RE: RR News re: $$ for Daniels Pond (Buchans too)THIS NEWS RELEASE IS NOT FOR DISSEMINATION IN THE UNITED STATES OR TO ANY UNITED STATES NEWS SERVICE
FSC / Press Release
BUCHANS RIVER ANNOUNCES BOUGHT DEAL $3.5 MILLION PRIVATE PLACEMENT WITH NORTHERN SECURITIES INC.
THIS NEWS RELEASE IS NOT FOR DISSEMINATION IN THE UNITED STATES OR TO ANY UNITED STATES NEWS SERVICE
Halifax, Nova Scotia CANADA, April 18, 2007 /FSC/ - Buchans River Ltd. (BUV - TSX Venture), is pleased to announce that it has entered into an agreement ("Agreement") with Northern Securities Inc. ("Northern") in which Northern has agreed to act as lead underwriter on behalf of a syndicate of underwriters including Bieber Securities Inc., on a bought deal basis, subject to certain conditions, in a private placement of up to $2,000,000 of units ("Units") and up to $1,500,000 of flow-through shares at a price of $0.40 per Unit and $0.50 per flow-through share. The proposed offering is expected to generate gross proceeds of $3,500,000 to Buchans River, not including the proceeds that may be raised as a result of the exercise of the Over-Allotment Option described below. Each unit is comprised of one Buchans River share and one-half of one Buchans River share purchase warrant. One whole Warrant will entitle the holder to subscribe for one Common Share at $0.54 at any time until the date that is 20 months from closing.
The net proceeds of the Flow-Through Shares shall be used for mineral exploration expenses and the proceeds of the Units shall be used for mineral exploration expenses and general corporate purposes.
The Agreement and the Offering are subject to receipt of all necessary approvals, including regulatory and stock exchange approvals. The closing is expected to occur on or about May 4th, 2007 ("Closing").
Buchans River has agreed to pay the Underwriters a commission equal to 7% of the aggregate gross proceeds of the Offering, including the Over-Allotment described below, and to grant the Underwriters brokers' warrants to acquire shares ("Brokers' Share Warrants") representing 7% of the number of Units and flow-through shares sold issued under the Offering, including the Over-Allotment described below. One Brokers' Share Warrant will entitle the holder to acquire one share ("Brokers' Share") for $0.40 at any time until the date that is 18 months from Closing.
Buchans River has also granted the Underwriters an over-allotment option ("Over-Allotment Option") to purchase up to an aggregate of $400,000 of Units or Flow-Through Shares at a price equal to the Unit Issue Price and the Flow-Through Share Issue Price, respectively. If not exercised at or prior to Closing, the Over-Allotment Option shall expire.
All of the securities issued in connection with the Offering will be subject to a four month hold period from the date of issue