By Laura Lutz
Des Moines, May 31 - Longbow Resources Inc. upsized its previously announced private placement of debentures, shares and warrants to C$6.5 million from C$6 million. The company also settled a first tranche of the offering for C$1.5 million.
In total, the company now plans to sell C$3.25 million in secured, convertible non-transferable 0% debentures; 8.125 million shares at C$0.40 each; and 2,379,465 warrants.
The debentures will mature in two years. They will be convertible into common shares at C$0.42 per share.
The company may force conversion of some of the debentures if its common shares trade at or above C$0.84 for a set period.
The warrants will each be exercisable at C$0.42 for two years.
The first tranche consisted of C$1.5 million of debentures and 350,000 warrants. Kisco LBR LLC was the sole investor in that tranche.
Kisco will also be the lead investor for the second tranche, but other investors may subscribe for the shares and warrants.
If both tranches are fully subscribed, Kisco would own about 45% of the company's expanded share capital, making it a new "control person" under applicable securities law. As a result, settlement of the second tranche will require approval of the TSX Venture Exchange and of shareholders.
Shareholder approval will be sought at a special meeting on June 29.
The second tranche is expected to close on July 2.
When the offering was announced on May 14, it was expected to include C$3 million in secured, convertible non-transferable 0% debentures; 7.5 million shares at C$0.40 per share; and 2.195 million warrants.
Proceeds will be used for exploration and development, ongoing acquisition evaluations and general corporate purposes.
Longbow is an oil and natural gas company based in Calgary, Alta.
| Issuer: | Longbow Resources Inc.
|
| Issue: | Secured, non-transferable convertible debentures; shares
|
| Amount: | C$6.5 million
|
| Investor: | Kisco Private Investors, LLC (lead)
|
| Pricing date: | May 14
|
| Settlement date: | May 31 (for C$1.5 million); July 2 for second tranche
|
| Stock symbol: | TSX Venture: LBR
|
| Stock price: | C$0.375 at close May 14
|
| Stock price: | C$0.43 at close May 30
|
|
|
| Debentures
|
| Amount: | C$3.25 million
|
| Maturity: | Two years
|
| Coupon: | 0%
|
| Price: | Par
|
| Yield: | 0%
|
| Conversion price: | C$0.42
|
| Warrants: | 2,379,465
|
| Warrant expiration: | Two years
|
| Warrant strike price: | C$0.42
|
|
|
| Shares
|
| Shares: | 8.125 million
|
| Price: | C$0.40
|
| Warrants: | See above
|
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