- Entered into an agreement with PI Financial Corp., as lead agent and sole bookrunner, on its own behalf and, if applicable, on behalf of a syndicate of agents in connection with a best efforts, private placement of up to 2,000,000 units of the Company at a price of C$1.25 per Unit for gross proceeds of up to C$2,500,000
Ottawa, Ontario–(April 6, 2021) – KWESST Micro Systems Inc. (TSXV: KWE) (OTCQB: KWEMF) (“KWESST” or “the Company”) is pleased to announce that it has entered into an agreement with PI Financial Corp., as lead agent and sole bookrunner (the “Lead Agent“), on its own behalf and, if applicable, on behalf of a syndicate of agents (together with the Lead Agent, the “Agents“) in connection with a best efforts, private placement of up to 2,000,000 units of the Company (the “Units“) at a price of C$1.25 per Unit (the “Offering Price“) for gross proceeds of up to C$2,500,000 (the “Offering“).
Each Unit will be comprised of one common share of the Company (a “Common Share“) and one Common Share purchase warrant (“Warrant“). Each Warrant shall be exercisable to acquire one Common Share (a “Warrant Share“) at a price of C$1.75 per Warrant Share for a period of 24 months from the closing of the Offering. If at any time after four (4) months and one (1) day following the Closing Date, the trading price of the Shares on the TSX Venture Exchange is equal to or exceeds $3 for a period of 10 consecutive trading days, as evidenced by the price at the close of market, the Company shall be entitled to notify the holders of Warrants of its intention to force the exercise of the Warrants. Upon receipt of such notice, the holders of Warrants shall have 30 days to exercise the Warrants, failing which the Warrants will automatically expire.
The Agents will have an option (the “Agents’ Option“) to offer for sale up to an additional 400,000 Units at the Offering Price for additional gross proceeds of up to C$500,000, which Agents’ Option is exercisable, in whole or in part, at any time up to 48 hours prior to the closing of the Offering.
The Company stated that proceeds from the financing would be used to close the acquisition of the Low Energy Cartridge non-lethal system and begin the commercialization of this product, accelerate productization of the GreyGhost micro-drone missile, ramp up the Company’s ATAK Centre of Excellence and accelerate productization of the Phantom electronic decoy.
The securities to be issued under the Offering will be offered by way of private placement in each of the provinces of Canada and such other jurisdictions as may be determined by the Company, in each case, pursuant to applicable exemptions from the prospectus requirements under applicable securities laws.
The Offering is scheduled to close on or about April 29, 2021, or such date as agreed upon between the Company and the Lead Agent (the “Closing“) and is subject to certain conditions including, but not limited to, the receipt of all necessary approvals including the approval of the Exchange. The Units to be issued under the Offering will have a hold period of four months and one day from Closing.
The securities described herein have not been, and will not be, registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act“), or any state securities laws, and accordingly, may not be offered or sold within the United States except in compliance with the registration requirements of the U.S. Securities Act and applicable state securities requirements or pursuant to exemptions therefrom. This press release does not constitute an offer to sell or a solicitation to buy any securities in any jurisdiction.
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