40 million is closed
Neptune Digital Assets closes $40M share issuance
2021-04-16 17:13 ET - News Release
Mr. Cale Moodie reports
NEPTUNE DIGITAL CLOSES CDN$40 MILLION INSTITUTIONAL CAPITAL RAISE TO ACCELERATE GROWTH
Neptune Digital Assets Corp. has closed its previously announced sale to United States and foreign institutional investors of its common shares and warrants to purchase common shares for aggregate gross proceeds to the company of approximately $40-million. Pursuant to the Private Placement, the company issued 29,630,002 common shares and warrants to purchase up to 14,815,001 common shares at a purchase price of Cdn$1.35 per common share and associated half warrant. Each whole warrant entitles the holder thereof to purchase one common share at an exercise price of Cdn$1.75 per common share at any time on or before April 16, 2024 (totaling another approximately Cdn$26 million once exercised).
"We are very pleased to complete this equity financing well above our 20-day volume weighted average price. We have held back from doing any major financing since 2018 in order to minimize dilution to our shareholders. This equity financing marks an important milestone in the growth trajectory for Neptune and this capital will enable Neptune to rapidly advance its business plan, substantially grow our earnings and pursue a variety of new and exciting projects in both proof-of-stake and proof-of-work mining. We are also very pleased to expand our institutional shareholder presence in the United States and abroad", commented Cale Moodie, President and CEO, who managed this process for Neptune.
H.C. Wainwright & Co. acted as the exclusive placement agent for the Private Placement.
H.C. Wainwright & Co. received (i) a cash commission of approximately Cdn$2.8 million (equal to ??7.0 of the gross proceeds of the Private Placement) and (ii) 2,222,250 non-transferable compensation warrants (the "Agent warrants"). Each Agent warrant entitles the holder thereof to purchase one common share at an exercise price of Cdn$1.6875 per common share at any time on or before April 16, 2024.
The company intends to use the net proceeds of the Private Placement to fund the development of a 5MW clean tech Bitcoin mining facility (i.e., negotiate property leases, purchase mining hardware, purchase containers for mining equipment, negotiate power purchase agreements with renewable energy providers and build out facilities and power infrastructure), to complete one or more purchases of Bitcoin mining servers over the course of 2021, to invest in proof-of-stake mining (such as blockchain infrastructure and their associated token ecosystems) and for working capital and general corporate purposes. Details as to the intended specific allocation of the proceeds are disclosed in the Prospectus Supplement referred to below and further business development announcements will be made by Neptune in due course as they arise.
The common shares and warrants issued under the Private Placement were qualified by way of a prospectus supplement dated April 14, 2021 under the company's base shelf prospectus dated April 12, 2021 (collectively, the "Prospectus Supplement") which was filed in the province of British Columbia, copies of which are available under the company's profile at www.sedar.com.
The common shares and warrants were offered and sold in the United States on a private placement basis pursuant to exemptions from the registration requirements of the United States Securities Act of 1933, as amended (the "U.S. Securities Act") and all applicable state securities laws, and in certain other jurisdictions in accordance with applicable securities laws. No securities were offered or sold to Canadian purchasers. The Private Placement remains subject to the final acceptance of the TSX Venture Exchange.
The securities issued under the Private Placement are subject to resale restrictions in the United States under applicable U.S. federal and state securities laws with no resale restrictions in Canada.