DelphX Announces Closing of Non-Brokered Unit Private Placement

Rhea-AI Summary

DelphX Capital Markets has closed a fully subscribed non-brokered private placement, issuing 2,650,000 units at C$0.08 per unit, generating gross proceeds of C$212,000. Each unit comprises one common share and one warrant, enabling the purchase of an additional share at C$0.20 within five years. An insider bought 650,000 units, categorized as a related party transaction under MI 61-101, but exemptions were applied due to the transaction value being below 25% of DelphX's market capitalization. Additionally, DelphX will pay a finder's fee of $3,640 and 45,500 warrants to AlphaNorth Asset Management. The offering has conditional acceptance from the TSX Venture Exchange, with final approval pending customary requirements. The funds raised will be used for general corporate purposes.

Positive

• DelphX successfully raised C$212,000 through a fully subscribed private placement.
• Issuance of warrants potentially increases future equity investment.
• Insider participation indicates confidence in the company's future.
• Conditional acceptance from TSX Venture Exchange indicates progress towards final approval.

Negative

• The private placement is categorized as a related party transaction.
• The issued securities are subject to a four-month hold period, limiting immediate liquidity.

Toronto, Ontario--(Newsfile Corp. - June 24, 2024) - DelphX Capital Markets Inc. (TSXV: DELX) (OTCQB: DPXCF) ("DelphX"), a leader in the development of new classes of structured products for the fixed income market, announces that it has closed its previously announced fully subscribed non-brokered private placement, issuing 2,650,000 units (the "Units") at a subscription price of C$0.08 per Unit, for gross proceeds of C$212,000 ("the Offering"). Each Unit consists of one common share ("Common Share") and one Common Share purchase warrant ("Warrant"). Each Warrant entitles the holder to purchase one Common Share at a price of $0.20, for a period of five years from the date of issuance.

An insider participated in the Offering subscribing for 650,000 Units, and as a result the Offering is considered a "related party transaction" within the meaning of Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions ("MI 61-101") and TSXV Policy 5.9 - Protection of Minority Security Holders in Special Transactions. However, DelphX has relied on the exemptions from the formal valuation and minority approval requirements of MI 61-101 contained in sections 5.5(a) and 5.7(1)(a) of MI 61-101 in respect of related party participation, as neither the fair market value of the securities issued to insiders nor the cash consideration paid for such securities exceeded 25% of DelphX's market capitalization. A material change report was not filed more than 21 days prior to closing of the Offering as the participation of insiders in the Offering and the extent of such participation was not finalized until shortly prior to the completion of the Offering.

In connection with the Offering, DelphX will pay cash finder's fees of $3,640 and issue 45,500 finders' warrants (the "Finders' Warrants") to AlphaNorth Asset Management, an eligible finder. The Finders' Warrants will be exercisable at C$0.20 each for a period of five years after issuance.

The Offering has been conditionally accepted by the TSX Venture Exchange, and completion of the Offering is subject to the fulfilment or satisfaction of certain customary requirements and final acceptance by the TSX Venture Exchange. The securities issued pursuant to the Offering will be subject to a hold period of four months plus one day from the date of issuance.

DelphX intends to use the net proceeds from the Offering in connection with general corporate purposes.

About DelphX Capital Markets Inc.

DelphX is a technology and financial services company focused on developing and distributing the next generation of structured products. Through its special purpose vehicle Quantem LLC, the Company enables fixed income dealers to offer new private placement securities that provide mitigation of spread and capital charge losses when downgrades occur, while allowing for attractive returns. The new DelphX securities will enable dealers and their qualified institutional investors (QIBs) accounts to competitively structure, sell and make markets in:

• Collateralized put options (CPOs) that provide secured rating downgrade protection for underlying corporate bonds;

• Collateralized reference notes (CRNs) that enable investors to take on a capped rating downgrade exposure of an underlying security in exchange for attractive returns.

All CPOs and CRNs are fully collateralized and held in custody by BNY Mellon. CPOs and CRNs are proprietary products created and owned by DelphX Capital Markets.

For more information about DelphX, please visit www.delphx.com.

Mark Forney, Corporate Development
DelphX Capital Markets Inc.
mark.forney@delphx.com
(718) 509-2160

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.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/214145

FAQ

What was the outcome of DelphX's private placement closing announced on June 24, 2024?

DelphX closed a fully subscribed non-brokered private placement, issuing 2,650,000 units at C$0.08 each, raising gross proceeds of C$212,000.

How many units did DelphX issue in its private placement?

DelphX issued 2,650,000 units in its private placement.

What is the significance of the 650,000 units purchased by an insider in DelphX's offering?

The insider purchase of 650,000 units classifies the offering as a related party transaction under MI 61-101.

What are the terms of the warrants issued in DelphX's private placement?

Each warrant allows the purchase of one common share at C$0.20, exercisable within five years from issuance.

What fees will DelphX pay in connection with its private placement?

DelphX will pay cash finder's fees of $3,640 and issue 45,500 finder's warrants to AlphaNorth Asset Management.

What will DelphX use the net proceeds from the private placement for?

DelphX intends to use the net proceeds for general corporate purposes.