2007 News Releases
Mega Uranium Announces C$30,627,000 "Bought Deal" Financing
February 6, 2007
NOT FOR DISSEMINATION IN THE UNITED STATES OR THROUGH U.S. NEWSWIRE SERVICES
Toronto, Ontario, February 6, 2007 – Mega Uranium Ltd. (“Mega”) (MGA:TSX) is pleased to announce that it has entered into an agreement with Westwind Partners Inc. as lead underwriter on behalf of a syndicate of underwriters (collectively, the “Underwriters”) to sell, on a bought deal private placement basis, 1,400,000 Flow Through Shares of the Company at a price of C$7.38 per Flow Through Share and 3,300,000 Units of the Company at a price of C$6.15 per Unit, for aggregate gross proceeds of C$30,627,000. The securities issuable under the private placement are subject to a four month hold period from the closing date.
Each Unit will consist of one common share and one half of one common share purchase warrant. Each whole warrant will entitle the holder to purchase one additional common share of Mega at a price of C$7.90 for 60 months from the closing date. In the event that the common shares trade at a closing price on the TSX of greater than C$12.30 per share for a period of 20 consecutive trading days at any time after four months and one day after the closing date, Mega may accelerate the expiry date of the warrants by giving notice to the holders thereof and in such case the warrants will expire on the 30th day after the date on which such notice is given by the Company.
The Underwriters will have the option to sell up to an additional 200,000 Flow Through Shares at the issue price per Flow Through Share and up to an additional 500,000 Units at the issue price per Unit for a period of up to two days prior to closing for additional gross proceeds of up to C$4,551,000. Mega plans to use the net proceeds from the sale of the Units for exploration and development of current projects and general corporate purposes. The proceeds from the sale of the Flow-Through Shares will be used for general exploration expenditures, which will constitute Canadian exploration expenses (as defined in the Income Tax Act) and will be renounced for the 2007 taxation year.
The Underwriters shall receive compensation comprised of cash and broker warrants upon closing of the offering.
The offering is scheduled to close on or about February 21, 2007 (in respect of the Units) and March 6, 2007 (in respect of the Flow Through Shares) and is subject to certain conditions including, but not limited to, the receipt of all necessary approvals including the approval of the TSX. The securities to be issued under this offering will be offered by way of private placement exemptions in all the provinces of Canada, offshore including in the United Kingdom pursuant to applicable exemptions and in the United States on a private placement basis pursuant to an exemption from the registration requirements of the United States Securities Act of 1933, as amended.
The securities being offered have not, nor will they be registered under the United States Securities Act of 1933, as amended, and may not be offered or sold within the United States or to, or for the account or benefit of, U.S. persons absent U.S. registration or an applicable exemption from the U.S. registration requirements. This release does not constitute an offer for sale of securities in the United States.
Up to 10% of the financing may be purchased by insiders of Mega.
Mega Uranium Ltd. is a Toronto-based mineral resources company with a focus on uranium properties in Australia, Argentina, Mongolia, Bolivia and Canada. Further information on Mega can be found on the company’s website at www.megauranium.com. Mega Uranium’s Australian uranium properties, including without limitation the Ben Lomond and Maureen properties, are subject to state policies which presently prohibit the mining of uranium in Australia.
THE TORONTO STOCK EXCHANGE HAS NOT REVIEWED AND DOES NOT ACCEPT RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.
For further information, please contact:
Mega Uranium Ltd.
Richard Patricio, Vice President Corporate and Legal Affairs
Telephone: (416) 643-7630