SAN FRANCISCO, March 12, 2004 (PRIMEZONE) -- On March 11, 2003, GoldSpring, Inc. (OTCBB:GSPG) commenced operations as a public company and on this First Anniversary, March 11, 2004, has received definitive agreements for $10 million Institutional equity private placement. Merriman Curhan Ford & Co. acted as sole placement agent in this transaction.
Use of Proceeds are as follows: $3 million to accelerate the ramp up of existing gold, silver and copper reserves into production; $3 million to complete and bring to production those acquisitions currently under LOI; $2 million for additional acquisitions, development and exploration and $2 million for working capital. This capital infusion, according to the Company's business plan, will enable production revenue on an annualized basis to increase from around $20 million to about $70 million.
2003 was a year of formation and staging for the enterprise. 2004 will focus on expanding mineral production at existing properties and increasing reserves through strategic acquisitions and exploration. The Company will continue to seek acquisition opportunities where the properties have proven reserves, advanced permitting in place and where exploration opportunities exist. The Company has three (3) Letters of Intent in place for properties that meet these criteria. Contingent upon successful due diligence, the Company intends to complete these acquisitions in the near term.
Current in-ground reported reserves total $609 million: Gold: $554 Million (1.35 Million oz.), Silver: $24 Million (3.7 Million oz.), and Copper: $31 Million (25 Million lbs.) The Company intends to increase In-Ground Reserves to over 3 million ounces of gold in 2004 through acquisitions and exploration of existing properties. Exploration opportunities exist on the Company's properties including a Bonanza potential discovery. GoldSpring is committed to creating a high-quality portfolio of gold and other precious metals producing assets to achieve substantial, long-term growth and cash flow.
Terms of Private Placement:
The Company raised a total of $10 million in a private placement to institutional and accredited investors through the issuance of 21,739,130 shares of unregistered common stock. The investors will also receive warrants to purchase 50% additional shares of common stock, at an exercise price of $0.86 per share. Additionally, investors have the option to invest an additional $5.0 million in a green shoe option.
This press release does not constitute an offer to sell or the solicitation of an offer to buy any security. The shares issued in the private placement have not been registered under the Securities Act of 1933, as amended, or applicable state securities laws and may not be offered or sold in the United States absent registration under the Securities Act of 1933, as amended, and applicable state securities laws or an applicable exemption from registration requirements. The Company has agreed to file a registration statement covering the resale of the shares.
Further information on the Company's operations and its AMEX listing will be forthcoming as details are available for publication.
Statements contained in this press release, which are not historical facts, are forward looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based largely on the Company's expectations and are subject to a number of risks and uncertainties beyond the company's control, including but not limited to economic, competitive and other factors affecting the Company's operations, management team effectiveness, expansion strategies, available financing, market prices and recovery costs, government regulations involving the Company, facts and events not known at the time of this release, and other factors discussed in the Company's filings with the Securities and Exchange Commission. These statements are not guarantees of future performance and readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this release. The Company undertakes no obligation to update publicly any forward-looking statements.