Peregrine Diamonds Announces Terms of $15.1 Million Rights Offering - Standby Purchase Agreement Executed - Final Prospectus Filed

August 25, 2014 PDF version
NOT FOR DISTRIBUTION TO UNITED STATES NEWS WIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES


Vancouver, BC - Peregrine Diamonds Ltd. (“Peregrine” or the “Company”) announced that it has filed and received regulatory approval for a final prospectus in each of the provinces and territories of Canada (other than Qu├ębec) for an offering of rights (the “Offering”) to holders of common shares of the Company to raise approximately $15.1 million in gross proceeds. The Company intends to use the net proceeds of the Offering for the Company’s 2014 Chidliak summer field program and to advance the 2015 Chidliak bulk sample program, as well as to make the final payment of $2.5 million owed to BHP Billiton.

Shareholders of Peregrine will receive one right (a “Right”) for each common share (“Share”) held. Two Rights will entitle the holder to purchase one unit (“Unit”) at $0.21 per Unit. Each Unit will be comprised of one Share and one common share purchase warrant (“Warrant”). Each Warrant will be exercisable for one Share at a price of $0.21 per Share for six months from the date of closing of the Offering. The Offering will include an additional subscription privilege under which shareholders who fully exercise their Rights will be entitled to subscribe for additional Shares, if available, that were not otherwise subscribed for in the Offering.

Mr. Eric Friedland (Peregrine’s Chairman and CEO), Newstar Securities SRL (a company wholly owned by Mr. Robert Friedland), and Goodman Merchant Capital Inc. (managed by Mr. Ned Goodman) (collectively, the “Standby Purchasers”) have entered into a Standby Purchase Agreement with Peregrine pursuant to which the Standby Purchasers have severally agreed to purchase all Units that are not otherwise subscribed for under the Offering on the terms contained in the Standby Purchase Agreement. The Company has agreed to pay the Standby Purchasers a fee equal to 3% of the aggregate gross proceeds of the Offering excluding proceeds from the Standby Purchasers’ exercise of their Basic Subscription Privilege.

Keys terms in the prospectus for the Offering include:
  • Each Peregrine shareholder, subject to restrictions imposed by applicable securities laws, will receive one transferable Right for each Share owned as of September 9, 2014, the record date of the Offering.
  • Two Rights will entitle the holder to purchase one Unit of Peregrine at $0.21. Each Unit will be comprised of one Share and one Warrant. Each Warrant will be exercisable for one Share at a price of $0.21 for six months from the date of closing of the Offering.
  • Approximately 71,921,597 Shares are expected to be issued under the Offering, which would represent 50% of Peregrine’s currently outstanding Shares. In the event of exercise of all of the Warrants, a further 71,921,597 Shares would be issued for proceeds of $15.1 million, representing a further 50% of Peregrine’s current outstanding Shares.
  • Shareholders who do not exercise all of their Rights will have their present ownership interests in Peregrine, as a percentage of the total outstanding Shares, reduced as a result of the Offering.
  • Peregrine expects the final prospectus relating to the Offering to be mailed to shareholders eligible to participate in the Offering on or about September 12, 2014.
  • The Rights will expire at 2:00 p.m. (Pacific Daylight Time) on October 6, 2014.
  • The Rights will be listed and posted for trading on the Toronto Stock Exchange with trading expected to begin on or about September 5, 2014.
Details concerning the Offering and the procedures to be followed by shareholders are contained in the final prospectus and other documents which Peregrine has filed with Canadian securities regulatory authorities. These documents are available on SEDAR on