Darnley Bay Resources Limited
TSX VENTURE : DBL

Darnley Bay Resources Limited

June 04, 2015 16:42 ET

Darnley Bay Closes Private Placement

TORONTO, ONTARIO--(Marketwired - June 4, 2015) -

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Darnley Bay Resources Ltd. (TSX VENTURE:DBL) ("Darnley Bay" or the "Company") is pleased to announce that it has closed a private placement of 2,400,000 units ("Units") at a price of $0.05 per Unit (the "Offering") for gross proceeds of $120,000. Each Unit is comprised of one common share ("Common Share") in the capital of the Company, issued on a flow-through basis under the Income Tax Act (Canada), and one warrant ("Warrant"). Each Warrant entitles the holder to purchase one Common Share for a period of twenty-four months from the closing date at an exercise price of $0.10.

JB Levy Corp., a corporation controlled by Jamie Levy, a director and officer of the Company, and Mr. Kerry Knoll, a director of the Company, acquired 800,000 and 500,000 Common Shares, respectively, in connection with the Offering. Following the completion of the Offering, Mr. Levy and Mr. Knoll will own or control, directly and indirectly, an aggregate of 2,400,000 and 2,463,020 Common shares, respectively, representing approximately 6.0% and 6.2% of the issued and outstanding Common Shares of the Company, respectively. If Mr. Levy and Mr. Knoll were to exercise all of their respective convertible securities they would own, directly and indirectly, 5,020,000 and 5,167,930 Common Shares, respectively, representing approximately 11.8% and 12.1%, respectively, of the Company's then outstanding Common Shares, on a partially diluted basis.

Mr. Levy and Mr. Knoll have acquired the Common Shares for investment purposes and they may, depending on market and other conditions, increase or decrease their beneficial ownership, control or direction over the Common Shares, or other securities of the Company, through market transactions, private agreements, treasury issuances, exercise of convertible securities or otherwise.

The Offering constituted a related party transaction within the meaning of TSX Venture Exchange Policy 5.9 and Multilateral Instrument 61-101 ("MI 61-101") as insiders of the Company subscribed for an aggregate of 1,800,000 FT Units. The Company is relying on the exemptions from the valuation and minority shareholder approval requirements of MI 61-101 contained in sections 5.5(a) and 5.7(1)(a) of MI 61-101, as the fair market value of the participation in the Offering by insiders does not exceed 25% of the market capitalization of the Company, as determined in accordance with MI 61-101. The Company did not file a material change report in respect of the related party transaction at least 21 days before the closing of the Offering, which the Company deems reasonable in the circumstances so as to be able to avail itself of the proceeds of the Offering in an expeditious manner.

Forward-Looking Information

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.

This news release contains certain "forward-looking information" within the meaning of applicable securities law. Forward-looking information is frequently characterized by words such as "plan", "expect", "project", "intend", "believe", "anticipate", "estimate", "may", "will", "would", "potential", "proposed" and other similar words, or statements that certain events or conditions "may" or "will" occur. These statements are only predictions. Forward-looking information is based on the opinions and estimates of management at the date the information is provided, and is subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking information. For a description of the risks and uncertainties facing Darnley Bay and its business and affairs, readers should refer to Darnley Bay's Management's Discussion and Analysis. Darnley Bay undertakes no obligation to update forward-looking information if circumstances or management's estimates or opinions should change, unless required by law. The reader is cautioned not to place undue reliance on forward-looking information.

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