Lone Star Gold to price $24 million private placement of common stock

Deal arranged with Fairhills Capital to fund exploration and drilling

By Devika Patel

Knoxville, Tenn., May 1 - Lone Star Gold, Inc. said it has negotiated a private placement of stock with Fairhills Capital Offshore Ltd., which will raise up to $24 million.

Proceeds will be used for general working capital purposes. In particular, the proceeds will fund Lone Star's exploration and drilling program at its La Candelaria gold-silver property and subsequent project activities.

"Now that we're into our second year of exploration on the La Candelaria Project, and are investing in on-site processing capacity to increase the productivity of the Tailings Project shipments, working capital is essential to continuing those efforts," Lone Star Gold president Daniel Ferris said in a press release.

"The $24 million financing agreement outlined in the term sheet would enable us to carry on with our current project activities while taking advantage of opportunities to grow our influence in the surrounding area through further acquisitions."

Based in Albuquerque, N.M., Lone Star is a gold explorer.

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