reason for stop tradeI just found this on Gabriel Resources site.
I hope it helps.
Toronto, Ontario: May 26, 2009 -- Gabriel Resources Ltd. (TSX-GBU) ("Gabriel" or the "Company") is pleased to announce that it intends to raise approximately Cdn$100 million by way of (i) a public offering of common shares, for which Gabriel has filed a preliminary short-form prospectus (the "Public Offering"); and, (ii) a concurrent private placement of common shares to certain significant shareholders (the "Private Placement").
Gabriel has today filed with the Securities Commissions in each of the Provinces of Canada, and has received a receipt for, a preliminary short-form prospectus qualifying the common shares to be distributed pursuant to the Public Offering. The Public Offering will be conducted through a syndicate of underwriters led by Cormark Securities Inc. and RBC Capital Markets as joint bookrunners (the "Underwriters"). The price per common share will be determined by the Underwriters and Gabriel in the context of the market at the time of entering into a definitive underwriting agreement between Gabriel and the Underwriters. Gabriel has granted to the Underwriters an over-allotment option (the "Over-Allotment Option"), which entitles the Underwriters to acquire at any time up to 30 days following the closing of the Public Offering, at the same issue price as the Public Offering, up to an additional 15% of the common shares distributed in the Public Offering. The common shares distributed in the Public Offering may be sold outside of Canada where they may be lawfully sold on a basis exempt from the prospectus and registration requirements of any such jurisdiction.
Pursuant to the proposed Private Placement, each of Electrum Strategic Holdings LLC and Paulson & Co. Inc. has indicated their intention to subscribe for, and the Corporation has indicated its intention to accept, subject at all times to the parties agreeing upon applicable terms and conditions thereon, on a "private placement" basis (the "Private Placement"), such number of common shares of the Corporation which, at the minimum would enable them to maintain their respective proportionate interest in the Corporation, after giving effect to the Private Placement and the Public Offering (including any exercise of the Over-Allotment Option), and at a maximum, the number of common shares of the Corporation which would enable them to increase their percentage interest in the Corporation to a percentage not equal to or greater than 20.0% of the Corporation's issued and outstanding shares, after giving effect to the Private Placement and the Public Offering (including any exercise of the Over-Allotment Option). Closing of the Private Placement and the Public Offering will each be conditional upon the closing of the other. The common shares to be issued pursuant to the Private Placement will be subject to the regulatory framework of the Toronto Stock Exchange (the "TSX") which may restrict the number of common shares to be subscribed for. The price per common share under the Private Placement will be the same as that under the Public Offering.
Newmont Mining Corporation ("Newmont") which currently owns 19.7% of Gabriel's issued and outstanding common shares, has waived its pre-emptive right to participate in the Public Offering (including the Over-Allotment Option) and the Private Placement. Newmont, however, continues to hold two board seats and remains strongly supportive of Gabriel and the Rosia Montana gold project. Pro forma the two financing offerings, Newmont Mining Corporation will continue to own approximately 17% of the issued and outstanding shares of Gabriel.
Gabriel intends to use the net proceeds of the Public Offering and the Private Placement towards costs associated with developing its 80% owned Rosia Montana gold project located in Romania and for general corporate purposes. The Public Offering and the Private Placement will close concurrently and will be conditional on each other, and on other customary conditions, including but not limited to the receipt of all necessary approvals of the TSX.
For further information regarding the Public Offering and the Private Placement, please contact Richard Young, Vice President and Chief Financial Officer at 416-682-6080.