Mr. John Nelson reports
AFRICA HYDROCARBONS ANNOUNCES BOUGHT DEAL FINANCING
Africa Hydrocarbons Inc. has entered into an engagement
agreement with Canaccord Genuity Corp. in connection with a bought-deal private placement offering of
6.9 million units of the company, at a price of 18 cents per unit, for aggregate gross
proceeds of $1,242,000 (the bought-deal offering). In addition, the company has granted the underwriter the option to sell up to an additional 5.6 million units on a commercially
reasonable efforts basis on the same terms as the bought-deal offering
for additional gross proceeds of up to $1,008,000. Assuming the full exercise of the underwriter's option, total gross
proceeds of both the bought-deal offering and the best-efforts offering
will be up to $2.25-million. Each unit will be composed of one common share and one-half of one
common share purchase warrant. Each whole warrant will entitle the
holder to acquire one common share of the company at a price of 30 cents
per common share for a period of 12 months after the closing of the
offering.
The company has agreed to pay the agent a fee of 7 per cent of the aggregate
gross proceeds of the offering. In addition, the underwriter will be
issued on the closing of the offering broker warrants entitling the underwriter to subscribe for common shares equal to 7 per cent
of the aggregate number of units issued under the offering at an
exercise price of 30 cents per common share. The broker warrants will
expire 18 months after the closing of the offering.
The offering shall be sold in Ontario, Alberta, British Columbia and
such other jurisdictions of Canada as Canaccord Genuity and the
corporation may agree in accordance with applicable securities laws and
regulations, and under applicable securities exemptions from prospectus
requirements. The offering will also be sold in the United States on a
private-placement basis to accredited investors pursuant to Rule 506 of
Regulation D or qualified institutional buyers pursuant to Rule 144A
and other eligible foreign jurisdictions in accordance with applicable
securities laws and regulations such that no prospectus, registration
statement or similar document is required to be filed in any
jurisdiction outside of Canada.
Proceeds from the offering will be used for general corporate purposes.
We seek Safe Harbor.
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