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CALGARY, Dec. 5, 2017 /CNW/ - Ironhorse Oil & Gas Inc.
(TSX-V:IOG) ("Ironhorse") and Pond Technologies Inc.
("Pond") jointly announce an amendment to the brokered
private placement financing of Pond (the "Financing") to be
completed as a condition to closing the previously announced
business combination of Ironhorse and Pond by way of a
"three-cornered amalgamation" (the "Transaction").
Financing
Concurrently with and as a condition of the Transaction, Pond
will complete a brokered private placement (the "Financing")
of a minimum of 2,708,333 subscription receipts ("Subscription
Receipts") and a maximum of 4,166,666 Subscription Receipts at
a price of $2.40 per Subscription
Receipt for aggregate gross proceeds of a minimum of $6,500,000 and a maximum of $10,000,000 (subject to the exercise, if any, of
an over-allotment option granted to the Agents (as defined below)
to issue and sell up to an additional 15% of the aggregate number
of Subscription Receipts sold under the Financing, which, if
exercised, would result in the issuance of a maximum of up to
4,791,666 Subscription Receipts for aggregate gross proceeds of up
to $11,500,000).
Each Subscription Receipt will be now be automatically
exchangeable for, without additional payment or further action on
the part of the holder thereof, into: (a) one Pond common share (a
"Pond Share"); and (b) one Pond Share purchase warrant (a
"Pond Warrant"), with each such Pond Warrant entitling the
holder thereof to purchase one Pond Share at a price of
$3.00 per share and expiring 24
months from the date of grant, upon the completion of the
Transaction provided that the date of completion of the Transaction
is not later than January 31, 2018,
failing which the subscription funds will be returned to the
subscribers. Upon the completion of the Transaction, each
Pond Share will be exchanged for one Ironhorse common share (on a
post-consolidation basis) and each Pond Warrant will be exchanged
for one Ironhorse common share purchase warrant (on a
post-consolidation basis), having the same exercise price, expiry
date and other terms as the Pond Warrants.
Industrial Alliance Securities Inc. and Hampton Securities
Limited (collectively, the "Agents") have been engaged by
Pond to complete the Financing on a best-efforts agency
basis. A commission of 8% of the aggregate gross proceeds
under the Financing (excluding up to $5,000,000 of proceeds raised, if any, from
certain identified potential subscribers) and a work fee in the
amount of $35,000 plus HST and any
expenses incurred by the Agents is payable to the Agents by
Pond. In addition, Pond will now issue Pond unit purchase
warrants ("Pond Agent Units") to the Agents equal to 8% of
the aggregate number of Subscription Receipts sold pursuant to the
Financing. Each Pond Agent Unit will entitle the Agents to
purchase, at an exercise price of $2.40 per unit at any time prior to the date that
is 24 months from the closing date of the Financing, one Pond Share
and one Pond Share purchase warrant, exercisable to purchase one
Pond Share at a price of $3.00 per
Pond Share at any time prior to the date that is 24 months from the
closing date of the Financing. The Pond Agent Units and Pond Share
purchase warrants issuable upon the exercise thereof, will include
adjustment provisions entitling the holder thereof, upon completion
of the Transaction, to acquire Ironhorse common shares upon the
exercise thereof at the same exercise price.
Upon completion of the Transaction (after giving effect to the
consolidation of the outstanding Ironhorse common shares on the
basis of 6.9 pre-consolidation Ironhorse common shares for each one
post-consolidation Ironhorse common share (the
"Consolidation") and assuming minimum aggregate gross
proceeds of $6,500,000 received under
the Financing), on an undiluted basis, Ironhorse shareholders will
own approximately 4,041,423 post-Consolidation Ironhorse shares,
which represents ownership of approximately 21.9% of Ironhorse
(16.6% on a fully diluted basis, which is lower than the percentage
noted in the Circular (as defined below)) and former Pond
shareholders will own approximately 14,439,577 post-Consolidation
Ironhorse common shares, which represents ownership of
approximately 78.1% of Ironhorse (59.4% on a fully diluted basis,
which is lower than the percentage noted in the Circular). As
a result of the Transaction, 5,828,006 post-Consolidation Ironhorse
common shares will be reserved for issuance to former holders of
Pond convertible securities being exchanged for equivalent
securities of Ironhorse and holders of certain Pond agent units,
including the Pond Agent Units, which is higher than the number
noted in the Circular (as defined below).
Upon completion of the Transaction (after giving effect to the
Consolidation and assuming maximum aggregate gross proceeds of
$10,000,000 received under the
Financing), on an undiluted basis, Ironhorse shareholders will own
approximately 4,041,423 post-Consolidation Ironhorse shares, which
represents ownership of approximately 20.3% of Ironhorse (14.7% on
a fully diluted basis, which is lower than the percentage noted in
the Circular) and former Pond shareholders will own approximately
15,897,910 post-Consolidation Ironhorse common shares, which
represents ownership of approximately 79.7% of Ironhorse (57.9% on
a fully diluted basis, which is lower than the percentage noted in
the Circular). As a result of the Transaction, 7,519,672
post-Consolidation Ironhorse common shares will be reserved for
issuance to former holders of Pond convertible securities being
exchanged for equivalent securities of Ironhorse and holders of
certain Pond agent units, including the Pond Agent Units, which is
higher than the number noted in the Circular.
