Acasta Enterprises Announces Completion of Private Placement

Jun 28, 2019 07:05 pm

Acasta Enterprises Inc. (TSX: AEF) (“Acasta” or the Corporation”) announced today that further to its press release dated June 7, 2019, it has completed a private placement (the “Subsequent Private Placement”) of 2,166,017 Class B Shares of the Corporation (the “Shares”) at a price of $0.68 per share for aggregate gross proceeds of $1,472,891 which is intended to be used to reduce the Corporation’s outstanding bank indebtedness. The private placement was effected at the market price.

The Corporation offered to certain of its larger shareholders (the “Offered Shareholders”) the opportunity to participate in the Subsequent Private Placement on the same terms as its initial private placement, which closed on June 7, 2019, on a pro rata basis. As announced in the June 7, 2019 press release, the offered unsubscribed for Shares (the “Unsubscribed for Shares”) were offered to third parties, as an Offered Shareholder did not accept all or a portion of the offer to subscribe. Corporations controlled by the co-CEO’s of the Corporation subscribed for the Unsubscribed for Shares, being an aggregate of 929,506 Shares.

Following the completion of the Subsequent Private Placement, the co-CEO’s of the Corporation will indirectly control an aggregate of 29,749,664 Class B Shares or approximately 40% of the outstanding Shares. The completion of the Subsequent Private Placement did not materially affect control of the Corporation and has received the conditional approval of the Toronto Stock Exchange.

The Subsequent Private Placement may be considered a “related party transaction” pursuant to Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101”). The Subsequent Private Placement was approved by the independent directors of the Corporation and is exempt from the formal valuation and minority approval requirements, respectively, of MI 61-101 as neither the fair market value of the Subsequent Private Placement, nor the fair market value of the applicable Shares, exceeds 25% of the Corporation’s market capitalization (as calculated pursuant to MI 61-101).

Pursuant to applicable Canadian securities laws, all securities issued pursuant to the Subsequent Private Placement are subject to, among other things, a statutory hold period of four months and one day, which will expire on October 29, 2019. The Subsequent Private Placement remains subject to the final approval of the Toronto Stock Exchange.

Cautions Regarding Future Plans and Forward Looking Information

Certain statements contained in this press release constitute forward-looking statements within the meaning of applicable Canadian securities laws which reflect the Corporation’s current expectations and projections about future results. Forward-looking statements generally can be identified by the use of forward-looking terminology such as “outlook”, “objective”, “may”, “will”, “expect”, “intent”, “estimate”, “anticipate”, “believe”, “consider”, “should”, “plans”, “predict”, “estimate”, “potential”, “could”, “likely”, “approximately”, “scheduled”, “forecast”, “variation” or “continue”, or similar expressions suggesting future outcomes or events. The forward-looking statements made in this press release relate only to events or information as of the date on which the statements are made in this press release. Actual results and developments are likely to differ, and may differ materially, from those expressed or implied by the forward-looking statements contained in this press release. Such forward-looking statements are based on a number of assumptions that may prove to be incorrect.

Except as specifically required by applicable Canadian securities law, the Corporation undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, after the date on which the statements are made or to reflect the occurrence of unanticipated events. These forward-looking statements should not be relied upon as representing the Corporation’s views as of any date subsequent to the date of this press release. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements.

Acasta Enterprises Inc.
Fred Leigh