CEMATRIX Corporation

December 03, 2009 17:02 ET

CEMATRIX Corporation Announces Intention to Issue Units

CALGARY, ALBERTA--(Marketwire - Dec. 3, 2009) - CEMATRIX Corporation (TSX VENTURE:CVX) (the "Corporation" or "CEMATRIX") is pleased to announce that it intends to complete a non-brokered private placement (the "Private Placement") of up to 100 units (individually, a "Unit") at a price of $5,000 per Unit, for aggregate gross proceeds of $500,000, each Unit to be comprised of a $5,000 secured subordinated participation debenture (individually, a "Debenture") and 10,000 warrants (individually, a "Warrant"), each whole Warrant entitling the holder thereof to purchase one common share in the capital of the Corporation (a "Common Share"). Completion of the Private Placement is subject to receiving all regulatory approvals, including that of the TSX Venture Exchange Inc. (the "Exchange"). 

Pursuant to the terms of the Private Placement, it is expected that each Debenture will mature 3 years after the issuance thereof, subject to early repayment. CEMATRIX has agreed that 3% of its cash revenues collected will be paid quarterly against the principal outstanding under each Debenture. For each Debenture held, the holder thereof will be entitled to a quarterly distribution of $150 so long as any of the principal amounts owing under the Debentures are outstanding. Notwithstanding that the principal amounts owing under the Debentures are paid back prior to the expiry of the three year term, and subject to compliance with all applicable laws, each holder of a Debenture will be entitled to a minimum of six quarterly distributions and: (i) should re-payment of the principal amount owing under the Debentures occur between months 19 and 24 after the issuance of the Debentures, a holder of Debentures shall be entitled to one additional distribution of $150 above and beyond their quarterly distribution for each Debenture held; or (ii) should re-payment of the principal amount owing under the Debentures occur between months 25 and 36 after the issuance of the Debentures, a holder of Debentures shall be entitled to two additional distributions of $150 above and beyond their quarterly distribution for each Debenture held. 

Each Warrant issued pursuant to the Private Placement shall be exercisable for a term of three years at an exercise price of $0.15. If the average closing trading price of the Common Shares on the Exchange or other recognized exchange is equal to or greater than $0.30 for a period of 60 consecutive days, the Corporation shall have an option at its sole discretion to provide a written notice to accelerate the expiry (the "Acceleration Notice") advising the Warrant holders that they shall have 21 days following the date of the Acceleration Notice to exercise their Warrants and any unexercised Warrants after the expiry of the 21st day following the Acceleration Notice shall expire with no further rights and privileges attached thereto.

The proceeds from the Private Placement will be used to support the working capital position of the Corporation and for capital additions.

Pursuant to the Private Placement, the Corporation has engaged The Howard Group to help assist the Corporation in raising funds pursuant to the Private Placement. It is expected that the Corporation will pay The Howard Group a finder's fees of up to 10% of the gross proceeds raised from the Private Placement. 

In addition, should the Corporation raise $400,000 pursuant to the Private Placement, the Corporation has agreed, subject to regulatory approval, to engage The Howard Group as investor relations advisors. It is expected that the terms of any investor relations agreement entered into will include a monthly advisory fee for services rendered together with stock options and, in accordance with Exchange policy, will be set out in further detail by way of press release. 

The Howard Group was established in 1988 and is a boutique, full service investor relations firm that provides a select number of Canadian publicly traded micro and small cap companies with strategic direction and exposure to targeted investment audiences.

CEMATRIX is an Alberta corporation with its head offices in Calgary, Alberta. The Corporation, through its wholly owned subsidiary, is a manufacturer and supplier of technologically advanced cellular concrete products with applications in a variety of markets, including oil and gas construction and infrastructure construction. Cellular concrete provides a cost and labour saving solution as a replacement for rigid and other insulating materials in frost-susceptible or permafrost conditions. Cellular concrete is also used in void filling situations and as a replacement for granular fills and weak or unstable soils.

Forward-Looking Statement

The statements contained in this release relating to the terms and conditions of the Private Placement and the use of proceeds from the Private Placement are forward-looking. Various assumptions or factors are typically applied in drawing conclusions or making the forecasts or projections set out in forward-looking information. Those assumptions and factors are based on information currently available to CEMATRIX. The material factors and assumptions with respect to the forward-looking information contained in this release include: CEMATRIX being able to obtain the necessary regulatory and director approvals for the Private Placement and subscribers agreeing to subscribe for Units on the terms and conditions set forth in this press release. Risk factors that could cause actual results or outcomes to differ materially from the results expressed or implied by forward-looking information include: general economic and business conditions, deterioration in market conditions and changes in the regulatory regulation. CEMATRIX cautions the reader that the above list of risk factors is not exhaustive. The forward-looking information contained in this release is made as of the date hereof and CEMATRIX is not obligated to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by applicable securities laws. Actual future results may differ materially. Because of the risks, uncertainties and assumptions contained herein, investors should not place undue reliance on forward-looking information. The foregoing statements expressly qualify any forward-looking information contained herein.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Contact Information

  • CEMATRIX Corporation
    Jeffrey Kendrick
    (403) 219-0484
    The Howard Group
    Peter Weichler
    (403) 221-0912