Breakwater Resources Ltd.

Breakwater Resources Ltd.

April 02, 2009 08:01 ET

Breakwater Resources Ltd. Provides Update With Respect to Public Offering

TORONTO, ONTARIO--(Marketwire - April 2, 2009) -


Breakwater Resources Ltd. (the "Company") (TSX:BWR) is providing an update with respect to the public offering announced on March 17, 2009. The Company has made application for the approval of the Toronto Stock Exchange for a $20 million public offering consisting of 200 million units (the "Units"). The Units will be offered at a price of $0.10 per Unit, with each Unit being comprised of one common share and one-half of a warrant (a "Warrant"). Each whole Warrant would have a term of five years and entitle the holder to purchase one common share at a price of $0.12 per share.

The offer and sale of the Units is subject to the filing of a final prospectus with the Ontario Securities Commission and the securities regulatory authorities of the other provinces of Canada. 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 Corporation and Toll Cross Securities Inc., is acting as underwriters of the offering. Subject to obtaining all required approvals, entering into an underwriting agreement with the syndicate of underwriters and subject to satisfaction of all terms and conditions of the underwriting agreement, the Company anticipates that the offering would close on or about April 9, 2009.

Subject to regulatory approval, Dundee Corporation has advised us of its intention to purchase up to 64 million Units under the offering (but in any event no fewer than the number required to maintain its approximate pro rata ownership interest in the Company (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 Company 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 Units equal to 15% of the Units sold pursuant to this offering, to cover over-allotments, if any, and for market stabilization purposes.

The Company will not proceed with the offering if the gross proceeds of the offering (prior to the exercise of the over-allotment option) are less than $20 million.

Further details of the offering, including the anticipated use of proceeds, are set out in the preliminary prospectus of the Company dated March 17, 2009 available on or from one of the members of the underwriting syndicate.

The Units 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 under the Company's profile. These forward-looking statements are made as of the date of this press release only and the Company 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