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TORONTO, Sept. 12, 2017 /CNW/ - Further to its news
release dated July 25, 2017, 22
Capital Corp. (TSXV: LFC.P) ("22 Capital") has completed its
previously announced non-brokered private placement of subscription
receipts (the "Subscription Receipts") whereby 22 Capital
issued 2,666,667 Subscription Receipts at a price of $0.1875 (the "Issue Price") per
Subscription Receipt for aggregate gross proceeds of $500,000 (the "Offering").
The gross proceeds from the Offering (the "Escrowed
Funds") will be held in escrow pending satisfaction of the
following conditions: (i) satisfaction or waiver of all conditions
precedent to the completion of 22 Capital's qualifying transaction
(the "Transaction") with nDivision Inc., including, without
limitation, the conditional approval of the TSX Venture Exchange
("TSXV") for the Transaction; and (ii) 22 Capital having
delivered a direction to the escrow agent to the Offering
confirming that the conditions set forth above in item (i) have
been met or waived (the "Escrow Release Conditions"). Upon
satisfaction of the Escrow Release Conditions, each Subscription
Receipt will automatically convert, without any further
consideration or action on the part of the holder thereof, into
0.416666667 of a common share of 22 Capital.
If the Escrow Release Conditions are not satisfied by
5:00 p.m. (Toronto time) on November 30, 2017, each Subscription Receipt
shall be automatically terminated and cancelled without any further
action on the part of the holder, and the Escrowed Funds shall be
returned to the holders of Subscription Receipts on a pro rata
basis. To the extent that the Escrowed Funds are not sufficient to
refund the aggregate Issue Price paid by the holders of the
Subscription Receipts, 22 Capital will be responsible and liable to
contribute such amounts as are necessary to satisfy any
shortfall.
Assuming the Escrow Release Conditions are satisfied, the net
proceeds from the Offering will be used for working capital and for
general corporate purposes.
Three insiders of 22 Capital participated in the Offering,
thereby making the Offering a "related party transaction" as
defined under Multilateral Instrument 61-101 – Protection of
Minority Security Holders in Special Transactions ("MI
61-101"). Messrs. Steven Mintz,
Marc Lustig and Jay Goldman, each a director of 22 Capital
(collectively, the "Insiders"), or companies wholly-owned by
such persons, purchased 160,000, 156,669 and 240,000 Subscription
Receipts, respectively, representing, in the aggregate, 25% of the
outstanding Subscription Receipts sold pursuant to the Offering. 22
Capital was exempt from the requirements to obtain a formal
valuation or minority shareholder approval in connection with the
Insiders' participation in the Offering in reliance of sections
5.5(b) and 5.7(a) of MI 61-101. 22 Capital did not file a material
change report more than 21 days before the closing of the Offering,
as the details of the Insiders' participation had not been
confirmed at that time.
The securities issued pursuant to the Offering are subject to a
statutory four month and one day hold period.
Trading Halt
The common shares of 22 Capital are currently halted from
trading and are to remain halted from trading until resumption of
trading is approved by the TSXV.
Further Information
Further details regarding the Transaction will be provided in a
filing statement (the "Filing Statement") prepared and filed
by 22 Capital in accordance with the rules and policies of the TSXV
and filed under 22 Capital's issuer profile on SEDAR at
www.sedar.com. 22 Capital expects to complete and file the Filing
Statement in October, 2017. The Transaction is expected to close
shortly thereafter.
Completion of the Transaction is subject to a number of
conditions, including but not limited to, TSXV acceptance. There
can be no assurance that the Transaction will be completed as
proposed or at all.
Investors are cautioned that, except as disclosed in the
Filing Statement to be prepared in connection with the Transaction,
any information released or received with respect to the
Transaction may not be accurate or complete and should not be
relied upon. Trading in the securities of a capital pool company
should be considered highly speculative.
The TSXV has in no way passed upon the merits of the proposed
Transaction and has neither approved nor disapproved the contents
of this press release.
NEITHER THE TSXV NOR ITS REGULATION SERVICES PROVIDER (AS
THAT TERM IS DEFINED IN THE POLICIES OF THE TSXV) ACCEPTS
RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS
RELEASE.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING
INFORMATION:
This news release contains "forward-looking information" and
"forward-looking statements" (collectively, "forward-looking
statements") within the meaning of the applicable Canadian
securities legislation. All statements, other than statements of
historical fact, are forward-looking statements and are based on
expectations, estimates and projections as at the date of this news
release. Any statement that involves discussions with respect to
predictions, expectations, beliefs, plans, projections, objectives,
assumptions, future events or performance (often but not always
using phrases such as "expects", or "does not expect", "is
expected", "anticipates" or "does not anticipate", "plans",
"budget", "scheduled", "forecasts", "estimates", "believes" or
"intends" or variations of such words and phrases or stating that
certain actions, events or results "may" or "could", "would",
"might" or "will" be taken to occur or be achieved) are not
statements of historical fact and may be forward-looking
statements. In this news release, forward-looking statements
relate, among other things, to: certain terms and conditions of the
proposed Transaction; risks relating to the failure to satisfy the
Escrow Release Conditions and use of funds. Forward-looking
statements are necessarily based upon a number of estimates and
assumptions that, while considered reasonable, are subject to known
and unknown risks, uncertainties, and other factors which may cause
the actual results and future events to differ materially from
those expressed or implied by such forward-looking statements. Such
factors include, but are not limited to: general business,
economic, competitive, political and social uncertainties; and the
delay or failure to receive board, shareholder or regulatory
approvals. There can be no assurance that such statements will
prove to be accurate, as actual results and future events could
differ materially from those anticipated in such statements.
Accordingly, readers should not place undue reliance on the
forward-looking statements and information contained in this news
release. Except as required by law, 22 Capital assumes no
obligation to update the forward-looking statements of beliefs,
opinions, projections, or other factors, should they change, except
as required by law.
SOURCE 22 Capital Corp.
