Toronto, ON, Canada -- (SBWIRE) -- 05/05/2006 -- Stroud Resources Ltd. (TSXV- SDR) ("Stroud" or the “Company”) is pleased to announce the completion of its previously announced private placement financing. Stroud has issued and sold today 23.33 million units at a price of $0.18 per unit raising gross proceeds of $4.2 million. Each unit consisted of one common share and one-half of one common share purchase warrant, with each whole warrant entitling the holder to acquire one common share at a price of $0.30 until May 4, 2008, subject to accelerated expiry in the event that the 20 day average closing price equals or exceeds $0.375 per share. In connection with the placement, the Company has paid finder's fees of $307,200 in cash and issued 1,706,665 finder's warrants exercisable at $0.235 for a 12 month period to registered dealers who have arranged for purchasers of units. All securities issued pursuant to the private placement are subject to a 4-month hold period.
Closing of the placement will allow the Company to complete its previously announced acquisition of the remaining 50% interest in the Santo Domingo silver project in Jalisco, Mexico from Amerix Precious Metals Corporation, to fund diamond drilling at the Santo Domingo project, as well as for general corporate purposes.
The financing has also allowed the Company to broaden its investor base with several institutional investors participating, including Sprott Asset Management Inc. which purchased units on behalf of various funds it manages.
Stroud is also pleased to announce that it has retained the services of Mr. Gregory Bewsh as Director of Investor Relations. Mr. Bewsh, has more than 10 years of experience in investor relations as well as in media and corporate communications. Prior to this appointment, Mr. Bewsh held senior investor relations positions with several corporations, in addition to having principal responsibility for a metals and mining loan portfolio with a major Canadian bank.
In consideration of the investor relations services to be provided, Stroud has agreed to pay Mr. Bewsh a monthly retainer of $5,000 during the initial one-year term of the agreement. In addition, Mr. Bewsh will be reimbursed for agreed upon expenses and, subject to regulatory approval, has been granted stock options to purchase 200,000 common shares in the capital of the Company under the Company’s stock option plan exercisable for a two year period at a price of $0.25 per share and vesting in equal amounts quarterly. Mr. Bewsh will be based in Stroud’s corporate office and will be responsible for communicating corporate news and developments to Stroud’s shareholders, the financial community, industry analysts and the media. Mr. Bewsh holds no direct or indirect interest in Stroud or its securities.
Stroud also announces that, subject to regulatory approval, it has granted options to acquire an aggregate of 1,450,000 common shares to directors and officers of the Company under Stroud’s stock option plan. Each option is exercisable to acquire one common share at a price of $0.25 per share for a three year period. The options vest as to one-third immediately and one-third on each of the 7 and 13 month anniversaries of the date of grant.
Stroud is a debt-free exploration company focused on the discovery and exploration of silver and gold deposits in Mexico and Ontario. Stroud owns a 50% interest in the Santo Domingo epithermal silver-gold project in central Mexico. In addition to the Santo Domingo project, Stroud's assets include 100% interests in the Hislop gold property, near Timmins, Ontario and the Leckie gold property, near North Bay, Ontario. Stroud also generates cash flow from a 3.75% interest in four natural gas, and natural gas condensate wells in central Alberta. Stroud's corporate goal is to create a mineral based company with projects that are exceptional, characterized as world-class in status and with the potential for near-term production.
For additional information please contact:
Mr. George Coburn
President and CEO
Stroud Resources Ltd.
Mr. Greg Bewsh
Director of Investor Relations
Stroud Resources Ltd.
Or visit: http://www.stroudresourcesltd.com
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