Stonecap leads deal to fund Utah oil sands development program
By Marisa Wong
Madison, Wis., May 16 - MCW Energy Group announced it will raise about C$5 million through a private placement led by Stonecap Securities Inc.
The placement will be comprised of subscription receipts priced at C$0.50 each, according to a news release. Each subscription receipt is convertible into one unit of MCW immediately prior to the closing of MCW's amalgamation with AXEA Capital Corp. and the listing of MCW's shares on the TSX Venture Exchange.
Each unit will be comprised of one common share of MCW and half of one common share purchase warrant. Each whole warrant is exercisable into one MCW share at a price of C$0.75 for a period of 24 months following the closing of the amalgamation.
Upon closing of the amalgamation, every four MCW units shall be exchanged into one unit of AXEA. Each AXEA unit consists of one AXEA share and half of a share purchase warrant. Each whole warrant is exercisable into one AXEA share at a price of C$3.00 per share for 24 months.
The private placement is expected to close on May 31.
"The entire management team at MCW Energy Group is looking forward to the completion of this proposed reverse takeover and the conclusion of the accompanying qualifying transaction," said Jerry Bailey, chief executive officer of MCW, in the release.
"Our anticipated listing on the Toronto Venture Exchange will provide increased MCW share liquidity, as well as an opportunity for North American investors to participate in a unique, U.S.-based oil sands development, which is coupled with MCW's environmentally-friendly extraction technology."
Proceeds from the placement will be used to fund the final payment of MCW's first 250 bbl/d oil sands extraction unit to be located in the Uinta basin of Utah and for general working capital purposes.
MCW is currently listed on the Frankfurt Stock Exchange and voluntarily entered into a "quiet period" until completion of the takeover, the release said.
MCW is a Glendale, Calif.-based holding company with two principal portfolio companies, a fuel distributor and a break-through oil sand recovery venture. AXEA is a capital pool company based in Vancouver, B.C.
Issuer: | MCW Energy Group
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Issue: | Subscription receipts convertible into MCW units
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Amount: | C$5 million (approximate)
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Price: | C$0.50
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Agent: | Stonecap Securities Inc.
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Pricing date: | May 16
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Closing date: | May 31
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Stock symbol: | Frankfurt: MW4
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MCW units
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Units: | One MCW common share, half of a warrant; every four MCW units exchangeable into one AXEA unit
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Warrants: | Each whole warrant exercisable into one MCW share
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Warrant expiration: | 24 months
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Warrant strike price: | C$0.75
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AXEA units
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Units: | One AXEA common share, half of a warrant
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Warrants: | Each whole warrant exercisable into one AXEA share
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Warrant expiration: | 24 months
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Warrant strike price: | C$3.00
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