PEARL Announces Pricing Of Financing
Wednesday February 23, 3:33 pm ET
TORONTO, ONTARIO--(CCNMatthews - Feb. 23, 2005) - Further to the Press Release of February 11, 2005, Patent Enforcement and Royalties Ltd. (TSX VENTURE:PAL - News; "PEARL" or the "Company") is pleased to announce that it has reached an agreement with a syndicate of agents led by Canaccord Capital Corporation and including Toll Cross Securities Ltd., First Associates Ltd. and Haywood Securities Inc. (collectively, the "Agents") pursuant to which the Agents will act on a best efforts basis, in connection with the private placement offering by PEARL of a minimum of $6,000,000 and a maximum of $10,000,000 of Non Flow-Through Purchase Receipts priced at $0.60 per Non Flow-Through Purchase Receipt including up to $2,000,000 of Flow-Through Purchase Receipts priced at $0.65 per Flow-Through Purchase Receipt. Each Non Flow-Through Purchase Receipt is exchangeable into one Unit. Each Unit will consist of one common share and one-half of one transferable common share purchase warrant. Each whole warrant will have an exercise price of $0.70 and will have a term of 2 years. The Non Flow-Through Purchase Receipts will be automatically exchanged for Units without payment of any additional consideration on a one for one basis after the four month hold period from the Closing Date, provided the Escrow Conditions (as defined below) have been satisfied. Each Flow-Through Purchase Receipt is exchangeable into one flow-through common share. The Flow-Through Purchase Receipts will be exchanged for flow-through common shares without payment of additional consideration on a one for one basis after the four month hold period from the Closing Date, provided the Escrow Conditions have been satisfied. The net proceeds of the offering (after deduction of expenses which would include legal fees and filing fees) (the "Escrow Funds") will be held in escrow pending satisfaction of the following conditions (the "Escrow Conditions") (i) receipt of shareholder approval to the Company's
Change of Business to a resource issuer; and (ii) satisfaction of the conditions precedent to completion of the acquisition of the Yorke Hardy Property to the reasonable satisfaction of the Agents. In the event that the Escrow Conditions are not satisfied on or before 5:00 p.m. (Vancouver Time) on April 30th, 2005, the Company will refund the full purchase price of the Purchase Receipts to the purchasers plus interest. For greater certainty, the Company will directly fund any shortfall to ensure that the purchasers are refunded their full purchase price. The financing is scheduled to close on or before March 21, 2005.
The Agents will be paid a commission of 7% of the gross proceeds of the offering paid at the time of the release of the Escrow Funds and will be issued Agents' warrants equal to 10% of the aggregate number of Non Flow-Through Purchase Receipts and Flow-Through Purchase Receipts sold. Each Agents' warrant will be exerciseable to acquire one common share at an exercise price of $0.70 for two years from Closing. Funds will be used for the acquisition of the Yorke Hardy Property (See press releases of November 22, 2004, January 18, 2005 and January 20, 2005), for the initial exploration program on the property recommended by Giroux Consultants Ltd. in their NI 43-101 report dated December 17, 2004, amended January 12, 2005, and to provide the Company with funds to further advance the project.
The private placement is subject to TSX Venture Exchange approval.
Completion of the acquisition of the Yorke Hardy Property (the "Transaction") is subject to a number of conditions, including but not limited to, Exchange acceptance and disinterested Shareholder approval of the Company's Change of Business. The Transaction cannot close until the required Shareholder approval is obtained. 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 to be prepared in connection with the Change Of Business, any information released or received with respect to the Change Of Business may not be accurate or complete and should not be relied upon. Trading in the securities of PEARL should be considered highly speculative.
To find out more about Patent Enforcement and Royalties Ltd. (TSX-V: PAL - News), visit our website at www.pearlltd.com.
Shares outstanding: 23,259,000 |
