Spectra7 Microsystems Inc (SEV)

[futrcash]

Spectra7 Announces Brokered Private Placement
April 12 2021 - 08:55AM
PR Newswire (Canada)


TORONTO, April 12, 2021 /CNW/ -- (TSXV:SEV) Spectra7 Microsystems Inc. ("Spectra7" or the "Company"), a leading provider of high-performance analog semiconductor products for broadband connectivity markets, announces that it intends to sell, on a brokered private placement basis, in one or more tranches, up to 220,000,000 units (the "Units"). The Company has engaged Cormark Securities Inc. (the "Agent") to offer the Units for sale on a best efforts agency basis. The issuance price of the Units will be determined in the context of the market.

(PRNewsfoto/Spectra7 Microsystems Inc.)

Each Unit will consist of one common share in the capital of the Company (each, a "Common Share") and one common share purchase warrant (each, a "Warrant") with each Warrant being exercisable into one Common Share at an exercise price of $0.05 for a period of five years from the date of issuance, subject to adjustment upon certain customary events. The expiry date of the Warrants can be accelerated by the Company at any time following the date that is four months and one day after the closing of the Private Placement and prior to the expiry date of the Warrants if the closing price of the Common Shares on the TSX Venture Exchange is greater than $0.08 for any 10 non-consecutive trading days. Interest in the Units has been expressed by both insiders of the Company as well as outside investors at $0.03 per Unit.

The Agent is entitled to receive a cash commission equal to 7% of the aggregate proceeds raised in the Private Placement and broker warrants entitling the Agent to purchase such number of Units as is equal to 7% of the aggregate of number of Units issued in the Private Placement at the issue price for a period of two years from closing.

The Offering is expect to close on or about May 7, 2021. The net proceeds from the Private Placement are intended to be used for working capital to support revenue growth, the payment of interest on its outstanding convertible debentures and for general corporate purposes.

"Our outlook is for significant revenue growth in the second-half of this year and into 2022, driven by strong adoption of Spectra7 Active Copper Cable solutions in next-generation Data Centers", said Raouf Halim, CEO of Spectra7. "We expect that proceeds from this Private Placement will fund our working capital needs to support our growth to cash profitability and beyond".

Pursuant to Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions ("MI 61-101"), the Private Placement constitutes a "related party transaction" as insiders of the Company are expected to subscribe for up to 25% of the Units. The Company is relying on exemptions from the formal valuation and minority approval requirements of MI 61-101.

The closing of the Private Placement is subject to certain conditions including, but not limited to, the receipt of all necessary approvals including the approval of the TSX Venture Exchange.

All dollar amounts in this news release are denominated in Canadian dollars unless otherwise indicated.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy the securities in the United States nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "1933 Act"), or any state securities laws and may not be offered or sold in the United States unless registered under the 1933 Act and any applicable securities laws of any state of the United States or an applicable exemption from the registration requirements is available.

futr