Finance & Investing | Capital Markets

NZEC Closes $16.1MM Private Placement Following Acquisition

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New Zealand Energy Corp., in connection with its latest asset acquisition, has closed a $16.1 million non-brokered private placement, raising $1.1 million more than the original $15 million objective.

The funds raised, $8.2 million will be used for financing costs and general working capital while the remainder was used to finance the Acquisition (plus a $6 million deposit paid previously).

The Company issued 48.9 million subscription receipts at a price of $0.33 per Subscription Receipt. The Subscription Receipts are convertible into units consisting of one common share and one-half of one non-transferable share purchase warrant (each whole warrant referred to as a "Warrant") of the Company. Each Warrant will entitle the holder to acquire one Share at a price of $0.45 with an expiry date of October 28, 2014.

NZEC will file a short form prospectus with the applicable regulatory authorities in each of the provinces of Canada where Subscription Receipts were sold. Each Subscription Receipt will automatically convert into one Unit on the date that a final receipt for the prospectus has been issued by the applicable regulatory authorities. The Shares and the Shares underlying the Warrants will be free-trading on conversion of the Subscription Receipts and exercise of the Warrants.

In relation to the private placement, NZEC paid $1 million in finder's fees and issued three million finder's special warrants. The special warrants will automatically convert into finder's warrants on the date that a final receipt for the prospectus has been issued by the applicable regulatory authorities. Each finder's warrant entitles the finder to acquire one Share at an exercise price of $0.33 with an expiry date of October 28, 2014. The Shares underlying the finder's warrants will be free-trading on conversion of the special warrants and exercise of the finder's warrants.