Daily News: December 11, 2012

Bri-Chem Closes $10MM Facility With Fulcrum Capital


Bri-Chem, a distributor and manufacturer of oil and gas drilling fluids and steel pipe, said it has closed a $10 million subordinated debt facility with Fulcrum Capital Partners.

The financing consists of a $10 million five-year subordinate debenture and the issuance of 300,000 common share purchase warrants. Each warrant entitles Fulcrum to acquire one Bri-Chem share at an exercise price of $1.77 for a period of 48 months from the date of issuance. Bri-Chem has the option to call the warrants at a 30% premium to the exercise price at any time during the first eighteen months from the date of closing of the credit facility. The credit facility is interest only for the first fifteen months with an annual interest of 11.5%.

Bri-Chem intends to use the net proceeds from the credit facility for future potential acquisitions, working capital and general corporate purposes, which may include capital expenditures.

Don Caron, chief executive officer of Bri-Chem, commented, “We are extremely pleased with the confidence that Fulcrum has shown in our Company, its operational strategies and management team. This credit facility will allow us to further strengthen and increase our presence in the North America drilling fluids marketplace and seek out new opportunities for additional steel pipe manufacturing micro-mills.”