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TSX-Venture Exchange: RRL
CALGARY, Feb. 21, 2018 /CNW/ - Relentless Resources Ltd.
("Relentless" or the "Company") is pleased to
announce: (i) a non-brokered private placement of up to an
aggregate of $7.5million (the
"Private Placement"); (ii) the appointment of Mr.
Stanley J. Swiatek to the board of
directors in connection with the completion of the Private
Placement; and (iii) subject to regulatory approval, a rights
offering (the "Rights Offering", and collectively with the
Private Placement, the "Recapitalization Financing") to
holders of common shares ("Common Shares") of the
Company.
Private Placement
Pursuant to the Private Placement, the board of directors,
officers, other insiders of the Company (collectively, the
"Insider Group"), together with additional subscribers
identified by the Insider Group, will subscribe for approximately
111,111,111 units (the "Units") of the Company at a
price of $0.0675 per Unit for total
proceeds of approximately $7.5
million. Each Unit shall be comprised of one Common Share
and, in the case of subscriptions by the Insider Group, one Common
Share purchase warrant (a "Warrant") and, in the case of all
other subscribers, one-half of one Warrant. Each whole Warrant will
entitle the holder to purchase one Common Share at a price of
$0.10 for a period of five years. The Warrants will vest and
become exercisable as to one-third upon the 20-day weighted average
trading price of the Common Shares (the "Market Price")
equaling or exceeding $0.12, an
additional one-third upon the Market Price equaling or exceeding
$0.16 and a final one-third upon the
Market Price equaling or exceeding $0.20. The completion of the Private Placement is
expected to occur on or about March 21,
2018, and may be completed in one or more tranches (the
"Closing").
Rights Offering
Upon completion of the Private Placement, the Company's
shareholders will be entitled to participate in the Rights
Offering, which is expected to be conducted by way of a Rights
Offering Circular. Pursuant to the Rights Offering, each
shareholder as of the record date for such offering (the "Record
Date") will be issued one right ("Right") for each
Common Share held on the Record Date, entitling that holder to
purchase one Unit for every four Rights held at a price of
$0.0675 per Unit at or before the
expiry time of the Rights Offering, following which, all
outstanding Rights shall terminate and expire. Each Unit will be
comprised of one Common Share and one-half of one Warrant. The
Warrants issued pursuant to the Rights Offering will be on the same
terms as those issued pursuant to the Private Placement (including
with respect to vesting provisions). Subscribers of Units under the
Private Placement will have a right to participate in the Rights
Offering with respect to any securities acquired pursuant to the
Private Placement.
Recapitalization
There are currently 92,350,484 Common Shares issued and
outstanding. Assuming the exercise of all existing stock options
and warrants, there will be approximately 102,893,340 Common Shares
outstanding. Upon completion of the Recapitalization Financing
(assuming the Private Placement is fully subscribed, the Rights are
fully exercised and all existing Relentless shareholders' Rights
are fully exercised), there will be approximately 254,326,994
Common Shares outstanding, and assuming the exercise of all
Warrants issued in connection with the Private Placement and the
Rights Offering (assuming the Insider Group acquires 44,444,444
Units in the Private Placement), there will be approximately
368,080,326 Common Shares outstanding.
Proceeds from the Recapitalization Financing will be used to
establish a presence of the Company in the Canadian cannabis sector
by: (i) making investments and deposits in connection with letters
of intent signed with strategic cannabis investment opportunities;
and (ii) for working capital and general corporate purposes. For
more information, see "Corporate Strategy".
The Recapitalization Financing is subject to applicable
regulatory approval, including the approval of the TSX Venture
Exchange ("TSXV").
New Director
Upon completion of the Private Placement, Stanley J. Swiatek will join the board of
directors of Relentless. Mr. Swiatek is the former CEO and a
current member of the board of directors of Sundial Growers.
Mr Swiatek was an early Applicant (78th) under Health Canada's
Access to Cannabis for Medical Purposes Regulations
("ACMPR"). Mr. Swiatek is a founder of Sundial Growers and
was instrumental in building it into the second largest Licensed
Producer in Alberta, with
operations also in British
Columbia. Mr. Swiatek is a Member of the Alberta Provincial
Government Cannabis Roundtable, as well as the Health Canada
Cannabis Roundtable. He has over 40 years' experience in
construction, development and commercial greenhouse agricultural
operations. In December 2017, Mr.
