Strategic Metals Ltd. Announces $16.25 Million Private Placement
February 23, 2011 - Strategic Metals Ltd. (TSX-V: SMD) ("Strategic" or the "Company") is pleased to announce that it has arranged a non-brokered private placement, to consist of the sale of up to 5,000,000 common shares at a price of CDN $3.25 per share, to raise gross proceeds of up to CDN $16.25 million (the "Offering").
The Company has agreed to allocate a portion of the Offering to subscribers introduced by Axemen Resource Capital Ltd., an Exempt Market Dealer ("Axemen"), and may agree to similar allocations to other exempt market or investment dealers. The Company will pay finder's fees equal to 5% of subscription amounts found, payable in cash or shares, plus issue finder's warrants in an amount equal to 5% of shares subscribed for, with each such finder's warrant to be exercisable into one common share of the Company at a price of CDN$3.35 for 18 months from closing.
Closing of the Offering is anticipated to occur on or before March 23, 2011 and is subject to receipt of TSX Venture Exchange acceptance. Securities issued under the Offering will be subject to a hold period in Canada which will expire four months and one day from the date of closing.
On closing of the Offering, subscribers will be eligible to participate in the recently-announced spin-out of Silver Range Resources, a new company that will focus on bulk tonnage, porphyry targets at its silver-enriched Silver Range project and gold-rich Mint project, both located in the Yukon Territory. Under the proposed transaction, Strategic shareholders of record would receive, on the effective date of the transaction, one Silver Range common share and one-half of a transferable Silver Range share purchase warrant for each three shares of Strategic held. Each whole Silver Range warrant will entitle the holder to purchase one additional Silver Range share at a price of $0.85 for a period of eighteen months from listing. The proposed transaction will be voted on at a special meeting of Strategic shareholders, expected to be convened in April or May, 2011. Adequate advance notice of the effective record date will be provided in due course.
The proceeds from the Offering will be used for working capital purposes.
About Strategic Metals Ltd.
Strategic is a pre-eminent explorer and claimowner in the Yukon, with 50 properties under option to other companies, 15 properties subject to sales or joint venture agreements, and more than 90 wholly-owned properties. Strategic also holds royalty interests in 8 projects, including a net smelter return royalty on part of the Wolverine Deposit which is scheduled to commence production in 2011. Strategic currently has approximately $27 million in cash and owns marketable shares of other resource companies with a total value exceeding $80 million.
ON BEHALF OF THE BOARD
"W. Douglas Eaton"
President and Chief Executive Officer
For further information concerning Strategic or its various exploration projects please visit our website atwww.strategicmetalsltd.com or contact:
Strategic Metals Ltd.
W. Douglas Eaton
President and C.E.O.
Tel: (604) 688-2568
Strategic Metals Ltd.
Bruce A. Youngman
Tel: (604) 687-2522
This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities of the Company in the United States. The Company's securities 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 may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.
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.
This news release may contain forward looking statements based on assumptions and judgments of management regarding future events or results that may prove to be inaccurate as a result of exploration and other risk factors beyond its control, and actual results may differ materially from the expected results.