Mr. Scott Ackerman reports
AUSTPRO CLOSES FINANCING
Austpro Energy Corp. has closed the non-brokered private placement previously announced on Oct. 19, 2020, for proceeds of $132,000.
This placement consisted of 1.1 million units of the company at a price of 12 cents per unit. Each unit consists of one common share and one common share purchase warrant, with each warrant entitling the holder to acquire an additional common share of the company at a price of 15.5 cents until Oct. 29, 2021. The securities have a hold period expiring on March 2, 2021.
Related party participation in the placement
The Emprise Special Opportunities Fund (2017) Ltd. Partnership, an insider of the company, was the sole subscriber to the placement. As an insider of the company participated in this placement, 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.
The offering is exempt from the formal valuation and minority shareholder approval requirements of MI 61-101 (pursuant to subsections 5.5(a) and 5.7(1)(a)) in respect of such insider participation, based on a determination that the fair market value of the participation in the placement by insiders did not exceed 25 per cent of the market capitalization of the company, as determined in accordance with MI 61-101.
The company did not file a material change report more than 21 days before the expected closing of the offering because the details of the participation therein by related parties of the company were not settled until shortly prior to closing of the offering and the company wished to close on an expedited basis for business reasons.
Early warning report
As a result of the placement, Emprise LP2017 has ownership and direction or control over 9.1 million common shares of the company, representing 61.3 per cent of the issued and outstanding common shares of the company (or 10.2 million common shares and 64 per cent of the company's then outstanding common shares of the company on a partially diluted basis, assuming exercise of Emprise LP2017's share purchase warrants). Neither the company nor, to the knowledge of the company after reasonable inquiry, Emprise LP2017, has knowledge of any material information concerning the company or its securities which has not been generally disclosed.
The company has been advised that Emprise LP2017 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.
The proceeds of the placement will be used by the company for working capital purposes. The company is actively investigating new business opportunities, with a view to graduating back to the main board of the TSX Venture Exchange.
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