Brazilian Resources, Inc.

Brazilian Resources, Inc.

August 24, 2005 13:33 ET

Brazilian Resources Completes CDN$5 Million Private Placement

CONCORD, NEW HAMPSHIRE--(CCNMatthews - Aug. 24, 2005) - Brazilian Resources, Inc. ("BRAZILIAN" or the "Company") has completed its previously announced Cdn.$5 million private placement (the "Offering") from a limited number of accredited investors. Kingsdale Capital Markets, Inc. and Kingsdale Capital Markets (USA) Inc. served as agents for the Offering. Cdn.$4.2 million from the Offering will be used to complete the acquisition of 49% of the quota shares of an existing corporation in Brazil, Prometalica Mineracao Ltda. ("Prometalica"), and the remainder will be used for working capital. Prometalica will use funds received from BRAZILIAN for development of its Monte Cristo property, an advanced-stage base metals project. BRAZILIAN intends to file a National Instrument 43-101 technical report within 30 days regarding the Monte Cristo property.

The Offering consisted of Cdn.$2 million of equity and Cdn.$3 million of convertible debentures. The equity component was comprised of 20 million units at a price of Cdn.$0.10 per unit. Each unit consisted of one common share and one purchase warrant, each warrant entitling the holder to purchase an additional common share at Cdn.$0.15 per share for a period of three years from the date of issuance. Cdn.$3 million principal amount of convertible debentures were issued with an annual interest rate of 10% and a term of three years. Fifty percent of the principal amount of the debentures is convertible before maturity into common shares at a conversion price of Cdn.$0.20 per share. The principal amount of the debentures is secured by a portion of the common shares of Jaguar Mining Inc. (JAG - TSX) owned by BRAZILIAN. In connection with the Offering, BRAZILIAN paid Kingsdale a six percent commission in the form of 3,000,000 common shares of BRAZILIAN valued at Cdn.$0.10 per share. Securities issued in the Offering have hold periods in Canada expiring between December 4 and December 23, 2005.

Because the size of the Offering exceeded the Cdn.$350,000 annual limitation prescribed by the policy of the NEX Board of the TSX Venture Exchange, BRAZILIAN voluntarily delisted its common shares from the NEX Board at the close of trading August 2, 2005. Kingsdale Capital Markets, Inc. continues to act as an advisor as the Company examines a broad range of strategic alternatives.

BRAZILIAN is a resource and infrastructure development company with business interests in mining and gamma ray ionization. Including the securities issued to complete the Offering, BRAZILIAN has 103,579,488 common shares outstanding (138,947,281 fully diluted), and holds 4,820,709 common shares of Jaguar Mining Inc., a gold producing company listed on the Toronto Stock Exchange.

The statements that are not historical facts are forward-looking statements involving known and unknown risks and uncertainties, which could cause actual results to vary considerably from these statements. Readers are cautioned not to put undue reliance on forward-looking statements.

BRAZILIAN's and Jaguar's securities have not been registered under the U.S. Securities Act of 1933, as amended, and may not be offered, sold or resold in the United States or to a U.S. person absent registration or an applicable exemption from the registration requirements. This release is not an offer of securities for sale in the United States or elsewhere.

Contact Information

  • Brazilian Resources, Inc.
    Daniel Titcomb
    President
    603-224-4800
    603-228-8045 (FAX)
    or
    Brazilian Resources, Inc.
    Jeffrey Kirchhoff
    Chief Financial Officer
    603-224-4800
    603-228-8045 (FAX)
    info@brazilianresources.com
    www.brazilianresources.com
    or
    Brazilian Resources, Inc.
    48 Pleasant Street
    Concord, NH 03301