An addendum to the joint management information circular of
Ironhorse and Pond dated November 17,
2017 (the "Circular") in connection with the annual
and special meeting of Ironhorse shareholders to be held on
December 18, 2017 and the special
meeting of Pond shareholders to be held on December 15, 2017 is being mailed to the
shareholders of Ironhorse and Pond which updates the disclosure in
the Circular to reflect the above amendments to the
Financing. A copy of the addendum may be found on Ironhorse's
SEDAR profile at www.sedar.com.
About Ironhorse and Pond
Ironhorse is a Calgary-based
junior oil and natural gas production company trading on the TSXV
under the symbol "IOG". Ironhorse owns a working interest in
a producing oil and gas property in Alberta.
Located in Markham, Ontario,
and continued under the laws of the province of Ontario, Pond is a private company that has
developed a proprietary system to transform carbon dioxide into
bio-products. Pond works with the cement, steel, oil and gas
and power generation industries to reduce greenhouse gas
emissions. Pond has pilot installations in Ontario and has granted and pending patents in
the USA, Europe, China
and Taiwan and patents pending in
other jurisdictions including Canada.
Pond's platform technology also includes algae superfoods for
the nutraceutical and food additive markets. Pond's
productive system can grow many species of algae, including strains
that produce anti-oxidants, omega-3 fatty acids, and protein for
human and animal consumption.
Reader Advisory
The TSXV conditionally accepted the Transaction on November 16, 2017. Completion of the
Transaction is subject to a number of conditions, including but not
limited to, disinterested shareholder approval and completion of
the Financing. Where applicable, the Transaction cannot close
until the required shareholder approvals are 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
Circular, any information released or received with respect to the
proposed Transaction may not be accurate or complete and should not
be relied upon. Trading in the securities of Ironhorse should be
considered highly speculative.
The TSXV has in no way passed upon the merits of the proposed
Transaction and neither has approved nor disapproved the contents
of this press release.
Forward-Looking Statements
This press release contains forward-looking statements and
forward-looking information within the meaning of applicable
securities laws. The use of any of the words "expect",
"anticipate", "continue", "estimate", "objective", "ongoing",
"may", "will", "project", "should", "believe", "plans", "intends"
and similar expressions are intended to identify forward-looking
information or statements. More particularly and without
limitation, this press release contains forward looking statements
and information concerning the Transaction, the Financing and the
timing and ability of Ironhorse and Pond to satisfy the conditions
to the completion of the Transaction and the Financing.
The forward-looking statements and information are based on
certain key expectations and assumptions made by Ironhorse and
Pond, including expectations and assumptions concerning the parties
to the Transaction, the Transaction, the Financing, the timely
receipt of all required shareholder approvals and the satisfaction
of conditions to the completion of the Transaction and the
Financing. Although Ironhorse and Pond believe that the
expectations and assumptions on which such forward-looking
statements and information are based are reasonable, undue reliance
should not be placed on the forward-looking statements and
information because Ironhorse and Pond can give no assurance that
they will prove to be correct. By its nature, such forward-looking
information is subject to various risks and uncertainties, which
could cause the actual results and expectations to differ
materially from the anticipated results or expectations expressed.
These risks and uncertainties, include, but are not limited to,
risks related to the following: the Transaction or the Financing
may not be completed as currently proposed or at all; the gross
proceeds to be raised in connection with the Financing;
satisfaction or waiver of all applicable conditions to closing of
the Transaction (including receipt of all necessary shareholder
approvals, and the absence of material changes with respect to the
parties and their respective businesses, all as more particularly
set forth in the amalgamation agreement giving effect to the
Transaction, as amended) and the Financing; the anticipated
benefits expected from the Transaction not being realized; delays
in the timing of the Transaction and the Financing; fluctuations in
general macroeconomic conditions; fluctuations in securities
markets and the market price of Ironhorse common shares;
fluctuations in currency markets (such as the Canadian dollar to
United States dollar exchange
rate); change in national and local government, legislation,
taxation, controls, regulations and political or economic
developments; and availability of financing. Readers are
cautioned not to place undue reliance on this forward-looking
information, which is given as of the date hereof, and to not use
such forward-looking information for anything other than its
intended purpose. Neither Ironhorse nor Pond undertake any
obligation to update publicly or revise any forward-looking
information, whether as a result of new information, future events
or otherwise, except as required by law.
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. No stock exchange, securities commission
or other regulatory authority has approved or disapproved of the
information contained herein.
SOURCE Ironhorse Oil & Gas Inc.