Rights issue for Breakwater

Under a proposed rights offering, common shareholders of Breakwater Resources (TSE) will receive one right for each common share held. One right will entitle the holder to buy one common share at 10 cents each.

As of June 17, Breakwater had 195.3 million common shares and 14.2 million Series A convertible preferred shares outstanding. The preferred shares are convertible into common shares on a 1-for-1 basis. If all the preferred shares are converted, the maximum number of rights to be issued will be 209.5 million.

If all the rights are exercised, the company will raise more than $20.9 million and have 419 million shares outstanding.

Dundee Bancorp (TSE), which owns 45.8% of Breakwater’s common shares and 40.6% of the Series A preferred shares, will subscribe for sufficient shares to provide Breakwater with a minimum of $5 million and up to $9.5 million in proceeds.