Sherbrook SBK Sport Corp, the hockey stick maker, has signed an exclusive investment banking mandate with Notre-Dame Capital Inc. According to the agreement, NDC as an exempt market dealer will raise on a best efforts basis a maximum of $2.5 million in private placement of 12 percent convertible unsecured debentures.
The principal of the debentures shall be convertible in units of the corporation at a price of Canadian $0.17 per unit being comprised of one common share at Canadian $0.17 and one half of a share purchase warrant. Each warrant shall entitle its holder to acquire one common share at a price of Canadian $0.25 per common share for a period of 18 months following the closing date. The accrued interests of the Debentures will be convertible in units of the Corporation at a price per unit equal to the closing price of the common shares of the Corporation on the TSX Venture Exchange the day before the conversion date.
The price per common share comprised in the units will be equal to the price per unit and the exercise price of the warrants equal to the price per unit plus a premium of 30 percent. The units will be offered to accredited investors in the provinces of Quebec, Ontario, British Columbia and Alberta. The securities issued pursuant to the Offering will be subject to a 4 month period restricted period and the Offering will be subject to regulatory approvals. The net proceeds of this offering will be used for potential acquisitions, marketing expenses and working capital purposes. SBK will pay to NDC, acting as an exempt market dealer, a cash commission of 8% of the gross proceeds and will issue non transferable broker warrants which will entitle NDC to acquire a number of common shares equal to 8 % of the principal of the Debentures divided by $0.17 at $0.17 per common share for a period of 18 months from the closing date. In addition to the initial $2.5 million private placement, NDC will assist the Corporation in its planned acquisition financing, and any and all follow on financings as needed.
“We look forward to working with such a dynamic team especially their President, Richard T. Groome who has been instrumental in the financing of so many companies in Canada and abroad. NDC answers all of our needs in terms of financing offering and their professionalism is remarkable.” said Georges Guilbault, President and CEO of SBK.
“The fact that Mr. Groome was part of the firm that financed Canstar Sports (Bauer), which was eventually sold for $430 million, will provide us with the added advantage needed in our quest to replicate the adventure” added Guilbault.
“We accepted the mandate because the market conditions are perfect for their expansion both organically and or through strategic acquisitions” said Groome. “The management team is key when it comes to the execution of the business plan and Mr. Guilbault and his team have the experience and knowledge to make it happen and we are glad to play a part in their success.”
