, the general risks associated with the mining industry, the price of gold and other metals, currency and interest rate fluctuations, increased competition and general economic and market factors, occur or should assumptions underlying the forward looking statements prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, or expected. We do not intend and do not assume any obligation to update these forward-looking statements, except as required by law. Shareholders are cautioned not to put undue reliance on such forward-looking statements.
Neither 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.
Contacts:
ESKAY MINING CORPORATION
info@kenrich-eskay.com
www.eskaymining.com