CALGARY, Aug. 20 /PRNewswire-FirstCall/ -- Infinito Gold Ltd. (the "Company") announces that it has drawn down a further $3,000,000 under the Secured Convertible Note held by Exploram Enterprises Ltd. ("Exploram") issued by the Company on February 10, 2009. Under this drawdown the principal amount of the drawdown may be converted into shares of the Company at a deemed price of $0.161 per share, being the 20-day volume weighted average price of the shares of the Company for the 20 trading days ending on the date of issue. In connection with the drawdown Exploram was also issued 18,633,540 common share purchase warrants (the "Warrants"). The $3,000,000 will be used to continue payments on capital items being delivered to the Crucitas mine project in Costa Rica, working capital and corporate general and administrative expenses.
The terms of the Secured Convertible Notes are described in detail in the Company's news release of February 10, 2009. Exploram waived certain conditions precedent to the Company's right to drawdown these funds under the Secured Convertible Notes, including the requirement for the issue of a favourable decision in respect of the Costa Rican legal challenge to the grant of a change of land use permit for the Crucitas mine announced by the Company on October 21, 2008. The Company is still waiting a ruling on this issue from the Constitutional Court, or Sala IV in Costa Rica and the Company has been advised that the justices from the Sala IV will make a site inspection on September 11, 2009. This waiver only applied to this drawdown. The payment of the structuring fee in respect to this drawdown in the amount of $90,000 has been deferred.
The Warrants issued at closing are exercisable until August 20, 2014 and each Warrant entitles the holder to acquire one share of the Company at $0.161 per share.
Before the drawdown Exploram held 61,154,490 shares of the Company and common share purchase warrants and a Secured Convertible Note of the Company entitling it to acquire a further 393,911,966 common shares of the Company. As a result of this $3,000,000 drawdown, Exploram will be entitled to acquire a further 37,267,080 common shares of the Company upon conversion in full of the additional principal due under its Secured Convertible Note and exercise of the Warrants. The Company presently has 122,434,289 shares outstanding.
The Warrants and any shares issuable under the Warrants and the Secured Convertible Note in respect of the amount drawn down are subject to a hold period expiring on December 21, 2009.
Caution Regarding Forward-Looking Information and Statements ------------------------------------------------------------
Certain statements in this press release address future events and conditions and, as such, involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the statements. These factors include, among others, the inherent risks involved in the exploration and development of mineral properties, the uncertainties involved in interpreting drilling results and other geological data, fluctuating metal prices, the possibility of project cost overruns or unanticipated costs and expenses, uncertainties relating to the availability and costs of financing needed in the future, the possibility that all necessary governmental and regulatory approvals will not be received, and the availability of a qualified workforce and third party contractors necessary for the development and operation of a mine. The Company undertakes no obligation to update these forward-looking information or statements if circumstances or management's estimates or opinions should change. The reader is cautioned not to place undue reliance on forward-looking information or statements.
INFINITO GOLD LTD. (signed) John Morgan President "The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release."
Infinito Gold Ltd.
CONTACT: INFINITO GOLD LTD., 216, 102 - 8th Avenue S.W., Calgary,
Alberta, T2P 1B3, Telephone: (403) 444-5191
