Breakwater Resources Ltd.
TSX : BWR

Breakwater Resources Ltd.

March 17, 2009 13:20 ET

Breakwater Resources Ltd. Announces Public Offering

TORONTO, ONTARIO--(Marketwire - March 17, 2009) -

NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES.

Breakwater Resources Ltd. ("Breakwater") (TSX:BWR) is pleased to announce that it has filed a preliminary short form prospectus in connection with a proposed marketed public offering of a minimum of C$20 million of common shares of Breakwater. The number of common shares to be distributed and the price per common share will be determined in the context of the market with the final terms to be determined at the time of pricing. A syndicate co-led by Cormark Securities Inc. and Dundee Securities Corporation and including GMP Securities L.P., Scotia Capital Inc., TD Securities Inc., Canaccord Capital Corporation, Octagon Capital Corp. and Toll Cross Securities Inc., is acting as underwriters of the offering. Breakwater has granted to the underwriters an option, exercisable in whole or in part at the discretion of the underwriters, for a period of 30 days from the closing date of the offering, to purchase up to that number of additional common shares equal to 15% of the common shares sold pursuant to this offering, to cover over-allotments, if any, and for market stabilization purposes.

Breakwater intends to use the net proceeds of the offering to pay trade creditors, customers and restructuring fees, with the balance available for general corporate purposes.

Dundee Corporation has advised us of its intention to purchase common shares under the offering to maintain its approximate pro rata ownership interest in Breakwater (based on at least a $20 million offering). Dundee Corporation and its affiliates hold approximately 25.2% of our issued and outstanding common shares.

The common shares to be sold under this offering will be offered by way of a short form prospectus in all provinces of Canada and in the United States on a private placement basis pursuant to an exemption from the registration requirements of the United States Securities Act of 1933, as amended and internationally pursuant to available exemptions.

The offering is subject to certain conditions including, but not limited to, the receipt of all necessary approvals including the approval of the Toronto Stock Exchange and the securities regulatory authorities.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any State in which such offer, solicitation or sale would be unlawful. The securities have not been registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements.

Forward-Looking Statements

This press release contains forward-looking statements regarding the proposed offering and the use of proceeds. The words "expected", "intends", "will" and similar words and expressions identify the forward-looking statements. These forward-looking statements involve known and unknown risks, uncertainties and other factors, which may cause the actual results or developments to differ materially from those expressed by the forward-looking statements. These risks, uncertainties and other factors include, but are not limited to: our financial condition and operations, market metal prices, current global financial conditions, and regulatory approvals. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by management at the date of such statements, are inherently subject to significant business, economic, social, political and competitive uncertainties and contingencies. The material factors and assumptions that were applied in making the forward-looking statements in this press release include but are not limited to: a minimum of $20 million being sold by the underwriters, entering into of an underwriting agreement, being able to obtain all necessary regulatory approvals and the offering being completed. For additional information with respect to risks, uncertainties and assumptions, please also refer to the "Risk Factors" in the preliminary short form prospectus dated March 17, 2009 filed on SEDAR at www.sedar.com under Breakwater's profile. These forward-looking statements are made as of the date of this press release only and Breakwater does not assume any obligation to update or revise them to reflect new information, estimates or opinions, future events or results or otherwise, except as required by applicable law.

Contact Information

  • Breakwater Resources Ltd.
    Ann Wilkinson
    Vice President, Investor Relations
    (416) 363-4798 Ext. 277
    Email: AWilkinson@breakwater.ca