Barkerville ex Callaghan seeks return to TSX-V
Barkerville ex Callaghan seeks return to TSX-V
2018-12-10 20:39 ET - Street Wire
Also Street Wire (C-BCK) Blind Creek Resources Ltd (2)
Also Street Wire (C-GCC) Golden Cariboo Resources Ltd (2)
Also Street Wire (C-STE) Starr Peak Exploration Ltd
by Mike Caswell
Lawyers for Frank Callaghan, the former chief executive officer of Barkerville Gold Mines Ltd., appeared before the B.C. Securities Commission on Monday to protest the TSX Venture Exchange's refusal to approve Mr. Callaghan as an officer or director. They said that the exchange has treated Mr. Callaghan unfairly in withholding its approval. They described Mr. Callaghan as the "kind of person who should be active in the mining industry," being one of the few to have taken a junior company to the production stage.
Monday's hearing comes with Mr. Callaghan having been mostly sidelined since 2015, when he landed in regulatory trouble for an overly optimistic resource estimate. At the time he was the CEO of Barkerville, which was developing the Cow Mountain project. The company reported that it had a 10.6-million-ounce indicated resource on the property plus as many as 65 million to 90 million ounces in the same trend.
 |
| BARKERVILLE GOLD MINES |
| Frank Callaghan |
The figures, had they been correct, would had been one of the largest gold finds in mining history. The stock more than doubled on the news, going to $1.60. Unfortunately for shareholders, the regulators determined that the estimate was beyond optimistic, and required the company to restate it, with the new figure coming at about one-10th of the original.
After that fiasco, the BCSC began investigating Mr. Callaghan. He eventually agreed to accept a one-year officer and director ban and to pay a $30,000 fine. The ban lasted until Oct. 22, 2016. At some point after that date, three TSX-V companies applied to have Mr. Callaghan as an officer or director. (The companies, Blind Creek Resources Ltd., Golden Cariboo Resources Ltd. and Starr Peak Exploration Ltd., are all junior metals listings. Mr. Callaghan is already an insider of the three companies through share ownership, holding more than 10 per cent of each issuer's shares.)
This is when the present trouble started. The TSX-V rejected the applications, determining that there were concerns with Mr. Callaghan's return. Among other things, the exchange was not satisfied that the companies had a plan to monitor Mr. Callaghan for future misconduct. The exchange also noted that he had landed in its sights more than once in the past. Going back to 1997, the TSX-V or its predecessors had sent him warnings on five occasions. In part the warnings had to do with the close relationship between Barkerville and a private company that Mr. Callaghan provided services through, Standard Drilling & Engineering Ltd. The exchange was concerned that Standard Drilling was performing large amounts of work for Barkerville and collecting fees accordingly. The exchange was also concerned that Standard Drilling was charging a fee (of 12 per cent) on top of the work. Those concerns, while dated, formed part of the TSX-V's present day rejection of Mr. Callaghan.
According to Mr. Callaghan, this rejection was entirely unfair. His lawyer explained on Monday that these things happened as far back as 21 years ago, and were addressed when they occurred. For example, Barkerville had an auditor look at the money the company was paying Mr. Callaghan through Standard Drilling, and the findings demonstrated that there were no problems. Barkerville was receiving the work at a bargain price. Moreover, Mr. Callaghan continued the exploration even when Barkerville had no money to pay his bills. When the exchange complained about the 12-per-cent fee he was charging on top of the exploration, he agreed to stop that charge.
In refusing to have him, the TSX-V has unfairly extended the one-year ban that Mr. Callaghan received from the BCSC, his lawyer said. The exchange has kept out the kind of person that should be active in the industry, at least according to his lawyer. Mr. Callaghan has spent almost his entire career in mining and is one of the "few people who can credibly claim" to have taken a company from its formation to production, his lawyer said.
Moreover, Mr. Callaghan's ability to work in the industry is of "profound importance" to his ability to make a living, his lawyer told the BCSC. Despite that, the TSX-V did not give him a chance to address its concerns at a hearing. It simply rejected the application as a matter of routine. Mr. Callaghan has in effect been disciplined twice for the same conduct.
For its part, the exchange defended its handling of the matter. At Monday's hearing, TSX-V lawyers said that it was incumbent on the three companies to show that they had a plan to ensure Mr. Callaghan complied with the exchange's past concerns. In applying to have him as a director, the companies simply made bald, unsupported statements in which they said that they were satisfied with his credibility. They did not say that they had met with him and discussed the matter. They also did not set out how they would ensure his compliance. In short, the companies provided no convincing reasons to accept Mr. Callaghan, the exchange said.
The two-member BCSC panel hearing the case has not yet come to a decision on Mr. Callaghan's application. It can rule that the TSX-V's ruling was unfair, and send the matter back to the exchange for further review. It could also simply order that Mr. Callaghan be allowed to serve as a director of the companies. It could, of course, refuse to do anything, which would result in Mr. Callaghan effectively remaining banned for an indeterminate period of time. Whatever the outcome, either side could take the matter to the Court of Appeal for British Columbia, potentially tying up Mr. Callaghan's future in litigation for some time to come.
Originally Mr. Callaghan was represented by Vancouver lawyer Rod Anderson of Harper Grey LLP, but at the hearing another Harper Grey lawyer, Owais Ahmed, represented him.
