Spackman Equities Group Inc. Announces Closing of Concurrent Financing, Subscription Receipt Offering and Update on Reverse Takeover with Crystal Planet Limited
Toronto, Ontario--(Newsfile Corp. - November 29, 2024) - Spackman Equities Group Inc. (TSXV: SQG) ("SQG" or the "Company") is pleased to provide an update, further to its press releases dated March 8, 2024, May 23, 2024, and August 26, 2024, on the status of certain matters relating to its proposed reverse takeover transaction (the "RTO") with Crystal Planet Limited ("CPL").
Completion of Concurrent Financing
On November 28, 2024, the Company closed its previously announced brokered private placement offering pursuant to which it issued 2,520,000 subscription receipts (the "Subscription Receipts") at a price of $0.20 per Subscription Receipt (the "Offering Price") for gross proceeds of CAD$504,000 (the "Offering").
The issuance of the Subscription Receipts by the Company comprised a portion of the concurrent financing completed in connection with the RTO. As part of the concurrent financing, CPL also completed a non-brokered private placement pursuant to which it issued ordinary shares for gross proceeds of $6,896,099 USD.
Each Subscription Receipt will entitle the holder thereof to receive, without payment of any additional consideration or any further action on the part of the holder, one unit of the Corporation (an "UnderlyingUnit") in accordance with the terms and conditions of the subscription receipt agreement entered into between the Company, the Agent (as defined below) and Computershare Trust Services of Canada (the "Subscription Receipt Agreement") and upon satisfaction of the certain conditions (the "Escrow Release Conditions") relating to the RTO. Each Underlying Unit will consist of one common share in the capital of the Company (a "Common Share") and one-half of one common share purchase warrant (each whole common share purchase warrant, a "Warrant"), with each whole Warrant entitling the holder thereof to purchase one Common Share (a "Warrant Share") at a price of $0.30 per Warrant Share for a period of three (3) years following the date on which the Escrow Release Conditions have been satisfied or waived. The Company may, in its sole discretion, accelerate the expiry date of the Warrants is, at any time following the four (4) month anniversary of the date on which the Escrow Release Conditions have been satisfied or waived, the volume weighted average price of the Common Shares on the TSX Venture Exchange (the "TSXV") is greater than $0.50 for any 30 consecutive trading days. If the Escrow Release Conditions are not satisfied on or before the date that is 120 days after the date of issuance of the Subscription Receipts, the holders of the Subscription Receipts will be entitled to the return of the aggregate Offering Price for the Subscription Receipts held by such holders, plus interest on the terms set forth in the Subscription Receipt Agreement.
Hampton Securities Limited (the "Agent") acted as agent in connection with the Offering, pursuant to the terms of an agency agreement between the Company, the Agent and CPL. As compensation for its services, the Agent received a cash commission equal to 6% of the gross proceeds of the Offering and an additional fee of $70,000. Additionally, following satisfaction of the Escrow Release Conditions, the Agent will receive compensation warrants ("Compensation Warrants") equal to 6% of the number of Subscription Receipts issued under the Offering. Each Compensation Warrant will be exercisable for one Common Share at a price of $0.30 per Common Share for a period of 36 months following the Escrow Release Date.
Update on RTO
On November 28, 2024, the TSXV granted an additional extension to the deadline for completing the proposed RTO from November 29, 2024, until December 27, 2024. The RTO is expected to be completed shortly.
Trading in the Common Shares of the Company is currently halted and it is not anticipated that trading will resume prior to the completion of the RTO. Listing of the Common Shares issuable on exchange or exercise of securities issued in the Offering is subject to the fulfillment of certain conditions, including the completion of the RTO. Upon the receipt of final TSXV approval, it is anticipated that the Common Shares will continue to trade on the TSXV under the symbol "SQG".
The RTO is also subject to additional closing requirements and conditions pursuant to the terms and conditions of the share exchange agreement (as amended) between the parties, a copy of which is available under the Company's profile on SEDAR+ at www.sedarplus.ca. These conditions include but are not limited to final approval of the TSXV.
There can be no assurance that the RTO will be completed as proposed or at all. Except as disclosed in the management information circular dated March 28, 2024, a copy of which is available under the Company's SEDAR+ profile at www.sedarplus.ca, that has been prepared in connection with the RTO, any information released or received with respect to the RTO may not be accurate or complete and should not be relied upon. Trading in the securities of the Company should be considered highly speculative.
The TSXV has in no way passed upon the merits of the proposed RTO and has neither approved nor disapproved the contents of this news release.
On behalf of the Board of Directors of Spackman Equities Group Inc.:
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accept responsibility for the adequacy or accuracy of this news release.
Forward-Looking Statements
Except for statements of historical fact, this news release contains certain "forward-looking information" within the meaning of applicable securities law. Forward-looking information is frequently characterized by words such as "plan", "expect", "project", "intend", "believe", "anticipate", "estimate" and other similar words, or statements that certain events or conditions "may" or "will" occur. In particular, forward-looking information in this press release includes, but is not limited to, statements with respect to satisfaction of the Escrow Release Conditions and the completion of the RTO and satisfaction of the other conditions precedent to the completion of the RTO.
Although management believes that the expectations reflected in the forward-looking information are reasonable, there can be no assurance that such expectations will prove to be correct. We cannot guarantee future results, performance, or achievements. Consequently, there is no representation that the actual results achieved will be the same, in whole or in part, as those set out in the forward-looking information.
Forward-looking information is based on the opinions and estimates of management at the date the statements are made and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those anticipated in the forward-looking information. Some of the risks and other factors could cause results to differ materially from those expressed in the forward-looking statements which include, but are not limited to risks relating to: general economic conditions in Canada, the United States and globally; industry conditions; potential occurrence of changes relating to the business, affairs, financial condition or operations of SQG or CPL; unanticipated operating events; competition for and/or inability to retain services and inputs; the potential that capital may not be available on acceptable terms; the need to obtain required approvals from regulatory authorities and the TSXV relating to the RTO; stock market volatility; changes in tax laws and incentive programs; and the other factors described in our public filings available at www.sedarplus.ca. Readers are cautioned that this list of risk factors should not be construed as exhaustive.
The forward-looking information contained in this news release is expressly qualified by this cautionary statement. We undertake no duty to update any of the forward-looking information to conform such information to actual results or to changes in our expectations except as otherwise required by applicable securities legislation. Readers are cautioned not to place undue reliance on forward-looking information.
