Solomon Resources arranges $1-million financing

2010-06-17 12:17 ET - News Release

Mr. Randy Rogers reports

SOLOMON ANNOUNCES $ 1,000,000 FLOW THRU AND NON-FLOW THRU FINANCING; SOLOMON TO RAISE UP TO $500,000 IN UNIT AND $500,000 IN FLOW-THROUGH UNIT PRIVATE PLACEMENTS

Solomon Resources Ltd. proposes to raise up to $1-million, through private placements of up to 3,333,333 units at 15 cents per unit and up to 2,777,778 flow-through units at 18 cents per unit.

Each unit will consist of one common share and one transferable share purchase warrant to purchase a further (non-flow-through) common share for 30 cents for a period of two years. The expiry date of the warrants may be reduced to 25 trading days from notice thereof, if the closing price of the common shares equals or exceeds 50 cents for 20 consecutive trading days after the expiry of the four-month restricted resale period.

Finders' fees of 8 per cent will be paid on funds raised from investors introduced by finders. Solomon will also issue warrants to eligible finders to purchase that number of (non-flow-through) units equal to 8 per cent of the number of units from investors introduced by the finders. The finder warrants will be exercisable for two years at 18 cents per unit (15 cents per unit for the non-flow-through-unit placement) in the first year and for 30 cents per unit in the second.

In order to maintain consistency with the financings that closed in April, 2010, the company has, subject to the approval of the TSX Venture Exchange, agreed to reduce the exercise price of the warrants that formed part of the units then issued from 40 cents to 30 cents. All other terms of the warrants then issued remain the same.

The financing is subject to regulatory approval.

The proceeds of this placement will be used to supplement $718,000 raised in April, 2010, for the exploration and development of Solomon's Ten Mile Creek project in the White Gold area of the Yukon Territory (where an exploration crew has commenced the summer work program) and the Cry Lake gold project in British Columbia, general corporate overheads, and the company's continuing efforts to locate more advanced exploration and development projects.