ProSep Completes Private Placement

ProSep has closed a tranche of its private placement of common shares of the Company ("Common Shares") previously announced on October 6, 2011. ProSep issued an aggregate of 163,346,459 Common Shares to Investissement Québec ("IQ"), Cycle Capital Fund I, L.P. ("Cycle"), Fondaction, le Fonds de développement de la Confédération des Syndicats Nationaux pour la coopération et l'emploi ("Fondaction"), Flint Energy Services Ltd. ("Flint"), and certain members of executive management of ProSep ("Management"), at a purchase price of $0.06825 per Common Share for total gross proceeds of $11,148,396.

The Company will use the net proceeds from the private placement for commercialization, business development and general working capital purposes.

As a result of the private placement:

  • IQ holds 65,934,066 Common Shares, representing 18.5% of the issued and outstanding Common Shares;
  • Cycle now holds 71,169,790 Common Shares, representing 19.98% of the issued and outstanding Common Shares;
  • Fondaction now holds 71,171,548 Common Shares, representing 19.98% of the issued and outstanding Common Shares;
  • Flint holds 29,304,029 Common Shares, representing 8.2% of the issued and outstanding Common Shares;
  • Management participating in the private placement now holds an aggregate of 4,704,264 Common Shares, representing 1.3% of the issued and outstanding Common Shares.

The Company has relied on the financial hardship exemption included in Multilateral Instrument 61-101 to be exempted from the requirement for a formal valuation and a minority shareholder approval. The Toronto Stock Exchange ("TSX") has also granted the Company an exemption from the requirement to obtain shareholders' approval for the private placement, in accordance with Section 604(e) of the TSX Company Manual in consideration of the serious financial circumstances of the Company.

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