Mr. Dev Randhawa reports
ROCKWEALTH RESOURCES CORP. ANNOUNCES A NON-BROKERED PRIVATE PLACEMENT
Rockwealth Resources Corp. has arranged a non-brokered private placement of units at a price of 15 cents per unit for aggregate
gross proceeds of up to $1-million. Each unit will be composed of one common share and one
common share purchase warrant. Each warrant will entitle the holder to purchase one common
share at a price of 20 cents per share for a period of 24 months from the date of issuance. The warrants are subject
to an acceleration clause whereby if the volume-weighted average closing price of the shares on the exchange
is 40 cents or more for 21 consecutive trading days at any time subsequent to the expiry of six months from the
date of issuance of the warrants, then the company will earn the right by providing notice to the warrantholders to accelerate the expiry date of the warrants to that date which is 30 days
from the date of the acceleration notice.
The net proceeds from this offering are expected to be used for exploration and for general corporate
purposes. Finders' fees up to 7 per cent in cash and 7 per cent in finders' warrants may be issuable under the offering in accordance
with securities regulations. Each finder's warrant will entitle the holder to purchase one common share at a
price of 20 cents per share for a period of 24 months from the date of issuance and be subject to the acceleration
notice as outlined above.
All of the securities issued under the offering will be subject to a four-month resale restriction. The completion
of the proposed offering remains subject to the approval of the TSX Venture Exchange and the satisfaction of
other customary closing conditions.
The company further reports that its board of directors has approved the settlement of up to $439,674 of debt
through the issuance of common shares of the company. Pursuant to the debt
settlement, the company would issue up to 2,931,160 common shares of the company at a
deemed price of 15 cents per share to certain creditors of the company, including certain of its directors and
The issuance of the shares to the creditors is subject to the approval of the TSX Venture Exchange. All securities
issued will be subject to a four-month hold period, which will expire on the date that is four months and one day
from the date of issue.
As certain insiders participated in the debt settlement, it is considered to be a related-party transaction under
Multilateral Instrument 61-101 (Protection of Minority Security Holders in Special Transactions).
All of the independent directors of the company, acting in good faith, considered the transactions and have
determined that the fair market value of the securities being issued to insiders and the consideration being paid
are reasonable. The company intends to rely on the exemptions from the valuation and minority shareholder
approval requirements of MI 61-101 contained in sections 5.5(b) and 5.7(b) of MI 61-101.
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