Solegear Bioplastic Technologies Inc.
TSX VENTURE : SGB

Solegear Bioplastic Technologies Inc.

February 25, 2016 16:42 ET

Solegear Announces Second Closing of Private Placement

VANCOUVER, BRITISH COLUMBIA--(Marketwired - Feb. 25, 2016) -

NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES

Solegear Bioplastic Technologies Inc. (the "Company" or "Solegear") (TSX VENTURE:SGB) is pleased to announce that, further to its press release dated February 1, 2016, the Company has completed the second tranche of a non-brokered private placement (the "Private Placement") of 1,312,500 common shares (the "Shares") at a price of C$0.16 per Share, for an additional gross proceeds of C$210,000. No commissions or finder's fees were paid in connection with the Private Placement. Since going public in 2015, the Company has now raised approximately $3.7 Million dollars in equity. The funds will be used for working capital and ongoing commercial activities.

The Private Placement is subject to final approval from the TSX Venture Exchange (the "TSX-V"). All Shares issued pursuant to this Private Placement are subject to a four-month hold period expiring on June 26, 2016 in accordance with applicable Canadian securities laws.

The Company concurrently announces that it has granted an option to purchase 500,000 common shares to Paul Antoniadis, its director and interim CEO, an option to purchase 450,000 common shares to Gary Clifford, its EVP & CFO, an option to purchase 75,000 common shares each to Michel Labonté, its Chief Technology Officer and Noel Harvey, its VP Business Development, plus an option to purchase 62,500 common shares each to Michael Thomson and Jim Zadra, members of its board of directors.

The options granted are exercisable at $0.20 cents per share. The options will vest at a rate of 25% on the first anniversary of the grant date, with the balance vesting in equal monthly installments over the following 36 months. The options will be exercisable for a period of 10 years, and are subject to the terms and conditions of the Company's stock option plan, a stock option agreement on the Company's standard form, and the approval of the TSX Venture Exchange.

Related Party Participation in the Private Placement

An insider of Solegear participated in the Private Placement, thereby making the Private Placement a "related party transaction" as defined under Multilateral Instrument 61-101-Protection of Minority Security Holders in Special Transactions ("MI 61-101"). Michel Labonté, Chief Technology Officer of the Company, subscribed for 62,500 Shares. Following the closing of the Private Placement, Mr. Labonté will beneficially own and control 62,500 Shares, representing approximately 0.12% of the issued and outstanding Shares on an undiluted basis.

Each common share of the Company provides the holder with the right to one vote per common share. Therefore, all Shares subscribed for pursuant to the Private Placement provide the subscriber, including Mr. Labonté, with one vote per Share. The Private Placement was unanimously approved by the directors of the Company.

Other than the subscription agreement between Mr. Labonté and the Company relating to the Private Placement, the Company has not entered into any agreement with an interested party or a joint actor with an interested party in connection with the Private Placement. Neither the Company, nor to the knowledge of the Company after reasonable inquiry, a related party, has knowledge of any material information concerning the Company or its securities that has not been generally disclosed.

The Private Placement is exempt from the formal valuation and minority shareholder approval requirements of MI 61-101 (pursuant to subsections 5.5(c) and 5.7(1)(b)) as it was a distribution of securities for cash and neither the fair market value of the Shares distributed to, nor the consideration received from, interested parties exceeded $2,500,000. The material change report in connection with the Private Placement was not filed 21 days in advance of the closing of the Private Placement for the purposes of Section 5.2(2) of MI 61-101 on the basis that the subscriptions under the Private Placement were not available to the Company until shortly before the closing.

About Solegear Bioplastic Technologies Inc.

Solegear Bioplastic Technologies Inc. (TSX VENTURE:SGB) is an innovator in the field of next generation bioplastics made from annually renewable plant-based sources. Committed to the principles of Green Chemistry, Solegear is driven by its mission to create healthier, safer and stronger communities by fundamentally changing the way plastics are made.

Solegear's proprietary bioplastic formulations, Polysole® and Traverse®, are designed to meet today's social and corporate requirements to lower carbon emissions, reduce waste and remove toxicity typically associated with traditional petroleum-based plastics. Together with its partners, Solegear custom engineers, produces and distributes its high-performance bioplastics as resin, sheets and finished goods with some of the highest percentages of renewable, plant-based materials currently available in the industry.

For more information: www.solegear.ca

On behalf of the Company:

Paul Antoniadis, Chief Executive Officer and Director

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

This press release does not constitute an offer of securities for sale in the United States. The securities being offered have not been, nor will be, registered under the United States Securities Act of 1933, as amended, and may not be offered or sold within the United States absent U.S. registration or an applicable exemption from U.S. registration requirements.

Cautionary Statement Regarding Forward-Looking Information

Information in this news release that is not current or historical factual information may constitute forward-looking information within the meaning of securities laws. By their nature, forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements, or other future events, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements.

Such factors include, among others, the risk that: (i) the Private Placement may not be completed on the terms contemplated above, (ii) the bioplastics market may not grow as anticipated by the Company, and (iii) the economic circumstances of Solegear may change and result in the proceeds of the Private Placement being used other in the manner described above.

When relying on the Company's forward-looking statements and information to make decisions, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. The Company has assumed that the material factors referred to in the previous paragraph will not cause such forward-looking statements and information to differ materially from actual results or events. However, there can be no assurance that such assumptions will reflect the actual outcome of such items or factors.

Other than as required under securities laws, we do not undertake to update this information at any particular time.

Forward-looking information contained in this news release is based on our current estimates, expectations and projections, which we believe are reasonable as of the current date. The reader should not place undue importance on forward-looking information and should not rely upon this information as of any other date. All forward-looking information contained in this news release is expressly qualified in its entirety by this cautionary statement.

Contact Information

  • Solegear Bioplastic Technologies Inc.
    Paul Antoniadis
    Chief Executive Officer and Director
    604-998-4058

    Investor Contact:
    Caleb Jeffries
    Kin Communications
    1-866-684-6730
    SGB@kincommunications.com

    Media Contact:
    Elisha McCallum
    FleishmanHillard Vancouver
    778-668-0185
    Elisha.McCallum@fleishman.ca