Barkerville ex Callaghan seeks return to TSX-V
2018-12-10 20:39 ET - Street Wire
Also Street Wire (C-BCK) Blind Creek Resources Ltd (2)
Also Street Wire (C-GCC) Golden Cariboo Resources Ltd (2)
Also Street Wire (C-STE) Starr Peak Exploration Ltd
by Mike Caswell
Lawyers for Frank Callaghan, the former chief executive officer of Barkerville Gold Mines Ltd., appeared before the B.C. Securities Commission on Monday to protest the TSX Venture Exchange's refusal to approve Mr. Callaghan as an officer or director. They said that the exchange has treated Mr. Callaghan unfairly in withholding its approval. They described Mr. Callaghan as the "kind of person who should be active in the mining industry," being one of the few to have taken a junior company to the production stage.
Monday's hearing comes with Mr. Callaghan having been mostly sidelined since 2015, when he landed in regulatory trouble for an overly optimistic resource estimate. At the time he was the CEO of Barkerville, which was developing the Cow Mountain project. The company reported that it had a 10.6-million-ounce indicated resource on the property plus as many as 65 million to 90 million ounces in the same trend.
| |
| BARKERVILLE GOLD MINES |
| Frank Callaghan |
The figures, had they been correct, would had been one of the largest gold finds in mining history. The stock more than doubled on the news, going to $1.60. Unfortunately for shareholders, the regulators determined that the estimate was beyond optimistic, and required the company to restate it, with the new figure coming at about one-10th of the original.
After that fiasco, the BCSC began investigating Mr. Callaghan. He eventually agreed to accept a one-year officer and director ban and to pay a $30,000 fine. The ban lasted until Oct. 22, 2016. At some point after that date, three TSX-V companies applied to have Mr. Callaghan as an officer or director. (The companies, Blind Creek Resources Ltd., Golden Cariboo Resources Ltd. and Starr Peak Exploration Ltd., are all junior metals listings. Mr. Callaghan is already an insider of the three companies through share ownership, holding more than 10 per cent of each issuer's shares.)
This is when the present trouble started. The TSX-V rejected the applications, determining that there were concerns with Mr. Callaghan's return. Among other things, the exchange was not satisfied that the companies had a plan to monitor Mr. Callaghan for future misconduct. The exchange also noted that he had landed in its sights more than once in the past. Going back to 1997, the TSX-V or its predecessors had sent him warnings on five occasions. In part the warnings had to do with the close relationship between Barkerville and a private company that Mr. Callaghan provided services through, Standard Drilling & Engineering Ltd. The exchange was concerned that Standard Drilling was performing large amounts of work for Barkerville and collecting fees accordingly. The exchange was also concerned that Standard Drilling was charging a fee (of 12 per cent) on top of the work. Those concerns, while dated, formed part of the TSX-V's present day rejection of Mr. Callaghan.
According to Mr. Callaghan, this rejection was entirely unfair. His lawyer explained on Monday that these things happened as far back as 21 years ago, and were addressed when they occurred. For example, Barkerville had an auditor look at the money the company was paying Mr. Callaghan through Standard Drilling, and the findings demonstrated that there were no problems. Barkerville was receiving the work at a bargain price. Moreover, Mr. Callaghan continued the exploration even when Barkerville had no money to pay his bills. When the exchange complained about the 12-per-cent fee he was charging on top of the exploration, he agreed to stop that charge.
In refusing to have him, the TSX-V has unfairly extended the one-year ban that Mr. Callaghan received from the BCSC, his lawyer said. The exchange has kept out the kind of person that should be active in the industry, at least according to his lawyer. Mr. Callaghan has spent almost his entire career in mining and is one of the "few people who can credibly claim" to have taken a company from its formation to production, his lawyer said.
Moreover, Mr. Callaghan's ability to work in the industry is of "profound importance" to his ability to make a living, his lawyer told the BCSC. Despite that, the TSX-V did not give him a chance to address its concerns at a hearing. It simply rejected the application as a matter of routine. Mr. Callaghan has in effect been disciplined twice for the same conduct.
For its part, the exchange defended its handling of the matter. At Monday's hearing, TSX-V lawyers said that it was incumbent on the three companies to show that they had a plan to ensure Mr. Callaghan complied with the exchange's past concerns. In applying to have him as a director, the companies simply made bald, unsupported statements in which they said that they were satisfied with his credibility. They did not say that they had met with him and discussed the matter. They also did not set out how they would ensure his compliance. In short, the companies provided no convincing reasons to accept Mr. Callaghan, the exchange said.
The two-member BCSC panel hearing the case has not yet come to a decision on Mr. Callaghan's application. It can rule that the TSX-V's ruling was unfair, and send the matter back to the exchange for further review. It could also simply order that Mr. Callaghan be allowed to serve as a director of the companies. It could, of course, refuse to do anything, which would result in Mr. Callaghan effectively remaining banned for an indeterminate period of time. Whatever the outcome, either side could take the matter to the Court of Appeal for British Columbia, potentially tying up Mr. Callaghan's future in litigation for some time to come.
Originally Mr. Callaghan was represented by Vancouver lawyer Rod Anderson of Harper Grey LLP, but at the hearing another Harper Grey lawyer, Owais Ahmed, represented him.