VANCOUVER,
Nov. 26, 2013 /CNW/ - C Level III
Inc. (TSXV: CLV.P) (the "Corporation"), a TSX Venture
Exchange (the "TSXV") capital pool company, is pleased to
announce that it completed its previously announced private
placement offering with 2299895 Ontario Inc. ("OntarioCo")
for combined gross proceeds of $1.41-million on November
21, 2013 (the "Amended Offering") and received
the conditional approval of the TSXV on November 22, 2013 to acquire all of the issued
and outstanding common shares of OntarioCo as part of its revised
and updated Qualifying Transaction (see News Release dated
October 3, 2013) pursuant to Policy
2.4 of the TSXV (the "Qualifying Transaction").
The Qualifying Transaction will be carried out by means of
securities exchange agreements, pursuant to which Giyani Gold Corp.
("Giyani Gold"), the majority shareholder of OntarioCo, and
two minority OntarioCo shareholders will collectively receive an
aggregate of 20,000,000 common shares (the "Resulting
Issuer Shares") of the issuer resulting from the completion of
the Qualifying Transaction (the "Resulting Issuer") in
exchange for their OntarioCo common shares (the "OntarioCo
Shares").
Upon the satisfaction of certain release conditions, including
completion of the Qualifying Transaction (the "Release
Conditions"), OntarioCo will be a direct, wholly-owned
subsidiary of the Resulting Issuer. The Qualifying Transaction will
constitute a reverse take-over of the Corporation inasmuch as the
current shareholders of OntarioCo will own approximately 59.5% of
the outstanding shares of the Resulting Issuer immediately upon
completion of the Qualifying Transaction (on a non-diluted basis
and assuming full subscription of the Offering described
below).
As a result of the securities exchange agreements and the
Offering described below, the Resulting Issuer will have
approximately 33,602,108 Resulting Issuer Shares, 483,392
options to acquire Resulting Issuer Shares, and approximately
7,698,308 share purchase warrants to acquire Resulting Issuer
Shares outstanding.
The Offering
The Amended Offering consisted of a combination of: (i)
subscription receipts for units of OntarioCo (the "Subscription
Receipts") at a price of $1.05
per OntarioCo Subscription Receipt, with each OntarioCo
Subscription Receipt automatically converting upon satisfaction of
the Release Conditions, without additional consideration or further
action on the part of the holder thereof, into seven (7) common
shares in the share capital of the Resulting Issuer (the
"Resulting Issuer Shares") and seven (7) share purchase
warrants to acquire Resulting Issuer Shares (the "Resulting
Issuer Warrants") at an exercise price of $0.25 per Resulting Issuer Share for a period of
twenty-four (24) months following completion of the Qualifying
Transaction; and (ii) subscription receipts for flow-through units
of the Resulting Issuer (the "FT Subscription Receipts") at
a price of $0.20 per FT Subscription
Receipt, with each FT Subscription Receipt automatically converting
upon completion of the Qualifying Transaction, without additional
consideration or further action on the part of the holder thereof,
into one (1) common share of the Resulting Share issued on a
"flow-through" basis under the Income Tax Act (Canada) (a "Resulting Issuer FT Share")
and one-half (½) of a flow-through share purchase warrant (each
whole flow-through share purchase warrant, a "Resulting Issuer
FT Warrant") entitling the holder to acquire one (1) Resulting
Issuer Share for each whole Resulting Issuer FT Warrant at an
exercise price of $0.30 per Resulting
Issuer Share for a period of twenty-four (24) months following
completion of the Qualifying Transaction.
The Amended Offering was brokered by Portfolio Strategies
Securities Inc. (the "Agent") on behalf of C Level and
OntarioCo on a private placement "best efforts" basis, pursuant to
an agency agreement between the Agent, C Level, OntarioCo, and
Giyani Gold (the "Agency Agreement") dated as of the Closing
Date (defined below).
