Red Mountain received subscriptions for 65%.
The shortfall will now be placed by the underwriter, PAC Partners Pty Ltd.
The new securities are expected to begin trading on the 16th March 2016.
Funds will be used for the Batangas Gold Project in the Philippines
Jon Dugdale, managing director, commented:
"The Rights Issue funding of $1.05 million, along with the approximately $1.6 million in funds expected from our strategic partner, Bluebird Merchant Ventures, by the end of March, really sets the company up to deliver on its key milestones at the Batangas Gold Project.
"These include completion of the DFS and permitting for development of the project.
"The funding will also assist us to assess a couple of interesting Australian advanced gold projects that have been brought to our attention.
"The objective of getting involved with any locally based project would be to achieve gold production in the near to medium term."
Proactive Investors is a global leader reporting financial news, media, research and hosts events for listed emerging growth companies and investors across four continents.