Friday, November 5th, 2010
Dawson Gold Completes Qualifying Transaction and $2.48 million Private Placement
November 5, 2010 – Dawson Gold Corp. (TSX-V: DYU.H) (“Dawson Gold”) is pleased to announce that it has completed its Qualifying Transaction pursuant to the policies of the TSX Venture Exchange. Dawson Gold’s common shares will commence trading as a Tier 2 Mining Issuer on the TSX Venture Exchange at the opening of trading on November 8, 2010 under the trading symbol “DYU”.
Completion of Qualifying Transaction
Pursuant to the Qualifying Transaction, Dawson Gold issued 8,864,357 common shares to acquire 100% of the issued shares of 0851045 B.C. Ltd. by way of amalgamation agreement, whereby 0851045 B.C. Ltd. amalgamated with a subsidiary of Dawson Gold. The amalgamated company assumed the name Dawson Exploration Corp., and is a wholly owned subsidiary of Dawson Gold. A total of 2,648,332 of the common shares issued in the transaction are subject to a TSX Venture Exchange Tier 2 Value Share Escrow Agreement under which 264,832 of the shares will be released from escrow upon issue of the TSX Venture Exchange bulletin approving the transaction, and 397,250 of the shares will be released every six months thereafter.
As a result of the amalgamation 2,640,000 share purchase warrants issued by 0851045 B.C. Ltd. became exerciseable to acquire the same number of common shares of Dawson Gold. Each such warrant is exercisable to acquire an additional share of Dawson Gold at a price of $0.25 for 12 months from closing and at a price of $0.35 for an additional 6 months.
On closing of the acquisition, Dawson Gold issued 1,000,000 common shares to Northern Freegold Resources Ltd. pursuant to the Tad/Toro property option agreement between Northern Freegold and 0851045 B.C. Ltd. Also on closing, a finder’s fee of 400,000 common shares of Dawson Gold was paid to Mark Komonoski in connection the acquisition. The securities issued to Northern Freegold and pursuant to the finder’s fee are subject to a hold period expiring on March 6, 2011.
As a result of the acquisition, Dawson Gold, through its subsidiary Dawson Exploration Corp., holds an option to acquire a 100% interest in the Tad/Toro and Nit claims (the “Toro Project”) subject to a 3% net smelter return royalty on the Tad/Toro claims and a 1% net smelter return royalty on the Nit claims. The Toro Project comprises 310 mineral claims covering approximately 32 square kilometres. The claims are located within the Dawson Range copper-gold belt in the southern portion of the White Gold District, central Yukon Territory, 100 kilometres northwest of Carmacks, which is 177 kilometres by road from Whitehorse.
Concurrent with the closing of the transaction, Simon Anderson replaced Paul D. Gray as CFO of Dawson Gold. Paul D. Gray will remain as CEO and a director of Dawson Gold.
Details respecting the Qualifying Transaction can be found in Dawson Gold’s Filing Statement dated October 22, 2010, which is available for review at www.sedar.com.
Concurrent Private Placement
Dawson gold is also pleased to announce the closing of 16,578,829 units at a price of $0.15 per unit for gross proceeds of $2,486,824. Each unit is comprised of one common share and one share purchase warrant. Each warrant is exercisable into an additional common share of the company for a period of 18 months from the closing of the private placement at a price of $0.25 per share for the first 12 months after closing of the private placement and at a price of $0.35 per share for the next 6 months.
In connection with the private placement, Dawson Gold paid finder’s fees of $151,886 in cash, 250,533 common shares, and 504,480 share purchase warrants exercisable for a period of 18 months from the closing of the private placement at a price of $0.15 per share.
The securities issued pursuant to the private placement and related finders’ fees are subject to a hold period expiring on March 6, 2011.
The proceeds of the private placement will be used to carry out future exploration programs on the Toro Project, for additional property acquisitions, for general working capital and other corporate purposes.
The Toro Project is the property of merit for Dawson Gold. Work in the summer and fall of 2010 included 1,516 metres of diamond drill in 8 drill holes which tested 4 target zones. One historic drill hole (DDH70-T12) was re-logged and partially re-sampled for detailed gold analyses. Six (6) geochemical soil grids and two (2) contour geochemical soil grid lines were established and sampled for a total of 549 samples. Induced Polarity geophysical surveys were conducted over three (3) target zones covering 4.5 km2. A total of 1,140 core and rock samples have been sent for analyses at Acme Analytical Laboratories of Vancouver, B.C. Assays are pending.
The 2010 Toro Project work program was conducted under the supervision of Michael Collins, P.Geo., President and a director of Dawson Gold and a qualified person under NI 43-101, who has read and approved the content of this news release.
On behalf of the Board of Directors,
Paul D.Gray, P.Geo. CEO
Dawson Gold Corp.
For further information, please contact:
Mark Komonoski,
Toll-Free: 1 877 255 8483
Phone: 403 255 8483
Neither 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.