European Commercial Real Estate Limited
TSX VENTURE : ERE.P

October 07, 2016 08:36 ET

European Commercial Real Estate Limited Announces Closing of Capital Pool Company IPO and Private Placement

TORONTO, ONTARIO--(Marketwired - Oct. 7, 2016) - European Commercial Real Estate Limited (the "Corporation") (TSX VENTURE:ERE.P), a capital pool company, is pleased to announce that it has completed its initial public offering (the "Offering") of 17,700,000 common shares ("Common Shares") at a price of $0.10 per share, for gross proceeds of $1,770,000 and the closing of a concurrent private placement to the directors and officers of the Corporation (the "Private Placement") of 27,300,000 Common Shares at a price of $0.10 per share, for gross proceeds of $2,730,000. The Common Shares issued pursuant to the Private Placement will be subject to a four-month hold period.

The Common Shares were listed for trading on the TSX Venture Exchange (the "Exchange") under the trading symbol "ERE.P" at the close of business on October 6, 2016 and will commence trading at the opening of the market on October 7, 2016.

The net proceeds of the Offering and the Private Placement will be used to provide the Corporation with a minimum of funds with which to identify and evaluate assets or businesses for acquisition with a view to completing a "Qualifying Transaction" under the capital pool company program of the Exchange with a focus on commercial real estate in Western Europe.

CIBC acted as agent for the Offering. In connection with the Offering, CIBC received a commission of 7% of the aggregate gross proceeds from the sale of the common shares.

The Corporation has also granted incentive stock options to acquire Common Shares ("Options") to a total of nine directors, officers and technical consultants of the Corporation to acquire a total of 5,500,000 Common Shares. The Options may be exercised for a period of ten years at a price of $0.10 per share.

After the closing of the Offering and the Private Placement, there were 55,000,000 Common Shares issued and outstanding, of which 37,300,000 Common Shares (including 10,000,000 Common Shares that had been issued prior to the Offering) have been placed in escrow in accordance with the policies of the Exchange.

On October 7, 2016, Thomas Schwartz acquired, on a private placement basis under the Private Placement, directly and indirectly, 9,150,000 Common Shares for total consideration of $915,000 ($0.10 per share) and was granted 800,000 Options representing in aggregate 17.83% of the Corporation's outstanding Common Shares on a partially diluted basis. After the acquisition, Mr. Schwartz, owned, directly and indirectly, 11,450,000 Common Shares and 800,000 Options, representing in aggregate 21.95% of the outstanding Common Shares on a partially diluted basis.

On the same date, Phillip Burns acquired, on a private placement basis under the Private Placement8,850,000 Common Shares for total consideration of $885,000 ($0.10 per share) and was granted 2,000,000 Options representing in aggregate 19.04% of the Corporation's outstanding Common Shares on a partially diluted basis. After the acquisition, Mr. Burns, owned 11,150,000 Common Shares and 2,000,000 Options, representing in aggregate 23.07% of the outstanding Common Shares on a partially diluted basis.

On the same date, David Ehrlich acquired, on a private placement basis under the Private Placement 3,850,000 Common Shares for total consideration of $385,000 ($0.10 per share) and was granted 800,000 Options representing in aggregate 8.33% of the Corporation's outstanding Common Shares on a partially diluted basis. After the acquisition, Mr. Ehrlich, owned 6,150,000 Common Shares and 800,000 Options, representing in aggregate 12.46% of the outstanding Common Shares on a partially diluted basis.

On the same date, Ian Dyke acquired, on a private placement basis under the Private Placement 3,850,000 Common Shares for total consideration of $385,000 ($0.10 per share) and was granted 1,000,000 Options representing in aggregate 8.66% of the Corporation's outstanding Common Shares on a partially diluted basis. After the acquisition, Mr. Dyke, owned 6,150,000 Common Shares and 1,000,000 Options, representing in aggregate 12.77% of the outstanding Common Shares on a partially diluted basis.

The Common Shares referred to above were acquired independently by each of Mr. Schwartz, Mr. Burns, Mr. Ehrlich and Mr. Dyke (collectively, the "Acquirors") for investment purposes. Each of the Acquirors may increase or decrease their respective ownership or control in securities of the Corporation depending on, among other factors, market conditions and other relevant factors.

Portions of this press release is being issued pursuant to National Instrument 62-103 - The Early Warning System and Related Take-Over Bid and Insider Reporting Issues which requires a reports of each of the Acquirors to be filed under the Corporation's profile on SEDAR (www.sedar.com) containing additional information with respect to the foregoing acquisitions. A copy of the related early warning reports for each of the Acquirors in respect of the acquisitions described above will be filed on www.sedar.com.

The Corporation's head office address is 199 Bay Street, Suite 5300, Commerce Court West, Toronto, Ontario, M5L 1B9.

The information in this news release includes certain information and statements about management's view of future events, expectations, plans and prospects that constitute forward looking statements. These statements are based upon assumptions that are subject to significant risks and uncertainties. Because of these risks and uncertainties and as a result of a variety of factors, the actual results, expectations, achievements or performance may differ materially from those anticipated and indicated by these forward looking statements. Forward-looking statements in this news release include, but are not limited to, the ability of the Corporation to complete a Qualifying Transaction. Any number of factors could cause actual results to differ materially from these forward-looking statements as well as future results. Although the Corporation believes that the expectations reflected in forward looking statements are reasonable, it can give no assurances that the expectations of any forward looking statements will prove to be correct. Except as required by law, the Corporation disclaims any intention and assumes no obligation to update or revise any forward looking statements to reflect actual results, whether as a result of new information, future events, changes in assumptions, changes in factors affecting such forward looking statements or otherwise.

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.

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