02:14:38 EDT Fri 29 Mar 2024
Enter Symbol
or Name
USA
CA



Arak Resources Ltd
Symbol AAC
Shares Issued 5,871,269
Close 2014-10-20 C$ 0.12
Market Cap C$ 704,552
Recent Sedar Documents

Arak Resources arranges $250,000 private placement

2014-10-22 09:37 ET - News Release

Mr. Carl von Einsiedel reports

Arak Resources Ltd. has completed its previously announced private placement of 6.33 million units. Each unit consists of one common share and one three-year share purchase warrant to purchase an additional common share at five cents in years one and two and at 10 cents thereafter. Gross proceeds of $316,500 will be used for general working capital. In connection with closing of the private placement, the company paid an aggregate of $19,022 and issued 380,446 finders' warrants under the same terms and conditions to certain persons who introduced subscribers to the company. All securities issued under the placement are subject to a hold period of four months and a day from the date of distribution.

Pursuant to the offering, Exchange Minerals Ltd., a company controlled by Michael Shmazian, acquired 2,225,541 units, at a price of five cents per unit, which consist of 2,225,541 common shares and 2,225,541 share purchase warrants, representing 18.5 per cent of the issued and outstanding common shares of the company and 35.2 per cent of the issued and outstanding warrants of the company following completion of the offering. As a result of the offering, Exchange Minerals holds 2,225,541 common shares of the company, representing 18.5 per cent of the current issued and outstanding common shares of the company, and would own 4,451,082 common shares, representing 30.9 per cent on a partially diluted basis, assuming the exercise of 2,225,541 warrants.

The company is advised that Exchange Minerals has acquired these securities for investment purposes and has no present intention to acquire further securities of the company, although it may in the future acquire or dispose of securities of the company, through the market, privately or otherwise, as circumstances or market conditions warrant. A copy of the early warning report relating to these holdings will be available under the company's profile on SEDAR.

The subscription to the offering by Exchange Minerals is a related-party transaction under the policies of the TSX Venture Exchange and Multilateral Instrument 61-101. The transaction is exempt from the formal valuation requirements under Section 5.4 of MI 61-101 and the minority approval requirements under Section 5.6 of MI 61-101 pursuant to the company's common shares being listed on the TSX Venture Exchange and the transaction having a fair market value of less than $2.5-million, under sections 5.5(b) and 5.7(1)(b), respectively, of MI 61-101. The offering was reviewed and approved unanimously by the company's board of directors.

The company also announces that it has arranged a new private placement of up to 1,666,667 units at a price of 15 cents per unit. Each unit consists of one common share and one share purchase warrant entitling the holder to purchase an additional common share for a period of three years at a price of 15 cents per share in year one and 25 cents per share thereafter. The warrants are subject to acceleration provisions whereby, if the company's shares trade at 50 cents or more per share for a continuous period of 30 days, the warrants must be exercised or forfeited. Gross proceeds of up to $250,000 will be used to finance administration and general working capital. The company will pay a finder's fee of 10 per cent of the gross proceeds in cash and 10 per cent of the number of units sold in warrants exercisable under the same terms and conditions.

Further, the company has granted an aggregate of 1.1 million incentive stock options to its officers, directors and consultants. The options will be exercisable at 15 cents per share for a period of five years expiring Oct. 21, 2019.

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