NOT FOR DISTRIBUTION TO U.S. NEWSWIRE
SERVICES OF DISSEMINATION IN THE UNITED
STATES
TORONTO, July 26,
2022 /CNW/ -- (TSXV:SEV) (OTCQB:SPVNF) Spectra7
Microsystems Inc. ("Spectra7" or the "Company"), a
leading provider of high-performance analog semiconductor products
for broadband connectivity markets, announced today a proposed
non-brokered private placement basis (the "Offering") up to
$8.0 million of 14% unsecured
convertible debentures (the "Debentures") and the closing of
the first tranche of the Offering consisting of the issuance of
$3,809,000 principal amount of
Debentures for gross proceeds of $3,732,820. All dollar amounts referenced in
this release are in Canadian dollars.
Each $1,000 principal amount of
Debentures will be sold at a subscription price of $980 for expected gross proceeds of up to
$7,840,000. The Debentures shall
mature on December 31, 2024 (the
"Maturity Date") and the principal amount of each Debenture
will be convertible into common shares of the Company (each, a
"Common Share") at the option of the holder at any time
prior to the close of business on the last business day immediately
preceding the Maturity Date, at a conversion price of $1.02 per Common Share, subject to adjustment
upon certain customary events. Holders converting their Debentures
will receive accrued and unpaid interest thereon for the period
from and including the date of the latest interest payment date to,
and including, the date of conversion.
The net proceeds from the Offering will be used for the
repayment of the existing convertible debentures of the
Company.
All securities issuable in the Offering are subject to a
statutory hold period until the date that is four months and one
day from the date of issuance. Approval of the TSX Venture Exchange
is required prior any conversion of Debentures that would result in
a holder holding more than 9.9% of the issued and outstanding
common shares of the Corporation and prior to the settlement of any
interest payment in common shares. The second tranche of the
Offering is expected to close on or before August 25, 2022.
Insiders of the Company participated in the first tranche of the
Offering purchasing an aggregate of $506,000 principal amount of Debentures. Pursuant
to Multilateral Instrument 61-101 Protection of Minority
Security Holders in Special Transactions ("MI 61-101"),
the Offering constitutes a "related party transaction" as insiders
of the Company are expected to subscribe for up to 25% of the
Debentures. The Company is relying on exemptions from the formal
valuation and minority approval requirements of MI 61-101. The
Company did not file a material change report more than 21 days
before the closing of the Offering as the details of the related
parties' participation in the Offering had not been settled. The
Offering was approved by all of the independent directors of the
Company.
The Company paid finder's fees totaling $47,373 and issued 118,055 finder's warrants
(each, a "Finder's Warrant") to arm's length parties,
including Cormark Securities Inc., in connection with the first
tranche of the Offering. Each Finder's Warrant entitles the holder
to purchase one Common Share at a price of $1.02 for a period of two years from
issuance.
This news release does not constitute an offer to sell or the
solicitation of an offer to buy the securities in the United States. The securities have not
been and will not be registered under the United States Securities
Act of 1933, as amended (the "U.S. Securities Act"), or any
state securities laws and may not be offered or sold in
the United States or to U.S.
Persons unless registered under the U.S. Securities Act and any
applicable state securities laws or an exemption from such
registration is available.
ABOUT SPECTRA7 MICROSYSTEMS INC.
Spectra7 Microsystems Inc. is a high-performance analog
semiconductor company delivering unprecedented bandwidth, speed,
and resolution to enable disruptive industrial design for leading
electronics manufacturers in data centers, 5G infrastructure,
virtual and augmented reality, and other connectivity markets.
Spectra7 is based in San Jose,
California with a design center in Cork, Ireland and technical support location
in Dongguan, China. For more
information, please visit www.spectra7.com.
Neither the TSX Venture Exchange nor its regulation services
provided (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
CAUTIONARY NOTES
Certain statements contained in this press release constitute
"forward-looking statements". All statements other than statements
of historical fact contained in this press release, including,
without limitation, the Company's anticipated closing date of a
second tranche of the Offering and the Company's ability to sell
the remaining Debentures in the Offering, the Company's strategy,
plans, objectives, goals and targets, and any statements preceded
by, followed by or that include the words "believe", "expect",
"aim", "intend", "plan", "continue", "will", "may", "would",
"anticipate", "estimate", "forecast", "predict", "project", "seek",
"should" or similar expressions or the negative thereof, are
forward-looking statements. These statements are not historical
facts but instead represent only the Company's expectations,
estimates and projections regarding future events. These statements
are not guarantees of future performance and involve assumptions,
risks and uncertainties that are difficult to predict. Therefore,
actual results may differ materially from what is expressed,
implied or forecasted in such forward-looking statements.
Additional factors that could cause actual results, performance or
achievements to differ materially include, but are not limited to
the risk factors discussed in the Company's annual information form
for the year ended December 31, 2021.
Management provides forward-looking statements because it believes
they provide useful information to investors when considering their
investment objectives and cautions investors not to place undue
reliance on forward-looking information. Consequently, all of the
forward-looking statements made in this press release are qualified
by these cautionary statements and other cautionary statements or
factors contained herein, and there can be no assurance that the
actual results or developments will be realized or, even if
substantially realized, that they will have the expected
consequences to, or effects on, the Company. These forward-looking
statements are made as of the date of this press release and the
Company assumes no obligation to update or revise them to reflect
subsequent information, events or circumstances or otherwise,
except as required by law.
For more information, please contact:
Matt Kreps/Jim Fanucchi
Darrow Associates
214-597-8200
ir@spectra7.com
Spectra7 Microsystems Inc.
Bonnie Tomei
Chief Financial Officer
669-212-1089
ir@spectra7.com
Spectra7 Microsystems Inc.
John Mitchell
Public Relations
650-269-3043
pr@spectra7.com
SOURCE Spectra7 Microsystems Inc.