/NOT FOR DISSEMINATION IN THE UNITED
STATES. FAILURE TO COMPLY WITH THIS RESTRICTION MAY
CONSTITUTE A VIOLATION OF UNITED
STATES SECURITIES LAW./
CALGARY, Dec. 27, 2017 /CNW/ - Return Energy Inc.
("Return" or the "Company") (TSX-V: "RTN") is pleased
to announce that it has closed its previously announced
non-brokered private placement (the "Unit Offering")
of 66,666,666 units of the Company ("Units") at a price of
$0.075 per Unit for aggregate gross
proceeds of $4,999,999.95 with Vertex
Managed Value Portfolio ("VMVP"), a fund managed by Vertex
One Asset Management Inc. ("Vertex"). Additionally,
the Company has issued 1,460,689 common shares ("FT Shares")
on a flow-through basis at a price of $0.10 per FT Share for aggregate gross proceeds
of $146,068.90 pursuant to its
previously announced non-brokered private placement of Canadian
exploration expense flow-through shares (the "FT Offering"
and together with the Unit Offering, the
"Offerings").
The proceeds of the Offerings will be used by Return to further
its development activities in the Rycroft, Gordondale and Valhalla areas of Alberta. The completion of the Offerings is
subject to the Company receiving all necessary regulatory
approvals, including final approval from the TSX Venture Exchange
(the "TSXV"). All securities issued under the Offerings,
including securities issuable on exercise thereof, are subject to a
hold period expiring four months and one day from the date
hereof.
Unit Offering
Further to the Company's news release dated December 27, 2017, the shareholders of the
Company approved an ordinary resolution authorizing the Unit
Offering and the creation of VMVP as a "control person" of the
Company, as such term is defined by the policies of the
TSXV.
Upon completion of the Unit Offering, VMVP acquired ownership of
66,666,666 Units. Each Unit issued under the Unit Offering
consisted of one common share in the capital of the Company (a
"Common Share") and one Common Share purchase warrant (a
"Warrant"). Each Warrant entitles the holder thereof
to purchase one Common Share at a price of $0.10 per Common Share (the "Warrant
Exercise Price") at any time up to 5:00 p.m. (Calgary time) on or before the earlier of the
date that is: (a) five years from the closing date of the Offering,
and (b) 30 days after the giving of the Early Termination Notice
(as defined herein) by the Company. If the volume-weighted
average price of the Common Shares on the TSX Venture Exchange (the
"TSXV") exceeds the Warrant Exercise Price by at least 200%
for a minimum of 20 consecutive trading days (whether or not
trading of the Common Shares occurs on such days, provided that the
Common Shares trade on at least fifteen of such trading days and
the total value of Common Shares traded during such periods is
greater than $1,500,000), the
Warrants will be subject to, at the option of the Company, an
accelerated expiry date that is 30 days after the date on which the
Company provides notice to holders of Warrants of such accelerated
expiry date (the "Early Termination Notice").
As a result of the completion of the Unit Offering, VMVP
acquired 66,666,666 common shares of the Company ("Common
Shares"), representing 60.30% of the issued and outstanding
Common Shares. Prior to the completion of the Unit Offering, VMVP
did not hold any securities of the Company. Under the Unit
Offering, VMVP acquired 66,666,666 Warrants. If all Warrants
held by VMVP were exercised, VMVP would own 133,333,332 Common
Shares, representing 75.24% of the outstanding Common Shares.
VMVP is an affiliate of another fund managed by Vertex called
Vertex Value Fund ("VVF"). VVF currently owns
8,333,400 Common Shares and 8,333,400 warrants to purchase Common
Shares. As the fund manager of both VMVP and the VVF, Vertex
has control over the securities of the Company held by VMVP and
VVF. Prior to the completion of the Offerings, Vertex
exercised control over 19.64% of the outstanding Common
Shares. As a result of the completion of the Offerings,
Vertex now exercises control over 75,000,066 Common Shares,
representing 67.84% of the outstanding Common Shares, and
representing a change of 48.20% in the number Common Shares
controlled by Vertex. If all warrants to purchase Commons
Shares held by VMVP and VVF were exercised, Vertex would exercise
control over 150,000,132 Common Shares, representing 80.84% of the
outstanding Common Shares.
VMVP's participation in the Offering resulted in VMVP becoming a
"control person" of the Company and constituted a "related party
transaction" under Multilateral Instrument 61-101 - Protection
of Minority Security Holders in Special Transactions ("MI
61-101") and TSXV Policy 5.9. The Unit Offering and
VMVP's participation in such offering were approved by 91.05% of
disinterested shareholders and 91.05% of minority shareholders at
the special meeting of shareholders of the Company held on
December 27, 2017 (the "Special
Meeting"). For more details on the results of the Special
Meeting, please see the news release of the Company dated
December 27, 2017.
The registered address of VMVP, VVF and Vertex is Suite 3200,
1021 West Hastings Street, Vancouver,
BC, V6E 0C3. VMVP, VVF and Vertex intend to review and
evaluate their investment in the securities of the Company on an
ongoing basis and may, depending upon their evaluation of the
business and prospectus of Return, or such other considerations as
they may deem relevant, determine to increase, decrease or dispose
of their holdings.
Neither the 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.
Reader Advisories
Forward-Looking Statements. This news release contains
forward-looking statements and information. More particularly, this
document contains statements and information concerning the closing
of the Offering and the use of proceeds. Forward-looking
information is frequently characterized by words such as "plan",
"expect", "project", "intend", "will", "believe", "anticipate",
"estimate", "scheduled", "potential", or other similar words, or
statements that certain events or conditions "may", "should" or
"could" occur. The forward-looking statements and information
are based on certain key expectations and assumptions made by
Return, including expectations and assumptions concerning timing of
receipt of required regulatory approval and the use of proceeds
from the Offerings. Although Return believes that the expectations
and assumptions on which the forward-looking statements are based
are reasonable, undue reliance should not be placed on the
forward-looking statements because Return can give no assurance
that they will prove to be correct. Since forward-looking
statements address future events and conditions, by their very
nature they involve inherent risks and uncertainties. Actual
results could differ materially from those currently anticipated
due to a number of factors and risks. These include, but are not
limited to, risks that required regulatory approvals are not
obtained. The reader is cautioned that assumptions used in
the preparation of such information, although considered reasonable
by the Company at the time of preparation, may prove to be
incorrect and readers are cautioned not to place undue reliance on
forward-looking information, which speaks only as of the date
hereof. The Company does not undertake any obligation to release
publicly any revisions to forward-looking information contained
herein to reflect events or circumstances that occur after the date
hereof or to reflect the occurrence of unanticipated events, except
as may be required under applicable securities laws.
This news release shall not constitute an offer to sell or
the solicitation of an offer to buy, nor shall there be any sale of
securities in the United States or
in any province, state or jurisdiction in which such offer,
solicitation or sale would be unlawful prior to the registration or
qualification under securities laws of any such province, state or
jurisdiction. The securities referenced herein may not be
offered or sold in the United
States except in transaction exempt from or not subject to
the registration requirements of the United States Securities Act
of 1933, as amended, and applicable state securities laws.
This news release is not to be disseminated in the United States.
SOURCE Return Energy Inc
