Foundation arranges offerings totalling $3.51-million

2010-05-07 08:14 ET - News Release

Mr. John Hiner reports

FOUNDATION RESOURCES ANNOUNCES EQUITY FINANCINGS FOR PROCEEDS OF UP TO $3,516,300

Foundation Resources Inc. has entered an agreement with a syndicate of agents led by Canaccord Financial Ltd. and including Fraser Mackenzie Ltd. to sell up to 4,765,000 flow-through units at a price of 42 cents per flow-through unit to raise up to $2,001,300 on a commercially reasonable efforts private placement basis and, on the same basis, to sell up to 2.9 million units at a price of 35 cents per unit to raise up to $1,015,000. The company will also be raising, on a non-brokered basis, up to $500,000 by selling a combination of units and flow-through units on the same terms as the brokered offering.

The flow-through units will consist of one flow-through common share of the company and one-half of one common share purchase warrant. The units will consist of one common share of the company and one purchase warrant. Each whole warrant shall be exercisable for one common share of the company at a price of 50 cents per share for a period of 18 months from the closing date of the transaction.

The agents will receive commissions consisting of cash and agent's warrants from the gross proceeds of the brokered offering.

The offering is expected to close on or around June 3, 2010, and is subject to regulatory approval, including the approval of the TSX Venture Exchange. Proceeds of the offering will be used to finance exploration on the company's Coldstream property located in Ontario and for general working capital purposes.

We seek Safe Harbor.