Ridgemont Iron Ore Corp. (TSX VENTURE:RDG)(OTCQX:RIOOF) ("Ridgemont" or the "Company") is pleased to announce that it has entered into an agreement with Dundee Securities Ltd. (the "Lead Agent") on behalf of a syndicate of Agents including Delano Capital Corp. and PowerOne Capital Markets Limited (the "Agents") under which the Agents have agreed to offer for sale, on a best efforts private placement basis, up to 18,750,000 flow-through units (the "Flow-Through Units") at a price per Flow-Through Unit of $0.40 and up to 6,580,000 units (the "Units") at a price per Unit of $0.38 (together, the "Offered Securities") for total gross proceeds of up to $10,000,400 (the "Offering"). The Agents have been granted the option (the "Option") to sell up to an additional $1,500,000 of the Offering in any combination of Flow-Through Units and/or Units, exercisable in whole or in part at any time up to 48 hours before the closing of the Offering (the "Closing Date").

 

Each Flow-Through Unit shall consist of one flow-through common share of the Company ("Flow-Through Share") and one-half of one common share purchase warrant ("FT Warrant"). Each whole FT Warrant shall entitle the holder thereof to acquire one common share ("Share") of the Company at a price of $0.60 for a period of 24 months following the Closing Date.

 

Each Unit shall consist of one Share of the Company and one-half of one common share purchase warrant ("Share Warrant"). Each whole Share Warrant shall entitle the holder thereof to acquire one Share of the Company at a price of $0.50 for a period of 24 months following the Closing Date.

 

In connection with the Offering, the Agents will receive a cash commission equal to 7.0% of the gross proceeds raised under the Offering (inclusive of the Option) and that number of non-transferable broker warrants ("Broker Warrants") as is equal to 7.0% of the number of Offered Securities sold (inclusive of the Option). Each Broker Warrant will be exercisable into one Share of the Company, for a period of 24 months from the Closing Date at a price of $0.38 per Share. Closing of the Offering is scheduled for on or about June 14, 2012. All securities issued will be subject to a statutory four month hold period. The Offering is subject to a number of conditions, including, without limitation, receipt of all regulatory approvals, including the closing of the previously announced acquisition of IronOne Inc. by the Company.

 

The gross proceeds from the Flow-Through Units will be used for Canadian Exploration Expenses (within the meaning of the Income Tax Act (Canada)), related to the Issuer's exploration projects. The Company has agreed to renounce such Canadian Exploration Expenses with an effective date of no later than December 31, 2012. The net proceeds from the sale of the Units will be used for general corporate purposes.

 

The securities described herein have not been, and will not be, registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act"), or any state securities laws, and accordingly, may not be offered or sold within the United States except in compliance with the registration requirements of the U.S. Securities Act and applicable state securities requirements or pursuant to exemptions therefrom. This press release does not constitute an offer to sell or a solicitation of an offer to buy any of the Company's securities in the United States.(Source: MarketWire)