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Klondex Completes CDN $1.75 Million Private Placement
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Vancouver, British Columbia: August 21, 2008 - Klondex Mines Ltd. (TSX:
KDX) announced today it has completed a non-brokered private placement
of 1,520,000 units (the "Units") at a price of CDN $1.15 per unit,
yielding gross proceeds of CDN $1,748,000. Each Unit consists of one
common share and one share purchase warrant that entitles the holder to
purchase one additional common share of the Company at a price of CDN
$1.60 for up to one year after closing. The warrants are subject to a
30-day early expiration if the stock closes on the Toronto Stock
Exchange, for a period of 30 consecutive trading days, at a price of
CDN $1.90 or greater.
Net proceeds of the private placement were CDN$1,658,300 and will be
used principally to complete Phase 7 of the surface drilling program at
Klondex's Fire Creek Property in North Central Nevada. The private
placement proceeds, in addition to existing cash reserves, bring
Klondex's current cash position to approximately CDN$2.5 million.
William Solloway, President of Klondex, commented, "Surface drilling
has been a successful path to building our indicated mineral resource
of gold at Fire Creek. With additional funding now in place we plan to
complete our Phase 7 surface drilling program this fall, and thereafter
we intend to update our NI-43-101 resource estimate to incorporate data
from the two productive years of drilling since our last resource
calculation."
Shares issued under the private placement are subject to a hold period
of four months and one day from the date of issuance. A 6% commission
attributable to authorized agents was applied to a portion of the
financing and amounted to CDN$89,700. Reflecting the issuance of
shares pursuant to this financing, as of August 21, 2008, Klondex had
25,069,804 shares issued and outstanding.
About Klondex Mines Ltd.:
Klondex Mines (TSX: KDX) is a gold exploration company focused on the
development and expansion of its high-grade Fire Creek deposit in
Nevada, covering 10,708 acres of fee and federal mining claims 100%
controlled by Klondex. At Fire Creek, Klondex has a September 2006, NI
43-101 defined Indicated Mineral Resource estimated at 1,636,555 tonnes
grading 19.88 grams per tonne (0.639 oz/tonne) containing 1,045,738 oz
of gold in two separate mineral zones. Since 2006, over 100,000 feet
of drilling has expanded the Company's resource which will be defined
in an updated 43-101. Klondex has filed for permits, which it
anticipates in Q3 of this year, to begin bulk sampling for
metallurgical testing of up to 120,000 tons of ore.
Fire Creek is located along the Northern Nevada Rift and on the Battle
Mountain-Eureka Trend in North Central Nevada, an area of prolific gold
production. Klondex currently has two drill rigs working to expand its
resource at Fire Creek. The Company was founded over thirty years ago,
and its property portfolio consists of four gold exploration projects,
all in Nevada. Eighty percent of Klondex's known resource is on
private land. For more information, please visit www.klondexmines.com.
ON BEHALF OF KLONDEX MINES LTD.
"William J. Solloway"
President
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Investor Contact:
David Collins
Jaffoni & Collins Incorporated
KDX@jcir.com
(212) 835-8500
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Copyright (c) 2008 KLONDEX MINES LIMITED (KDX) All rights reserved.
For more information visit our website at http://www.klondexmines.com/
or send mailto:info@klondexmines.com
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