Burcon NutraScience Corporation (TSX:BU)
(NASDAQ:BUR) ("
Burcon") is pleased to announce
that it will be offering rights (the "
Rights
Offering") to holders of its common shares
("
Common Shares") of record at the close of
business on November 3, 2016 (the "
Record Date").
Pursuant to the Rights Offering, each holder of Common Shares will
receive one transferable right (a "
Right")
for each Common Share held. Every 18 Rights will entitle a holder
to purchase one Common Share at a price of $2.58 (the
"
Subscription Price"). The Subscription Price is
equal to approximately an 18.5% discount to the volume weighted
average trading price of the Common Shares on the Toronto Stock
Exchange (the "
TSX") for the 5 day period ending
on October 20, 2016. A maximum of 1,990,708 Common Shares will be
issued pursuant to the Rights Offering, representing approximately
5.6% of the currently issued and outstanding Common Shares. The
Rights Offering will be conducted in Canada only and in those
jurisdictions where Burcon may lawfully offer the Rights. No
fractional Common Shares will be issued.
A Rights Offering notice (the
"Notice"), together with a Rights certificate,
will be mailed to registered holders of Common Shares as of the
Record Date. Full details of the Rights Offering, including
information regarding the distributions of the Rights and the
procedures to be followed, are included in the Rights Offering
circular, which will be filed today, together with the Notice,
under Burcon's profile on SEDAR at www.sedar.com. To
subscribe for Common Shares, a completed Rights certificate,
together with payment in full of the Subscription Price for each
Common Share subscribed for, must be received by the subscription
agent for the Rights Offering, Computershare Investor Services
Inc., prior to the expiry of the Rights at 5:00 p.m. (Toronto time)
on November 30, 2016. Shareholders who own their Common Shares
through an intermediary, such as a bank, trust company, securities
dealer or broker, will receive materials and instructions from
their intermediary.
The Rights and the Common Shares issuable upon
exercise of the Rights will be listed on the TSX. The Rights will
be listed for trading on the TSX beginning on November 1, 2016
under the symbol "BU.RT". Trading in the Rights on the TSX will
cease at 12:00 p.m. (Toronto time) on November 30, 2016.
The Rights Offering will include an additional
subscription privilege under which holders of Rights who fully
exercise their Rights will be entitled to subscribe pro rata for
additional Common Shares, if available, that were not otherwise
subscribed for in the Rights Offering.
The estimated net proceeds of the Rights
Offering, assuming full exercise of the Rights and after deducting
expenses, will be approximately $5 million. The estimated net
proceeds of the Rights Offering will be used to fund Burcon’s
ongoing and expanded research and development program, further
strengthen and expand its intellectual property portfolio and for
general working capital. Burcon’s research and development will be
focused on its Peazazz® pea protein extraction and purification
technology. Burcon will continue its discussions with a select
group of potential strategic partners to commercialize
Peazazz®. Research and development work, ranging from
applications work to shelf-life testing, is and will continue to be
undertaken to provide samples to these parties for potential market
applications for Peazazz®.
In connection with the Rights Offering, Burcon
has entered into a standby commitment agreement (the
"Standby Commitment Agreement") with ITC
Corporation Limited ("ITC") and Mr. Allan Yap
("Mr. Yap"), Burcon’s Chairman and Chief Executive
Officer. Pursuant to the Standby Commitment Agreement, ITC and Mr.
Yap, have agreed, subject to certain conditions, to purchase from
Burcon such number of Common Shares that are available to be
purchased, but not otherwise subscribed for under the Rights
Offering, that will result in 1,990,708 Common Shares being issued
under the Rights Offering (the "Standby
Commitment"). A copy of the Standby Commitment Agreement
will be filed today under Burcon's profile on SEDAR at
www.sedar.com.
As compensation for providing the Standby
Commitment, each of ITC and Mr. Yap is entitled to receive
non-transferrable Common Share purchase warrants
(the "Standby Warrants") entitling ITC to
acquire up to 253,815 Common Shares and Mr. Yap to acquire up to
243,862 Common Shares at an exercise price of $2.58 per share. The
Standby Warrants will expire two years after issuance. In
accordance with the policies of the TSX, the exercise of the
Standby Warrants by each of ITC and Mr. Yap is subject to
shareholder approval, which will be sought at Burcon's next annual
meeting, which is expected to be held in September 2017.
This press release does not constitute an offer
to sell or the solicitation of an offer to buy any of the
securities described herein, nor shall there be any sale of these
securities in any state or jurisdiction in which such an offer,
solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of any such jurisdiction.
Such securities, including the securities sold pursuant to the
Standby Commitment Agreement, have not been registered under the
U.S. Securities Act of 1933, as amended, and may not be offered or
sold in the United States or to U.S. Persons absent registration
under the United States Securities Act of 1933, as amended
(the "U.S. Securities Act") and applicable
state securities laws, or absent an available exemption from such
registration requirements.
About Burcon NutraScience Corporation
Burcon is a leader developing functionally
superior plant-based proteins. Burcon has developed a portfolio of
composition, application, and process patents originating from a
core protein extraction and purification technology. Burcon's
CLARISOY™ soy protein offers clarity and high-quality protein
nutrition for low pH beverage systems; Peazazz® is a uniquely
soluble and clean-tasting pea protein; and Puratein®, Supertein™
and Nutratein® are canola protein isolates with unique functional
and nutritional attributes. For more information about Burcon,
visit www.burcon.ca.
The TSX has not reviewed and does not accept
responsibility for the adequacy of the content of the information
contained herein. This press release contains forward-looking
statements or forward-looking information within the meaning of the
U.S. Private Securities Litigation Reform Act of 1995 and
applicable Canadian securities legislation. Forward-looking
statements or forward-looking information involve risks,
uncertainties and other factors that could cause actual results,
performances, prospects and opportunities to differ materially from
those expressed or implied by such forward-looking statements.
Forward-looking statements or forward-looking information can be
identified by words such as “anticipate,” “intend,” “plan,” “goal,”
“project,” “estimate,” “expect,” “believe”, “future,” “likely,”
“may,” “should,” “could”, “will” and similar references to future
periods. All statements other than statements of historical fact
included in this release are forward-looking statements, including,
without limitation, the timing and ability to complete the Rights
Offering and other intentions and plans contained in this press
release. There can be no assurance that such statements will prove
to be accurate and actual results and future events could differ
materially from those anticipated in such statements or
information. Important factors that could cause actual results to
differ materially from Burcon’s plans and expectations include the
actual results of business negotiations, marketing activities,
adverse general economic, market or business conditions, regulatory
changes and other risks and factors detailed herein and from time
to time in the filings made by Burcon with securities regulators
and stock exchanges, including in the section entitled “Risk
Factors” in Burcon’s annual information form dated June 27, 2016
filed with the Canadian securities administrators on www.sedar.com
and contained in Burcon’s 20-F filed with the U.S. Securities and
Exchange Commission on www.sec.gov. Any forward-looking statement
or information only speaks as of the date on which it was made and,
except as may be required by applicable securities laws, Burcon
disclaims any intent or obligation to update any forward-looking
statement, whether as a result of new information, future events or
otherwise. Although Burcon believes that the assumptions inherent
in the forward-looking statements are reasonable, forward-looking
statements are not guarantees of future performance, and
accordingly, investors should not rely on such statements.
CLARISOY is a trademark of Archer Daniels Midland Company.
Media & Industry Contact:
Michael Kirwan
Director, Corporate Development
Burcon NutraScience Corporation
Tel (604) 733-0896, Toll-free (888) 408-7960
mkirwan@burcon.ca
www.burcon.ca
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