Chemaphor Inc.
TSX VENTURE : CFR

Chemaphor Inc.

April 30, 2009 16:00 ET

Chemaphor Inc. Completes Private Placement

OTTAWA, ONTARIO--(Marketwire - April 30, 2009) - Chemaphor Inc. (TSX VENTURE:CFR), today announced that it completed a private placement resulting in gross proceeds of $380,000.

Chemaphor issued convertible secured debentures in the principal amount of $380,000. The debentures will bear interest at a rate of 13.00% per annum and will mature on December 31, 2010. Each debenture will be convertible into common shares at the option of the holder at any time prior to maturity at a conversion price of $0.185 per common share, subject to adjustment for anti-dilution protections.

After December 31, 2009 and on or prior to December 31, 2010, the debentures may be redeemed in whole or in part from time to time at the option of Chemaphor at a 5% premium to the principal amount plus accrued and unpaid interest thereon, if any, provided that the 20-day volume weighted average price of the common shares on the TSX Venture Exchange on the date on which the notice of redemption is given is not less than 250% of the conversion price then applicable to the debentures. Subject to prior approval of the TSX Venture Exchange, upon the occurrence of a change of control involving the acquisition of voting control or direction over 66 2/3% or more of the outstanding common shares of Chemaphor by any person or group of persons acting jointly or in concert, holders of debentures have the right to require Chemaphor to repurchase their debentures, in whole or in part, at a price equal to 110% of the principal amount of such debentures plus accrued and unpaid interest.

Chemaphor has the option, subject to prior approval of the TSX Venture Exchange, to satisfy interest payments by delivery of that number of common shares obtained by dividing the interest payment by the market price of the common shares on the TSX Venture Exchange at the time of settlement (determined in accordance with TSX Venture Exchange rules). Chemaphor also has the option to satisfy its obligation to repay the principal or any premium on the debentures by delivery of that number of common shares obtained by dividing the principal amount by 95% of the then current market price of the Common Shares on the TSX Venture Exchange (as defined in the policies of the TSX Venture Exchange). Any issuance of common shares in settlement of principal or premium based on a price per share that is less than $0.185 is subject to prior approval of the TSX Venture Exchange.

In connection with the offering Chemaphor also issued an aggregate of 1,027,023 common share purchase warrants. Each warrant entitles the holder to purchase one common share for a purchase price of $0.20 until April 30, 2014.

Chemaphor paid a total of $37,500 in cash commissions and issued a total of 202,703 agent warrants to agents that assisted in the private placement. The cash commission represents 10% of the gross proceeds of the financing brought in by such agents and the warrants are exercisable for 10% of the number of common shares issuable on conversion of the debentures sold to investors brought in by such agents. Each agent warrant is exercisable to purchase a common share of Chemaphor for a purchase price of $0.20 until April 30, 2014.

The securities issued under this private placement are subject to restrictions on transfer, including a hold period ending on August 31, 2009.

The net proceeds of the proposed offering will be used to fund working capital and research and development expenditures and for general corporate purposes.

About Chemaphor

Chemaphor Inc. (www.chemaphor.com) uses its core expertise in organic chemistry to develop premium products for the animal health, skin care cosmetics, pharmaceutical and specialty chemical markets. Chemaphor's focus is on two proprietary products, a non-pharmaceutical product OxBC, and a lead cancer drug compound OCL-1. Chemaphor's goal is to fully exploit its proprietary platform of carotenoid oxidation compounds by finding recognized partners to commercialize its products in multiple, large markets.

Neither 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

  • Evolution Group
    514-448-4887
    866-703-4887 (toll free)
    514-906-2428 (FAX)
    www.evolutiongrp.com
    or
    Chemaphor Inc.
    Dr. Graham Burton
    613-990-0969