RYU Apparel Inc., creator of urban athletic apparel, announced that it proposes a non-brokered private placement offering (the “Offering”) to raise up to $6,000,000 by the issuance of up to 80,000,000 units (each, a “Unit”) at a price of $0.10 per Unit less the maximum discount of 25 percent permitted under TSXV policies in one or more tranches.
The company has received several calls from investors inquiring as to whether a stock consolidation is being proposed by the company at this time. In response, management would like to advise the market that a stock consolidation is currently not being considered by the company.
Each Unit of the Offering will be comprised of one common share in the capital of the company (each, a “Common Share”) and one transferable common share purchase warrant (each, a “Warrant”) being exercisable into one Common Share at a price of $0.15 per share for a period of three (3) years from closing, subject to an acceleration provision of the company whereby, in the event the company’s common shares have a closing price on the TSX Venture Exchange (the “Exchange”) (or such other exchange on which the shares may be traded at such time) of greater than $0.30 per share for a period of 5 consecutive trading days at any time after four months and one day from the closing date, the company may accelerate the expiry date of the warrants by giving notice via news release to the holders thereof and, in such case, the warrants will expire on the 30th day after the date on which the news release is disseminated by the company.
There is no minimum aggregate proceeds amount that is required to close the Offering. Management anticipates that the company will allocate the proceeds of the Offering as follows: 15 percent for expansion of new stores, 35 percent for inventory, 22 percent for manpower, 11 percent for brick and mortar rent, and 17 percent for general working capital purposes.
The Offering will be conducted under available exemptions from the prospectus requirements of applicable securities legislation and participation in the Offering will be available to existing shareholders in qualifying jurisdictions in Canada in accordance with the provisions of Multilateral CSA Notice 45-313 and BC Instrument 45-354 (the “Existing Shareholder Exemption”). The company has set January 22, 2019 as the record date for the purpose of determining shareholders entitled to participate in the Offering in reliance on the Existing Shareholder Exemption. Qualifying shareholders who wish to participate in the Offering should contact the company at the contact information set forth below. If the Offering is over-subscribed for, units will be allocated pro-rata amongst all subscribers. In addition to conducting the Offering pursuant to the Existing Shareholder Exemption, the Offering will also be conducted pursuant to other available prospectus exemptions. Insiders may participate in the Offering.
In addition to the Existing Security Holder Exemption and other available prospectus exemptions, a portion or all of the offering may be completed pursuant to Multilateral CSA Notice 45-318 – Prospectus Exemption for Certain Distributions through an Investment Dealer (“CSA 45-318”) and the corresponding blanket orders and rules implementing CSA 45- 318 in the participating jurisdictions in respect thereof (collectively with CSA 45-318, the “Investment Dealer Exemption”). As at the date hereof, the Investment Dealer Exemption is available in each of Alberta, British Columbia, Saskatchewan, Manitoba and New Brunswick. Pursuant to CSA 45-318, each subscriber relying on the Investment Dealer Exemption must obtain advice regarding the suitability of the investment from a registered investment dealer. There is no material fact or material change of the company that has not been generally disclosed.
All securities issued pursuant to the Offering will be subject to a statutory hold period expiring four months and one day after closing of the Offering. Completion of the Offering is subject to a number of conditions, including, without limitation, receipt of all regulatory approvals, including approval of the Exchange.
None of the securities issued in the Offering will be registered under the United States Securities Act of 1933, as amended (the “1933 Act”), and none of them may be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the 1933 Act. This press release shall not constitute an offer to sell or a solicitation of an offer to buy nor shall there be any sale of the securities in any state where such offer, solicitation, or sale would be unlawful.