Tirex settles oversubscribed deal; Pacific Valley Bank to issue stock; Conquest secures SEDA

By Stephanie N. Rotondo

Portland, Ore., Aug. 24 - Monday's private placement market saw many single-digit deals entering the marketplace, with many coming from the mining sector.

Tirex Resources Ltd. said it raised more than C$3 million in a "dramatically" oversubscribed stock sale. The company is now eligible for matching funds through its funding agreement with the European Bank for Reconstruction and Development.

Meanwhile, Pacific Valley Bank announced a plan to raise $2 million. The deal includes a greenshoe consistent with California banking regulations.

Conquest Petroleum Inc. inked a deal with Yorkville Advisors LLC for a standby equity distribution agreement, a financing tool pioneered by Yorkville. Proceeds will be used for reworking existing oil and gas wells and for debt repayment.

Elsewhere, Blue Cove Capital Corp. is aiming to take in C$2 million via a private placement. The company has not yet released details of the financing.

Also, Arsenal Energy Inc. will secure C$3 million in exploration funds through a sale of stock. Lorex Technology Inc. meanwhile amended the terms of a previously announced private placement.

Tirex settles oversubscribed deal

Tirex Resources took in C$3.11 million in an oversubscribed private placement of common shares, according to a press release.

The deal originally priced at C$3.01 million on July 30.

The Vancouver, B.C.-based company sold approximately 4.44 million shares at C$0.70 per share. No warrants were included.

Bryan Slusarchuk, chief executive officer and director, said the "interesting thing about the financing" is that it "actually qualifies us for a whole lot more."

The transaction does so because of Tirex's funding agreement with the European Bank for Reconstruction and Development, which was inked Oct. 9, 2008. Under the terms of that agreement, Tirex can get matching funds from the European Bank.

"This will allow us to really ramp up quite aggressively onsite in the Mirdita District," Slusarchuk told Prospect News. "We will continue to undertake that work with the goal of ramping up tonnage quite quickly."

In addition, Slusarchuk said the deal generated "a lot of interest."

"It was dramatically oversubscribed," he said.

Slusarchuk said investors reacted positively to the deal because of the overall project associated with Mirdita, which has exposure to multiple metals, including copper, gold, zinc and silver. And, the project covers a whole district, not just one plot of land.

He said the funding agreement with EBRD was also helpful in getting investors on board.

Also, Slusarchuk noted that none of its financings, including this one, include warrants, which is "the best way to give investors upside," he said.

"The stock price can really run with no warrants hanging over it," he explained.

Tirex also has a "simple shares structure," and "undertaking this type of private placement is the best way to maintain that simple structure," Slusarchuk said.

"So we're in really good shape to ramp up over there," he added.

Tirex's stock (TSX Venture: TXX) gained 1 cent, or 1.2%, to C$0.84. Market capitalization is C$31.6 million.

Pacific Valley to issue stock

Pacific Valley Bank will conduct a private stock offering of up to $2 million, the company announced.

The company will issue stock at $7.00 per share. About 285,715 shares will be sold, according to a press release.

The deal also includes an over-subscription option for 20% of the maximum number of shares sold.

"That's consistent with California State banking regulations," said David B. Warner, CEO.

Warner said the deal was similar to a financing done in December 2008. He added that the company's directors were the primary investors of that transaction and that some directors will be participating in the current deal.

"We're always seizing opportunities to keep up with our capital base," Warner said. "This was the time to do it."

Overall, Warner said he was "absolutely pleased" with the terms set forth and noted that, in the current market, it is sometimes difficult for a bank to raise extra capital.

"Raising capital for banks these days is a challenge," he said. "So we're delighted."

Warner said the proceeds would also help to "make provisions for bad loans, like all the banks are [doing]."

Pacific Valley's equity (OTCBB: PVBK) closed unchanged at $7.75.

Pacific Valley Bank is a Salinas, Calif.-based banking institution.

Conquest secures SEDA

Conquest Petroleum signed a two-year standby equity distribution agreement with Yorkville Advisors LLC.

Under the terms of the SEDA, Yorkville will purchase up to 4.62 million common shares in regular tranches. The price per share will equal the lowest daily volume-weighted average price of the stock for the five days following the drawdown request, less a 6.5% discount.

"We believe that having the ability to sell up to 4.62 million shares of common stock on such advantageous terms should significantly improve our balance sheet and help us to develop a portion of our low risk proved oil and gas reserve base, which in turn should enhance our profitability," stated Robert D. Johnson, president and CEO, in a news release. "We would like to thank Yorkville for their confidence in our management team and our business plan."

"Yorkville sees great potential in the investment opportunity presented by Conquest Petroleum," added Yorkville's managing director, Richard Brand. "We believe that Robert D. Johnson and the rest of his management team have strategically realigned the company to meet its obligations in the growing demands of the oil and gas industry."

Conquest's shares (OTCBB: CQPT) improved by 5 cents, or 20%, to $0.30. Market capitalization is $4.04 million.

Conquest Petroleum is based in The Woodlands, Texas.

Blue Cove plans placement

Blue Cove Capital is looking to raise C$2 million in the private placement market.

The company said details regarding the financing led by Canaccord Capital Corp. would be released at a later date.

The transaction comes as the company signed a letter of intent with Golden Predator Mines Inc. and Great American Minerals Inc. to purchase the parties' interest in "certain mineral exploration properties located in the Battle Mountain and Cortez Trends of North Central Nevada, including the Modoc Project, UNR/Keystone Project, Trail Project and the Platte River Joint Venture Project."

Blue Cove has until Sept. 15 to enter into a definitive agreement to buy the assets.

The company did not return calls seeking comment on Monday.

Blue Cove's stock (TSX Venture: BCV.P) ended steady at C$0.25.

Blue Cove Capital is an Abbotsford, B.C.-based capital pool company.

Arsenal wants exploration funds

Arsenal Energy will sell flow-through shares in its quest to raise C$3 million, the company said.

The Calgary, Alta.-based mineral resource company will issue 7.5 million of the shares at C$0.40 per share.

Proceeds will be used for exploration. Settlement is expected by Sept. 3.

Calls seeking comment went unreturned Monday.

Arsenal's shares (Toronto: AEI) fell a penny, or 2.63%, to C$0.37. Market capitalization is C$37 million.

Lorex changes placement terms

Lorex Technology amended a private placement of convertible debentures previously announced on June 24.

Originally, Lorex intended to raise between C$1.6 million and C$2 million by selling the subordinate series A convertible debentures. In a press release issued Monday, the company said it now plans to raise C$1.25 million from the convertible sale, plus another C$1.25 million from the sale of subscription receipts.

The three-year convertibles can be exchanged for common stock at C$0.10 per share. The debentures bear no interest.

Also, the company will sell 12.5 million subscription receipts at C$0.10 each. The subscriptions are automatically convertible into 12.5 million preference shares, which in turn are convertible into common stock on a one-for-one basis.

Adam Levin, director, said the increased placement will give the company more liquidity, which will "improve ratios overall and make the company even healthier."

With the completion of the financing, Lorex hopes its bank lenders will amend the terms of its credit facility, including extending the maturity.

There is no guarantee, however, that the lenders will do so, the company said in a press release.

Lorex's equity (Toronto: LOX) finished unchanged at C$0.06. Market capitalization is C$1.62 million.

Lorex is a Markham, Ont.-based company that provides businesses and consumers with video surveillance security solutions and sells its products through two market channels.

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