Crazy Horse Resources Inc.

Crazy Horse Resources Inc.

October 21, 2010 17:32 ET

Crazy Horse Closes $8.5 Million Private Placement

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Oct. 21, 2010) -


Crazy Horse Resources Inc. (the "Company") (TSX VENTURE:CZH) announces that it has closed its private placement (previously announced in its news release of September 13, 2010) and issued 11,333,333 subscription receipts (the "Subscription Receipts") at a price of C$0.75 per Subscription Receipt for gross proceeds of approximately $8.5 million. The offering was comprised of: (i) a brokered private placement (the "Brokered Offering") led by NCP Northland Capital Partners Inc. (the "Agent") pursuant to which 10,800,332 Subscription Receipts were issued (including the issuance of 1,999,999 Subscription Receipts pursuant to the exercise of the Agent's over-allotment option); and (ii) a non-brokered private placement pursuant to which 533,001 Subscription Receipts were issued.

Each Subscription Receipt is automatically exercisable, for no additional consideration, into one unit of the Company (a "Unit") upon satisfaction of all conditions precedent to completion of the Company's previously announced acquisition of the Taysan Copper-Gold Porphyry Project in the Philippines (see news releases of June 15, 2010 and August 24, 2010) (the "Taysan Acquisition"). Each Unit will consist of one common share of the Company ("Shares") and one-half of one common share purchase warrant (each whole warrant a "Warrant"). Each Warrant will entitle the holder thereof to acquire one additional common share of the Company at any time prior to October 21, 2011 at a price of $1.25 per share, provided that should the price of the Company's common shares on the TSX Venture Exchange close at or above $1.75 per common share for 10 consecutive days (at any time during the period commencing on February 22, 2011 and ending on October 21, 2011), the Company can elect to give notice to reduce the exercise period of the Warrants to 30 days. 

The gross proceeds from the Brokered Offering less the Agent's expenses are held in escrow by Equity Financial Trust Company as Subscription Receipt Agent, pending final closing of the Taysan Acquisition. Should the Taysan Acquisition not close by December 21, 2010, the Subscription Receipts shall be cancelled and the escrowed proceeds shall be used to repurchase the Subscription Receipts issued pursuant to the Brokered Offering. If the Escrowed Proceeds are not sufficient to refund to each subscriber its purchase price, then the Company shall deliver to the Subscription Receipt Agent the amount of the shortfall in order for the Subscription Receipt Agent to remit to the Brokered Offering subscribers the full amount of their purchase price.

Upon exercise of the Subscription Receipts and release of the subscription proceeds from escrow, the proceeds will be used by the Company to complete the Taysan Acquisition, to further develop the Taysan Property, and for general working capital purposes.

The Company would like to acknowledge NCP Northland Capital Partners Inc. in its capacity as agent for the Company in completing the brokered portion of the private placement. As total consideration to NCP and all members of the selling group, and certain finders, the Company will pay an aggregate 7% cash commission, and will issue compensation options ("Compensation Options") to acquire Units equal to 7% of the number of Subscription Receipts issued pursuant to the Offering. Each Compensation Option is exercisable to acquire one Unit on the same terms as will be issued upon conversion of the Subscription Receipts.

The Subscription Receipts, all of the securities issuable upon exercise of the Subscription Receipts, the Compensation Options and the securities issuable upon exercise of the Compensation Options are subject to resale restrictions expiring on February 22, 2011.

The Company will continue to seek approval of the TSX Venture Exchange ("Exchange") to the Taysan Acquisition as expeditiously as possible, and anticipates being in a position to close that transaction within 30 days. 


Darren Devine, President and CEO

This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the Subscription Receipts, or any of the securities issuable upon exercise of the Subscription Receipts, in the United States. Such securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act"), or any state securities laws, and may not be offered or sold within the United States or to U.S. persons (as such term is defined in Regulation S under the U.S. Securities Act) unless registered under the U.S. Securities Act and applicable state securities laws, or an exemption from such registration is available. Any public offering of securities in the United States must be made by means of a prospectus that contains detailed information about the Company and its management, as well as financial statements.

This news release includes "forward-looking statements" including forecasts, estimates, expectations and objectives for future operations that are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of Crazy Horse Resources Inc. The Company intends to use the net proceeds of the private placement in the manner stated, but reserves the right to allocate the funds as it may see fit. Statements regarding completion of the Taysan Acquisition are subject to all of the risks and uncertainties normally incident with completing corporate transactions including, but are not limited to property title issues and regulatory approvals. Investors are cautioned that any such statements are not guarantees of future performance. There is no assurance the Taysan Acquisition will be completed in the manner now contemplated, within the time estimated, or at all. Should the Taysan Acquisition fail to complete, the Company will have to pay an amount equal to the expenses incurred by NCP Northland Capital Partners Inc. in completing the private placement. Such forward-looking information represents management's best judgment based on information currently available. The Company does not assume the obligation to update any forward-looking statement, except as required by applicable law.

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.

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