The Corporation will pay the Agent a cash commission equal to 7%
of the gross proceeds from the FT Subscription Receipts and 2% of
the gross proceeds from the Subscription Receipts sold pursuant to
the Offering upon satisfaction of the Release conditions. The Agent
will also be issued broker warrants (the "Broker Warrants")
upon satisfaction of the Release Conditions, equal to a total of 7%
of the aggregate number of FT Subscription Receipts and 2% of the
aggregate number of Subscription Receipts sold pursuant to the
Offering. Each Broker Warrant will be exercisable to acquire one
Resulting Issuer Share at a price of $0.15 per Resulting Issuer Share for a period of
eighteen (18) months following satisfaction of the Release
Conditions.
The gross proceeds from the Amended Offering will be held in
escrow in a non-interest bearing account pending satisfaction of
the Release Conditions (the "Escrowed Proceeds"). If the
Release Conditions are not satisfied or waived on or
before 5:00
p.m. (Toronto time) on December 6, 2013, then the Subscription Receipts
and FT Subscription Receipts will immediately become null and void
and the escrow agent shall distribute the Escrowed Proceeds and
accrued interest to the holders of the Subscription Receipts and FT
Subscription Receipts on a pro rata basis so that
they are refunded their full purchase price.
Required Approvals
Completion of the Qualifying Transaction is subject to a number
of conditions, including but not limited to receipt of final
approval of the Qualifying Transaction from the TSXV.
The Qualifying Transaction is not a "Non-Arm's Length Qualifying
Transaction", as the Corporation and OntarioCo do not share any
common "Control Persons", within the meaning of those terms in
Policy 2.4 of the TSXV. As such, the approval of the Corporation's
shareholders is not required.
The TSXV has waived its sponsorship requirements in connection
with the Qualifying Transaction.
A filing statement in respect of the Qualifying Transaction has
been prepared and conditionally approved by the TSXV and will be
filed in accordance with Policy 2.4 of the TSXV on SEDAR at
www.sedar.com at least seven (7) business days prior to the
commencement of trading of the Resulting Issuer's shares.
Further Information
All information contained in this news release with respect to
the Corporation and OntarioCo was supplied by the parties
respectively, for inclusion herein, and each party and its
directors and officers have relied on the other party for any
information concerning the other party. Further information on the
proposed management and directors of the Resulting Issuer is
available in the October 3, 2013 and
July 4, 2013 news releases.
Completion of the transaction is subject to a number of
conditions, including but not limited to, TSXV acceptance. There
can be no assurance that the transaction will be completed as
proposed or at all.
Investors are cautioned that, except as disclosed in the
management information circular and filing statement prepared in
connection with the transaction, any information released or
received with respect to the transaction may not be accurate or
complete and should not be relied upon. Trading in the securities
of a capital pool company should be considered highly
speculative.
The TSX Venture Exchange Inc. has in no way passed upon the
merits of the proposed transaction and has neither approved nor
disapproved the contents of this press release.
NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES
PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX
VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR
ACCURACY OF THIS RELEASE.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION: This
news release includes certain "forward-looking statements" under
applicable Canadian securities legislation. Forward-looking
statements include, but are not limited to, statements with respect
to: the terms and conditions of the Re-Stated Qualifying
Transaction; the terms and conditions of the proposed Amended
Offering; future exploration and testing; use of funds; and the
business and operations of the Resulting Issuer after the proposed
transaction. Forward-looking statements are necessarily based upon
a number of estimates and assumptions that, while considered
reasonable, are subject to known and unknown risks, uncertainties,
and other factors which may cause the actual results and future
events to differ materially from those expressed or implied by such
forward-looking statements. Such factors include, but are not
limited to: general business, economic, competitive, political and
social uncertainties; delay or failure to receive board,
shareholder or regulatory approvals; and the results of current
exploration and testing. There can be no assurance that such
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. The Parties disclaim any intention or
obligation to update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise,
except as required by law.
SOURCE C Level III Inc.