Brazilian Resources Raises US$800,000, Advances Gold and Hydroelectric Projects, and Elects Two New Directors.CONCORD, NEW HAMPSHIRE--(BUSINESS WIRE)--June 22, 1998-- Brazilian Resources(CANADIAN DEALING NETWORK Canadian Dealing Network (CDN) The organized OTC market of Canada. Formerly known as the Canadian Over-the-Counter Automated Trading System (COATS), the CDN became a subsidiary of the Toronto Stock Exchange in 1991. :BZIN.) Brazilian Resources, Inc. ("BRAZILIAN") announced today that it has completed two debenture and purchase warrant private placements. A US$200,000 placement was self-brokered, and a US$600,000 placement was brokered by David Williamson Associates Ltd., London, U.K. BRAZILIAN received a total of US$800,000 (approximately Cdn.$1,150,000) from the sale of one-year debentures with an annual interest rate of 12 percent. Debenture holders also received a total of 1,333,333 common stock purchase warrants exercisable at US$0.15 (approximately Cdn.$0.215) for up to 30 days following full repayment of the debentures' principal and interest. This bridge financing Bridge Financing A method of financing, used by companies before their IPO, to obtain necessary cash for the maintenance of operations. Notes: These funds are usually supplied by the investment bank underwriting the new issue. represents the first tranche of BRAZILIAN's larger capital program. Proceeds are being used to fund the initial stage of design, development and feasibility studies on both gold and hydroelectric assets, the completion of which will provide documentation necessary to complete a senior debt financing Debt Financing When a firm raises money for working capital or capital expenditures by selling bonds, bills, or notes to individual and/or institutional investors. In return for lending the money, the individuals or institutions become creditors and receive a promise to repay . Work currently underway includes development of the second heap leach at the Santa Maria Santa Maria, city, Brazil Santa Maria (sän`tə mərē`ə), city (1991 pop. 217,592), Rio Grande do Sul state, S Brazil. It is a major railroad terminus and the site of an important military base. gold mine, which should increase production capacity to 35,000 ounces per year. BRAZILIAN has formed a strategic alliance with Duke Engineering & Services, which will be responsible for development of the priority hydroelectric projects. BRAZILIAN is seeking a US$75 million debt financing to be used primarily to acquire and develop small (10 to 30 megawatt meg·a·watt n. Abbr. MW One million watts. meg  a·watt ) hydroelectric
assets, with approximately US$10 million dedicated to development of the
Santa Maria mine and surrounding properties. It is anticipated that
approximately 70 percent of the debt load would be in the form of a
revenue sharing revenue sharingFunding arrangement in which one government unit grants a portion of its tax income to another government unit. For example, provinces or states may share revenue with local governments, or national governments may share revenue with provinces or states. bond, directly tied to the performance of the projects. The remaining debt is scheduled to be a conventional bond issue guaranteed by a third party insurance company and collaterized by gold assets. Management views this capital plan as a method to leverage the company's gold properties, which it believes are currently undervalued Undervalued A stock or other security that is trading below its true value. Notes: The difficulty is knowing what the "true" value actually is. Analysts will usually recommend an undervalued stock with a strong buy rating. . At its Special Meeting in lieu of an annual meeting of shareholders held June 12, 1998, BRAZILIAN re-elected seven directors (William E. Dow, Anthony F. Griffiths, Jeffrey C. Kirchhoff, Michael Seaward, Daniel R. Titcomb, David R. Titcomb and Lars E. Vannman), and elected two new directors, John J. Devine and Robert W. Jackson. John J. Devine is Vice President of Duke Engineering & Services, a subsidiary of North Carolina-based Duke Power Company. He is a professional engineer with 25 years of diverse experience in the planning, licensing, design and construction of small and large civil engineering projects, focusing on the engineering and environmental aspects of hydroelectric and water resource facilities. Mr. Devine is currently President and Director of the National Hydropower Association The National Hydropower Association (NHA) in the United States represents the interests of the U.S. hydropower industry, which includes all forms of water energy -- conventional, hydrokinetic, tidal and ocean. . Robert W. Jackson is President of Metal Royalties Corporation, a subsidiary of Toronto-based McCarvill Corporation. He is a director of McCarvill Corporation, and has served as an ex-officio member An ex-officio member was a member of a colonial legislative council or an executive council. They were civil servants who served in a colonial government, appointed to sit in a council or both councils alongside with unofficial members. of BRAZILIAN's board since October 1997. Mr. Jackson is a mining engineer with more than 13 years experience in the mining and mine financing businesses. Most recently, Mr. Jackson was a senior vice president of Midland Walwyn Corporation's mining finance team. Not seeking re-election was Martin Rapaport Martin Rapaport is an American entrepreneur and founder of the Rapaport Diamond Report. Rapaport is a maverick[1] within the diamond industry, and is often recognized for his signature bow tie. , diamond dealer and publisher of the Rapaport Diamond Report The Rapaport Report is the jewelry industry standard for the pricing of diamonds. The report is published weekly and given to jewlers and diamond merchants to set the price for consumers. , and director since September 1994. BRAZILIAN wishes to thank Mr. Rapaport for his guidance and service over the past several years. BRAZILIAN is quoted on the Canadian Dealing Network under the symbol "BZIN". There are 40,014,232 common shares outstanding, of which officers and directors control approximately 22 percent. BRAZILIAN's securities have not been registered under the U.S. Securities Act of 1933, as amended, and may not be offered, sold or resold in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. or to a U.S. person absent registration or an applicable exemption from the registration requirements.
CONTACT: Brazilian Resources Inc.
Daniel Titcomb, 603/ 224-4800
603/ 228-8045 (FAX)
E-mail: info@brazilianresources.com
Website: www.brazilianresources.com
or
Brazilian Resources Inc.
Jeffrey Kirchhoff, 603/ 224-4800
603/ 228-8045 (FAX)
E-mail: info@brazilianresources.com
Website: www.brazilianresources.com
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