LUNA GOLD ANNOUNCES INCREASE IN PREVIOUSLY ANNOUNCED PRIVATE PLACEMENT FINANCING
NOT FOR DISSEMINATION IN THE UNITED STATES OR FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES
Vancouver, British Columbia - August 16, 2016 - As previously announced on August 15, 2016, Luna Gold Corp. ("Luna" or the "Company") is offering 11,500,000 units of the Company (the "Units") at a price of C$0.20 per Unit (the "Offering Price") for gross proceeds of up to C$2.3 million (the "Offering"). Each Unit will consist of one common share of the Company (a "Unit Share") and one common share purchase warrant (a "Warrant") exercisable at a price of C$0.25 per common share for a period of 60 months from the closing of the Offering. The Company is pleased to announce that it has increased the Offering by 23,500,000 Units, at the Offering Price, for additional gross proceeds to the Company of up to C$4.7 million. Thus, if fully subscribed, the Offering will consist of 35,000,000 Units for gross proceeds of C$7.0 million.
The up to 70,000,000 common shares of the Company that are being issued and made issuable in the Offering (assuming full excise of the Warrants) represents approximately 24% of the Company's total number of currently issued and outstanding common shares. The Offering Price is at a 29% discount to the volume weighted average trading price of Luna's common shares listed on the Toronto Stock Exchange ("TSX") between the date of the first press release on August 15, 2016 and this current press release.
As previously announced, the management team of the Company will subscribe for 11,500,000 Units at the Offering Price, but no insiders will otherwise participate in the Offering or exercise any participation right in connection therewith. The Offering will not result in any new control person of the Company.
Pursuant to the rules and policies of the TSX, when securities of the Company are issued at a price that is lower than market price less the maximum applicable discount, the Company must obtain shareholder approval for the issuance of such securities. However, in accordance with section 604(d) of the TSX Company Manual, the Company will obtain such shareholder approval by way of written consent (the "Shareholder Consent") from its significant shareholders holding in excess of 60% of the common shares of the Company (the "Supporting Shareholders") that would be eligible to vote to approve the Offering if a shareholders' meeting were held for such purpose. The Shareholder Consent will confirm that the Supporting Shareholders consent to, and are in favor of, the Offering.
Proceeds from the Financing will be used to complete technical work required to restart the Aurizona Gold Mine, as well as for general working capital purposes. Closing of the Offering is scheduled to occur on or about August 29, 2016, subject to applicable regulatory and other approvals, including approval of the TSX.
About Luna Gold Corp.
Luna is engaged in the exploration and redevelopment of its past producing Aurizona Gold Mine, which was placed on care and maintenance in 2015. The Company expects to publish a National Instrument 43-101 compliant technical report for the Aurizona Gold Mine in 2016.
On behalf of the Company
LUNA GOLD CORP.
Christian Milau, Chief Executive Officer and Director Website: www.lunagold.com
For further information contact Investor Relations at +1-604-558-0560
NOT FOR DISTRIBUTION IN THE UNITED STATES OR THROUGH U.S. NEWSWIRE SERVICES
Forward-Looking Statements
This release contains certain "forward looking statements" and certain "forward looking information" as defined under applicable Canadian and U.S. securities laws. Forward-looking statements can generally be identified by the use of forward-looking terminology such as "may", "will", "expect", "intend", "estimate", "anticipate", "believe", "continue", "plans" or similar terminology. Forward-looking statements include, but are not limited to, statements with respect to returning the Aurizona mine to production, the expected timing for the closing of the Offering, the Company's intended use of the proceeds of the Offering, and future gold production and/or the results of analysis on gold production. Forward-looking statements are based on forecasts of future results, estimates of amounts not yet determinable and assumptions that while believed by management to be reasonable, are inherently subject to significant business, economic and competitive uncertainties and contingencies. Forward-looking statements are subject to various risks and uncertainties concerning the specific factors identified in Luna Gold Corp.'s periodic filings with Canadian Securities Regulators. These factors include the inherent risks involved in the exploration and development of mineral properties, the uncertainties involved in interpreting drill results and other exploration data, the potential for delays in exploration or development activities, the geology, grade and continuity of mineral deposits, the possibility that future exploration, development or mining results will not be consistent with the Company's expectations, accidents, equipment breakdowns, title matters, labor disputes or other unanticipated difficulties with or interruptions in production and operations, fluctuating metal prices, unanticipated costs and expenses, uncertainties relating to the availability and costs of financing needed in the future, the inherent uncertainty of production and cost estimates and the potential for unexpected costs and expenses, commodity price fluctuations, currency fluctuations, regulatory restrictions, including environmental regulatory restrictions and liability, competition, loss of key employees, and other related risks and uncertainties. The Company undertakes no obligation to update forward-looking information except as required by applicable law. Such forward-looking information represents management's best judgment based on information currently available. No forward-looking statement can be guaranteed and actual future results may vary materially. Accordingly, readers are advised not to place undue reliance on forward-looking statements or information.