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Blackham Resources Raising $1.4M From Lanstead Capital

Blackham Resources (ASX:BLK) has completed a $3.6 million capital raising after reaching an Equity Swap Agreement for $1.4 million worth of shares to UK based institutional investor Lanstead Capital.

Under agreement, Lanstead will subscribe for 7,843,137 new shares priced at $0.1785 each in 18 monthly settlement tranches.

This adds to the $2.2 million placement of 10.5 million shares priced at $0.21 each announced last week, and together with its existing cash resources of $1.2 million as of 31 March 2014, will fund exploration and development of its Matilda Gold Project in Western Australia.

"We are delighted to welcome Lanstead as a shareholder in the Company further increasing the financial capacity of our share register," Blackham managing director Bryan Dixon said.

"The fundraising and associated swap arrangements are designed to provide additional financing to progress the development of Matilda Gold Project, whilst allowing the company to secure much of the potential upside arising from increases in its share price.

"As a result of these transactions, Blackham will benefit from additional working capital for immediate deployment with further amounts receivable over 18 months subject to the outcome of its investment in the equity swap agreements."

Blackham has delivered some outstanding results from the Galaxy Deposit of its Matilda Gold Project, including the best ever drill intercept of 9 metres at 13.4 grams per tonne gold with strong widths and grades from near surface.

It is well on the road towards becoming a near term gold producer, having recently acquired the Wiluna Mine and processing plant near Matilda.

The Wiluna mine holds 16.7 million tonnes at 5.3g/t gold for 2.8 million ounces, complementing the Matilda project's 23.7 million tonnes at 1.9g/t gold for 1.4 million ounces.

It is also participating in the Zanthus Project in the Fraser Range, Western Australia, where partner Rumble Resources (ASX:RTR) has started a magnetic survey to scout for nickel.

Lanstead Capital Equity Swap Agreement

Lanstead, a new institutional investor in Blackham, will subscribe for 7,843,137 new shares in 18 monthly settlement tranches.

This agreement allows for the company to receive more than the monthly settlement due if the measured share price for that month is above the benchmark price of $0.238 per share.

There is no upper limit placed on the additional proceeds received as part of the monthly settlements.

In contrast, it will receive a smaller settlement on a pro rata basis if the share price is below the benchmark.

A decline in the company's share price will not result in any increase in the number of ordinary shares received by Lanstead.

Blackham will also pay Lanstead 392,157 shares as consideration for the Equity Swap Agreements.

Following completion of the subscription, Lanstead will hold 8,235,294 Ordinary Shares representing approximately 6.8% respectively of Blackham's enlarged issued share capital.

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