Mr. Vishwa Mootooveeren reports
COMPOSITE ALLIANCE GROUP ANNOUNCES LOAN TO SUBSIDIARY
Composite Alliance Group Inc.'s subsidiary, Techni Modul Engineering SA, has obtained a short-term loan of 620,000 euros from a related party, Team Alpha Ltd., which loan is unsecured, shall bear interest at a rate of 5.3 per cent per annum and matures two months starting from the date when TAL has sent the full amount of the loan to TME. TAL is an entity controlled by Jim Hsieh, a director and shareholder of the company.
Related-party participation
The loan is being provided by an entity controlled by an insider of Composite Alliance. As an insider of the company participated in this transaction, it is deemed to be a related-party transaction as defined under Multilateral Instrument 61-101 (Protection of Minority Security Holders in Special Transactions).
Neither the company, nor, to the knowledge of the company after reasonable inquiry, a related party has knowledge of any material information concerning the company or its securities that has not been generally disclosed. Since the loan is not convertible into shares of Composite Alliance, there will be no effect on the voting interests of any related parties. The loan was approved by all of the directors of Composite Alliance, except for Mr. Hsieh, who abstained from voting.
The entering into of the loan is exempt from the formal valuation and minority shareholder approval requirements of MI 61-101 (pursuant to subsections 5.5(c) and 5.7(1)(b)) as it is a distribution of securities for cash, and neither the fair market value of the securities distributed to, nor the consideration received from, interested parties exceeded $2.5-million.
We seek Safe Harbor.
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