Swiatek joined the board of directors of Grunewahl Organics, a
Pre-licensed Health Canada Applicant.
Corporate Strategy
With the appointment of Mr. Swiatek to the board of directors
and the proceeds from the Recapitalization Financing, the Company
will be well positioned to build and maintain a diversified
portfolio of cannabis-sector businesses. The Company's growth
strategy will initially include the production, distribution and
sale of cannabis in all acceptable forms, through the acquisition
of, or an investment in, a licensed producer or a late stage
applicant to become licensed producer under ACMPR, following which,
the Company will work towards the investment and development of
ancillary products and services for the fast-growing cannabis
market, and pursue the acquisition of complementary production and
manufacturing facilities.
Key to the successful execution of the Company's growth strategy
is the acquisition, build-out and operation of production
facilities capable of producing cannabis of a consistent and
reliable quality to meet both the regulatory requirements and the
needs of medical patients and, as the law permits, other authorized
consumers. As such, the Company will initially seek to identify and
evaluate businesses with a view to negotiate an acquisition of a
licensed producer or a late stage applicant to become a licensed
producer under the ACMPR. The Company will continue to seek out
revenue generating cannabis related ventures including forging
strategic partnerships in research, packaging and distribution with
a plan to operate an integrated cannabis-sector business.
In connection with its growth strategy, it is anticipated that
the Company may appoint additional members to its board of
directors and management team who have direct operational and
strategic experience in various facets of the cannabis sector in
Canada including building value in
a highly-regulated industry. Shareholders may also be asked to
approve a change in the Company's name to reflect the renewed
business strategy of the Company.
It is anticipated that any acquisition or investment made by the
Company in the cannabis sector will be operated as a wholly-owned
subsidiary of Relentless. Relentless, as the parent company, will
continue to be engaged in the business of developing its oil and
gas assets.
The Company's future plans detailed under this section may
constitute a "Change of Business" pursuant to the policies of the
TSXV.
About Relentless Resources Ltd.
Relentless is a Calgary based
emerging oil and natural gas company, engaged in the exploration,
development, acquisition and production of natural gas and light
gravity crude oil reserves in Alberta. Relentless' Common Shares trade on
the TSXV under the symbol RRL.
Relentless' primary corporate objective is to achieve
non-dilutive growth and enhance shareholder value through internal
prospect development, strategic production acquisitions and prudent
financial management. Upon completion of the Recapitalization
Financing, the Company will pursue the corporate objective by
developing a diversified portfolio which will include a
cannabis-focused investment strategy.
Website: www.relentless-resources.com
Forward Looking and Cautionary Statements
This news release may include forward-looking statements
including opinions, assumptions, estimates, the Company's
assessment of future plans and operations, and, more particularly,
statements concerning the completion of the Recapitalization
Financing, the number of securities issued by way of the
Recapitalization Financing, the business strategy of the Company,
the change of name of the Company, use of proceeds from the
Recapitalization Financing and the appointment of additional
members to the board of directors and management of the Company.
When used in this document, the words "will," "anticipate,"
"believe," "estimate," "expect," "intent," "may," "project,"
"should," and similar expressions are intended to be among the
statements that identify forward-looking statements. The
forward-looking statements are founded on the basis of expectations
and assumptions made by the Company which include, but are not
limited to, the timing of the receipt of the required regulatory
approvals and the future operations of, and transactions completed
by the Company. Forward-looking statements are subject to a wide
range of risks and uncertainties, and although the Company believes
that the expectations represented by such forward-looking
statements are reasonable, there can be no assurance that such
expectations will be realized. Any number of important factors
could cause actual results to differ materially from those in the
forward-looking statements including, but not limited to,
regulatory and third party approvals not being obtained, the
ability to implement corporate strategies, the state of domestic
capital markets, the ability to obtain financing, changes in
general market conditions and other factors more fully described
from time to time in the reports and filings made by the Company
with securities regulatory authorities.
Neither TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
SOURCE Relentless Resources Ltd.
