VANCOUVER, British Columbia–(BUSINESS WIRE)–Doxa Energy Ltd (“Doxa” or the “Company”) (TSX Venture Exchange:DXA.V) announces that further to its press release dated October 22, 2020, the Company has completed its non-brokered financing (the “Financing”) of subscription receipts (the “Subscription Receipts”) issuing an aggregate of 14,000,000 Subscription Receipts at a price of $0.40 per Subscription Receipt generating gross proceeds of $5,600,000 The completion of the Financing satisfies a key condition precedent to the completion of the Company’s proposed reverse takeover transaction (the “Transaction”) with ProStar Geocorp Inc. (“ProStar”) (see press releases dated November 7, 2018, May 23, 2019, and October 22, 2020).
As previously disclosed, the Subscription Receipts will automatically convert immediately prior to the closing of the Transaction into one post-consolidation Doxa unit (a “Unit”). Each Doxa Unit will consist of one Doxa common share, following the completion of a 17 for 1 consolidation (a “Share”) and one-half of one transferable common share purchase warrant (each whole warrant, a “Warrant”). Each Warrant will entitle the holder to purchase, for a period of 24 months, one additional post-consolidation Share at an exercise price of $0.60. The proceeds of the Financing (the “Escrowed Funds”) are currently being held in escrow with the Company pending the satisfaction of all conditions precedent to the completion of the Transaction as set forth in the merger agreement between the Company and ProStar dated May 22, 2019, as amended, except for the release of the Escrowed Funds (collectively, the “Escrow Release Conditions”) on or before March 23, 2020, except as may be extended in accordance with the terms of the Subscription Receipts.
Finder’s fees will be paid in association with the Financing of $351,575 and an aggregate of 878,937 non-transferable finder’s warrants, each exercisable at a price of $0.40 per share for a period of 24 months from issuance. All finder’s fees will be paid by the Company upon the conversion of the Subscription Receipts into Units.
The Subscription Receipts bear a hold period expiring on February 24, 2021, but it is anticipated that the Units issued upon their conversion will be free of re-sale restrictions in connection with the Transaction.
The proceeds raised from the Financing will be used in furtherance of ProStar’s business plans, to be more particularly outlined in the Company’s management information circular for the Transaction at its upcoming annual and special shareholder meeting.
ProStar’s Chief Executive Officer Page Tucker stated, “We would like to thank existing shareholders, new investors and the syndicate of agents for their support and successful execution of a 40 percent oversubscribed financing. We now have the financial resources to support the next phase of our journey with the primary focus being to further expand our operations and significantly increase our sales and marketing initiatives. We have a great deal of momentum going into the new year and look forward to updating the investment community in the upcoming months.”
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