FIRST Bauxite Corporation (FBC),  the Canadian natural resource company engaged in the exploration and development of deposits in the Bonasika area, of Region 3 (Essequibo Islands/West Demerara), has experienced very difficult market conditions in recent months and is in serious financial difficulty. But the company is currently engaged in a non-brokered private placement for the sale of 40,000,000 common shares at a price of $0.125 each to raise total proceeds Cdn$5,000,000.
If this venture fails, FBC will run out of money by January 2014, Hilbert N. Shields, President and Chief Executive Officer (CEO)  said recently.
A private placement refers to a sale of stocks to a relatively small number of select investors as a way of raising capital.
Investors involved in such transactions are, usually, large banks, mutual funds, insurance companies and pension funds.
A ‘brokered’ private placement is one in which a registered representative sells stock for a company.
A ‘non-brokered’ offering is when the company’s investor relations department sells the stock directly to investors.
The FBC non-brokered private placement is with   Resource Capital Fund, a mining-focused equity firm that partners with companies to build strong, successful and sustainable businesses that strive to produce superior returns to all stakeholders.

EXTREMELY APPRECIATIVE
“We are extremely appreciative of the continued financial support from Resource Capital Funds in these demanding capital markets conditions,” said Shields.
“Resource Capital Funds clearly sees the longer term value in First Bauxite and is demonstrating its commitment to our efforts to develop the Bonasika mine and processing plant by offering this private placement at a significant premium to market and generally at terms that are very competitive, in these very difficult current market conditions for junior resource explorers and developers,” he stated.
The proceeds of the private placement are designed to allow FBC to continue with its work programmes, including completing the preliminary feasibility study on manufacturing ceramic products from the bauxite and kaolin hosted by the deposits in its Bonasika mining licence.
It will also allow limited phase one pre-production work over the Bonasika mining licence, inclusive of haul road and Bonasika seven-pit and waste dump preparation, and  exploring the 20 prospecting licences under application in the areas adjacent to the Bonasika mining licence and the Tarakulli permission, which also hosts the Canje prospects.
The private placement remains subject to the Canadian Stock Exchange approval and the satisfaction of customary closing conditions contained in the subscription agreement between the parties, Shields said.
Another closing condition of the private placement is that an RCF partner, Mr. Mason Hills, be nominated to join the board of directors of the FBC.

(By Clifford Stanley )