Barksdale Resources Corp. (TSXV: BRO) (OTCQX: BRKCF) (“Barksdale” or the “Company”) announces that it intends to conduct a non-brokered private placement financing of 4,166,666 units (the “Units”) at a price of $0.48 per Unit for gross proceeds to the Company of $2,000,000 (the “Offering”). Each Unit will consist of one common share of Barksdale (each a “Common Share”) and one-half of one common share purchase warrant (each whole warrant, a “Warrant”). Each Warrant shall entitle the holder to acquire one Common Share at a price of $0.72 for a period of three years from the date of issuance. Crescat Capital LLC (“Crescat”), a significant shareholder of the Company, has committed $1,000,000 to the financing. In connection with the Offering, Barksdale has agreed to grant Crescat equity participation right to maintain its pro-rata ownership in the Company for as long as it owns more than 2% of the outstanding common shares of Barksdale.
The proceeds of the Offering will be used to finance exploration activities at the Company’s properties in Arizona and Mexico, as well as for working capital and general corporate purposes. Closing of the Offering is expected to occur on or about September 14, 2022, and will be subject to increase in the event Teck Resources Ltd. elects to exercise its equity participation rights in the Offering (see news release dated June 11, 2019). All securities issued by Barksdale will be subject to a minimum hold period of four months and one day and completion of the Offering is subject to customary closing conditions, including acceptance of the TSX Venture Exchange (“Exchange”).
Rick Trotman, Barksdale’s President, and CEO, states, “As we near the end of our permitting endeavors in Arizona, we are very excited that our key shareholders have made the decision to increase their exposure to Barksdale. The next few months should be particularly exciting for the Company, which is why we’ve petitioned the Exchange to extend the soon-to-be expiring warrants until early next year to give our valued shareholders additional time to benefit from their patience and loyalty.”
Extension of Warrants
The Company also proposes to extend by a further four (4) months, the expiry date of a total of 7,597,836 share purchase warrants, issued September 29, 2020, and 690,790 share purchase warrants issued October 1, 2020 (collectively, the “2020 Warrants”) in connection with a non-brokered private placement. These aggregate 8,288,826 2020 Warrants are exercisable into 8,288,826 common shares and remain at an exercise price of $0.55 per share. The application to extend the expiry date on the 2020 Warrants is subject to the Exchange’s acceptance, and the Company makes no assurances that the required acceptance for the extension of the term of the 2020 Warrants will be granted.
Convertible Debenture Extension
The Company has agreed to extend the maturity date of the secured convertible debenture (“Debentures”) held by Delbrook Capital Advisors Inc. (see news release dated February 2022) by one year until December 31, 2023, and the conversion price has been increased to $0.55 per share from $0.45 per share. The Debentures have a remaining principal amount of $1,500,000 and all other terms of the Debentures remain unchanged.
Additionally, Delbrook and the Company have agreed to a debt for equity plan whereby $110,000 of accrued interest will be exchanged for Units at the same terms of the Offering. In exchange for extending the Debentures, the Company has agreed to an extension fee of 1,200,000 common share purchase warrants, exercisable at a price of $0.72 for a period of three years from the date of issuance (“Extension Warrants”). The Debenture extension, extension fee, debt for equity plan, and increased conversion price are all subject to the approval of the Exchange.
Barksdale Resources Corp. is a base metal exploration company headquartered in Vancouver, B.C., that is focused on the acquisition, exploration, and advancement of highly prospective base metal projects in North America. Barksdale is currently advancing the Sunnyside copper-zinc-lead-silver and San Antonio copper projects, both of which are in the Patagonia mining district of southern Arizona, as well as the San Javier copper-gold project in central Sonora, Mexico.