Legend Gold Announces Proposed Acquisitions and Financing

Marketwired

TORONTO, ONTARIO--(Marketwired - May 15, 2013) -

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Legend Gold Corp. (The "Company" or "Legend Gold") (TSX VENTURE:LGN) is pleased to announce that the Company is nearing completion of definitive agreements to acquire several exploration-stage properties located in Mali from Endeavour Mining Corporation ("Endeavour") (EDV.TO)(EVR.AX) and to acquire Corado Resources Corp. ("Corado"), a private Canadian company exploring in the Republic of Congo. In conjunction with this acquisition the Company will raise up to $6 million through a non-brokered private placement with affiliates of Sprott Inc. ("Sprott"). The Company will also strengthen its management team through the addition of key personnel from Corado. Legend has been exploring for gold in Mali since 2002 and has three projects with active exploration programs.

Douglas Perkins, CEO of Legend stated that "this is a tremendous deal for Legend shareholders as it strengthens the balance sheet through the financing, provides exposure to a suite of dynamic exploration properties with country and metal diversification, and strengthens our management team with the addition of Demetrius Pohl and Steve Olson both of whom have worked in Africa for the past 25 + years. It also adds Endeavour as a significant shareholder. Endeavour has three operating mines in Ghana, Mali, and Burkina Faso and one mine under construction in Côte d'Ivoire."

Neil Woodyer, CEO of Endeavour stated that "we are pleased to participate in this transaction that attracts both dedicated funding and an experienced exploration team to advance properties we have not been actively exploring as we are focused on building our fourth mine."

The details of the Endeavour and Corado acquisitions are outlined below and are expected to close in late June. Both acquisitions are subject to signing of definitive agreements, TSX-V approval, and completion of the financing. There is no certainty that either of the acquisitions or financing will be completed as planned. As part of Legend's upcoming annual shareholder's meeting, the Company will seek shareholder approval to consolidate the common shares outstanding on a 6 for 1 basis which, if approved, would reduce the shares outstanding from 80,431,324 to 13,405,221.

Endeavour Property Acquisition

  • Portfolio being acquired from Endeavour includes 10 exploration licenses and one permit application in Mali (1,043.2 square kilometers) which range from early to advanced stage gold properties.
  • Legend will issue 10,000,000 consolidated Legend shares and pay $750,000 to Endeavour.
  • Upon completion of both Endeavour and Corado acquisitions as well as the financing, Endeavour will own approximately 19.5% of Legend.

Corado Resources Corp Acquisition

  • The portfolio being acquired from Corado includes two licenses and one application in the Republic of Congo (1,578 square kilometers) prospective for high-grade base/precious metals with drill ready targets which will be subject to a joint venture with a third party; and one application (1,815 square kilometers) covering a laterite banded manganese target.
  • Legend will issue 6,757,797consolidated Legend shares to the shareholders of Corado.
  • Upon completion of both the Endeavour and Corado acquisitions as well as the financing, Corado shareholders will own 13.1% of Legend.

Private Placement

Legend will engage affiliates of Sprott to raise, on a best efforts basis, $6 million through the sale of 20,000,000 subscription receipts (the "Subscription Receipts") at a price of $0.30 per Subscription Receipt. Each Subscription Receipt shall be convertible, for no additional consideration, into a unit (each a "Unit", and collectively the "Units") upon satisfaction of the conditions specified below under "Conversion Conditions". In the event that certain closing conditions are not satisfied on or before 5:00 pm (Toronto time) on July 12, 2013 (the "Termination Time"), the Subscription Receipts shall be automatically redeemed for a redemption price equal to the subscription price plus a proportionate share of any interest earned on the Proceeds.

  • Units: Each Unit shall consist of one consolidated Legend common share and one common share purchase warrant. Each warrant will entitle the holder to acquire one consolidated Legend common share at a price of $0.55 per share at any time prior to 5 years from closing. In the event that, during any period of 20 consecutive trading days commencing more than four months after the closing date of the financing, the average closing price of the consolidated Legend shares is not less than $0.75 per share, Legend shall have the right (but not the obligation) to give notice within five trading days following such period of 20 trading days, to the holders of the Warrants that the expiry date of the Warrants has been accelerated to the date specified in such notice, which date shall be not less than 30 days after the date of such notice.
  • Conversion Conditions: The conversion of the Subscription Receipts into Units is subject to the completion of the Legend share consolidation, completion of the Corado Acquisition, completion of the Endeavour Acquisition, and TSX-V approval. In the event the financing is not successful, the acquisitions would not proceed.
  • Escrow of Proceeds: The Proceeds shall be held in escrow by a mutually agreeable escrow agent. Upon conversion of the Subscription Receipts into Units following satisfaction of the closing conditions at any time prior to the Termination Time, the escrow agent shall pay the Proceeds to Legend. In the event that the closing conditions are not satisfied prior to the Termination Time, the escrow agent shall return the Proceeds with interest to the holders of the Subscription Receipts.
  • Commission: The Company shall pay a finder's fee payable in Units equal to 7% of the number of Units which are issued upon conversion of the Subscription Receipts

About The Company

Legend Gold is a mineral exploration and development company focused on exploring for gold in the Republic Of Mali, West Africa. Our five main projects are the Lakanfla, Mougnina, Tiekoumala, Kata, and Mogoyafara projects. In recent years, we have made significant gold discoveries on the Tiekoumala project located in Southern Mali, and the Lakanfla project located in Western Mali. Please visit our website www.legendgold.com to view project details.

This press release has been prepared by Legend Gold Corp. Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

This news release may contain forward-looking statements that are based Legend Gold Corp.'s expectations, estimates and projections regarding its business and the economic environment in which it operates. These statements are not guarantees of future performance and involve risks and uncertainties that are difficult to control or predict. Therefore, actual outcomes and results may differ materially from those expressed in these forward-looking statements and readers should not place undue reliance on such statements. Statements speak only as of the date on which they are made, and the Company undertakes no obligation to update them publicly to reflect new information or the occurrence of future events or circumstances, unless otherwise required to do so by law.

Contact:
Legend Gold Corp.
Douglas Perkins
President & CEO
514 806 6788
dperkins@legendgold.com
www.legendgold.com

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