/NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR
DISSEMINATION IN THE UNITED STATES./
VANCOUVER, May 16 /CNW/ - Selwyn Resources Ltd (TSXV: SWN) ("Selwyn") today announced that its brokered best efforts
private placement financing through Paradigm Capital Inc. as lead agent
on behalf of a syndicate including Canaccord Genuity Corp.
(collectively, the "Agents") to raise gross proceeds of up to $15
million (the "Offering") has been amended to provide for the sale of up
to 60,000,000 Special Warrants at a price of $0.25 each (the "Issue
Price"). Selwyn has granted to the Agents an option to sell up to an
additional 15% of the Special Warrants at the Issue Price for
additional gross proceeds of $2.25 million. The gross proceeds from the
Offering will be delivered to Selwyn upon closing of the Offering.
The proceeds from the Offering will be used for the purchase
consideration payable by Selwyn in connection with the acquisition of
ScoZinc Limited from Acadian Mining Corporation (See February 8, 2011
News Release) and for general working capital purposes. ScoZinc Limited
owns the zinc/lead Scotia Mine in Nova Scotia that was closed in 2009
due to the collapse of the price of zinc in late 2008.
Each Special Warrant will be convertible for no additional consideration
into one common share ("Common Shares") of Selwyn and one-half of one
common share purchase warrant ("Warrants") of Selwyn upon the earlier
to occur of Selwyn clearing a prospectus (the "Prospectus") in
applicable Canadian jurisdictions, and the date that is four months
after the closing date for the Offering. Each whole Warrant will
entitle the holder thereof to purchase one Common Share at $0.40 for a
period of 24 months after the closing date of the Offering. If the
Prospectus has not been cleared by July 8, 2011, each Special Warrant
will be convertible into 1.1 Common Shares and 0.55 of a Warrant.
Selwyn also intends to raise approximately $30 million through the sale
of debt securities as part of the funds to reopen the Scotia Mine.
The Offering is subject to acceptance by the TSX Venture Exchange.
About Selwyn Resources Ltd
Selwyn's main focus remains the exploration and development of its
properties that make up the Selwyn Project in the Yukon, by the joint
venture comprised of Selwyn and Chihong Canada Mining Ltd. The
acquisition of the Scotia Mine will provide Selwyn with a new
opportunity for growing the company, expanding its management team, and
providing cash flow to fund growth as it advances the Selwyn Project.
FORWARD LOOKING STATEMENTS: This press release contains forward-looking statements concerning the
issue of Special Warrants and the acquisition of ScoZinc Limited. These
forward-looking statements are based on assumptions and judgments of
management regarding the sale of the Special Warrants and the
acquisition that may prove to be inaccurate due to factors beyond
Selwyn's control, including the satisfaction of conditions to the
closing of the acquisition and the offering of Special Warrants.
Although Selwyn has attempted to identify important factors that could
cause actual results to differ materially from those contained in the
forward-looking statements, there may be other factors that cause
results not to be as anticipated or intended. There is no assurance
that such information will prove to be accurate, as future events could
differ materially from those anticipated in such information and
accordingly, there is no assurance that the acquisition of ScoZinc
Limited and the completion of the offering of Special Warrants will be
completed as anticipated. Readers should not place undue reliance on
Neither the TSX Venture Exchange nor its Regulation Services Provider
(as that term is defined in the policies of the TSX Venture Exchange)
accepts responsibility for the adequacy or accuracy of this release.
SOURCE Paradigm Capital Inc.
For further information:
Harlan Meade, Chief Executive Officer