Brownstone Ventures has entered into an agreement with PowerOne Capital Markets Limited (the "Agent") to raise up to $5,000,000 on a commercially reasonable basis, by way of a brokered private placement of up to 10,000,000 units (the "Units") at a price of $0.50 per Unit.
Each Unit will consist of one common share in the capital of Brownstone and one-half of one common share purchase warrant of Brownstone. Each whole common share purchase warrant will entitle the holder to purchase one common share of Brownstone at any time within 24 months (the "Warrant Term") after the closing date of the financing at an exercise price of $0.75 per share. If, following the expiry of the four month hold period, the closing price of Brownstone's common shares exceeds $1.50 for 20 consecutive business days, then the Warrant Term shall be automatically reduced and the share purchase warrants will expire on the date that is 30 days following the issuance of a press release announcing the reduced Warrant Term.
Upon closing, the Agent will receive a cash commission equal to 7% of the gross proceeds raised under the private placement and that number of warrants (the "Agent's Warrants") equal to 8% of the number of Units sold under the private placement. Each Agent's Warrant will be exercisable for one Unit at a price of $0.50 per Unit for a period of twenty-four months from closing.
Brownstone may be considered to be a "connected issuer" to the Agent for purposes of applicable securities legislation as its Chairman and President is also the President, CEO and a director of the Agent's 50% shareholder and its Chief Financial Officer is the Chief Financial Officer and a director of the Agent.
Closing of the private placement is subject to receipt of all necessary regulatory approvals. The securities issued will have a hold period expiring four months and one day from the date of closing. Proceeds from the sale of the Units will be used for general corporate purposes.
Up to 25% of the financing may be purchased by insiders of Brownstone.
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