Peregrine arranges $3.5-million rights offering

2009-01-19 08:36 ET - News Release

Ms. Brooke Clements reports

PEREGRINE DIAMONDS ANNOUNCES $3.5 MILLION RIGHTS OFFERING

Peregrine Diamonds Ltd. will be offering rights to holders of its common shares of record at the close of business on Jan. 27, 2009, expiring Feb. 19, 2009. The offering will be made in all of the provinces of Canada (except in Quebec) and in such other jurisdictions where the company is eligible to make such offering.

Shareholders of record on Jan. 27, 2009, will receive one right for each common share held. Seven rights will entitle the holder to purchase one unit at a price of 35 cents per unit. Each unit will consist of one common share and one-half of a common share purchase warrant. Each whole warrant will entitle the holder to purchase one common share for a term of two years following the expiry date of the rights offering at a price of $1.00 during the first year and $1.50 during the second year of the term. Exercise of the rights and purchase of the units must be completed by 5 p.m. ET on the expiry date. Shareholders who fully exercise their rights are entitled to subscribe pro rata for additional units, if available, that were not subscribed for initially on or before the expiry date. A fully subscribed rights offering will raise gross proceeds of $3,498,323, which will be used for exploration expenses on the company's mineral properties and general working capital.

The common shares of the company are expected to commence trading on the Toronto Stock Exchange on an ex-rights basis at the opening of business on Jan. 23, 2009, meaning that common shares purchased on or following that date will not be entitled to receive the rights under this offering. At that time, the rights are expected to be posted for trading on the TSX on a when-issued basis and will thereafter trade under the symbol PGD.RT. Trading of the rights is expected to continue until 12 noon ET on the expiry date.

A rights offering circular together with rights certificates will be mailed to eligible shareholders on or about Jan. 28, 2009. Registered shareholders wishing to exercise their rights must forward the completed rights certificates, along with the applicable funds to Computershare Investor Services Inc. by the expiry date. Shareholders who own their shares through an intermediary, such as a bank, trust company, securities dealer or broker, will receive materials and instructions from their intermediary.

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