Midway Gold Announces US$70 Million Strategic Financing
Midway Gold Corp. ('Midway' or the 'Company') (TSX VENTURE:MDW) (NYSE
MKT:MDW) is pleased to announce that it has arranged a US$70 million
private placement financing of five year 8% convertible Series A
Preferred shares at a price of US$1.85 per share ('Preferred Shares?).
Kenneth A. Brunk, Midway′s Chairman, President and CEO said, 'Midway is
pleased to welcome lead investor Hale Capital Partners, L.P. as a key
strategic financial partner in the pursuit of the Company′s goal of
becoming a Nevada gold producer in the near term. This is a very
important step forward for Midway as we have dramatically reduced
financing risk in uncertain times, and have done so without incurring
hedging on our future gold production or committing to any security over
our assets, all while seeking to minimize equity dilution to our
shareholders.?
Martin Hale, CEO and Portfolio Manager of Hale Capital Partners, L.P.,
said, 'We have been investors in Midway since 2010 and that history, the
quality of the team and properties, and management execution have given
us great confidence in supporting the Company.?
The conversion price of the Preferred Shares represents a significant
premium of 37% to the closing price of the Company′s shares on November
20th, 2012.
The primary use of proceeds from the private placement will be to
advance the Pan heap leach gold project towards production, including
the ordering of long-lead time capital equipment, as well as engineering
studies to advance the Gold Rock project.
The Private Placement is subject to customary closing conditions and
deliverables. Midway anticipates executing final documentation and
closing the private placement on or before December 13th,
2012.
Key Terms of the Preferred Shares:
US$70 million Offering at a price of US$1.85 per Preferred Share.
Each Preferred Share is convertible into Common Shares of the Company
on a 1 to 1 basis.
Holders of the Preferred Shares are entitled to receive an annual,
cumulative preferred 8% dividend payable quarterly in cash or common
shares, at the Company′s option.
Preferred Shares are redeemable by either the Company or the holders
after five years from the date of issuance for cash equal to the
conversion price, initially US$1.85.
After a period of one year, subject to certain price and volume
conditions, the Company may force the conversion of the Preferred
Shares to common shares on a 1 to 1 basis.
Preferred Shares have a liquidation preference equal to 125% of the
issue price of the Preferred Shares in connection with certain
liquidation events.
Except as otherwise required by law, the holders of Preferred Shares
will be entitled to vote their shares, on an as converted basis, at
meetings of the shareholders of the Company.
Upon common shareholder approval at the next annual general meeting of
the Company, the holders of Preferred Shares shall be entitled to
nominate and elect a Director of the Company.
The issuance of common shares below a price of US$1.85 or repurchase
any common shares, requires the consent of a designated Preferred
Shareholder.
No fees or commissions are payable in connection with this placement.
The investors have been granted registration rights under a
Registration Rights Agreement and other rights related to board and
committee appointments under a side letter.
Neither the Preferred Shares nor the Common Shares issuable upon
exercise of the Preferred Shares or in lieu of cash dividend payments
have been registered under the United States Securities Act of 1933, as
amended, or the securities laws of any state. The securities may be
offered or sold only under exemptions from these registration
requirements. This press release does not constitute an offer of
securities.
ON BEHALF OF THE BOARD
'Kenneth A. Brunk'
Kenneth A. Brunk, Chairman, President and CEO
About Midway Gold Corp.
Midway Gold Corp. is a precious metals company with a vision to explore,
design, build and operate gold mines in a manner accountable to all
stakeholders while assuring return on shareholder investments. For more
information about Midway, please visit our website at www.midwaygold.com
or contact R.J. Smith, Vice President of Administration, at (877)
475-3642 (toll-free).
Neither the TSX Venture Exchange, its Regulation Services Provider
(as that term is defined in the policies of the TSX Venture Exchange)
nor the NYSE MKT accepts responsibility for the adequacy or accuracy of
this release.
This press release contains forward-looking statements within the
meaning of Canadian and United States securities laws about the Company
and its business which may include, but is not limited to, the intended
terms of the private placement, closing of the private placement and use
of proceeds. Such forward-looking statements and forward-looking
information reflect our current views with respect to future use of
proceeds and are subject to certain risks, uncertainties and
assumptions, including but not limited to risks related to delays in
closing, the receipt of regulatory approvals and changes in market
conditions. Forward looking statements are statements that are not
historical facts and include, but are not limited to, statements about
the Company's intended work plans and resource estimates and potential
offering of common shares of the Company from time to time. The
forward-looking statements in this press release are subject to various
risks, uncertainties and other factors that could cause the Company's
actual results or achievements to differ materially from those expressed
in or implied by forward looking statements. These risks, uncertainties
and other factors include, without limitation, risks related to the
timing and completion of the Company's intended work plans, risks
related to fluctuations in gold prices; uncertainties related to raising
sufficient financing to fund the planned work in a timely manner and on
acceptable terms; changes in planned work resulting from weather,
logistical, technical or other factors; the possibility that results of
work will not fulfill expectations and realize the perceived potential
of the Company's properties; uncertainties involved in the
interpretation of drilling results and other tests and the estimation of
gold resources and reserves; the possibility that required permits may
not be obtained on a timely manner or at all; the possibility that
capital and operating costs may be higher than currently estimated and
may preclude commercial development or render operations uneconomic; the
possibility that the estimated recovery rates may not be achieved; risk
of accidents, equipment breakdowns and labor disputes or other
unanticipated difficulties or interruptions; the possibility of cost
overruns or unanticipated expenses in the work program; and other
factors identified in the Company's SEC filings and its filings with
Canadian securities regulatory authorities. Forward-looking statements
are based on the beliefs, opinions and expectations of the Company's
management at the time they are made, and other than as required by
applicable securities laws, the Company does not assume any obligation
to update its forward-looking statements if those beliefs, opinions or
expectations, or other circumstances, should change.
Midway Gold Corp.
R.J. Smith, (877) 475-3642 (toll-free)
Vice
President of Administration
